project nomination form acme...

PROJECT NOMINATION FORM

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Acme Pharmaceuticals

2018 Manufacturing Leadership Awards

Step 1: Executive Sponsor Contact Information: (The executive-level individual at the manufacturing company who led sponsorship of the project. Contact must be VP level or higher.)

Name: John Doe Title: VP Global Manufacturing Specialty Generics

Company: Acme Pharmaceuticals Address: 555 Main

City: City State: CA Zip/Postal Code: 94619 Country: USA

Phone: (510) 555-5555 E-mail:

Project Contact Information: (Primary project contact. This contact will receive award status notification e-mail.)

Name Title:

Company

Phone: E-mail:

**Your Company’s Public Relations/Marketing Contact: (Someone who can help get the word out about your award.)

Name: Title:

Company:

Phone: E-mail:

Partner Contact Information: (Contact at the technology partner or service provider facilitating this nomination, if applicable)

Name: Title:

Company:

Phone: E-mail:


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Step 2: Nomination Categories — *Note that judges have the final decision on the appropriate category for each

nomination. For definitions and more information on the award categories, visit

http://mlawards.gilcommunity.com/about-awards/categories/

Select the PROJECT award category you are submitting this nomination for (please select one):

__ Data and Analytics Leadership Award __ Collaborative Innovation Leadership Award __ Engineering & Production Technology Leadership Award

__ Enterprise Integration and Technology Leadership Award __ Industrial Internet of Things Leadership Award

_X_ Operational Excellence Leadership Award

___ Smart Products and Services Leadership __ Supply Chain Leadership Award __ Sustainability Leadership Award

__Talent Management Leadership Award

Step 3: Manufacturing Company Information

Full Company Name: Acme Pharmaceuticals

Headquarters Address:

City: State/Province: Zip/Postal Code: Country:

Website: Company Twitter Handle:

Size of Company/Division:

1. Annual Revenues (please select one)

_X_ Over $1 billion __ $25 Million - $50 Million __ Confidential

__ $500 Million - $1 Billion __ $10 Million - $25 Million

__$250 Million - $500 Million __ $5 Million - $10 Million

__$100 Million - $250 Million __ $1 Million - $5 Million

__ $50 Million - $100 Million __ $0 - $1 Million

2. Number of Employees (please select one)

__1,000 or more _X_ 100-499 __ 20-49 __500 – 999 __ 50-99 __ Under 20

http://mlawards.gilcommunity.com/about-awards/categories/


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3. Industry – Select the business category or segment(s) in which your company does business (select all that

apply).

__ Academic __ Instruments and Controls

__ Aerospace and Defense _X_ Life Sciences

__ Apparel and Textiles __ Machine Shop

__ Association __ Miscellaneous

__ Automation Products __ Packaging and Printing

__ Automotive OEM __ Petroleum, Gas, and Coal Products

__ Automotive Supplier __ Plastics and Rubber Products

__ Chemicals __ Primary Metals

__ Construction Materials __ Pulp and Paper

__ Consumer Packaged Goods: Cosmetics, Beauty, and Household Products

__ Railcars, Ships and Other Transportation

__ Consumer Packaged Goods: Food, Beverage, and Tobacco

__ Sporting Goods

__ Electrical Equipment and Appliances __ Stone, Clay, Glass and Concrete Products

__ Fabricated Metal Products __ Warehousing/Logistics

__ Furniture and Fixtures __ Wood

__ Heavy Industrial Equipment and Machinery _X_ Other (please specify): Pharmaceuticals

__ Hi-Tech/Electronics/Semiconductor


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Step 4: Project Information

1. Products Made: What does your company manufacture? What is the main line of products made?

The company manufactures, packages and distributes solid and liquid pharmaceutical products in the specialty generic marketplace. The pharmaceutical industry is very complex and highly regulated by multiple agencies. 2. Project Abstract. In 250 words or less, please provide the name of the project being nominated,

what was done, and benefits delivered by the project. Acme OpEx Project

➢ Created Vision and Mission Statements

o Vision (Inspire):

▪ The agile supplier of choice.

o Mission (Our purpose):

▪ Engage our employees in a culture focused on serving our customers through

sustainable delivery of high quality products.

➢ Developed site strategy utilizing Hoshin Kanri process to achieve vision and mission statements

through improvements in Key Performance Indicators (KPIs).

➢ Generated deployment plans that were managed by the Senior Leadership Team (SLT).

Activities not achieving set dates were assigned countermeasures.

➢ Developed leading and lagging metrics displayed on the site "huddle" board, with an escalation

process to be used where needed.

