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How to Improve Supplier Management to Save Time and Pivot Quickly When Disruption Hits (MDO)

The strength of collaboration with partners can be the difference between surviving and thriving during disruption.

This article was originally written for and published in Medical Design & Outsourcing.

In the ever-evolving world of medical devices, the ability to pivot quickly when faced with disruptions is crucial. But how can we ensure we’re best positioned to face these challenges?

A key component is improving supplier management and fostering a seamless and secure collaboration with partners. This article provides four actionable steps medical device companies should take to ensure they are prepared to respond effectively to disruption.

Deciding which device systems/pieces to outsource

The landscape of medical device production has changed drastically in the past few years. With products becoming more complex and specialized — often involving many levels of parts like sub-assemblies, software, and PC boards — there’s an increasing trend towards outsourcing. Whether due to cost considerations or risk diversification, outsourcing demands a thorough assessment of what components of a device should be outsourced and to whom.

First and foremost, companies often lack control and a thorough understanding of their device, which at a fundamental level is the bill of materials (BOM) structure and sub-components including revisions and sourcing. This, in turn, limits control and visibility to make decisions for make, buy or reuse.  Furthermore, engineers often source components based on their technical needs, without taking into consideration reuse, cost, risk, and environmental company objectives. As a result this often leads to duplicate manufacturer parts which proliferates part usage across next generations and other product lines.

With technological advancements, products have become more intricate and specialized. This increased complexity often means companies need to outsource more components, ranging from sub-assemblies to software and PC boards. As a result, businesses must manage a myriad of suppliers, each responsible for a crucial piece of the puzzle. It’s paramount to have an intimate understanding of what each partner is building, ensure they adhere to your specifications, and maintain a mutual timeline.

Improving the supplier evaluation processes

Communication and clarity are essential. In my time at a renowned medical device company, supplier communication was frequently at the root of high-cost recall issues. Recurrent questions included “re we building to the correct revision?” and “Are we communicating the right details about product changes?” Today’s complex products require a thorough engagement and evaluation process with potential suppliers, ensuring they meet quality and production standards and align with your product vision.

When discussing supplier evaluation, it’s essential to look beyond the onboarding phase. Effective supplier management should encompass the entire lifecycle, from initial consideration to continuous performance monitoring. It’s not just about bringing suppliers onboard, but constantly assessing their performance based on real-time data.

Products, market conditions, and company objectives evolve over time. This demands periodic reevaluation of suppliers, not just based on their previous performance but also on their potential contribution to future endeavors. In addition, multiple and alternate sources of supply are increasingly needed for supply chain resilience, availability and cost. It’s not uncommon for customers to report price hikes, sudden lack of inventory, and long lead times resulting in tremendous pressures to launch or meet demand. A supplier providing critical components today might not be as crucial tomorrow, or they might expand their offerings, requiring a different kind of assessment.

The challenge of supplier communication and secure sharing

In today’s digital age, relying solely on emails for communication is too risky, making collaboration platforms even more essential. Email can easily become convoluted when handling multiple suppliers. Each thread, especially when splintered among various participants, becomes challenging to manage and monitor. Miscommunication can lead to missed updates or noncompliances, causing disruptions down the line.

A lack of strong collaboration can become a company’s Achilles’ heel. The potential fallout from miscommunication or missed communication can lead to increased risk. In industries such as medical devices, these risks can be costly both financially and in terms of brand reputation. For instance, lapses in supplier communications can inadvertently result in adverse events or recalls. This is often due to companies discovering too late that partners weren’t working off the most recent product revision or were unaware of changes in the design and manufacturing process.

To tackle these challenges, businesses need a cloud portal — consolidated dashboards all on a common platform. This centralized approach offers a unified view of all communications, streamlining processes, and reducing the risk of errors. It’s about transforming a reactive communication method into a proactive one.

A modern cloud solution enables seamless and secure collaboration with cross-functional teams, suppliers, distributors, and more. By having a unified dashboard and streamlined communication processes, companies can mitigate risks, ensure everyone is on the same page, and promptly address any arising issues.

Continuous tracking, re-evaluation and improvement

Constant monitoring and risk evaluation of your supplier pool are crucial. An effective strategy includes looking at current quality issues, discerning trends, and taking proactive measures to address them. Moreover, periodic reevaluation is pivotal. Understanding the specifics of which components that each supplier provides, down to the minute details, will ensure that you remain flexible, ready to pivot, or adapt when necessary.

In a world where product complexity, specialization, and outsourcing are on the rise, collaboration and proactive supplier evaluation are no longer optional — they’re mandatory. By adopting a comprehensive, cloud-based system and maintaining constant vigilance in supplier evaluation and controls, companies can not only navigate disruptions but also turn them into opportunities for growth and innovation. The medical device industry, with its perpetual advancements and high stakes, cannot afford to be left behind.

Learn more about the powerful impact cloud-native solutions can have on your supplier management. Watch a demo now.

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Post by
Chuck Serrin
VP of MedTech & Life Sciences Industry Marketing, Propel

Chuck is the VP of MedTech and Life Sciences Industry Marketing at Propel. Formerly, as a Solution Architect and Program Manager at Stryker Corporation, he implemented and supported global PLM, QMS, and digitalization projects. Chuck has deep domain expertise on the development, compliance, and commercialization of medical device products, along with providing high-quality support in launching new products. Over 20 years of experience across senior positions in enterprise software solutions with companies such as Agile Software, Oracle, and PTC.

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Chuck Serrin