The client- A renowned medical products manufacturer, Revenue- $8 billion, Area of Engagement- Supply chain management
The current healthcare industry is witnessing the proliferation of partnerships, relationships, and joint ventured initiatives to meet the growing healthcare expenditure and deliver value to the customers. Despite political uncertainties and sluggish economic growth, medical products manufacturers are planning to invest in innovations to redefine their business models and create a value proposition for the customers. The rapid transformation in the medical products manufacturing space is fueled by the aging population, proliferation of chronic diseases, and increasing emphasis on quality of care and treatment.
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Amid the rapidly changing economic conditions, small and large players have been compelled to adapt and find new opportunities for development. Let’s look at some of the factors the may influence the growth of the industry.
- Cost of product development: The increasing complexity and sophistication of devices are further increasing the R&D expenditures, which, in turn, is increasing the cost of product development. Also, the growing demand for medical products among the consumers is increasing the need for reducing capital in the manufacturing process while negotiating on the expenses.
- Ensuring product quality: Medical products manufacturers need to ensure that they maintain quality in their products to avoid any issues related to product recalls. For any medical products manufacturer, product recalls can have a negative impact on brand reputation and the company’s overall bottom-line performance.
- Regulatory compliance: The growing safety standards and regulatory compliance are compelling medical product manufacturers to offer reliable and quality services to the end-users. Besides the regulatory guidelines, manufacturers of medical devices should garner government support to improve research and development and offer favorable tax reimbursements.
As medical products manufacturers are shifting from a transaction-based approach to a value-based approach that focuses on creating value for providers and practitioners, it becomes essential for the medical devices companies to go beyond the traditional business models to ensure better supply chain visibility. With the rising aging population and increasing health concerns, companies need to rely on supply chain management to grow by leaps and bounds and meet the demands of the end-user segments.
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The Business Challenge
In 2012, the top twelve companies in the medical devices industry contributed to approximately 45% of the overall global market.
With operations becoming complicated, a renowned medical products manufacturer faced the need to increase the efficiency of their operations across the supply chain to remain competitive in the market space. With the growing concerns related to delayed shipments, inefficient plants, and inconsistent suppliers, the medical products manufacturer wanted to reduce operational costs to improve supply chain responsiveness and product quality. In addition, the medical products manufacturer wanted to gain insights into the healthcare trends in terms of the people, processes, assets, and the entire value chain.
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The Solution Benefits and the Business Impact
Strategies that we recommend to improve supply chain visibility and ensure efficiency.
The supply chain management solution offered by Quantzig helped the medical products manufacturer gain relevant insights into the medical devices sector and the opportunities in the medical devices manufacturing space. The client was able to leverage the use of supply chain management to enhance their supply chain visibility, demand forecasting, and further improve the overall merchandising capabilities. In addition, the solution helped the client consolidate metrics into the overall supply chain to help the business optimize their networks and improve efficiency.
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Supply Chain Management Predictive Insights
The client was able to gain better visibility into the supply chain process and increase efficiency, improve service levels, and reduce inventory levels. The solution offered end-to-end visibility into the supply chain from the procurement of raw materials to the distribution of medical products to the end-user segments. In the midst of the global competition, the medical products manufacturer was able to develop effective supply chain strategies and logistical capabilities to serve the needs of the customers in a timely and efficient manner.