Sustaining Velocity: Four Key Considerations for OEMs

In highly competitive industries—like orthopedic device manufacturing—time to market matters. Often, victory goes to those who can launch, produce, and deliver innovative products the fastest while maintaining the highest level of quality possible.

This pressure forces OEMs to create and sustain velocity. Yet that’s easier said than done. That’s because velocity is complex: it’s the result of a variety of different processes and functions working optimally, both separately and together. It’s the effect of carefully considered and analyzed decisions, made to generate momentum toward realizing firm goals.

Sustaining velocity often requires processes that can, along with labor, flex and scale to meet demand, even when it comes in the form of late, last-minute orders. Velocity requires looking at inventory footprint and optimization with a sharply critical eye; making decisions to extend processes and productivity by only the most profitable means; and ensuring that you’re allocating resources in the best ways to support efficiency and growth.

If sustaining velocity is one of your priorities, here are four key considerations that can help your firm.

#1: Turn loaner kits faster.

Consider the benefits of turning loaner kits faster. Managing the loaner kit turnaround at the highest level means receiving, inspecting, cleaning, repackaging, inventorying and shipping kits out efficiently and quickly every time. The faster—and better—you can do it, the more surgeries you can support. Streamlining and speeding your loaner kit process can also drive down your inventory footprint, since you can support demand with fewer kits overall, which means a smaller cash investment.

A smaller inventory footprint paired with an increased ability to support surgeries via faster turnarounds can free up cash to reinvest in your business—while also supporting a larger number of customers.

#2: Extend the daily shipping window.

An extended daily shipping window can fuel velocity, much as faster loaner kit turnaround does. It’s really a numbers game: the longer your daily shipping window, the more patient cases per day you can support. And the more patient cases per day you can support, the more units of product you’re selling.

Yet, it’s important to be prudent here. Carefully consider the increased direct costs of labor for an extended daily shipping window. When you factor in your direct costs—wages for the staffing personnel—and the indirect costs of an increase in your hours, you want to ensure that your higher costs are not eating into your profitability. Depending on your local labor rates and the fluctuations of actual demand, your best option for extending your daily shipping window efficiently and effectively may be to consider outsourcing.

#3: Speed packaging turnaround.

The more quickly a unit of inventory proceeds from manufacturing to validated packaging to inventory, the more quickly that unit can be shipped to the field. The more quickly it is shipped, the higher the chance it will be utilized in a procedure, and the faster you’ll recoup your investment (and make a profit, of course). In short, packaging turnaround is cash turnaround.

Package design and validation can be a lengthy process, though. Depending on the package design process and any delays or failures in validation, the timeline to market can be months long—or even stretch into years. Pre-validated packaging, which can accommodate a vast number of spine and ortho products, significantly reduces risk and speeds time to market while upholding patient safety and quality priorities. And, since packaging turnaround is cash turnaround, this option can be a great solution to increase velocity. (See more on the specifics and advantages of pre-validated packaging here).

#4: Approach facility buildout cautiously—very cautiously.

As OEMs grow—and outgrow—their current footprint and as their needs change, many consider facility buildout and staffing as a crucial next step.

The challenge of expanding capacity, hiring staff, and undertaking facility construction is enormous. Depending on where you are located, wages and geographic cost pressures could make yours a steep climb to profitability. And, in any construction project, as your staff is diverted with new responsibilities, productivity can suffer. Unanticipated delays can frequently affect planned timelines.

OEMs who are truly focused on sustaining velocity are savvy about facility and staffing needs. They know that outsourcing is often the very best option for labor that can flex and scale to turn product faster, ship more, and get to market more quickly—all at better value.

They also know that outsourcing often helps them achieve the highest quality outcomes at a lower cost—while preserving significantly more free cash for reinvestment in R&D, innovation, and production.

At Millstone, we get it. We believe quality drives patient success. That’s why we’ve perfected all the capabilities medical device manufacturers need to get to market. Today we offer post-manufacturing and aftermarket services to more than 50 customers, including some of the top 10 orthopedic companies in the world. We are constantly evolving our processes and services to help OEMs achieve sustainable success. We offer clean room packaging, medical device specific warehousing, finished goods distribution, loaner kit management, advanced inspection and reverse logistics services—all with an unparalleled focus on quality.

What could we help you do better? Learn more at velocity often requires processes and labor that can flex and scale, so that you can meet demand while preserving free cash and driving growth



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