Embedding a Culture of Continuous Improvement & Lean Manufacturing Across Pfizer Global Manufacturing

Pharmaceuticals came to the continuous improvement table later than some other manufacturing-centric industries, but noteworthy results achieved in the relatively short time since have influenced the industry's approach to manufacturing and allied business processes. Operational excellence and Six Sigma programs were rolling out across the pharmaceutical industry by the late 1990s, but only in the last five to six years have similar initiatives and programs, collectively referenced as continuous improvement, achieved critical mass and industry imperative status.

Gerry Migliaccio

The pharmaceutical industry was built, and has prospered, on a "hurry up and test" manufacturing model that valued quality but failed to optimize the processes by which quality was achieved. Today's global pharmaceutical industry is the product of rapid and dramatic changes, and continues to evolve in response to market and other shifts. For the long-staid, risk-averse, and change-resistant pharmaceutical industry, embracing the concept of continuous improvement meant radically rethinking the same old approaches.

Albert Einstein wasn't referring to implementing a culture of continuous improvement across an organization as large as Pfizer Global Manufacturing (PGM) when he said, "problems cannot be solved at the same level of awareness that created them," yet this often referenced quote captures the overriding shift in thinking that success in such an endeavor demands.

Historically, quality was the gauge by which pharmaceutical manufacturing processes were measured. For example, PGM had plenty of checks and balances for ensuring quality, but checks and balances alone were not enough to ensure that our manufacturing processes were optimally robust. As a result, we were spending too much time and resources solving problems and not enough time on improvement activities and proactively resolving issues.

A scientific approach designed to foster systemic, ongoing, and value-added change, Pfizer's continuous improvement path began in 2003. Initially focused on understanding and improving the manufacturing processes that directly affected our products, Pfizer's continuous improvement program (incorporating Six Sigma, Lean, and Agile tools, among others) is now being expanded across PGM and into the other divisions and enabling functions of Pfizer.

At Pfizer, all continuous improvement activities are built on five key pillars.

Pfizer's Principles of Continuous Improvement

1. Continuous improvement is a journey of relentlessly seeking perfection.

2. Everything is a process; continuous improvement is not simply limited to manufacturing.

3. Improvement is not judged internally, but by our customers.

4. You must measure performance (cost, quality, speed) to improve the process.

5. Those closest to the work know the issues and opportunities best; get the right tools in the hands of the right people.

What follows is an exploration of how these principles were applied to develop and implement "Right First Time" and Lean initiatives across PGM to instill a culture of innovation and continuous improvement.

THE "RIGHT FIRST TIME" STRATEGY

The "Right First Time" (RFT) strategy, like subsequent Lean initiatives, is a core component of PGM's strategies for ensuring supply and continuing to meet customers' needs. The goal of RFT is to reduce the variation in processes and make them stable and capable of being further optimized. The output of a process cannot be predicted unless the process is understood, and only when a process is understood can risk mitigating or minimizing strategies be devised and optimization achieved. Process understanding, in turn, enables value stream mapping (VSM), a method (incorporated into Pfizer's Lean training) for evaluating the effectiveness of processes (and their effect in a larger system) in a value-added framework.

Pfizer's continuous improvement program is now being expanded across PGM and into other divisions and enabling functions of Pfizer.

To implement RFT across PGM, the perception that it was just another corporate initiative had to be overcome. Getting the right tools in the hands of the right people was essential, as was convincing PGM colleagues of the benefits of using those tools. At opposite ends of the colleague reaction spectrum, small groups of early adopters and skeptics book-ended the silent majority of PGM colleagues in the middle.

Focused on winning that silent majority's confidence and buy-in, the roll-out strategy was three-fold: connect the RFT concept and mission to those of PGM and of Pfizer; demonstrate the active buy-in and support of PGM executive and site-level leadership; and, focus on the core processes of manufacturing, documentation, and laboratory testing.

IMPLEMENTING RFT AT SITE-LEVEL

RFT gives all PGM colleagues, not just a handful of first-line supervisors and operators, tools for boosting process understanding, and developing and implementing strategies for optimizing process capability. Appointing a credible RFT champion at site-level (to date, more than 40 RFT champions have been appointed across PGM's global site network) has proved enormously successful, as did encouraging managers to motivate and inspire operators and other colleagues to use their brains as well as their hands.

As RFT rolled out, all PGM colleagues were given basic Six Sigma knowledge through method 1, or yellow belt, training. Selected candidates with clearly defined projects subsequently received method 2, or green belt, and method 3, or black belt, training. The coaching provided to colleagues during these projects was critically important to success. Because process improvement is impossible without process measurement, new process capability metrics were introduced. As the rollout continued, we continually monitored progress and made adjustments as needed to optimize buy-in and support.

Supported by Six Sigma-based (yellow, green, and black belt) training, colleagues were empowered to present managers with their ideas for improving processes. Site management recognized and applauded the success of colleague-devised RFT strategies, and, as more colleagues took notice, the impact rippled across sites and plants. RFT represented a real and significant departure from the old way of doing things, and this awareness combined with early successes to fuel colleague buy-in and support.

THE NEXT STEP: APPLYING LEAN ACROSS PGM

Currently, some 5% of PGM colleagues have received green belt training, and approximately 1% of Pfizer colleagues have received black belt training. Applying RFT principles and Six Sigma techniques, PGM colleagues are completing more than one project per day (in a calendar year, more than 365 projects will be completed). It is also worth noting that 23,000 PGM colleagues have received one-day yellow belt training and, with these enhanced problem-solving skills, are on a monthly basis resolving thousands of issues across PGM.

