Improvement of manufacturing operations at a pharmaceutical company A lean manufacturing approach Boppana V. Chowdary Department of Mechanical and Manufacturing Engineering, The University of The West Indies, St Augustine, Trinidad and Tobago, and Damian George Genethics Pharmaceuticals Limited, Trincity Industrial Estate, Arima, Trinidad and Tobago Abstract Purpose – The current good manufacturing practices (cGMP) are followed in the pharmaceutical sector to ensure that products are consistently produced and controlled to the appropriate quality standards as required by the marketing agencies. The purpose of this paper is to share improvement experiences due to implementation of lean principles combined with cGMP in a pharmaceutical company. Design/methodology/approach – To conduct the study, an intensive review of literature has been conducted. For analysis of the problems existing in the selected production line, the 5-whys methodology was followed. The current state value stream map (VSM) has been developed after making several company visits and necessary computations. For improvement of the system, various lean strategies have been proposed and the future state VSM developed. Findings – The methodology assisted this company in reducing lead times, cycle times and WIP inventory in the manufacturing process. Furthermore, the storage area was reduced by 38 per cent and production staff was reduced by 50 per cent. Practical implications – The prime purpose of a lean strategy is to eliminate wastes and to search for continuous improvement in processes. The proposed lean strategies indicated scope for improvement in production efficiency and effectiveness of manufacturing operations. Originality/value – The guiding principle of cGMP is that quality is built into a product, and not just tested into a finished product. This paper makes several contributions to the pharmaceutical manufacturing company. The proposed lean strategies are considered to be highly valuable for implementation in similar manufacturing industries. Keywords Trinidad and Tobago, Lean production, Pharmaceuticals industry, Manufacturing systems, Lean manufacturing, Cycle time, Inventory management, 5-whys, 5S, Value stream mapping, Cellular manufacturing Paper type Case study 1. Introduction Manufacturing industries around the world are being affected profoundly by emerging technologies resulting in a significant increase in competition in local, regional The current issue and full text archive of this journal is available at www.emeraldinsight.com/1741-038X.htm The authors wish to thank the referees for their detailed comments and constructive criticism of the initial draft. JMTM 23,1 56 Journal of Manufacturing Technology Management Vol. 23 No. 1, 2012 pp. 56-75 q Emerald Group Publishing Limited 1741-038X DOI 10.1108/17410381211196285
Transcript
Improvement of manufacturingoperations at a pharmaceutical
companyA lean manufacturing approach
Boppana V. ChowdaryDepartment of Mechanical and Manufacturing Engineering,
The University of The West Indies, St Augustine, Trinidad and Tobago, and
Purpose – The current good manufacturing practices (cGMP) are followed in the pharmaceuticalsector to ensure that products are consistently produced and controlled to the appropriate qualitystandards as required by the marketing agencies. The purpose of this paper is to share improvementexperiences due to implementation of lean principles combined with cGMP in a pharmaceuticalcompany.
Design/methodology/approach – To conduct the study, an intensive review of literature has beenconducted. For analysis of the problems existing in the selected production line, the 5-whysmethodology was followed. The current state value stream map (VSM) has been developed aftermaking several company visits and necessary computations. For improvement of the system, variouslean strategies have been proposed and the future state VSM developed.
Findings – The methodology assisted this company in reducing lead times, cycle times and WIPinventory in the manufacturing process. Furthermore, the storage area was reduced by 38 per cent andproduction staff was reduced by 50 per cent.
Practical implications – The prime purpose of a lean strategy is to eliminate wastes and to searchfor continuous improvement in processes. The proposed lean strategies indicated scope forimprovement in production efficiency and effectiveness of manufacturing operations.
Originality/value – The guiding principle of cGMP is that quality is built into a product, and notjust tested into a finished product. This paper makes several contributions to the pharmaceuticalmanufacturing company. The proposed lean strategies are considered to be highly valuable forimplementation in similar manufacturing industries.
Keywords Trinidad and Tobago, Lean production, Pharmaceuticals industry, Manufacturing systems,Lean manufacturing, Cycle time, Inventory management, 5-whys, 5S, Value stream mapping,Cellular manufacturing
Paper type Case study
1. IntroductionManufacturing industries around the world are being affected profoundly by emergingtechnologies resulting in a significant increase in competition in local, regional
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1741-038X.htm
The authors wish to thank the referees for their detailed comments and constructive criticism ofthe initial draft.
