For many manufacturers, the economics of quality is a simple cost-benefit analysis: investing in quality manufacturing is worth the associated payoff in customer satisfaction, retention, reputation and more. (For a full discussion about the costs and benefits of quality in manufacturing, you should read our whitepaper on The Butterfly Defect.) If the costs of providing quality products are higher than the benefits of meeting customer expectations and retaining their business, these manufacturers can adjust those costs accordingly. Because they typically operate in a less regulated world, they can more quickly pivot to offset QA costs or requirements, such as using lower cost suppliers, sourcing cheaper materials or updating their QA requirements.
As a medical device manufacturer, you don’t have the luxury of thinking about quality in simple economic terms; meeting customer expectations can be a matter of life or death. And the costs associated with quality take on a dimension that sets you apart from your manufacturing peers — the cost of regulatory compliance.
The cost of regulatory compliance for the highest performing medical device companies is a baseline quality cost. According to McKinsey’s research, Capturing the value of good quality in medical devices, quality costs generally equate to 2-2.5% of sales. But this cost is estimated to be only a small portion of the potential liability if all costs of poor quality were evaluated.
The liabilities associated with the direct costs of poor quality highlights what can go wrong despite all of the resources you throw at prevention and compliance. That’s why “quality” in the medical device world is a two-part equation: assurance and control.
Controlling the costs of poor quality: How to make an impact on the manufacturing floor (even if you don’t have “quality” in your title)
The true source of liability for all costs of poor quality — remediation, internal and external quality failures, nonroutine failures — is people’s time. It accounts for the time it takes quality and operations teams in the factory to deal with defects: documenting, investigating, communicating about, reworking, handling and disposing of them. And all of that time requires control systems to manage and make teams more efficient. Here are a few ways you can get productive, save time and drive down the costs of poor quality.
Get to the assignable root cause faster: A product complaint comes in or there is evidence of continual failures in the field that could represent the start to a very long corrective and preventative (CAPA) process. In fact, the process for the majority of medical device quality investigations takes at least 30 days. This can get drawn out even longer when investigators can’t narrow down the source or be 100% sure of the actual cause when they do.
Visual traceability solutions, like Drishti allow quality engineering and operations teams to zero in on potential problems in assembly quickly with video playback. They can look up each product assembled and get a recording of its actual assembly, providing investigators with a firsthand account of non-standard work and video confirmation of non-conformance.
Identify non-conformance at the source: In assembly, standard operating procedures and good work instructions are critical for successful line associates, because they ensure that the worker consistently – builds the right product every cycle. What if you could measure those cycles to quickly pinpoint abnormal cycle times? What if you were able to identify those long or short cycles in real time?
One way to detect non-conformance is to pay close attention to cycle time. Drishti Flow uses AI to automatically measure cycle time for highly manual processes. Our medical device customers use it to spot stations with unusual variability or unexpected performance, which is a strong indication that the process may be failing.
Defend against false quality complaints: Following good manufacturing practices (cGMP) and having proof of those practices on record should clear you of regulatory action or false claims. However, proof of good assembly processes is sometimes purely subjective. You rely on internal line audit procedures and data collection to control for potential missteps in the process.
Visual traceability via video gives you complete confirmation of well-established assembly procedures. You also get to rely on instant video based on serial or lot numbers and time of day to provide reference for any claim.
Limit the scope of recalls: If defects escape, and a complaint rises to the level of a recall, the costs of removal and repairs can skyrocket. These non-routine costs of poor quality have been reported to be as high as 8% of sales in some cases, according to the McKinsey report.. Eliminating the uncertainty around the actual devices that have the highest likelihood of having the reported problem could save thousands, if not millions, of dollars.
This is where visual traceability comes into play once again. With it, you can pinpoint the defective product with a timestamp and produce a full video record of its assembly. Drishti provides quick access to concurrent video footage of products being assembled with the same processes. When you’re able to quickly reference the point of failure and get video to all other similarly assembled products, you can scope your repairs and returns appropriately and keep costs to a minimum.
The bottom line is that the costs of poor quality in medical device manufacturing are much higher than just the scrapped unit. If you could recapture just 1% of your sales by eliminating those quality costs, what would that be worth?