Few could argue that Vicki McKee hasn’t earned her stripes when it comes to finding creative ways to handle supply chain disruptions and ensure components and other items needed for finished medical products continue to flow. After all, the MedTech industry expert has found herself in the thick of things during a global contagion (COVID-19, 2020), natural disaster (Hurricane Maria, 2017), and radiation catastrophe (Fukushima Daiichi Nuclear Power Plant, 2011).
“I had staff in Japan during the Fukushima meltdown, and in the aftermath there was quite a lot of supply chain interruption that we needed to overcome with secondary vendor sources,” said McKee, a former QualityHub principal consultant. “When Fukushima happened, it was an all-hands-on-deck situation when it came to the global supply chain and making sure there was no pause in the manufacture of products,” said McKee, who was senior director of quality, regulatory, and clinical affairs at the time for a Japanese maker of reagents and other medical products. The manufacturer sourced reagent-grade salt in Japan for its reagents but had to stop after the nuclear incident.
That’s when the company’s Chicago manufacturing facility stepped in and began sourcing reagent-grade sodium chloride from Morton Salt, also located in the Windy City. It was the ability to quickly switch to a second source supplier for the salt that ensured the reagents would continue to be made without interruption – a supply chain success story born from a nuclear nightmare.
And when Hurricane Maria struck the Caribbean, McKee was VP of quality for a healthcare company whose sole-source facility high on a storm-ravaged Puerto Rican mountain made it difficult to ensure that finished product continued to make its way to patients and caregivers.
“How do you restart an industry that’s devastated? It’s nonstop work,” McKee said. “We rented a gas station for all our employees at the bottom of the mountain so they’d have access to gasoline. We brought in cash, and we began paying employees in cash daily so they could use cash at the gas station. We asked our cafeteria manager to make meals for employees to purchase at a reduced cost to bring home to their families every evening.
“We were able to fill our distribution areas again and get production restarted, and eventually began paying employees using our usual payroll system,” she added. “But restarting manufacturing after the storm by using cash and making sure there was gas and food available for employees – those were the types of vital things that were put in place that really helped get product moving.”
Returning to manufacturing quickly and being empathetic partners with employees when it came to basic items like money, food, and gas was lifesaving for many.
And what more can be said of the COVID pandemic that stressed and broke many a supply chain?
Compared to today, “I’ve seen the supply chain in a worse condition during COVID – before the vaccines came out during COVID – when we were all not employed and huddling at the house and there was nothing was being manufactured. Supply chains were broken all over the place and that’s probably the worst I’ve seen it,” McKee said.
“But there’s a lot of uncertainty in the supply chain right now and I believe that as an industry we may be moving from more of a global supply chain to a national supply chain,” she noted. “In my career, over 33 years, I’ve never seen this kind of movement come back inside the United States. So, I do believe the supply chain is in flux. And I think any time you’re changing supply chains and you’re in flux, then there’s a variability that needs to be monitored and controlled for risk.”
During a recent interview with QualityHub, McKee offered manufacturers four tips for making sure their company can weather any type of supply chain troubles.
1. Identify Secondary Suppliers Before A Crisis Strikes
Like McKee’s experience during the Fukushima disaster, having a secondary vendor where you can get components or other items needed to make finished product can make all the difference.
“There’s a lot of whiplash right now with tariffs and not knowing which countries are stable and will continue to be stable in the future. I would simply recommend that you make sure that whichever supplier your company goes with is stable and that you don’t use sole-source vendors unless that is your only option,” McKee said.
She went on: “In the end, it’s about understanding the stability of your suppliers. Is it a mom-and-pop shop? Is it a mom-and-pop shop that has facilities in multiple areas so if something happened at one facility, you could move to another? It’s also about understanding the long-term strategy for your critical components. And not every component is the same. While a screw is a screw, other components like microprocessors or solid-state chemistry for a laboratory, those are critical suppliers, and you need to take a risk-based approach and make sure you have a strong supply chain foundation for those.”
McKee noted that manufacturers that use a third-party consultancy like QualityHub to “review their critical suppliers and come back with a risk-based approach for moving forward for a product line is money well spent.”
2. Make Sure Suppliers Can Meet Projected Growth
“When you launch a product, you want to make sure the suppliers you’re taking with you can meet your growth targets and go beyond,” McKee said. “And what’s your relationship like with those suppliers? If there’s a natural or manmade disaster that unfolds, can those suppliers double their output? Can they triple it? Is it a matter of cash flow for them to do that, or are they too small and just wouldn’t be able to keep up with you?”
When dealing with vendors that could fall short, a company would be wise to find a secondary source, as long as the quality of the parts from the two different suppliers is the same.
“It’s also about looking at things like operational capacity. Do they have the space if they’re running one line for your company five days a week and do they have the space to go 24/7, if necessary, on that one line? Can they double their output on that one line? And is there space at the supplier to be able to negotiate a second output line if you need it?” McKee said. “These are all important questions a manufacturer should ask.”
3. Keep A Sharp Eye Out For Quality Issues
MedTech companies can also find themselves in hot water if they don’t adequately maintain and ensure the quality of supply chains.
“Let’s consider punch molds that need to be sterilized down the road. If a supplier doesn’t do maintenance routinely on those molds, you’re going to end up with hanging chads or some other issue that is going to cause a quality concern,” McKee said. “It’s important for you to review the operational efficiencies of your supplied parts and determine what works when you receive them so you can gather quality data” to trend over time.
4. Be Careful When Switching From OUS Vendors To US Ones
A medical device manufacturer that chooses to switch from a supplier located outside the US to one that does business in the country – or vice versa – should exercise caution.
“From a quality perspective, making sure that things are consistent, that all the critical quality attributes are the same at either facility is going to be critical,” McKee said.
“And when it comes to some of the older devices and parts on the market, you might not have modern data to suggest that everything is equivalent,” she added. “So, running extra protocols or verifications or validations between the two facilities to ensure that the supplied product has the same quality attributes and the same quality levels is going to be essential for resiliency as we make product in today’s world.”