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56
Journal of Manufacturing TechnologyManagementVol. 23 No. 1, 2012pp. 56-75q Emerald Group Publishing Limited1741-038XDOI 10.1108/17410381211196285
and global markets. Companies recognize that consistent and disciplined application oflean manufacturing strategies with the emphasis on waste elimination andprocess streamlining can lead to business excellence (Mejabi, 2003; Taj, 2008;Rahman et al., 2010). Lean is a manufacturing paradigm based on the fundamental goalsof Toyota Production System (TPS), which is aimed at continuously minimizing wasteto maximize flow (Vinodh et al., 2010). According to TPS, the seven most commonwastes are overproduction, waiting, transport, inappropriate processing, unnecessaryinventory, waste of motion and defects (Ohno, 1988). This was endorsed by the study ofHobbs (2004). Work cells are created to facilitate one-piece flow production, where awork cell consists of a close arrangement of people, machines, and/or workstations asper the processing sequence (Dolcemascolo, 2008; Satoglu et al., 2010).
In pharmaceutical manufacturing, quality standards are very stringent as goodmanufacturing practices focuses mainly on the manufacturing of safe and qualityproducts (Greene and O’Rourke, 2006). World Health Organisation (WHO) definescurrent good manufacturing practices (cGMP) as “that part of quality assurance whichensures that products are consistently produced and controlled to the quality standardsappropriate to their intended use and as required by the customer” (A WHO Guide toGood Manufacturing Practice Requirements, 2010). Further, the report states that “theconcepts of quality assurance (QA), cGMP and quality control (QC) are interrelatedaspects of quality management.” In this regard, cGMP says that quality is built into aproduct, and not just tested into a finished product. This can be achieved through severalways: controlling the quality of the production facilities, starting materials, productionat all stages, product testing methods, controlling the identity of materials by adequatelabelling; controlling the quality of products by adequate storage, etc. Stubbs (2008) hasemphasized the need for integration of the compliance objectives of Food and Drug andAdministration’s (FDA’s) “pharmaceutical GMP for the 21st century” initiative with thebusiness goals of increasing efficiency and reducing costs. In order to achieve productand process quality in pharmaceutical plants, Miller (2008) recommended a holistic andsystematic approach in incorporating lean manufacturing principles. This assists ineliminating wastes both within the firm and across the value chain (Suarez-Barraza andRamis-Pujol, 2010).
Leanness is associated with reducing lead times in production (Rahman et al., 2010).Based on this, global manufacturers are implementing lean manufacturing techniques(Matt, 2008; Anand and Kodali, 2008; Chen et al., 2010) towards improvement in on-timeproduct delivery to customers (Brown et al., 2006). Lean manufacturing techniques suchas 5S, Kanban, Kaizen, total productive maintenance, total quality management, failuremode and effect analysis, quality function deployment (QFD), value stream mapping(VSM), cellular manufacturing (CM), etc. are currently under implementation(Vinodh et al., 2010). On the other hand, implementation of VSM and CM combinedwith cGMP are found to be feeble in the pharmaceutical manufacturing sector. In thiscontext, this case study has been carried out. In the case study presented in this paper, ithas been shown that the wastes such as unnecessary inventory and setup times, improveproduction time. In order to accomplish this task, the managers of the organisation haveto implement approaches like 5S, VSM, CM, etc. Thus, in order to build quality intoproducts, lean tools together with cGMP helps the practitioners to visualize the wastesoccurring in the organisation and the future possibility of reducing/eliminating them. Inaddition, the integrated cGMP and lean environment create an environment of clear
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communication and provide a system that allows a simple flow of products to reduceproduction time and cost. The knowledge gained as a result of conducting this casestudy will be presented in the rest of this paper.
2. Literature review2.1 Lean manufacturingLean thinking and its principles as prescribed by Womack and Jones have beensuccessfully applied to manufacturing and operations environments, and associatedcase studies and research literature have also been published extensively (Haque andJames-moore, 2004; Papadopoulou and Ozbayrak, 2005; Taj, 2008; Eatock et al., 2009).The principles of lean manufacturing have become state-of-the-art in modernmanufacturing design and its implementation has become a vital pre-requisite inglobal competition (Matt, 2008). The term “lean” was first introduced by Womack et al.(2007) inTheMachineThat Changed theWorld. Furthermore, the authors proposed a setof principles for achieving lean enterprise: understand the value stream; improve workflow; let value flow only through the customers’ pull; and pursue perfectioncontinuously. As mentioned previously, lean manufacturing is embedded in the TPSand mainly aims at the elimination of waste (Muda). Ohno (1988) defined “muda” as anyhuman activity, which absorbs resources but creates no value. This insight creates avision of eliminating waste both within the firm and across the value chain.
Among various lean techniques available in the literature, VSM and CM are the mostpopulous tools and widely accepted by manufacturing sector. VSM is a micro-levelanalysis of material and information flow through the various levels of a manufacturingsetup (Serrano et al., 2008; Vinodh et al., 2010). On the other hand, some studies (Lee, 1985;Hyer and Wemmerlov, 2002; Slomp et al., 2005; Hunter and Black, 2007) examine issuesinvolved in designing cellular systems, generally treating the cell design process purelyas the selection and grouping of machines into cells (Angra et al., 2008).
