The Utilization of Quality KPIs in the Pharmaceutical Industry

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<ul><li><p>CASE REPORT</p><p>The Utilization of Quality KPIs in the Pharmaceutical Industry</p><p>Marianne Torkko &amp; Nina Katajavuori &amp; Anu Linna &amp;Anne Mari Juppo</p><p># Springer Science+Business Media New York 2014</p><p>AbstractPurpose The overall aim of this study was to investigate thesignificance of quality key performance indicators (KPIs) andhow comprehensively they are used in the pharmaceuticalindustry. A specific aim was to find which KPIs were relevantto personnel from the perspective of their own work respon-sibilities. A further aim was to determine which factors moti-vate personnel enough to respond to improve KPIs.Methods Qualitative theme interviews of ten staff from onecase company were conducted to study the impact of KPIs.Interview data were analyzed using qualitative content analy-sis and reductive analysis.Results Personnel considered deviations in manufacturingand packaging to be the most important quality KPI whenthey considered their own work responsibilities. The qualityindicators data were utilized quite efficiently, for example, incomplaint and deviation handling processes, and they provid-ed useful information for corrective and preventive actions(CAPA)-reporting. The most important factors that motivatedsupervisors, managers, and experts regarding KPIs were those</p><p>that affected interviewees own particular work responsibili-ties, the cooperation within the operators own departments,and the cooperation between different departments. The inter-viewees opined that the production bonus was the most im-portant motivational factor for production operators to im-prove upon quality indicator performance.Conclusions Quality indicator feedback data were utilizedwidely by the case company and were considered to be auseful tool to guide personnel in ensuring or potentially im-proving the quality of operations.</p><p>Keywords Quality KPI . Quality indicator . Pharmaceuticalindustry . Lean practices</p><p>AbbreviationsKPI Key performance indicatorOPEX Operational excellenceTQM Total quality managementRFT Right first timeCAPA Corrective and preventive action</p><p>Introduction</p><p>Price pressure and stiff competition are driving the pharma-ceutical industry towards greater efficiencies, higher quality,and continuous improvement. It is crucial to do things rightthe first time (RFT)without a time delay and without incurringextra costs caused by losses and rejected batches. ICH guide-line Q10 highlights the importance of continuous improve-ment and urges the pharmaceutical industry towards everhigher quality standards [1]. Product quality and processperformance systems have to provide the tools for the mea-surement and analysis of quality and production parameters.The system should also include feedback from internal and</p><p>M. Torkko :A. M. JuppoDivision of Industrial Pharmacy, Faculty of Pharmacy, University ofHelsinki, P.O. Box 56, Viikinkaari 5E, Helsinki 00014, Finland</p><p>A. M. Juppoe-mail:</p><p>M. Torkko (*)Orion Corporation, Tengstrminkatu 8, P.O. Box 425, 20101 Turku,Finlande-mail:</p><p>N. KatajavuoriFaculty of Pharmacy, University of Helsinki, P.O. Box 56,Viikinkaari 9, Helsinki 00014, Finlande-mail:</p><p>A. LinnaOrion Corporation, Orionintie 1, P.O. Box 65, 02101 Espoo, Finland</p><p>J Pharm InnovDOI 10.1007/s12247-014-9184-3</p></li><li><p>external sources such as complaints, reports of deviations, andaudit findings.</p><p>The pharmaceutical industry can be considered as a specialcase because it is under strict regulatory control. However, themethods used in developing a supply chain in othermanufacturing industries, such as lean practices, have alsobeen implemented in the GMP environment [24]. The prin-ciples of lean practices involve the identification of value forthe customer, elimination of all types of waste, and the gener-ation of flow [5]. Any activity in the manufacturing processthat does not add value for the customer is considered a waste[6]. Lean practice also relies upon the continuous improve-ment principle.</p><p>Friedli et al. [7] investigated the implementation of OPEX(operational excellence) as a target state for lean manufactur-ing in the pharmaceutical industry. They also investigated theassociation of OPEX with key performance indicators (KPIs).OPEX includes four subsystems: total quality management(TQM), total productive maintenance, just-in-time, and effec-tive management system. Their study was based on a surveyof pharmaceutical production sites in 2004 and 2009. Theyfound that the pharmaceutical companies were able to im-prove the TQM significantly. The KPIs that most affectedTQM were complaint rate (customer), rejected batches, andthe complaint rate (supplier). The data from these KPIs werefound to be better in 2009 than in 2004 except for a slightincrease in the number of supplier complaints. Their studyshowed that pharmaceutical companies took steps towardsimproving OPEX over the 5-year period. However, there isstill a lot of work to do in this area in the pharmaceuticalindustry.