Is there a supply chain transformation roadmap for your company? Yes there is – and it flexes to your unique needs – here’s a case study.
With so much going on in today’s supply chains, you would be right to be a bit overwhelmed with all the options put forth by digital technology, a bit confused as to how to implement any changes in your rapidly changing world, and a bit reticent to change complex operations without some guarantee of success.
You know that change must be planned, flexible, and lead to the organizational results you, the executive team, and your customers expect.
But how can a pre-established roadmap provide flexibility?
Just as you now need to embed agility into your supply chains to handle unexpected demand changes, regulatory changes, and customer last minute changes, supply chain transformation roadmaps need to do the same.
I use the SCOR roadmap as a guide because it is built on known project management phases. It painlessly combines building blocks you already posses, or are bringing in house, such as risk management, quality control, cost control, mapping of supply chains, desired ROI, with the Lego® style SCOR framework elements and easy to use tools to reflect your reality.
Because here’s the thing: even if life is chaotic inside your world of supply chain, you still need answers starting now about supply chain transformation.
Now at this point, you should still have questions.
After all, I’ve only highlighted what has worked successfully for me with a variety of companies all in transformation mode.
But will it work for you? The best way I know to answer that is through a case study.
The SCOR case study below highlights many areas and processes that are part of supply chain transformation. In this particular case about a leading pharmaceutical company, ASCM SCOR-P training (the training with the supply chain transformation roadmap) formed the foundation the company used to launch their supply chain transformation.
And in good Industrial Engineering practice, it proves you can receive many answers from implementing just one framework – even in a pandemic.
Here’s the case…
“The pharmaceutical industry has faced massive changes, even before the onset of the COVID-19 pandemic. Governments have been pressuring pharmaceutical suppliers to lower costs. Increased competition has required more speed from industry players. And an explosion of personalized therapies has strained medical supply chains to deliver unique products for each patient, rather than bulk supplies of a singular product. Within this climate, Basel, Switzerland-based F. Hoffmann La-Roche Ltd. pledged to deliver twice as many medical advances at half the cost to society.
Leading this charge is Roche’s Pharma Technical Development Clinical Supply Chain (PTDS) team. Richard Groenenboom, head of global clinical supply chain management, says this group manages one of the largest and most complex pharmaceutical pipelines in the industry. The PTDS team typically handles more than 600 active clinical trials at any given time, and it plays a critical role in ensuring that 100,000 patients a year receive innovative new investigational medicines reliably and safely in almost every country in the world.
To push the needle even further, the PTDS team partnered with ASCM to transform the organization. The overarching goal was to better balance reliability, responsiveness, agility, cost and sustainability — key SCOR metrics categories — across operations.
Learning the SCOR language
Roche’s SCOR transformation process started in 2018 with general SCOR training and awareness sessions for all PTDS employees to help them communicate in the same business language. “Although we were successfully managing clinical trials for years with experienced people, we were not speaking the same language and did not have an end-to-end view of our processes,” explains Nathalie Mathys, business support project manager for clinical supply operations.
Both leaders and training participants found that the training significantly improved the company’s general knowledge and communication capabilities. “I have never received any formal training before, but I would recommend high-level APICS education to everyone working in supply chain,” says Claire Stamborski from the company’s global clinical distribution. “It helps you get the big picture and understand your role in this process. It also helps a lot in your personal work and in the interaction with your colleagues.”
Through this training, leaders realized that a variety of tools and practices already were available to meet the company’s specific needs. “Given the sensitive nature of our work in supplying clinical trial medicines, it’s easy to believe the work we do requires highly specialized processes,” Groenenboom says. “But we found that cross-industry best practices and standardized processes and key performance indicators (KPIs) also can apply to clinical supply chains.”
As a result of the training, clinical supply chain leaders have better aligned KPIs, and all PTDS employees were able to facilitate the process changes identified through the SCOR assessment.
Achieving critical synergy
“The holistic SCOR reference model combined with the [following] accelerator workshops have given our supply chain transformation a kick start,” Groenenboom says. “Very quickly, we were able to identify pain points in our processes, data or systems usage and come up with better practices for our future setup.
In order to glean the most from the accelerator workshops, clinical supply chain leaders made sure to remove constraints for time, effort and required system changes, Mathys explains. This freed people’s minds and enabled the team to brainstorm bold improvements, she says. After, the team reviewed the ideas and prioritized those that could be the biggest levers for improvement.
>>>There is an introduction to SCOR workshop on April 29. Learn more – click here. <<<
Continuing with the case study…
“The continuous collaboration with ASCM has played a pivotal role in driving our transformation, elevating our performance capabilities by improving processes, systems, tools and people skills,” Coolen says. As more transformation projects are completed, the PTDS team continues to gain confidence in its ability to sustain lasting and positive change, he adds.”
