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The Three C’s of Supply Chain Success

Like our human bodies, the medtech supply chain needs predictable, uninterrupted inflow of materials and steady-state internal processes to function—with the end result the production of lifesaving products on a regular schedule. It’s an ideal scenario, but the challenges and interruptions of the last few years have made it difficult to attain. From the shortage of raw materials and skilled labor to the disruptions caused by natural disasters and political tensions, medtech firms must navigate new complexities and an unpredictable landscape—and even then, might not have access to a steady supply of critical components and equipment.

As a result, many medtech firms and device manufacturers have reassessed existing and developed new supply chain management strategies that close gaps and reduce vulnerabilities. These include reexamining supply chain configurations, stress-testing plans and protocols, building slack into their systems and timelines, conducting supplier risk assessments, and vetting supplier networks. These are steps in the right direction, but many OEMs overlook a pivotal factor in planning for supply chain success: partnering with a single, expert point of contact. The right strategic partner is critical in setting up the three C’s of supply chain success:

• Coordination: simplifying the coordination of the inbound supply chain, including components, materials, and contract manufacturing
• Capacity: understanding current and future capacity demands and being prepared to deliver against them
• Clarity: enabling enhanced visibility and control over every step in the supply chain

This article looks at each of the three C’s in depth, including how they play out in real-world scenarios for orthopedic device manufacturers in today’s disrupted, high-pressure, high-stakes market.

Streamlining supply chain coordination

Orthopedic device and medtech firms encounter distinct challenges in supply chain coordination for legacy production and new product launches. While some are common—like meeting strict compliance requirements and managing multiple suppliers and subcontractors—new product launches introduce additional pressure and uncertainty. This is where comprehensive service with a single expert point of contact proves advantageous.

Let’s illustrate this through a recent example with a large client working to launch a product in a robotic assisted surgery platform. The challenge lay in coordinating multiple vendors, from a component through final product assembly and packaging. Having so many vendors and points of contact increased the potential for hiccups and delays that could put the aggressive product launch timeline at risk. Moreover, the launch of any new product, especially one with specialized equipment and assembly requirements, is riskier than legacy production. The reason is that teams are encountering new territory, from tolerances to snags in assembly, that were not fully anticipated.

This is where expertise matters, especially in meeting a goal as ambitious as an 18-month timeline for bringing a brand-new product to market. An expert team understands every critical step that goes into each stage from sourcing and assembly to quality critical inspection and packaging. Experience and success have shaped how a team like Millstone’s can bring together all the players and functions into a coordinated whole, reducing the risk for delays and ensuring that each potential pitfall has been anticipated. It’s this level of expertise that’s necessary for coordinating such an aggressive launch—and hitting the date.

Ensuring supply chain capacity

Understanding what goes into coordination is one thing; ensuring you have the capacity to deliver on the service commitment is another. To successfully manage a launch, a strategic partner needs to have a clear understanding of how realistic lead times and timelines are.

To show how this looks in practice, consider this example. A global OEM has launched a successful product and with increased demand comes the imperative to ramp up production. The projections are for a threefold increase within 12 months. This requires excess capacity. It also introduces an array of points for oversight or failure.

A strategic partner will know where these are and how to address them in time to meet the higher sales volume targets. To do so, the partner pulls in engineering and process improvement experts from the team; works upstream with suppliers on the inbound side, communicating the need and ironing out the potential hiccups to secure the right amount of material; stress tests the supply network; and remains in constant communication to ensure capacity is building on the planned ramp-up timeline. This ensures the scale-up tracks with the demand curve.

Gaining supply chain clarity

According to recent research by McKinsey, deep supply chain visibility is still a persistent challenge across industries. Despite progress over the last two to three years, many companies still do not have a comprehensive understanding of the risks that might be lurking inside complex multi-tier, multi-vendor supply networks.

An expert partner can be invaluable in helping an OEM identify risk and gain clarity. At Millstone, we play the role of the independent authority, bringing people together internally to understand the current reality. We conduct ongoing risk assessments into the supply chain and existing supplier network to identify current and future areas of risk, escalating them for our customers before they threaten lead times and contribute to production delays. We review these supply chain realities on a monthly basis, providing detail at the supplier and component levels and projecting the effect they will have on standard and current lead times. Once we have this clarity, we can be proactive in addressing these problems with proven strategies, while we have the time to do so.

Coordination, capacity, and clarity are the keys to supply chain success, now more than ever given the ongoing pressure and challenges of the orthopedic device and medtech sectors. Having an expert strategic partner can make all the difference in how firms navigate them to recoup R&D investments, accelerate time to market, and uphold patient safety in the course of business success.

Millstone’s Tier 1 service gives OEMs much-needed expertise, from coordinating inbound supply and managing contract manufacturing, to quality critical inspection, in-process testing, cleaning, packaging, and sterilization, all handled under a single PO. With the launch of Millstone Testing Services in late 2022, Millstone now offers a comprehensive range of product, packaging, and environmental testing for the medical device and pharmaceutical industries. Millstone offers these testing services as part of its Tier 1 service as well as standalone contract services.

Today Millstone offers 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 testing, and reverse logistics services—all with an unparalleled focus on quality.

What could we help you do better? Learn more at https://millstonemedical.com.