The site exceeded the targets in all areas of measurement - Safety, Quality, Service and Cost - for the period of December 2015 to September 2017.

➢ Safety near miss reporting ratio improved from five incidents to one hazard observed and corrected to one incident per six hazards observed and corrected.

➢ Right First Time (RFT) metric improved from 84% to 94%. ➢ Operational Equipment Efficiency (OEE) increased from 19% to 35%. The average overall

change-over times were reduced by 25%. ➢ Master Production Schedule Adherence (MPSA) improved from 64% to 95%. The Unit Fill Rate

(UFR) improved from 76% to 99% and remained at 99% for twelve consecutive months. ➢ These improvements resulted in a hard cost savings of $9 million.

In 2017, Acme was recognized by both customers and external professional organizations for the OpEx transformation. 3. Detailed Project Overview. What is the business/technology initiative/project you are nominating

for a Manufacturing Leadership Award? Please give a complete overview of the project/initiative. Please detail the project’s implementation, scope, and status.

The OpEx project was initiated to align site strategies with corporate goals and with other Acme sites. To become the agile supplier of choice, we developed a unified forward looking strategy (Hoshin Kanri) to better meet the needs of our customers and the patients they serve.


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An assessment was completed in comparing the 2015 current state to the future state. This created an awareness of areas for improvement in several processes. Our Corporate and Site Leadership Teams collaborated to understand the areas for improvement and reached consensus on a strategic direction for improvement. Safety, Quality, Service and Cost were established as specific areas of focus with identified KPIs and objectives. The next phase was to develop deployment plans to execute the strategy and achieve the goals. During our deployment plan discussions, it was noted in the area of Safety that it was imperative that our Near Miss Reporting ratio be improved. The goal was to improve safety awareness and build a stronger safety culture at the site and encourage our employees to report near miss events. In the area of Quality, RFT was identified as the major improvement opportunity to be addressed in the deployment plan. Improving RFT significantly reduces the number of human error related exceptions generated across the Site. Improving safety and quality optimizes production execution and improves customer service, reduces backorders and waste. This improvement is measured in shop floor OEE which is a key business driver metric at the site. Sustainability is managed through a site governance process, including daily SLT huddles and a fixed repeatable process to identify the results of the key business driver metrics, gaps and countermeasures to be implemented.

4. Initiative/Project Background – Describe the competitive trends in your industry and your company’s competitive position prior to the project. How did these conditions drive or impact your project? What was the rationale for the project, and what were its goals and objectives?

Acme’s Specialty Generics segment was facing significant headwinds in the market. The total market was declining while at the same time, pricing was favorable which invited competition. In a market where there may have been three suppliers, the competition quickly grew to double digits in some cases. Amidst the market pressure, the company’s continuity of supply needed improvement. Historically, there were persistent backorders, unit fill rate was 11 points below target, and inventory turns were in the middle of the pack when compared with a cross section of 19 competitors. Acme’s Specialty Generics supply chain is a vertically integrated design where plants supply plants, as well as 3rd party sales. Forecast variance and bias needed to be reduced, on-time delivery increased and agility improved to respond to market disruptions to remain competitive. To achieve our vision, Acme’s Hobart plant had to focus on strategy and improve in the areas of Safety, Quality, Service and Cost. The goal was to become the agile supplier of choice through:

• Increasing the Safety Near Miss Reporting Ratio

• Improving RFT

• Improving OEE

• Improving UFR

• Increasing agility and adherence to the supply plan


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5. Project Timeline – When was the project undertaken and completed? If this was a multi-phase project, please indicate phases still to be implemented.

2015: Recognizing the increased market constraints and dynamics, Acme determined a need for a focused strategy. 2016: Hoshin Kanri planning was deployed to align tactical plans with strategic objectives. This alignment of objectives allowed for rapid improvement in performance for different functional areas. A joint effort between operations and quality assurance to improve RFT had a direct impact on the plant’s MPSA performance. In November, an opportunity was presented to Acme to increase shipments by 29% for a product family. As a result of improvements, Acme demonstrated agility and was able to respond to market demands in December. 2017: The second year of Hoshin Kanri planning and execution evolved with continued opportunities to demonstrate agility. Acme was approached by a customer about increasing production on one particular item within the same product family. The team elected to utilize the safety stock and divert raw materials to the item requested, which allowed Acme to capitalize on an opportunity to boost revenue for the quarter by approximately 6% of budget. Throughout the year, several first time events occurred which included sustained 99% UFR for 12 straight months, achieving zero backorder for the first time in memory, and institutionalizing Hoshin Kanri planning as the way we work.