</p><p>Companies must have the tools with which tomeasure theirperformance and quality dimensions. Bourne et al. [8] inves-tigated the major factors that impact upon the success orfailure of performance measurement systems. Those authorscarried out research on ten manufacturing companies. Theystudied the samemanagement process in all ten companies, sothat any differences between process-related factors theremight have been were excluded from their study. Semi-structured interviews with directors and managers of the com-panies were given. Their study found that the commitment ofthe top management and the perceived benefits from theperformance measurements were the two main factors thatdrove the implementation of performance measures. In anoth-er study, Antony and Banuelas [9] investigated the criticalsuccess factors that affect the implementation of quality im-provement initiatives by investigating the initiation of sixSigma projects in different companies. They found that thecommitment and involvement of the management were themost important factors in successfully attaining the implemen-tation of the quality improvement initiatives. Other criticalsuccess factors were the following: the understanding of thetools and techniques used for the initiatives, the linking of</p><p>quality initiatives with business strategies, linking of cus-tomers and suppliers, quality project selection, reviews andtracking, organizational infrastructure, cultural change in thecompany, quality project management skills, training, and thelinking of quality initiatives to human resources.</p><p>There is still a lot of work to do towards attaining higherquality and continuous improvement in the pharmaceuticalindustry. It is necessary, therefore, to have the appropriatetools to measure the quality of operations. It is also importantto know what the personnel think about ensuring and improv-ing quality and what they think about quality indicators interms of their value for the production process, because this isthe only way to influence attitudes and improve the quality ofoperations.</p><p>Torkko et al. used an e-mail survey to investigate the usageof quality KPIs in pharmaceutical and food companies inFinland [10]. The results of that survey showed that the qualityKPIs of the pharmaceutical and the food industries were quitesimilar to each other. However, the food industry was slightlymore advanced than the pharmaceutical industry in the utili-zation of the results of quality KPIs. The overall aim of thisinterview-based study was to investigate the utilization ofquality KPIs in depth in one case company. It is important toknow what those personnel, who are actively engaged inproduction, think about quality in general and quality indica-tors in particular. As far as we are aware, this type ofinterview-based study about the utilization of quality KPIs inthe pharmaceutical industry has not been previously pub-lished. The specific aim of this study was to investigate whichquality KPIs were considered essential to personnel in relationto their own work responsibilities. A second specific aim wasto investigate how comprehensively quality indicators wereused by personnel in this company. A third aim was to find outwhat factors motivate personnel enough for them to respondto and improve quality in response to KPI data reports.</p><p>Our hypothesis was that internal signals are more importantto personnel than external signals. In Fig. 1, quality indicatorsare arranged according to the internal and external signals, andaccording to their relative seriousness to the production pro-cess. The Number of Deviations and also RFT, keyperformance indicators are in the same group, because theyboth measure the same thing but in different ways.</p><p>Methods</p><p>One company was chosen for this study instead of multiplesof companies, in order to get a deeper understanding about theopinions of personnel within a single organization. Studyingthe data of only one company also excludes the between-company variation from studying two or more companies.The case company is a medium-sized pharmaceutical manu-facturer, which manufacture its own products and also carries</p><p>J Pharm Innov</p></li><li><p>out contract manufacturing. The company employs about2,800 staff and it has three manufacturing plants in Finland.This company was selected because the latest quality KPIswere implemented just before this study commenced and itwas a good opportunity to get important information about theutilization of quality KPIs from their inception. There were sixquality KPIs in use by the company during this study. Thesequality KPIs and their definitions are presented in Table 1.Some of these quality KPIs were implemented in 2008, but themost recent (number of complaints, number of observa-tions in audits and inspections, and the number of recalls)were implemented in August 2012. After implementing all ofthese quality indicators, the KPIs were presented to the rele-vant staff in various training sessions and meetings during theautumn of 2012. The background of these quality KPIs usedby this case company was known to the first author, and theperformance data of these quality KPIs weremade available tothe author for research purposes.