MTS Blog: Innovate, Achieve, Lead
In a new book, entitled Quirky: The Remarkable Story of the Traits, Foibles, and Genius of Breakthrough Innovators Who Changed the World, author Melissa Schilling explores the lives of serial breakthrough innovators like Benjamin Franklin, Nikola Tesla, Elon Musk, and Steve Jobs. What do they have in common? They are obsessive, have an unrelenting drive for achievement, possess exceptional working memory, are idealists, and demonstrate a good dose of hubris.
No doubt leaders in the medical device industry have many of the same traits when it comes to business strategy and the development of life-saving or life-enhancing medical devices. Medical device innovations come from independent thought, creative problem solving, and an openness to new ideas. But, while medical device leaders apply this innovative thinking to revolutionary products, they are complacent, inward facing, and myopic about managing inventory.
Instead of embracing a Forward Stocking Location (FSL) model for storing, replenishing, and distributing inventory, many medical device companies rely on antiquated, homegrown systems that barely scratch the surface of what is possible with the help of an expert partner and sophisticated software. Think of FSL as the breakthrough method for managing inventory. But, buyer beware. There is a new cast of distribution companies who are catching wind of the opportunity to provide pieces of FSL but are not willing or are unable to provide FSL from start to finish.
Some companies offer to take over the management and distribution of inventory but plan to use the medical device company’s existing software. Not a good idea. The whole value proposition of FSL is the ability to leverage resources in order to increase sales productivity, gain operational efficiencies, save costs, and scale, baby, scale.
What to Look for in a FSL Partner
Medical device leaders are in need of two outcomes: First, they want to unburden sales professionals and give them the time and resources needed to sell more. Second, they want surgical kits to arrive at the right place at the right time. The ideal FSL partner will provide solutions to both challenges.
A humming FSL will take over the arduous task of managing inventory and sales reps will no longer spend on average up to 10 hours per week tracking down and delivering surgical kits and products. Instead, inventory will be housed in a central location where it will be inspected, stocked, and distributed with “white glove” delivery service right to the point of care. More time is saved with software that enables case scheduling and advanced inventory tracking, ordering, and replenishment through a robust combination of a mobile app and a web-based platform. The goal is to free up sales reps to spend more time selling and to reduce turnover by offering them a better quality of life.
Putting inventory management in the hands of experts also improves quality control all along the supply chain. With a network of warehouses and advanced technology, the FSL model with an experienced partner increases accountability while improving reliability and eliminating the fear of missing a surgery. A strong FSL partner develops strict standards, implements through consistent practices, and ultimately handles the labor-intensive processes of inventory management seamlessly for manufacturers, sales reps, and hospitals alike.
“Solve Before You Scale” or “Your Mess for Less”
Medical device companies are brilliant at developing and marketing innovative devices. They are not renowned for their inventory management practices, which often involve DIY software programs, whiteboards, spreadsheets, and hidden stashes of products. Moving to a FSL model is the smart move, but not if antiquated systems and procedures come as part of the package. The best FSL partners “solve before they scale.” That is, they build an infrastructure and technology stack that allows the sharing of assets, and they develop and adopt optimized lean operations processes from the outset so that every medical device company can count on flawless service.
The right FSL partner, the one that enhances growth prospects both in sales and operations, does not offer a “your mess for less” approach. In fact, promising the FSL model without standardizing processes and procedures is like air traffic control without a centralized system. Imagine if each airline decided to use their own software to track their planes. Now imagine several planes from different airlines converge on an airport at the same time. Chaos would ensue because no one could see across all the airlines and direct the planes effectively.
What really makes the FSL model remarkable is that the nasty business of change management, moving from that outdated method of managing inventory to something state-of-the-art, is accomplished by the FSL partner. By doing the heavy lifting of solving before they scale, the FSL vendor makes the change once and allows its many customers to benefit from such change. And, once a medical device company joins forces with a FSL partner that has solved before it scales, the real rewards of expertise and leveraged resources can be realized. This collaboration between the FSL partner and their medical device company customers delivers the ability to scale on both sides. Standardization enables the FSL to scale its business, and streamlined operations allows medical device companies to scale without the typical growing pains associated with expanding warehousing and distribution functions.
The right FSL partner optimizes operations before scaling their business so that they can provide an airtight foundation that makes it possible for medical device companies to scale and bring more breakthrough innovations to market. Steve Jobs said, "Innovation distinguishes between a leader and a follower." Now is the time for medical device companies to lead by doing what they do best.
* James Surowiecki. "The Quirky Secrets of the World's Greatest Innovators." Strategy and Business. April 9, 2018. Web. July 2018. Click here to read the full article.