6. Achievements – What key business processes were improved with this project and how? How did this initiative allow your company to deliver and realize greater value? How did the project improve your company’s competitive position?

Through Hoshin Kanri Strategy Deployment, our project results delivered significant value to our site in measured areas - Safety, Quality, Service and Cost. The Safety Near Miss/Hazard Observations Metric (NMHO) was created to foster employee engagement and proactively identify Near Misses across multiple business processes. The data shows that NMHO have improved from less than 20 to greater than 80 per month based on the modified business process driving employee engagement. An increase in number of Hazard Observations reported and remediated directly impacts the opportunity to reduce future Environmental Health & Safety (EHS) incidents to occur. The business process improvement has resulted in a 12% decrease in EHS incidents at the site.


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Through enhanced employee engagement, EHS events participation improved from approximately 200 to 3,900. The positive Safety culture mindset protects our most important asset, our employees. It lays the foundation to capture the hearts and the minds of our employees across all cultural initiatives tied to Safety, Quality, Service and Cost.

The RFT metric improved from 84% to 94%.

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OEE increased from 19% to 35%. A large contributing factor was changing the shift schedule from a 5x8 24 hour operation to a 4x10 24 hour operation enabling flexible resource deployment. In addition, a key component of OEE is equipment changeover time which was modified significantly in 2017. This included the introduction of changeover standard work and the creation of a changeover board for each packaging line. After Action Review sheets were created and introduced to all production areas to track and review performance to standards. The flexibility of the 4x10 work schedule combined with the business process change reduced the average changeover process by 25%. The process has been sustained for multiple months post implementation. The site training program assessed the gap in the current skills base of each functional area and developed a 70/20/10 learning and development concept. This model will enable employees to be competent and capable to deliver to business needs. In addition, a Training Manager was hired to lead the training model.


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The improvements made throughout the entire supply chain have impacted in both profitability and customer service. The MAPE improvement increased profitability by approximately 2% in the fiscal year ending September 30, 2016, and resulted in exceeding the "World Class" benchmark by 0.5%. Backorders decreased over this period with the corresponding UFR increase.


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A new key business driver metric called MPSA was introduced to capture progress against schedule performance. The new metric identified the gap between the schedule and actual production output allowing countermeasures to be implemented real time. This metric was instrumental in improving UFR performance. Acme was able to improve MPSA by 37 percentage points from Dec. 2015 to Oct. 2017.

The improvements made throughout the entire supply chain impacted both profitability and customer service. UFR has improved by 23 percentage points from 2014 to 2017. Inventory turns also improved, as Acme improved quarterly average turns per year by 52% from 2014 to 2016, overtaking all competitors analyzed. Service is up and costs are down, a good story.

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Unit Fill Rate

Unit Fill Rate World Class


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As expected with an increase in UFR, backorders have also decreased over this period. Average daily backorder metrics for Q1 2017 represent a 92% reduction from Q4 2014 and a 97% reduction from the maximum single day backorder.

7. Return on Investment – What was the cost of the project in terms of financial and other resources?

What specific hard and soft benefits did your company realize from the project? Where possible, provide information on financial returns and metrics on specific process improvements. (Financial and all other details would be welcomed, and will be treated as confidential.)

The project was cost neutral utilizing existing resources to complete the Hoshin Kanri planning and execution process. Project results delivered significant value in all measured areas - Safety, Quality, Service and Cost. Many exceeded our targets. In the period between December 2015 and September 2017:

➢ Improved safety near miss reporting ratio from five incidents to one hazard observed and corrected to one incident per six hazards observed and corrected

➢ Improved RFT metric improved from 84% to 94% ➢ Improved OEE from 19% to 35%. The average overall change-over times reduced by 25% ➢ Improved MPSA from 64% to 95% ➢ Improved UFR from 76% to 99% and remained at 99% for twelve consecutive months ➢ Combined hard cost savings : $9 million

Additional benefits realized were:

➢ Improved employee engagement survey results from 59% to 63% o Statistically 61 employee engagement survey questions improved and none declined o The top categories improved by 10%

➢ Increased employee involvement and feeling of ownership


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➢ Increased opportunistic business as a result of improved agility and performance ➢ Received the 2016 Cardinal Health Supply Chain Excellence Award ➢ Received the 2017 APICS Award for Supply Chain Transformation ➢ Received the 2017 ASQ International Team Excellence Award ➢ Ranked consistently #1 Supplier for AmerisourceBergen out of 26 in the peer group

project nomination form acme...

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