Ten Steps to Process Improvement, Part 1

Many mid-level pharmaceutical manufacturing professionals recognize the competitive threats and pressures that beset their companies – competition from abroad and from generics, pressure to reduce costs, and a dearth of blockbuster products in the pipeline – and they want to do something about it by improving manufacturing processes. They recognize, too, that their current approaches to improvement aren’t getting the job done. But they hesitate to take the initiative. The use of approaches such as Lean Manufacturing, Six Sigma, or a combination of the two seems daunting. Moreover, executives have been convinced that only top-down improvement initiatives, spearheaded by top management, stand any real chance of success.

Experience, however, has shown that mid-level manufacturing executives – from VPs to directors, to managers – can establish significant improvement initiatives on their own. By carefully pursuing a comprehensive 10-step process outlined here in Part 1 and detailed in Part 2, ambitious executives can determine the most promising improvement methodology for their function, department, or business unit, acquire a working knowledge of that approach, win the backing of their superiors, and deliver and sustain measurable, documented business results.

Consider the case of a pharmaceutical operations manager. He was given responsibility for a group that was taking 12 weeks to produce a product that had a target production of six weeks. The manager was instructed to fix the problem although management did not specify how. The manager first educated himself on modern process improvement techniques by attending seminars and reading. He also took the trouble to visit companies that had successfully implemented process improvement. Concluding that Six Sigma could help fix his production problem, he hired a consultant to train 12 of his staff as Green Belts – the name for the leaders of individual Six Sigma projects. Within six months, the production process time had been reduced to six weeks. In addition to this 50% improvement in operations, the effort yielded a savings of $2.2 million/year.

The benefits for the organization of such successful improvement initiatives include:

• Improved process performance
• Reduced costs and a better bottom line
• Increased ability to stay within budget and do more with less
• Better utilization of staff and therefore happier employees
• Reduced firefighting, resulting in more time to pursue high-value work
• More satisfied customers, both internal and external, as a result of a “healthy process serving happy customers”

Consider just one of the benefits – reduced firefighting – and its ripple effects, both for the organization and the executive who initiated the improvement program, in this case a billing process manager. Despite a stated goal of eight to nine days to get bills out, the process required 17 days. The manager, after attending a seminar on analytical approaches to process improvement, persuaded his management to support hiring consultants to teach his staff how to achieve improvement.

Using Lean Six Sigma techniques, the manager’s team reduced the billing process cycle time to the nine-day target in just six months, saving money and using staff resources far more efficiently. As a result, the department gained eight days each month to pursue value-added work rather than to put out fires, and the manager was freed to pursue other projects that could further raise his profile in the larger organization; $2.5 million/year in cost savings were also achieved.

10 Steps to Improvement

Key elements of this 10-step approach include a focus on processes, the selection of strategic projects, the use of metrics and data, clear leadership, rigorous project management, and teamwork. Pharmaceutical manufacturing executives can ensure that they make the most out of their determination to move the organization forward by taking the following 10 steps:

1. Demonstrate the need for improvement
2. Become familiar with proven improvement methodologies
3. Build support in the management structure for real solutions
4. Prepare yourself and your team for the effort
5. Pick your project
6. Complete the project in a timely fashion
7. Periodically review the project with management
8. Identify and demonstrate the effectiveness and value of your process improvements
9. Select and pursue the next project
10. Make improvement part of your organization’s infrastructure and, ultimately, its culture.

Based on Kotter’s model for successful change [1], this approach to pursuing improvement has been found to work in a number of diverse situations [2,3].

Pitfalls to Avoid in Undertaking Improvement

As you follow 10 steps, you should take care to avoid some well-known pitfalls, as well. These dangers are found primarily in two areas – (1) the management systems required to administer and monitor the overall improvement program and (2) the selection and management of individual improvement projects.

The pitfalls that can undermine management systems include:

• Little leadership from top management including deployment plans – strategy, goals, etc.
• Poor or infrequent management reviews
• Top talent not used
• Poor support from Finance, IT, HR, Maintenance, QC Lab
• Focus is on training, not improvement
• Poor communication of initiative and progress
• Lack of appropriate recognition and reward.

The pitfalls of project selection and management include:

• Projects not tied to business goals and financial results
• Poorly defined project scope, metrics, and goals
• Wrong people assigned to projects
• Project leaders and teams don’t have sufficient time to work on projects
• Many projects lasting more than 6 months
• Little technical support from improvement master
• Large project teams (more than 4-6 persons per team)
• Infrequent team meetings.

As you move through the 10 steps to improvement, frequently ask yourself if you have fallen into any of those traps, either in the way the program is being managed or the way the projects are being pursued, to ensure that you don’t derail the program.

Personal and Professional Benefits

For the executive who successfully initiates and executes the improvement program, there are, in addition to the benefits for the organization, personal benefits as well, including the satisfaction of a job well done, greater visibility in the organization, and the acquisition of powerful new skills.

For example, a plant manager for a pharmaceutical supplier needed to improve the performance of a 120-employee plant with goals of increasing capacity, achieving cost savings of $1 million/year, and improving teamwork. Through attending workshops and reading, he educated himself about Six Sigma and its benefits and concluded that it would achieve the magnitude of improvement he was seeking. His boss supported the effort but declined to provide any funding.

Nevertheless, the plant manager trained his staff as improvement leaders and project champions and initiated the improvement program. He then brought in a consultant who trained and mentored the plant’s first 10 Green Belts. Ultimately, 16 Green Belts were trained. The first 10 Six Sigma projects produced savings of $1.7 million/year. The plant manager was lured to a new employer, given increased responsibility, and enabled to initiate a Six Sigma improvement program only one month after starting the new assignment.

Similar recognition and reward await other mid-level pharmaceutical leaders who are ready to make a real difference. Part 2 of this series, to be published in January’s issue, explains precisely how they can.

About the Author

Ronald D. Snee is principal of process and organizational excellence and Lean Six Sigma initiative leader at Tunnell Consulting in King of Prussia, Pa. He earned a doctorate in applied and mathematical statistics from Rutgers University, New Brunswick, N.J. Snee has published four books and more that 165 articles on process improvement, quality and management. His work has been recognized by 20 awards and honors including America Society for Quality’s Shewhart and Grant Medals and American Statistical Association’s Deming Lecture Award.

References

1. Kotter, J. Leading Change, Harvard Business School Press, Boston, Mass., 1996.



2. Snee, R. and Hoerl, Leading Six Sigma – A Step-by-Step Guide Based on Experience with GE and Other Six Sigma Companies, Financial Times Prentice Hall, New York, N.Y., 2003.



3. Snee, R. and Hoerl, R., Six Sigma Beyond the Factory Floor – Deployment Strategies for Financial Services, Health Care, and the Rest of the Real Economy, Financial Times Prentice Hall, New York, N.Y., 2005.