Sustaining Operational Excellence Improvements
A conversation with Wendy A. Kouba, Vice President, Operations Management, Wyeth
Last week, Pfizer, the world's largest biopharmaceutical company, officially completed its merger with Wyeth, which produces some of the world's top-selling medicines, including Enbrel for rheumatoid arthritis and Prevnar, a vaccine against pneumococcal disease. Wyeth's manufacturing organization, known as Technical Operations & Product Supply (TO&PS), has been producing more than 4,800 SKUs manufactured by about 18,000 employees at 28 plants in 13 countries. For several years, TO&PS realized productivity improvements using traditional operational excellence methods, including Six Sigma and Lean manufacturing. Almost two years ago, however, Wyeth faced a powerful threat. Wendy Kouba, vice president of operations management, recently explained to BioPharm International how Wyeth overcame the challenge using a holistic approach to operational excellence that has transformed its global manufacturing network.
On the global manufacturing side, we realized that we had to make dramatic changes to deliver our portion of that savings and we wouldn't get there via a traditional, incremental approach to cost savings. We needed to transform the way we thought and behaved across our site network.
Q: So what did you do?
Q: Why 25 percent?
Q: So how did you do it?
What we have found critical in MI is the notion of how—and where—leaders spend their time. (Figure 2). This is about lean leadership. It's our version of Gemba, or "where the truth lies," and it's all about getting leaders out of their offices and focused on supporting and engaging people on the floor.
The third element, mindsets and behaviors, is driving a continuous improvement culture by doing two things: building the capability of the organization through a just-in-time approach to learning, and coupling that learning with engaging the hearts and minds of everyone in the plant.
Very simply, with this holistic model, we are blending deep technical change with cultural change—and then enabling our site leaders to run with the tools and approach to drive breakthrough improvements locally.
Q: How is that different from traditional operational excellence initiatives?
Q: How did you get your leaders to change?
We also conducted qualitative research, including focus groups and personal interviews with cross-sections of site employees. Then we compiled all the data and took site leaders through a structured process of reading, absorbing, and discussing the information the diagnostic reveals. This can be a painful process, but it is effective. After the site leaders completed the diagnostic process, they worked as a team to develop a transformation roadmap for their site, which included comprehensive training for leaders at all levels, starting at the top of the house with the site leadership team.
As part of this, we have made a tremendous investment in learning and building the organization's capability. In fact, we have developed more than 40 training modules for site leaders, front-line leaders and those who are participating in mini-transformations.
Q: That's impressive, but how do you turn information from the diagnostic into real cost reductions?
For example, at our vaccines plant in Pearl River, New York, we conducted a Mini-T in the fill-finish area (Figure 3). In just 12 weeks, the Pearl River team decreased change-over time from 14 hours to 8 hours, and they are still improving today. As a result, they increased capacity by 78 percent with a 12 percent reduction in headcount per shift, and went from completing 6 or 7 fills per week to an average of 8 or 9 fills per week. All of that equates to a dollar savings of about $23 million.
Q: How did they do it?
Q: How does that kind of motivation translate to your other plants?
In fact, we are even seeing a new, healthy competition develop among our sites. It's almost like sibling rivalry. They absolutely understand that the future of their sites depends on their ability to transform and be cost-effective. The mindset of leaders and front line employees has changed dramatically. Supervisors now are expected to "get out and Gemba"—to go out and find where the truth lies. One recently said in a focus group, "I now ask much more than I direct." Another supervisor said, "We used to focus solely on not making mistakes; now we focus on where and how we can improve."
Q: That sounds great. How can you sustain that level of engagement?
In fact, in his book Execution, Larry Bossidy wrote, "The culture of a company is the behavior of its leaders. Leaders get the behavior they exhibit and tolerate. You change the culture of a company by changing the behavior of its leaders." At Wyeth, our leaders have changed their mindsets and behaviors, and we are already seeing the benefits.
Q: How do you know you're right?