Hans Willems, Boston Scientific: “We’ve now evolved into a solutions provider”
A Boston Scientific medical device is used somewhere in the world every two seconds, but the company is much more than a medical device manufacturer. Supply chain has played a crucial role in its evolution into a provider of solutions for hospitals. The firm’s lean engineers and supply chain engineers help hospitals not only with inventory management and logistics but also with process improvements in catheterisation labs, for example. A decade of internal costsaving measures at Boston Scientific has led to creative, state-of-the-art solutions such as a genetic algorithm that calculates the optimum packaging size to minimise the amount of empty space being shipped.
By Caroline Linssen
In the late 1970s, Boston Scientific’s initial success was built on guide catheters and balloon catheters for coronary artery treatments. The associated operation techniques were less invasive and hence considerably shortened a patient’s stay in hospital. Today, Boston Scientific is still focused on what, internally, is affectionately referred to as ‘the plumbing’, but the company now also supplies equipment for ‘the electrics’ such as pacemakers and defibrillators. Its most recent advancements include pain-management devices based on neuromodulation in the brain and spinal cord, aortic valve implants and 3D heart scans to detect problems.
Hans Willems, Vice President Supply Chain Europe Boston Scientific: ‘We’ve now evolved into a solutions provider’
Europe accounts for 21 percent of Boston Scientific’s total revenue. The facility in Kerkrade ships 3,600 orders a day. Based on an average of seven products per order that amounts to over nine million medical devices per year which are used to treat millions of patients. Hans Willems is responsible for the European supply chain team of 450 employees in 14 countries, including a leadership team of ten managers and directors.
How does Boston Scientific set itself apart from its competitors?
“With a broad product portfolio which enables us to support all departments within a hospital and hence offer a ‘total partnership’. Within Europe there are significant differences between how hospitals are organised, but they all have to reduce costs because healthcare is under pressure everywhere. The value we add lies in the high quality of our products. For example, the battery in our defibrillators lasts twice as long, which can halve the treatment costs per patient. And we go a step beyond products alone; over recent years, we’ve evolved from a medical device provider into a solutions provider.
Often, the healthcare sector still uses old-fashioned technology, especially abroad. A lot of the orders we receive are still sent using old fax machines, plastered with all kinds of scribbles and labels.
In our facility in India, 80 people try to decipher them. If they don’t succeed, they call our customer service team who in turn contact the hospital. We sometimes joke that we could better give them a new fax machine! But seriously, we try to help optimise the process at all levels. One example is the optimisation of the activities in a hospital’s catheterisation lab because they are a source of inefficiency in many countries.
Our lean and supply chain engineers work with the customer to analyse the process flows. They then make recommendations for improvements throughout the entire supply chain, so including in the hospital itself, such as shortening lead times and administrative routes. Sometimes our engineers come across situations in which it takes up to a week before a product makes its way from goods received to the department in question. There are also gains to be made by reducing consignment stock. We don’t invoice our customers until they actually use the devices and they can return obsolete products to us, so we keep a close eye on the expiry date and help them with logistics.”
Was there also an internal reason to change direction?
“From 2005 onwards, when we became part of the global manufacturing organisation, the Senior Vice President Operations demanded a 5 percent net saving year on year. With a lot of effort we succeeded, but there comes a point when there’s nothing more to shave off internally so you then have to go in search of value outside the chain. Soon after joining Boston Scientific 18 years ago, I accompanied a sales colleague on customer visit. I’d gathered information about that hospital and thought about what could be improved.
… Read more …