Yusuf and Adeleye (2002) have carried a comparative study of lean and agilemanufacturing with a related survey of current practices in the UK. Barla (2003) haspresented a case study of supplier selection for lean supply by using a mathematicalmodel. Mark (2004) has enumerated the setup reduction benefits in a lean manufacturingenvironment. Papadopoulou and Ozbayrak (2005) has highlighted the misconceptionssurrounding issues such as the constituents of lean and further identified the keyconcepts and practices that leanness encompasses. Achanga et al. (2006) have identifiedseveral critical factors that determine the success of implementing the concept of leanmanufacturing within SMEs. Yang and Su (2007) have presented a lean operationconcept for productivity improvement in a semiconductor manufacturing industry.Taj (2008) has investigated the adaptation of lean principles and assessed its currentstate of practice in various industries in China including pharmaceutical and chemical.Khamis et al. (2009) explored the practical use of the 5S checklist for housekeeping andhealth, and for safety improvement at two manufacturing organizations. Vinodh et al.(2010) have shown that the manufacturing wastes such as inventory and defects need tobe reduced in order to improve the production time in a manufacturing industry.
2.2 Lean tools and applications2.2.1 Survey on VSM. This section will explore the strengths of VSM as a lean tool andalso to provide an insight on the explored areas of lean manufacturing where VSM has
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been applied. Though lean manufacturing has been widely recognised for its effectivenessin continuously improving productivity, product quality, and on-time delivery tocustomers, the manufacturing companies are not exploiting the full potential of theconcepts and techniques inherent within lean philosophy (Lasa et al., 2009; Chen et al.,2010). VSM has become a popular implementation method for lean manufacturing inrecent years (Lian and Landeghem, 2007; Vinodh et al., 2010). Therefore, this sectionattempts to present the key factors necessary to exploit the full potential of lean tools.
McDonald et al. (2002) have presented an application of VSM enhanced by simulationto a dedicated product line in an engineer-to-order motion control productsmanufacturing company. Seth and Gupta (2005) have reported the use of VSM toachieve productivity improvement at an auto industry. Huang and Liu (2005) appliedVSM tool for a Taiwan-funded enterprise in a repetitive manufacturing environment.Braglia et al. (2006) have applied a VSM framework for a complex production systembased on seven iterative steps. Lummus et al. (2006) have reported on a VSM projectcarried out in a small medical clinic that has resulted in lower patient wait time and anincrease in patient throughput thereby improving quality. Lian and Landeghem (2007)have analysed the effects of lean manufacturing using a VSM-based simulationgenerator. Seth et al. (2008) have addressed various wastes in the supply chain (SC) of theedible cottonseed oil industry using VSM approach to improve productivity andcapacity utilization in an Indian process industry. Lasa et al. (2009) have proved thatVSM is a suitable tool for redesigning the production system through a case study.Chen et al. (2010) presented a case study of lean implementation at a small manufacturerin the USA. In this paper, the “5 whys” method was employed to reveal root causes thatkeep the company from moving towards future state. In summary, VSM is a simple toolto help operation managers understand how their flows currently operate and to helpguide them through the process of analysis to improve those existing flows and designbetter ones in the future.
2.2.2 Survey on CM. The adoption of group technology based CM system hasconsistently formed a central element of many of the research efforts and has receivedconsiderable interest from both practitioners and academicians (Slomp et al., 2005).Savings from a variety of sources have resulted from setting up CM systems, includingreduction in material handling costs, setup and throughput time, work-in-process (WIP)inventories; simplified flow of raw materials and parts; and centralization ofresponsibility (Logendran, 1998). In order to implement a cellular approach, it isnecessary to plan the cell design properly (Hyer and Wemmerlov, 2002). Albert (2004)has recommended lean manufacturing principles for a US pharmaceutical equipmentmanufacturing firm to reduce waste in its shopfloor operations by applying theprinciples of 5S. Furthermore, to reap the benefits of setup reduction, the studyhighlighted the need for regrouping the machines into cells which could share commonsetup areas and fixtures.
Black (2007) has proposed a design rule that entails production in manufacturingcells and argued its effectiveness in reducing manufacturing lead time. Hunter and Black(2007) stated that the TPS uses CM subsystem for increased productivity. Dolcemascolo(2008) has also proved that one-piece flow implementation can be successful once therequirements such as the ability to consistently produce good products, repeatability,near 100 percent uptime on equipment are met. Pattanaik and Sharma (2009) haveshown the impact of CM in a lean environment and mapped the improvements through
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VSM and proved that several non-value added (NVA) times such as waiting andmaterial handling time can be minimized. Satoglu et al. (2010) have proposed asequential methodology for design of a hybrid CM system, to facilitate one-piece flowpractice. Saurin et al. (2010) have presented a framework for assessing the use of leanpractices in manufacturing cells through a case study of an automobile parts supplier.Based on the literature review, it has been found that the design of a CM system is quitechallenging (Praveen et al., 2009) as there are many strategic issues such as the selectionof parts suitable for manufacturing on a group of facilities, the level of equipmentflexibility, the layout of cells, and the type of fixtures must also be considered during thesystem design.
