CHICAGO, IL--(Marketwired - August 16, 2016) - In the medical device industry, the complexity of supplier-manufacturer relationships poses quality and compliance related risks that could be very costly and have a high operational and reputational impact. Global supply chain operations have become increasingly intricate and selecting the right vendors as well as managing them effectively can significantly influence the bottom line and overall competitive advantage.
Lee Young, Director Supplier Quality at Thermo Fisher Scientific, recently spoke with marcus evans about topics to be discussed at the Medical Device Supplier Quality & Risk Management Conference:
How do you manage budget expectations when utilizing a supplier overseas?
LY: In various ways: China based suppliers need extra travel budget allotted to them both for R&D transfer and for surveillance. It quickly becomes obvious that local support is required. This support can also help with R&D planning activities.
Regional support starts to make sense when you have 5 to 20 suppliers in a region or time zone. We supported Asia from Singapore for a number of years, and then hired local support in-country for China and last year in Taiwan. Japan and South Korea are areas that we'd consider in-country resources for next year. South Korea and Japan normally require translation services to be included in visits, where China currently has fluent English speaking support.
Why are third-party auditors useful when hiring a supplier overseas?
LY: Cost advantages exist for 3rd party auditors in certain regions and can be cheaper than to travel to those regions. We find this true mostly in India and South Africa. 3rd parties are also able to enter into competitor's facilities easier than internal resources.
What factors need to be taken under consideration when predicting risk and expenses?
LY: Risk management is a growing area for our vertical and will be an area of expansion for my team in 2016. This area can be augmented with software support that utilizes social media for information. So I can hear about political unrest in an area hours before the supplier notifies me of concerns in the area. We break down risk into 14 areas, ranging from revenue impact to geopolitical tension. We have developed and used a supply chain risk management process that follows a FMEA from six sigma.
How can a company ensure conformity in all supplier relationships?
LY: Conformity is ensured by close communication with suppliers and frequent visits. Partnerships (close suppliers) need to be developed in three key groups and encouragement on growth is important.
These groups break down as R&D, quality (supplier quality) and procurement. Strong communication and frequent communication here are key.
What are the difficulties all companies have to overcome to harmonize the device manufacturer, supplier, and sub-tier supply chains?
LY: Visibility into your supply chain is key for resolving difficulties throughout the various levels of all supply chains. Understanding commodity constraints and where supplier materials come from is paramount for success for resolving any and all difficulties. Risk management software is also helpful for this communication.
Join Lee at the Medical Device Supplier Quality & Risk Management Conference, October 12-13, 2016 in Chicago, IL. For more information, please visit the conference website or contact Tyler Kelch, Digital Marketing Manager, marcus evans at 312.894.6310 or Tylerke@marcusevansch.com.
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