An Interview With Kay Phillips, President, ATEK Medical Manufacturing
Engineers are often halfway through the design process before they know how
much a device is going to cost to manufacture. This month’s “View From The
Top” interview reveals how to avoid such pitfalls, which slow the product development
process.
Kay Phillips: “One of our biggest challenges is how to make the improvements
we need to make in a highly structured industry.”
By Lisa Arrigo, Editorial Director
When Kay Phillips considers the future of medical device design and manufacture,
she sees the need for speed. Phillips is the president of ATEK Medical Manufacturing,
a contract manufacturer headquartered in Grand Rapids, MI, specializing in the
manufacture and assembly of mechanical and electrical surgical devices and medical
equipment. She predicts robust growth in the medical device sector in the next
three to five years—growth that will demand shorter new product development
cycles.
“Design engineers must move through the new product process more quickly, and not just the product development stage but the whole new product process, from idea generation to getting the product to market,” she says. “Those who react quickly will be successful.”
How can design engineers speed up the process? Phillips believes they must deepen their understanding of the whole development cycle. “For example, make sure the design can be manufactured well and at the target cost.”
This may seem obvious, but Phillips says design engineers are often 50 or 60 percent through the design process before they figure out how much a product or part will cost to manufacture. “And then they say, ‘We’ve got to go back.’ They’re into costs and packaging issues too far down the road.”
Phillips acknowledges that these problems are understandable given the pressures on design engineers these days, but she maintains they aren’t good business. “Design engineers are busy working on their designs and aren’t always thinking sufficiently about materials or manufacturing,” she explains. “And, it’s not easy bringing additional people into the process because there is a time frame to meet. But it’s important to get the necessary expertise into the process early, to effectively integrate the manufacturing, sterilization, packaging, and key component knowledge—bring it all together up front. Engineers are great at designing, but they must bring the other elements into the process. If they can do that, then they can hit a homerun.”
Phillips, who became president of ATEK Medical Manufacturing at its launch two years ago, has spent 25 years in manufacturing—eight in medical manufacturing. She was vice president of Praxair’s Healthcare Division before joining The ATEK Companies in 2001. ATEK Medical Manufacturing is part of The ATEK Companies. It was formed with the acquisition of selected assets from Medtronic’s Cardiac Surgery Division. The ATEK Companies, which provides design engineering and product launch support, supply chain management, packaging, sterilization management, and distribution services, has facilities in Brainerd and Plymouth, MN, and is considered to be one of the largest woman-owned manufacturing companies. Its facilities have been involved in the research, development, and production of medical devices since 1979, and its employees have experience in lean production techniques and design for manufacturability as well as process validation, fixture development, and microbiological support.
Phillips, who has a passion for lean manufacturing, has applied lean concepts to manufacturing and administrative processes to identify waste, improve quality, and reduce cycle times and costs. When she talks about the advantages of lean production techniques, her words pour out quickly and her explanations are peppered with real-world examples. “Each project is unique. We modify our common process for each customer and we map out everything in great detail. It’s a very interactive process with the customer. It’s easy to talk about but very difficult to do. A recent customer gave us a compliment that was also a little bit of a complaint. They said, ‘You guys were driving us harder than our internal guys were.’ And we were.” She laughs. “It’s true that the devil is in the details.”
Modifying a process to perfect it also means mistakes can happen, but Phillips views such mistakes as learning tools. She recalled one example in which a change in the assembly and packaging of a disposable device solved one problem but created another. Initially, some products were reaching final QA without a required cap in the box. A change was made to fix the cap to the product in the clean room. However, it was later determined that this simple change could possibly cause the cap to crack. By further examining the assembly and packaging procedures, both problems were solved effectively. “You can learn from changes. Sometimes there’s a real issue you have to work through, and sometimes it’s a perception of what you can do or can’t do.”
Following are answers from Phillips that address frequently asked questions regarding
ATEK Medical Manufacturing, lean manufacturing, and surgical device development.
Q: Your company specializes in the manufacture and assembly of cardiac surgical devices. What are the special requirements of this product technology?
A: Operating lean and speed to market are crucial. We produce over 1,400 product codes and more than 4.5 million finished products each year. Many of these products have unique applications and each surgical team has its specific needs. This business is very competitive and requires intense ongoing support for current products and high-quality new product introduction.
Q: Lean manufacturing reduces inventory lead time, improves quality, and reduces
shipping costs. What’s one example of how you use lean manufacturing principals
in medical device production to significantly influence the bottom line while
maintaining quality?
A: One of the most exciting projects involves packaging, labeling, and final QA processes. We are transitioning from a centralized packing operation to packing online in each of our seven clean rooms located throughout the plant. With over 1,400 product codes, this is a large undertaking. We are about 70 percent complete, and when finished, we will have dramatically improved quality, reduced cycle time, and reduced costs.
Q: What major trends are influencing the medical device manufacturing market?
A: First, medical OEMs are focusing on their core competencies and viewing outsourcing as a critical element of their long-term strategy. Second, the continued growth in the industry is challenging many OEMs’ ability to manufacture internally. Third, medical device companies are stepping up new product development and seeking ways to get their products to market more quickly. And finally, consolidation within the industry is accelerating.
Q: Which trend has the most impact on cardiac surgical devices?
A: For our customers, the focus on core competencies and speed.
Q: What are the biggest challenges facing design engineers working on medical
devices?
A: The cycle time and numerous steps involved to implement change are challenging. With lean implementation, our teams see many areas of improvement and we need to continue to find ways to streamline the approval processes internally and with our customers. Also, technology is changing quickly and we must continually add to our knowledge and capabilities.
Q: How has the role of the contract manufacturer changed in the last five years?
A: Greatly. There has been a significant transition from component manufacturer to overall manufacturing partner. There is a much greater emphasis on new product support, including design. We are taking a much greater role in supply chain management. The focus on cost and cost reduction is growing so we must be very cost-effective and continually drive wastes and costs out of the entire process.
Q: What are the biggest challenges facing contract manufacturers?
A: One of our biggest challenges is how to make the improvements we need to make in a highly structured industry. We need to find new ways to improve quality while moving with greater speed. Planning in some instances is a challenge due to the lack of visibility to the end market.
Q: How can the OEM benefit from working with a contract manufacturer, including
cost reduction?
A: If the OEM picks the right manufacturing partner, it will be able to focus on its core competencies and drive revenue and profits, reduce capital requirements for manufacturing (usually millions of dollars), improve product launches, and reduce costs by 5 to 10 percent.
Q: What key accomplishment has been made by your company?
A: The successful formation of ATEK Medical Manufacturing. The transaction was one of the largest in the medical industry and quite challenging due to the plant producing over 1,400 finished goods and providing new product support for two separate divisions. There were some skeptics regarding the entire outsourcing project and whether we were the right partner. Fortunately, the transition went very well and both parties are achieving their goals. For us, the first year was focused on a smooth transition and now we are in the process of building a world-class medical device manufacturing company. ATEK Medical Manufacturing, 2600 Niagara Ln. N., Minneapolis, MN 55447.