2.3 Survey on cGMPThe cGMP regulations for finished pharmaceuticals (Berry, 2008) can be summarizedas follows:
[. . .] the minimum current good manufacturing practice for methods to be used in, and thefacilities or controls to be used for, the manufacture, processing, packing, or holding of a drugto assure that such drug meets the requirements of the act as to safety, and has the identityand strength and meets the quality and purity characteristics that it purports or isrepresented to possess.
Therefore, the cGMP guidelines embedded many of the features that make thepharmaceutical manufacturing sector an unusual one. The cGMP covers various aspectsof the manufacturing process namely defined manufacturing process; validated criticalmanufacturing steps; and suitable premises, storage, transport. There are a number offederal regulations that relate to cGMP which, if not followed, can lead to criminalpenalties. In addition, to sell products in US markets, approval from the FDAismandatory (Eatock et al., 2009). Moreover, the WHO GMP Report for PharmaceuticalProducts (A WHO Guide to Good Manufacturing Practice Requirements, 2010)presented the following quality management aspects:
[. . .] the concepts of quality assurance (QA), GMP, and quality control (QC) are interrelatedaspects of quality management. They are of “fundamental importance to the production andcontrol of pharmaceutical products”.
This global document is reflecting a very wide range of norms, for instance, the QA conceptencompasses systematic actions (procedures and processes) necessary to ensure adequateconfidence that a product will satisfy given requirements for quality. Moreover, the cGMPreport presents the principles of QA to ensure that good laboratory practice (GLP) codesare strictly implemented which include all material controls, validations, etc. that must beperformed as specified. In addition to the above, cGMP insists that the independence of QCfrom production is fundamental, where the QC function specifically involves determiningspecifications, testing and approval of starting materials, intermediate and final product;,etc. (Nally, 2007; United Nations, 2009). In summary, all these aspects tend to focus onquality and efficiency rather than cost reduction.
Mukhopadhyay et al. (1998) have proposed an integrated production planningsystem for a pharmaceutical manufacturing firm in India to move towards world classmanufacturing through the application of lean concepts. Lau and Mak (1999) havedeveloped a unified framework for the development of a supervisory control system for apharmaceutical industry. Choudhury et al. (2004) have developed an analytical network
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process model to incorporate strategic planning problems of a SC cell and tested througha pharmaceutical firm. Kocakulah and Upson (2005) have presented the implementationaspects of a computerized physician order entry system, which has been evaluated usingVSM techniques. Greene and O’Rourke (2006) referred to the integration of leanprinciples and cGMP as lean pharma approach. Owing to the lack of similarities betweenthe two approaches as shown in Table I, the move towards application of lean principlesto manufacturing operations of pharmaceuticals has been slow. In order to meet theproduct and process quality, Peeters (2008) has focussed on the design of an effectivecompliance programme and highlighted the importance of maintaining the properdocumentation in the context of pharmaceutical manufacturing environment. In thesimilar context, Miller (2008) and Stubbs (2008) have emphasized the need for a holisticapproach in incorporating lean manufacturing principles in pharmaceutical plants. Inaddition, they tried to assist practitioners in understanding the cost implications ofnon-complying with cGMP standards and the impact on company’s overheads. Murray(2009) has worked on mitigating pharmaceutical manufacturing risks where the studyfocussed primarily on indicating the best practice risk management. Based on theliterature review, it has been found that though the lean manufacturing principles havebeen adopted across the world several years ago, most of the organisations have startedimplementing lean concepts currently (Anand and Kodali, 2008; Chen et al., 2010).However, very little evidence exists regarding the utility of these interrelated aspects ofquality management in the pharmaceutical manufacturing sector. This forms themotivation for this research project.
The rest of the paper is organised as follows: the next section presents theresearch methodology followed in the study. This is followed by a case study andanalysis that includes problems existing and root cause analysis, and quantification
Focus Storage, process traceability, startingmaterials approval, and precisedocumentation
Product value streamMaterial flowInformation flow
Approach tomanufacturing
Quality is built into product throughoutproduction
Quality along withproductivity
Typical goals Independence QC from production Reduce costFollow validated processes Improve qualityStage inspection Decrease CTGLPs Reduce inventory
On-time deliveryTypical tools Approved procedures Value stream mapping
Complaint reviews 5SQuality audits Kaizen
KanbanCMQFD
Source: Greene and O’Rourke (2006), Hunter and Black (2007) and WHO (2010)
Table I.Comparison of cGMP and
lean manufacturingprinciples
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of the identified wastes. Strategies for the improvement and development of futurestate VSM are presented in the immediate section. Discussion of results and inferencesare provided in the following section. Finally, conclusions are given.