Improved vitals
The SCOR training and transformation projects delivered a variety of benefits throughout the business unit’s processes, systems, tools and metrics that helped the PTDS team achieve its transformation and operational goals:
- Efficiency: The organization reduced the leadtime of its make-to-order finished goods kits by 50%, improved on-time delivery performance to 70% in 2019 and to more than 95% in 2020, and reduced the time for the deliver make-to-order product (sD2) SCOR process by 23%, or about five days.
- Reliability: These efficiencies were achieved without sacrificing reliability or out-of-stock performance. The team made a goal to keep its stockouts to fewer than 20 per year. In 2019, the company only experienced 11 stockouts. In 2020, the company had fewer than 10 stockouts.
- Clear roles and responsibilities: Once employees were all speaking the same business language and had at least a basic understanding of supply chain management and the SCOR model, company leaders were able to set clearer roles and responsibilities. “By systematically identifying opportunities to sharpen the focus of the planning team to areas where they are uniquely positioned to add value, we were able to significantly reduce complexity and clearly define their roles,” Mathys explains.
- Formalized processes: Leaders implemented a monthly clinical demand and operations planning process as well as a project management structure within the enable SCOR stream to provide a harmonized governance structure and digital benefits realization tracking across all improvement projects. The PTDS team also added inventory and waste management processes that helped the team reduce comparator drug waste by more than $16 million. The team is on track to double that savings annually.
- Clear KPIs: Better understanding of organizational and operational goals also aided the company in choosing its KPIs as well as a method for tracking performance. The PTDS team implemented the SCOR balanced scorecard as an easy-access, centralized, digital representation of a metric performance dashboard. KPIs are frequently reviewed, especially in sales and operations planning meetings, which has led to more efficient use of valuable clinical trial medicines and materials, Groenenboom says.
Many of the improvements that enabled the PTDS team achieve these goals also helped with the organization’s overarching goal to lower costs. “Over the years, we had honed an intense focus on reliability, namely eliminating stockouts,” Groenenboom says. “However, this came at a cost, as we had neglected the costs and assets side of our scorecard. Many team members were surprised to see that we could indeed lower the costs of inventory or distribution while maintaining the same level of service. In short, we maintained strength while improving the usage of our inventory, which once seemed nearly impossible.”
New processes also have led to improvements across Roche’s supply chain. The company added a structured supplier relationship management program, including a set of standard metrics and a regular meetings schedule. This has led to more predictable results and improved agility, Mathys says.
Knowledge refill
Since day one of training, the PTDS team has wanted to ensure that it could sustain all of these benefits beyond the original transformation projects. The key to this has been ongoing SCOR and APICS certification education and training, Coolen says. This gives seasoned team members the confidence to continue supporting processes as well as a renewed focus on important skills, continuous improvement and enhanced decision-making.
In addition, new employees receive SCOR training as part of their onboarding process so that they can best collaborate with their cohorts right from the start of their Roche careers. Possibly the most important benefit of this training, according to Coolen, is that it gives employees the motivation to continue to find ways to deliver new medicines for patients in a better, faster and more efficient way. This enables Roche to improve its processes and practices in order to support the fast-evolving pharmaceutical industry and deliver medical treatments to patients around the world.”
I want you to have the same success as Roche. It’s all built on practical, organized, customized to your supply chain and culture building blocks that do not require years of consulting.
Here are three practical ways to begin your supply chain transformation roadmap to success:
First, if you are ready to learn more about the success that awaits with SCOR, Click here to join Rochester NY for a virtual SCOR workshop on aligning metrics and integrating technology. April 29. 1:30 pm – 4 pm EST. 100% of your $25 registration goes to the GRBBA in Rochester.
Second, on the same day, join me again with Rochester NY ASCM at their free, virtual PDM discussing strategic supplier negotiations (including a bit of SCOR for better deal making).
Third, you can gain the same practical, supply chain transformation advantage as Roche by taking our virtual May SCOR-P course. Attendees receive a FREE bonus session on supply chain digital transformation based on the SCOR blocks you just mastered.
The difficult part in any supply chain transformation is trying to understand what to change to that customers will pay for.
You’ll answer that question as you move through our three steps.
Don’t wait – this is your supply chain transformation practical roadmap to best practice results.
Keywords and concepts: Supply chain transformation roadmap, best practice, KPI, SCOR, SCOR-P, process improvement, rapid change, workshop, training
Cynthia Kalina-Kaminsky is a SCOR Master instructor and has taught SCOR-P virtually before. You still get the hands-on teamwork during class time to master the framework and apply it to a supply chain you are designing, implementing, growing – and then digitizing. Just click here for more information