How Terumo Medical Got Back on Top
A world class medical device manufacturer suddenly has far too many projects, a serious backlog, a slow review process, and few good options to help fix things. Realization’s toolkit of best practices and the company’s SMART Project Delivery software helped tame the workload, prepare each project, and resolve problems as they arose.
Twenty-thousand people strong, Terumo Corporation is a global medical device manufacturer focused on cardiac and vascular surgery, hospital products, and home health care. The Cardiovascular Group in Ann Arbor, Michigan services the company’s precisely calibrated machines that are in use around the world. They manufacture parts, develop new technology, and interact with the FDA.
Terumo reached out to Realization to help them resolve a huge backlog of work. They were struggling to respond to FDA requests and to meet demand from corporate headquarters. Terumo didn’t have the resources to staff the number of projects they had underway. Still, managers pushed projects into an execution phase on a hope and a prayer that the system would somehow rise to the occasion.
Overtaxing the system
It didn’t. Overloading resources had the opposite effect. It created confusion about priorities and led to too many half-finished projects and too few projects fully delivered. Lead times increased. Throughput decreased. Predictability was poor. There were so many projects in progress it wasn’t always clear what the various teams were working on.
As a best practices first step, Terumo created an inventory of projects and assessed total workload against current capacity. Working together, Terumo and Realization teams working onsite ran a simulation using SMART Project Delivery. It revealed the optimal number of projects that could be taken on at one time. (What was the maximum throughput and the minimal cycle times?) The number turned out to be about half the current levels. Management then prioritized a series of projects, and the team reduced the number of active projects by nearly 50%. Several projects were put on temporary holds. Resources were routed back to remaining projects to help push them forward. As in-progress projects finished, on-hold projects were started up again. Newly aggressive timelines were now possible without the constant starting and stopping that came from overtaxing the system. Project cycle times were significantly reduced, and the backlog became more manageable. It took just eight months.
“We were able to achieve record execution times on some key critical projects using principles introduced by the Realization team: collaborative work, focus and finish, and reducing our work-in-progress (WIP).” ~Jessica McCumons, PMO Manager
Maintaining workload levels
SMART Project Delivery also helped Terumo maintain their workload levels. As new work came in, the system revealed when those projects could be started and finished. If the project was urgent, they could quickly run what-if scenarios. Which existing projects could we move down the list? Where could we add resources? Resource managers could now make rational decisions on how to proceed: Deliver more capacity for busy periods or stagger out the due dates?
Another problem the company faced was too many projects with too little preparation. Scope wasn’t always clear. Key parts were sometimes late. Project feasibility was often a question. Projects got stuck, time and work was wasted. Following another SMART Project best practice, Terumo developed a triage process. Best practice stipulates that prior to launch, all relevant teams review scope and other detailed steps. First, is the project viable? Second, determine the size and type of project so that the pipeline process could yield better staggering. The SMART Delivery System enabled that kind of preparation through its full kitting capability. Teams established specific tasks and a process to monitor total preparation of projects before launch.
What once took weeks, now took days
Management and engineering review cycles were also too long. What should have been a one-day review process would take weeks. The teams began a SMART System best practice. They set specific time slots aside each week, sometimes twice per week, to conduct reviews. The SMART Delivery System helped prioritize projects for key approval reviews. This focused the constraining expert capacity. What once took weeks, now took just a few days.
Another stubborn problem—even routine issues took too long to resolve. Frontline managers and technical experts were spread thin across a high number of projects. But less work-in-progress did not automatically translate into a rapid resolution environment. Another SMART System best practice was introduced. Ad hoc status and resolution meetings were replaced with a weekly focused process. Early warning signals from the SMART System showed which issues needed the most attention. Since the data was live, focused thirty to forty-five-minute meetings could identify and assign actions to take to get stuck projects moving again.
SMART project planning
Hovering above everything was project planning. The Terumo team knew that project plans were essential for systematic project management. What they may have felt instinctively, but didn’t know with certainty, was that the planning process took too much time and effort. Plans were too complicated. They were always changing as new problems came up. And they couldn’t keep them current.
“Reduced WIP (work-in-progress) has led to clearer priorities and an ability to achieve newly aggressive timelines.” ~Jessica McCumons, PMO Manager
The SMART project model changed all that. Projects could now be organized into two tiers—a planning tier that had few tasks and rarely changed. And an execution tier that could be changed on the fly. This radically simplified the plans and the planning process. Templates could now be created for new projects as a recurring starting point. SMART Project Delivery made it even easier by providing templates at both tiers.
Terumo now has a live system that not only helps them deliver more projects faster, but also keeps management fully in control.