3. Research methodologyThe methodology followed to conduct this research study is as follows: as presented inSection 2, literature review has been performed on lean manufacturing tools and cGMP.This is followed by the selection of an appropriate production line at the selectedpharmaceutical manufacturing for carrying out the lean study. After identifying the line,the problems existing within the line have been analysed through the 5-why method.Thereafter, the current state VSM has been developed and analysed. Following this,various strategies for improving the leanness of the organisation has been formulatedand validated with the company managers to develop the future state map. After thedevelopment of the future state VSM, various inferences that would improve theproduction line have been drawn.
4. Case studyThe company selected for the study is a local manufacturer and distributor of awide range of pharmaceutical and non-pharmaceutical products. The plant is situatedin a 10,000 square feet area and began operations in 1991. The company has a smallproduction staff of 12 floor workers, two process operators and two supervisorsand together produces a variety of products on four production lines in an eight hour dayshift. The company is also involved in the contract manufacture of an antisepticdisinfectant liquid (ADL) for an international company and has involved in numerousproducts to meet a variety of market needs.
4.1 Problems at the selected organizationCurrently the firm is facing two major problems. The first problem is that of propertymortgage in the form of fixed operating cost. Owing to contraction of the manufacturingoperations over the years, most of the floor space is used inefficiently. At present, themajority of the space is occupied by semi-finished goods and raw materials.
The second problem being faced by the company is its inability to supply productsto various markets in a timely manner. This results in customer dissatisfaction as wellas a huge loss in sales revenue. Currently, the company’s product delivery target is twoto three working days from receipt of sales orders. In addition, the sales departmentrequires a two month buffer of its key products to meet export orders. This objectivehas caused complications due to the production of ADL, which requires two weeksevery month to meet the demand and utilizes six to eight of the 12 available employeesfor its manufacture. However, four to six employees are required to produce thecompany’s regular products. Therefore, the majority of their products must beproduced in the time when ADL is not being produced. In addition, late arrival of rawmaterials, frequent supply of defective materials, long setup times and poor inventorymanagement have become major issues of the company. Owing to these difficulties,there is a tremendous pressure on the management to meet the on-time delivery ofproducts.
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4.2 Selection of the production lineIn this study, the Creams and Ointments line, hereafter referred to as Line-1, was selected.On application of Pareto’s principle to the historical sales revenue of the productsmanufactured in-house, one stock keeping unit with the highest sales revenue wasselected for the purpose of the study. Hereafter, this will be referred to as product 1 (P1).
4.3 The study objectivesIn order to conduct the case study, the following objectives were set:
(1) To analyse root causes of the company’s manufacturing problems and todevelop current state VSM.
(2) To quantify wastes and to develop future state VSM for enabling leanness inthe pharmaceutical manufacturing operations.
4.4 Project executionTo execute the project, a cross-functional research team with three members has beenformed. In the determination of the root causes of the problems faced by the company,the 5-why analysis (Chen et al., 2010) was performed with a focus group comprised of thecompany employees from production, logistics and warehouse departments. In thisstudy, process wastes were quantified through the use of process flow chart (PFC) andVSM. Vinodh et al. (2010) approach was followed to calculate uptime. The actualoperating and available production times were computed from the company’s log books.
4.5 Root cause analysisAnalysis of problem 1. The “5-why” analysis of problem 1 is shown in Table II. Accordingto the current plant layout, property mortgage is the main fixed operating cost.
1 Why is it necessary toutilize 10,000 squarefeet of floor space?
Large storage areas are required forproduction of the various products and someareas are unused due to business contraction
2 Why are large areas ofspace required forproduction?
Products are coded and labeled in one area.The result is an accumulation of WIPinventory which is moved around until thereis sufficient room to label and code
3 Why is it necessary tolabel and code all itsproducts in one area?
This is the only area where products are notfilled. Since labeling is done by hand, thisoperation requires space which cannot beaccommodated in a production room as itmay be needed for filling of other products
4 Why is labeling donemanually instead of bymachine?
The current production rooms do not havesufficient space to accommodate a labelingmachine
5 Why does the existingfloor-area not allow forthis equipment?
The present layout is not planned properly Table II.The “5-why” analysis
of problem 1
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Therefore, it is necessary to not only identify the reason for the high operating cost butalso why approximately the 10,000 square feet of plant space is currently in use. Theanalysis indicates poor line layout as the main reason for this root cause. The analysisfurther indicates transportation of materials from one workstation to another causingunnecessary movement of material.
