In Part 1, we covered the business and technology challenges that the medical device industry is experiencing. These will require a re-think of how to manage products, streamline the business and interact with customers. Those manufacturers who are still using legacy or customized computer systems will find it difficult to make the necessary changes. To achieve their transformation goals, they should consider an enterprise resource planning (ERP) system geared towards their industry’s key needs. An ERP solution geared for the medical device industry can provide the backbone for operational excellence, maximize supply chain efficiency, ensure high-quality products, and provide the capabilities to become more customer-centric.
Integration of design and manufacturing
The components that make up devices are not only complex but also can change quickly. Many manufacturers use a CAD/CAM system for design and engineering control. However, the challenge of a stand-alone CAD/CAM system is to make sure the design specifications are mapped correctly to the production system. An ERP application that integrates with CAD/CAM software automates the synchronization of design and engineering change orders with the Bill of Materials (BOM) which is the centralized source of information used to manufacture a product.
Regulations in many countries require tracking and monitoring of products. Medical device manufacturers must constantly monitor component and product quality to ensure regulatory compliance. This must also include suppliers’ quality management processes. An ERP system for medical device manufacturers can automate the quality management process so that best practice is integrated into operations to address compliance requirements.
Linked to quality management is traceability, and an ERP system will provide the tools to enable tracking from the component level, through assembly, to the shipping of finished goods so that manufacturers have complete end-to-end traceability. In addition, if a potential problem is discovered, the system will automate and streamline the recall or Corrective and Preventive Action (CAPA) process.
Inventory and logistics management
As medical devices increasingly have embedded sensors that can transmit data over the Internet, companies are looking at the possibility of digital supply networks (DSN). DSNs integrate information across the entire supply chain, removing the problem of siloed inventory management and logistics operations. An ERP system provides the capability to manage the information as it flows through different functions in the supply chain, speeding up the procurement process, the location and picking of stock, and ensuring items get to the right place at the right time.
By integrating contact management and customer relationship management (CRM) capabilities with the rest of the business through the ERP system, medical device manufacturers can better understand, manage and improve the relationship with their customers. A CRM provides consistent customer touchpoints and manages the ongoing interactions across the customer life cycle. When problems arise, the CRM can generate a case that the ERP system uses to create either a returns process, or issue a new works order to respond to and manage issue resolution.
An ERP system can help medical device manufacturers to manage after-sales services, such as unscheduled maintenance, warranty management, repair and defect identification. Defect information can be fed back to design or manufacturing functions for product improvement. The ERP system can also schedule field service activities, scheduling and dispatching the right technicians for better, faster issue resolution.
For manufacturers looking at the potential of the Equipment-as-a-Service business model, they need an ERP system that comprises all the functions needed to deliver this service (e.g., after-sales service, warranty and repair management). By combining those capabilities with Internet of Things (IoT) technology, an ERP system can detect automated signals from devices that are failing, diagnose the problem and issue a maintenance job to repair or replace the device.
To develop new products and improve the customer experience, medical device manufacturers will increasingly rely on data. A huge increase of health care data is expected to dramatically improve diagnosis, clinical decision-making, and help deliver better patient outcomes.
A report by Deloitte commented that in a wide-ranging survey of health-related businesses and researchers, 67 percent agreed that data storage and integration will be a key service in the future. The data will be used to make more informed decisions about patient care, provide information to stimulate innovation, lower health care costs, and improve the relationship between medical device manufacturers and their suppliers and customers.
An ERP solution can provide the data platform to gather data from multiple sources. This can then be the basis of research and analysis that generates the insights needed for better products and decision-making, and a more personalized customer experience.
Another reason that medical device manufacturers should adopt a data platform is that consumer technology companies already have the advantage of data about their customers and can use that to better understand their needs. The consumer healthcare industry is using data to upend the traditional reactive business model to a more proactive one based on the consumer. Without their own data store, medical device companies will be at a disadvantage when it comes to new products and services, and customer recognition.
The future of the medical device industry
Medical device manufacturers of the future will likely face a very different health care landscape to one they dealt with in the past. Due to innovations in digital technology, competition from consumer technology companies, and new care models, manufacturers will need to adopt new technologies to support the new business models that they will need to survive. An ERP system that caters for the specific needs of the industry makes it easier for manufacturers to make the operational and technology changes that are required to survive in the 21st century.
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