Continuous Improvement Sets Stage for Success

MEDRAD sees growth in 2011, due in part to its CI efforts.

Winning a Baldrige Award once is quite an achievement. Winning twice is rare. Add to that winning IW Best Plants in 2007, and MEDRAD has quite a track record in producing successful continuous improvement programs.

"We rely on our Operational Excellence program to drive productivity to help reduce costs as well as maintain our cost profile," explains Jeff Owoc, MEDRAD's senior vice president of Operations. The company, which manufactures high tech medical devices for computed tomography, magnetic resonance, and cardiovascular applications, won its first Baldrige in 2003 and its second in 2010.

MEDRAD, a business of Bayer HealthCare, has experienced double-digit growth over the past fifteen years but saw a slowdown in the past three years. "Current economic conditions have put pressure both on pricing and costs. One of the things we are doing is working with our key suppliers on cost improvement programs," explains Owoc.

The company will train their suppliers on the fundamental aspects of their CI program. They will also send out engineers and production personnel to suppliers' locations and have hosted suppliers at their factories.

However, global economic pressure combined with health care reform and a slowdown in procedures has had its affect on the company. For the first time in 15 years, the company had to conduct a layoff.

But 2011 is looking more positive with the company predicting growth.

"A bright spot for us will be the considerable growth in emerging markets, such as China and Brazil as medical technology is increasing in those countries," says Owoc.

In its core radiology market the company is expecting flat to modest growth. In the interventional business -- cardiovascular, diagnosis and treatment -- the company is predicting solid growth. And expectations are for the service business to grow with rest of the business.

One reason for this rosy picture is that the company was able to maintain its investment in new product development during the rough times. Part of the reason that funds were made available for R&D was due to the success of their CI efforts.

"We will stay focused on cost and containing cost, and we will continue to invest in innovative new product and new product offerings. That is our core strategy," says Owoc.

"We fight with our products but we win with our people," Owoc contends.

See Also -- Other 2011 Predictions

IR's Mike Lamach: Building on a Strong Hand

Lean Won't Work in 2011

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