In addition to the above, the products were labeled manually despite the availabilityof three labeling machines, resulting in large quantities of WIP on the production floor,as employees are unable to complete labeling in time. For instance, a total of2,800 square feet is used as the coding and labeling area in addition to a separate fillingarea. Furthermore, due to the outsized WIP inventory, materials which are notneeded at a particular time are moved to unused area until sufficient floor space isavailable.
Owing to improper utilization of the available floor space and equipment,unnecessary transportation of the material exists resulting in a high WIP inventory.This poor line layout has also resulted in the company’s second problem of inconsistentsupply of products to the market, which is explained in the next section.
Analysis of problem 2. The “5-why” analysis of problem 2 is shown in Table III. Aninconsistent supply of products to the market was found due to the lack of knowledgeand experience in managing production management systems effectively. Poorcommunication exists among various components of SC and there is no remedialcommunication with suppliers regarding delays in raw material supplies, defectivematerials, inefficient manufacturing methodology and inaccuracies between thephysical and electronic stock quantities. Owing to this, stock outs are repetitive in thecompany.
4.6 Development of current state VSMThe current state VSM developed is shown in Figure 1. The orders are being receivedfrom the customers on a monthly basis. The customer demands are stable and constant.The production control department sends out the instructions daily to productionmanager. The production manager conveys the instructions to various personnel on adaily basis. By applying the PFC technique, all process steps necessary to complete theselected process was recorded. The information obtained from the PFC indicates that atotal of six process stages are involved in the process. The first operation is filling.It involves six shop floor personnel. The cycle time (CT) for this manual operation is8 minutes. The changeover time between the successive jobs at this production stage is90 minutes. The inventory carried over between filling and capping is 1,750 units.Uptime is calculated as 99.9 percent by dividing the actual operating time (8,835.5 hours)by available time (8,837 hours). Here the actual operating time is the difference ofavailable time and changeover time (90 minutes). Similarly, the calculations have beencarried out for the rest of the operations. The total cycle time (TCT) for the process is28 minutes whereas the total NAV is 1,170 minutes. The finished product is beingsupplied to the clients on a monthly basis. The company maintains a finished productinventory of 864 units because of the monthly delivery scheme.
4.7 Development of future state VSMThe future state VSM depicting the various modifications incorporated in themanufacturing process is shown in Figure 2. After the analysis of wastes existing
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in the manufacturing process, various lean strategies for waste elimination/reductionhave been developed in consultation with the managers of the company, which are givenbelow:
. Create a good housekeeping environment through cGMP: implementation of 5Sprinciples at labelling, capping, filling and coding operations to create a cGMPenvironment, housekeeping and health as well as for safety.
. Form a work cell: grouping of operations filling, capping, labelling, coding andpackaging into a cell which could share common setup areas and fixtures to gainbenefits from setup reduction, floor space, material handling costs and WIPinventory.
. Introduce prior inspection (PI) methodology – PI after capping, labeling andcoding operations.
Phenomenon: inconsistentsupply of products to marketWhy no. Why Reason
1 Why is there an inconsistentsupply of products to themarket?
a. In consistent supply of raw andpackaging materials
b. Long setup timesc. Ineffective sequence of operationsd. High level of WIP inventoriese. Production times for some
products demanded are beyondthe desired delivery time
2 a. Why are materialsexhausted?
a. There are insufficient materials tomeet demand
b. Why are production timesbeyond delivery times?
b. Unnecessary actions are donewithin the process
3 a. Why are there insufficientmaterials to cover demand?
a. No sales forecast was doneb. Late arrival of materials
b. Why are unnecessary actionscarried out?
c. Persistent defects in deliveriesd. Inaccurate inventory updatese. Resistance to change methods
4 a. Why was no sales forecastdone?
a. It was not a job function in theorganization
b. Why did materials arrivelate?
b. Poor communication among SCunits
c. Why are there persistentdefects in deliveries?
c. No remedial communication withsuppliers
d. Why is the electronicinventory stock inaccurate?
d. No system for regular physicalstock counts
5 a. Why was there poorcommunication in the SC?
Due to the lack of experience andknowledge of computer aidedproduction management systemsb. Why was there no remedial
. Utilise existing automatic filling and capping machines to fill and seal theunits.
. Introduce a customer supplier agreement (CSA) to reduce incoming materialdefects and on-time product delivery: currently, the result of the number ofnon-conformances has been mainly due to rejections of jars. Throughimplementation of CSA, the material shortages can be avoided and superiormaterials can be expected.
. Compliance of cGMP by storing jars and caps in sealed bins: through the use ofbins, jars and caps can be stored for easy access during the filling and cappingoperations. In this way, a 5S environment together with a reduction of setup timecan be achieved.
. Introduce an electronic inventory management system (eImS): currently at theorganization, manual material update procedures are being adopted to indicatethe reorder point of materials. This has to be altered to eImS for enablingautomatic information update on replenishment materials and on-time deliveryof products.