</p><p>This study used a theme interview, which consisted ofseveral open-ended questions. The interview was chosen toobtain a deeper understanding of the attitudes and opinions ofthe personnel. An understanding of such opinions is seen asthe only way to influence the attitudes of involved staff andimprove the quality of the production operation. The open-ended questions provided the personnel with the opportunityto express their opinions about these quality KPIs and theimportance/relevance of these to their own particular workspecialties. The open-ended questions also provided the inter-viewees with the opportunity to describe their perceptions intheir own words. More questions were asked as and whenneeded for clarification purposes. The interview was designedto cover three themes: the operators knowledge of the qualityKPIs, the importance of the KPIs from the perspective of theinterviewees own work responsibilities including the utiliza-tion of quality KPIs data for improving the quality, and whichfactors motivated the personnel enough for them to respond tothe feedback data of the KPIs.</p><p>The contents of this interview were selected and arrangedbased on the literature. The coauthors then reviewed this draftof the interview and modified it according to the targets of theresearch. The modified interview was then piloted by oneexpert to check its suitability for the interviewees. There wereno subsequent changes made to the questions of the pilotinterview, which was adopted and used in this study.</p><p>The interview was given in September 2012. Intervieweeswere chosen from different departments of the company:production (n=6), quality assurance (n=3), and the technicaldepartment (n=1). Theywere also chosen from different stratawithin the organization, namely: operators, supervisors, andmanagers to get the widest variety of opinions of the companypersonnel. The number of interviewees was suitable, becausethe same themes were repeated in the interviews and a satu-ration point was achieved [11].</p><p>Recalls</p><p>Complaints</p><p>Observations in audits and inspections</p><p>Loss</p><p>Deviations: RFT, number of deviations</p><p>Seriousness and costs</p><p>External signal</p><p>Internal signal</p><p>Fig. 1 Hypothesis: Importanceof quality KPIs to personnelaccording to internal and externalsignals</p><p>Table 1 Case companys quality KPIs</p><p>KPI Definition</p><p>Loss Loss incurred during manufacturing orpackaging process (%)</p><p>Deviations Number of deviations related to themanufacturing or packaging batch</p><p>Right first time (RFT) Manufacturing or packaging batcheswithout any deviations</p><p>Complaints Number of complaints/million packages</p><p>Observations made in auditsand in inspections</p><p>Number of observations/audit or inspectionday is presented as a rolling mean of12 months</p><p>Recalls The number of recalls is presented as arolling sum of the latest 12 months</p><p>J Pharm Innov</p></li><li><p>All the interviews were recorded on tape which was sub-sequently fully transcribed by the first author. Interviewslasted from 15 to 55 min. The transcribed texts of the inter-view varied in length from 5 to 13 pages. Each interview textwas first carefully read through, and the answers to the spe-cific study questions were ascertained. The data were groupedinto similar themes and ideas according to the qualitativecontent analysis method [12]. Different categories and subcat-egories were constructed. The interview responses werechecked again, and then the categories were combined andregrouped during the analytical phase of this study. Finally,the classification was checked by the coauthor, and the differ-ences between both researchers were discussed to achieve aconsensus. Furthermore, reductive analysis was used in ana-lyzing what the interviewees said about the case companysquality KPIs.</p><p>Results and Discussion</p><p>Three themes that arose from the interviews were knowledgeof the quality KPIs, utilization of quality KPIs, and the moti-vation of personnel that would be required to improve theoutcomes of quality KPIs. Each theme was further dividedinto subcategories. Some typical but informative quotationsfrom interviewees are presented in the results section to sup-port the analyzes of the results. Some numerical data are alsopresented to give a general description of interview materialanalyzed. The appropriateness of selected quality KPIs wasalso analyzed.</p><p>Knowledge of Quality KPIs</p><p>Interviewees had different opinions about quality in generaland about the specific quality indicators. The knowledge ofquality indicators was classified into three categories based onthe opinions expressed in the interview: the importance of thequality indicators was well understood and internalized (class1), the importance of quality indicators was somewhatunderstood (class 2), and the importance of quality indica-tors was not understood at the time of the interview (class 3).This classific...</p></li></ul>