By Patricia Jacoby
Publication Editor and Writer
Frost & Sullivan
Frost & Sullivan recently caught up with John Daley, Vice President, Quality Assurance and Distribution and Supply Chain at Boston Scientific, one of the largest medical device companies in the world. Mr. Daley is a Medical Technologies 2015 Advisory Board Member and a past recipient of Frost & Sullivan’s Thought Leader of the Year Award.
We posed the following questions about supply chain challenges, innovation and quality assurance and received some insightful responses.
Frost & Sullivan: How well prepared do you believe your supply chain is to face the challenges of the future? What has Boston Scientific done with its supply chain to be more prepared?
John Daley: “We are very well prepared. In fact, we devote a lot of management time in planning for global scope and reach. Our global partners are an integral part of our planning. We make every effort to involve them, empower them and bring them into the conversation. In essence, we seek to make them true partners. “
Frost & Sullivan: As healthcare providers continue to face reimbursement declines, how important have cost reduction strategies in your supply chain been to your company’s ability to respond to your customers’ pricing pressure?
John Daley: “Very important. A key hedge against pricing pressures is to keep innovating, and to develop incremental value that people/customers can take part in.”
One specific example Mr. Daley noted referenced less developed markets. Sometimes, in these markets certain product features are of great importance while other product components are not attractive or sought after at all. Boston Science might, accordingly, offer a product with only the features a particular market desires. But never at the expense of quality.
Frost & Sullivan: What impact has the consolidation of U.S. hospitals and healthcare providers in recent years had on your supply chain for products you sell to those facilities?
John Daley: “The impact of all the consolidation has been pretty substantial. It has had numerous effects on us as on other organizations from small to large…but it has also forced us to up our game and get better at presenting one voice to customers.”
For instance, like most of the industry, we work hard to have one voice to work with the large buying groups. Now coordination is key, as many hospitals have consolidated. But it is more important than ever to understand what your customer wants and needs.”
One example Mr. Daley shared involved the complications that can arise when a huge hospital has someone negotiating on their behalf and that person is not aware of all of the hospital’s needs.
For example, if a hospital is used to AM deliveries and doctors expect that but negotiations are done for less expensive afternoon deliveries without the involvement of medical staff or other key stakeholders, than that can be problematic. As so often happens in large organizations (as so many hospitals have now become) key decisions are sometimes made without input from those they most affect.
Frost & Sullivan: What types of healthcare customers have the greatest needs for innovation in the supply chain for your products?
John Daley: “There is room for innovation everywhere! Innovations can be made in packaging, shipping, product features, and also in how customers use your product. One innovative feature that comes to mind combines innovation and technology. It’s called Radio Frequency Identification, or RFID. It involves placing a tiny little chip in all products. Then, when the product is taken off the shelf, or used, the system relays the date, cost, expiration date and other data to the supplier. The supplier might also learn that 1 operating room uses 10 of these devices in a short period of time…so the supplier can pack 10 per box, not one per box, saving greatly on shipping economies.”
Frost & Sullivan: When it comes to Quality Assurance, can you address how Boston Scientific changed their quality systems in response to past FDA warnings?
John Daley: “We moved to a steward model for quality. We took the opportunity, in 2007, to completely overhaul and revamp our quality system, and to benchmark data for Field Action Performance. We greatly improved our results both internally and with 3rd party audits and we reduced issues significantly. In fact, Boston Science is living proof that when you take quality seriously and apply it in your innovations, it really can be a “win-win” for your company…and your customers.”