Improving productivity to mitigate pricing pressures from emerging markets

The challenge

A leading global pharmaceutical company’s growth in demand from emerging markets for off-patent products had created the risk of reduced margins as a result of pricing pressures.

The client challenged us  to support the site leadership team to accelerate the delivery of productivity benefits that would mitigate the impact of these pricing challenges. 

How we helped

Our own experience, in our own company, has shown that a high level of employee engagement is the only way to sustain new ways of working.

Our consultants began by engaging production and warehouse staff to help them identify and then implement improvement opportunities. Working with the client’s internal change agents we started coaching them in Lean ways of working.

It was clear that long lead times and the over delivery of materials, together with poor communication between isolated departments, were all contributing to cost pressures.

Engaged staff ensured changes were embedded quickly

Our focus on creating high levels of staff engagement helped the breakdown of internal silos and allowed people to start to work together to identify non value adding elements. The outcome was a dramatic reduction in lead times. This optimised material movements in the warehouse and improved right first time delivery of material to the production line.

We worked closely with the client’s lead change agent to provide coaching throughout the transformation process. The levels of engagement created and the knowledge transferred ensured that the entire team had the commitment and capability to sustain and further develop the new Lean processes.

The results

By the end of the three months significant results had been achieved:

  • Materials delivery lead time was reduced from 36 hours to 4 hours
  • Service to manufacturing lines was improved, with the returns to warehouse from production reduced by 60%
  • As a result, operating costs reduced by £600,000 per annum allowing margins to be sustained within the new pricing regime