Changing suppliers is never easy, being both costly and time-consuming. Nevertheless, when you're a small manufacturer, without the influence and purchasing power of larger companies, supply chain management is "hugely important," notes Jim Hilgendorf, buyer/planner of Cardiac Science, a manufacturer of advanced diagnostic and therapeutic cardiology devices and systems. Since the company found itself lacking in some of the key supply chain areas -- cost, quality, delivery and service -- the potential upside of improving its supply chain outweighed the challenges, he says.
One issue small to mid-sized original equipment manufacturers such as Cardiac Science can face is a lack of attention from large molders, Hilgendorf explains. "We sometimes represent too small of a piece of business for these suppliers, so the relationships aren't as robust as we need them to be. Many smaller OEMs gravitate toward like-sized suppliers for the closer relationships they offer." However, he points out, there often are tradeoffs in these situations, such as quality concerns and fewer value-added capabilities. "And in today's competitive climate, these tradeoffs are unacceptable."
Class III medical device OEMs such as Cardiac Science have strict process controls, documentation approvals, evaluations, testing, audits, engineering time and other quality procedures, he explains. When it came time to choose a new molding supplier, the Bothell, Wash.-based company issued a global request for quote (RFQ), and then narrowed down the choices to eight international and domestic candidates. As other U.S. manufacturers have learned in recent years, after factoring in the costs of global logistics, Cardiac concluded that "there was no clear advantage to working with an overseas plastic injection molder," Hilgendorf observes.
For Cardiac Science, a maker of electrocardiogram systems and other diagnostic devices, sacrificing quality to win pricing concessions from suppliers was an unacceptable option.
Ultimately, Cardiac Science opted to go with Dickten Masch Plastics (DMP), based in Nashotah, Wis., as its new full-service injection molding partner. The key to the decision, according to Hilgendorf, was DMP's commitment to being a fully involved partner in Cardiac's supply chain. "DMP's engineering team sat down with our product developers early in the design phase of a new product and identified several ways to improve our industrial design," he explains. "They worked with us to make a variety of part design, tooling and material adjustments that improved manufacturability, repeatability, durability, cosmetics and total costs."
DMP also eliminated steps from Cardiac Science's value stream through value-added secondary operations including speaker installation, heat staking, vibratory welding, pad printing and decorating, he notes. The supply chain relationship is further enhanced through vendor-managed inventory and electronic data interchange. End result, according to Hilgendorf: "We were able to consolidate from our previous domestic and overseas suppliers and gained a true partner in meeting our customers' evolving needs."