Continuous Improvement and the Role Purchasing Could Play
Continuous Improvement (CI) activities are well documented in a wide variety of industries, most notably the automotive industry with the Toyota Production System (TPS). CI is a tool and process that is used in many types of companies from a holistic company approach (preferred) to department or project activity applications, or manufacturing floor personnel seeking new opportunities to work smarter and not harder each day. The transportation industry, computer manufacturers, food industry, raw material manufacturers, defense industry and more all have opportunities to use this process for their customers and company’s benefit.
The Health Care Industry can also benefit greatly from continuous improvement activities and programs. It is not just for companies that sell and manufacture products in-house. End users, distribution companies, and contract manufacturers can also benefit with improved delivery times, reduced costs, and even quality improvements when the process is in full swing. By utilizing customer feedback through the purchasing group and then on to the supplier(s), valuable information for product and/or process improvement(s) can take place if collected and promptly acted upon.
Here is the opportunity for the purchasing team to work with their regulatory, marketing, and development teams to identify areas of opportunity to provide the best possible products for their customers. Also, realize if you choose not to, your competitors probably are utilizing CI already.
Another area that needs more attention from companies that I have observed is visiting as many suppliers each year as your company allows to better understand their needs, constraints, and areas of joint opportunities you both can share.
Maybe your quantities were what you always ordered, but the raw material coming to the supplier ends up in more waste to meet your current purchase order(s). Maybe you have a family product line at the supplier, but you order other sizes sporadically requiring additional setups which result in more cost being passed on to your company. Just by visiting the supplier, meeting your contact(s), and discussing what you would like to do versus what they can offer, and possibly meet your needs in one or more ways you didn’t even know about is priceless! Gemba walks (going to the source) for purchasing agents are a little further away than for in-house planners, but can be well worth the trip.
If your travel budget is almost lower than my tolerance for waste, then at least get on a shared internet meeting with real cameras and see some of the people involved with your purchase orders. Chat about each other’s needs and hope your supervisor will start fighting for travel allocations to save the company money in the long run.
Bottom line, purchasing agents who only process requests to buy items and aren’t allowed to be more active with their suppliers have little chance to lower costs and improve quality for your customers. By actively engaging your outside supplier like they were your in-house supplier, good to great things can happen with discussions, meeting each other’s needs, and providing quality products on time at a cost both companies can enjoy. Continuous improvement is not a destination, it is an ongoing journey.