5. Results, discussion and inferences5.1 Managerial outcomes
. 5S principles have been proposed for the labelling, capping, filling and codingoperations because the process environment prevailing in those stages is ruinedat present. Development and employment of the 5S tool will enable thecleanliness of production shop (Vinodh et al., 2010).
. Creation of a family based production cell involving labelling, coding andpackaging operations has resulted in a reduction in CT, floor space and in WIPinventory. Owing to the implementation of CM, TCT has been reduced from 28 to10 minutes in the product value stream. Therefore, on-time product delivery canalso be achieved (Dolcemascolo, 2008).
. Presently, the number of non-conformances has been mainly due to rejectionsof jars and non-hygienic conditions of the lids. Owing to the nature of theproducts manufactured it is imperative that the packaging meet certainhygiene requirements, specifically during the primary packaging. Throughthe use of CSA the delivery procedures can be changed along with superiormaterial quality and on-time product delivery can be achieved byperforming PI.
. Through the use of bins, jars and caps can be stored for easy access during thefilling and capping operations. The current product setup times can be reducedthrough implementation of packaging inspection prior to the start of productionand storing the materials in sealed bins, a good housekeeping environment canbe achieved.
. Currently, inspection is being carried out at the final stage. One technician isneeded for performing inspection. The CT for inspection is about 4 minutes. Thefinal inspection has been transformed to PI. This has eliminated the final stageinspection. Owing to the elimination of inspection operation, WIP inventory hasbeen reduced greatly in the product value stream.
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. Presently, stock outs are repetitive in the company due to existence of non-remedial communication with suppliers regarding incoming quality of packagingmaterials, and supply of raw materials. Introduction of eImS facilitates theautomatic update of material status and monitoring material orders. Owing toimplementation of electronic information systems, there will be an overallimprovement in the quality of incoming materials can also be achieved.
5.2 Improvements in lean parametersThe improvement in various performance measures as a result of the conduct of thecase study has been mentioned as follows:
. NVA time has been decreased from 1,170 to 420 minutes.
. TCT has been reduced from 28 to 10 minutes.
. Workforce has been reduced from 6 to 3 (50 percent).
. Reduction in WIP inventory from 6,092 to 864 units.
. Reduction in shop floor area from 144 to 90 square feet2.
. Reduction in floor space (38 percent) has been achieved.
5.3 Practical validationIn order to determine the practical feasibility of deploying lean tools such as VSM andCM for enabling interrelated aspects of quality management, a questionnaire-basedpractical validation as proposed by Vinodh et al. (2010) has been followed. Thispractical approachability of deploying lean tools together with cGMP principles hasbeen gathered not only from the company’s production/operations managers but alsofrom experts in similar industries. A sample list of questions used to develop thequestionnaire has been given below:
. The current VSM developed for your manufacturing process has been shown. Towhat extent do you think the current VSM reflects the aspects of QA, cGMP andQC?
. The future VSM has been shown. To what extent do you think that this proposedVSM is feasible and implementable?
. To what extent do you think that the application of VSM and CM are beneficialto the pharmaceutical company?
The feedbacks of the respondents are shown in Table IV. The respondents’ reactionswere positive towards the introduction of the 5S approach, PI, sealed bins, cellular layoutand eImS in developing a cGMP environment. Despite the feedback indicating thefavourable receptivity of these leanness enablers, the cost factor involved had to beclosely studied for investigating the practical implications. Understandably, economicpayback is a main concern for any company. The concept of converting the existingbatch to one-piece based process flow will involve the relocation of equipment, layoutrenovation and introduction of PI procedures. The total estimated implementation costfor the cell was $3,345. The figure would have been considerably higher if new capitalequipment had been purchased. However, initially, existing equipment and computersoftware will be used. The savings from the cell may be justified by computing one-timeinventory savings (Hunter and Black, 2007). The one-time inventory savings is $6,691,
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which is computed as reduction in WIP inventory (6,092-864) multiplied by companyprovided average holding cost per unit ($1.28). The reduced inventory savings alone istwice the amount of the cell implementation costs (6,691/3,345 ¼ 2). Hence, the costfactor would not be a sensitive factor and thus, it is necessary to educate the practitionersto promote the cell’s various productivity benefits such as reduced direct labour hours,improved employee morale and reduced/eliminated material handling costs. In this casestudy, one of our primary challenges was inconsistent supply of products to the market.This obstacle was successfully met by reduction in TCT (Brown et al., 2006;Dolcemascolo, 2008).
