The medical device industry is facing a tough environment – US regulatory process, the device excise tax, sluggish sales, pricing pressures and caps on reimbursement rates. Many executives in this industry summarize the environment as “challenging” and “uncertain”. Another area of concern is the impact of globalization and outsourcing. Because of the tougher environment in the US many medical device companies have resorted to growing sales by focusing on international markets and global sourcing. The increase in the excise tax, 2.3 percent by 2013, is having a negative impact on technology innovation.

So what is a medical device company to do in such an environment??

One such company has decided to combat these pressures by focusing on their continuous improvement (CI) transformation. They used value stream mapping (VSM) to quickly identify improvement opportunities. The main focus has been on driving quality improvements and cost reductions, but they have also started creating a Visual Factory. By making sure they have the proper safety, quality, delivery and cost metrics in place, supervisor training implemented with Managing for Daily Improvement (MDI) techniques, and shoring up the CI team they have achieved 30 to 40 percent improvements in productivity, reduced lead time by 50 percent or better, and reduced defects by 60 to 70 percent. Strong senior management sponsorship within the company has also been a key success factor in their improvement journey.

Read a case study on another medical device company that has had similar results.