5.4 Inferences from the studyThe first step towards a lean production system is the mapping of the desired futurestate of the production system’s value streams (Erlach, 2005). With the application oflean manufacturing principles, the future state VSMs of the production system can bedeveloped. The lean manufacturing paradigm has emerged with a focus on wasteelimination thereby achieving industrial competitiveness (Seth and Gupta, 2005;Lummus et al., 2006). On the other hand various interconnected quality managementconcepts such as QA, cGMP, and QC are of fundamental importance to the productionand control of pharmaceutical products. However, practitioners find it difficult toidentify the key functional areas for waste elimination and arrangements made toensure that pharmaceutical products meet the quality required for their intended useand timely delivery to the market. In order to accomplish this goal, the leanmanufacturing literature has offered VSM and CM as improvement tools. Using theseproductive tools, it is possible to develop the current state VSM and consequentexamination for accomplishing waste elimination. The pharmaceutical case studypresented in this paper has shown the way in which practitioners can use VSM and CMtools for identifying the key functional areas for implementing this waste eliminationapproach. In this research, it has not only been shown that the manufacturing processwastes such as unnecessary inventory, storage area, TCT can be reduced andproduction flow can be improved. In order to achieve this goal, the managers of thecase organization have to initiate approaches like 5S, CM, CSA, eImS, etc. Therefore,lean tools help the practitioners to envision the present level of process wastesoccurring in the shop floor and the scope of reducing/eliminating them.
6. ConclusionsThe cGMP regulations for finished pharmaceuticals are sought to implement newmanufacturing philosophies, and the rigorous controls to be used for, the manufacture,processing, packing, or holding of a drug to assure that such drug meets the customerrequirements. Research has shown that the “5 whys” method was employed to revealthe root causes of various manufacturing hurdles (Chen et al., 2010). Manyproduction/operation managers have implemented or will be implementing leanprinciples because of the waste elimination benefits reported by other companies whereefforts are mainly aimed at the optimization of total SC costs (Choudhury et al., 2004;Lummus et al., 2006; Anand and Kodali, 2009; Schaeffer et al., 2010). VSM frameworkin manufacturing cell environment has potential to identify types of focused processstages where lean controls are sought (Huang and Liu, 2005; Saurin et al., 2010). In thisregard, our paper presents a case study that focuses mainly on the application of VSM
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in the CM environment for pharmaceutical operations. Several lean strategies inthe context of waste elimination/reduction such as 5S, inspection at suppliers’ doorstep, and eImS have been proposed. It has been noted that the lean strategies ondeployment has benefited the company in terms of considerable reduction in idle time,inventory costs and significant improvement in on-time delivery due to reduction inTCT. Based on the practical validation performed, it could be stated that application ofVSM framework in a CM environment is an effective lean manufacturing approach,which could be employed in a pharmaceutical manufacturing situation for facilitatingcontinuous material flow, thus assisting the firm to accomplish leanness in cGMPenvironment. Furthermore, VSM and CM tools have assisted the companymanagement to envisage the process wastes stirring in their production shop andthe means and ways of reducing them.
Reduction/elimination of wastes via the adoption of lean manufacturingprinciples and methodologies may lead a company to world-class competitor statusin a particular market niche. Further research is necessary in studying the advantageswhich determine the implementation benefits such as improved quality, on-timedelivery, and improved employee morale in a cellular environment, for severalmanufacturing firms.
Improvementstrategy Description
Mean response in a scale of range 0-9(0: not implementable, 5: moderatelyimplementable, 9: completelyimplementable)
1 Implementation of 5S principles atautomatic filling and capping (AFC), andpacking operations to create a cGMPenvironment, housekeeping and health aswell as for safety purposes
20
2 Work cell formation will gain benefits fromsetup reduction, regrouping of operationsfilling, capping, labelling, coding and pac9kaging into a cell which could sharecommon setup areas and fixtures such assealed bins (SB). Further, reduction of WIPdue to automatic filling and capping
18
3 Introduction ofCSA: throughimplementation of CSA, the materialshortages can be avoided as well as for PI ofmaterials and on-time product delivery ispossible
19
4 Compliance of cGMP: PI through the use ofsealed bins, jars and caps can be stored foreasy access during the filling and cappingoperations
12
5 Introduction of eImSfacilitates electronictracking of activities such as materialsreplenishment and on-time product delivery
12Table IV.Feedbacks fromrespondents
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About the authorsBoppana V. Chowdary is a Faculty Member in the Department of Mechanical and ManufacturingEngineering at The University of The West Indies, St Augustine, Trinidad. His researchinterests are in the areas of lean manufacturing, product design and development and CAD/CAM.
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Boppana V. Chowdary is the corresponding author and can be contacted at:[email protected]
Damian George is currently the Plant Operations Manager at Genethics PharmaceuticalsLimited, Trinidad, where he is responsible for the Logistics, Production and Maintenancedepartments. The majority of his experience comes from his 12 years at Unilever, where he firstlearned about manufacturing systems. He is currently working on improvements of the productlines at Genethics and driving lean principles forward.
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