Yellow belt techniques are routinely applied to standard root cause analysis (RCA) for quality, and environmental health and safety (EH&S) investigations, and PGM colleagues use these skills to improve many other business processes.

As the RFT roll out continued, the results of our optimization efforts drove variability from our core processes, which had previously recorded levels of variability that ranged from 2–3 Sigma, whereas today, they consistently deliver a level of performance between 4 and 5 Sigma. As a result, we are experiencing significantly more consistent process output and fewer recurring problems. Our costs were decreasing while the speed and reliability of our processes were increasing.

As its name implies, continuous improvement is organic and continuously evolving, and PGM's journey had just begun. As a result of RFT, our processes were capable, but were they efficient?

LEAN 101: USING THE METHODS

The lessons learned by rolling out RFT were applied to the next phase of continuous improvement by leaning out PGM's manufacturing and manufacturing support functions to achieve optimal process capability and efficiency. The primary lesson of RFT is: If processes cannot be predicted, efficiency cannot be optimized. If Lean is the ultimate goal, colleagues must first accept, understand, support, and use RFT principles before initiating Lean.

In the Six Sigma continuum, efficiency follows capability, and the distinction is critical. Pfizer's approach to Lean has two-steps: apply RFT to achieve process capability, and then apply Lean to achieve process efficiency. This philosophy influenced PGM's decision to stagger the implementation of RFT and Lean by approximately 18 months, giving colleagues the necessary time to adjust to, accept, and incorporate RFT principles before tackling Lean. As with RFT, leadership buy-in and support at the site level was the central driving factor behind the successful introduction, adaptation, and ongoing, daily-level implementation of Lean principles across PGM.

Unless RFT and Lean are very closely linked, opportunities for identifying and minimizing or mitigating systemic organizational challenges optimization can be lost. Process efficiency can be optimized by closely linking the application of Lean principles to the areas for improvement previously identified through RFT. The close linkage of RFT and Lean has yielded significant results across PGM.

Across Pfizer, the application of Lean Principles builds on the foundation of capable processes that result from the activities of RFT. As a result, PGM is seeing enhanced performance in terms of efficiency, cycle time, and reduced inventory. This approach has now been applied to an expanding list of key product supply chains. Improvements of more than 50% have been seen in the lead-time for product supply.

Pfizer designed its Lean Toolbox to enable improved efficiency and better management of complexity. Applied to manufacturing and manufacturing support processes, Lean is focused on eliminating non-value-added activity (waste). Visually depicting the current and future process, value stream mapping, (VSM), is used to identify the opportunities.

Additional tools and tactics that are used to advance Lean goals include standard work plans, spaghetti diagrams, cell design, and pull principles (in which product is produced to service the immediate needs of customer orders, rather than the traditional approach of pushing supply of product to meet long-term forecasts). Lean tools and principles combine to establish a firm foundation for continuous process improvement. The dramatic reduction in Lipitor end-to-end (raw material to main market) lead-time that follows is just one of many examples.

STREAMLINING THE PROCESS: THE VALUE STREAM TEAM

Pfizer's Lipitor Value Stream Team, composed of manufacturing, logistic, and support colleagues working to move Lipitor from raw material at Pfizer's Little Island, Ireland facility to packs of tablets in distribution centers all over the world, first met in April 2007 to take on the challenge of reducing end-to-end lead-time by 75%. VSM gives a highly detailed big picture view of what is occurring at every stage of the process and a baseline for measuring the impact of subsequent process changes. The team's first goal was to reduce lead time by 30% by year's end; they achieved this milestone in December 2007.

By mapping the value stream of those processes by which Lipitor evolves from raw material to packaged tablet, the team was able to identify the specific points at which bottlenecks, redundancies, down time, and other non-value–added problems impeded process effectiveness and undermined process capability. Bottlenecks could be found anywhere in the value stream, and were associated with poor process capability or unreliable equipment.Pfizer's Lipitor team used this insight to design process improvement strategies and to evaluate their implementation.

The team worked in conjunction with colleagues across several Pfizer sites to achieve another milestone by the end of 2008: trimming end-to-end Lipitor lead-time by 60%. Now, progress must continue on projects and initiatives currently underway at various Pfizer locations, including Little Island and Loughbeg (both in Ireland); Freiburg, Germany; and Vega Baja, Puerto Rico.

MOVING FORWARD: A CULTURE OF CONTINUOUS IMPROVEMENT

PGM is using RFT and Lean principles and tools organization-wide, across our manufacturing sites and global supply chains, to trim lead-times, optimize inventory, and reduce costs. The impact extends beyond manufacturing processes to improve performance in areas including marketing, product launch, sourcing of raw material and packaging supplies, and managing product complexity.

PGM began its continuous improvement program in 2003. We have since developed internal training competencies, including an internal certification program, to enable in house training and coaching, and support colleague recognition. Colleagues at every level are actively engaged in continuous improvement, for a positive impact on colleague engagement and business performance overall.

To date, Pfizer has delivered Six Sigma training to more than 23,000 PGM colleagues, and has completed thousands of projects across the division. Combined, these continuous improvement activities have delivered impressive results; PGM has reduced costs (by 5–20%) and inventory/lead-time (by 20–40%), and steered clear of capital expenditures. Overcoming capacity restraints at one of our European sites, for example, meant spending an estimated $2–3 million on new equipment. By improving the efficiency of our operation we were able to create additional capacity and avoid spending the capital.

Earlier this year, when our continuous improvement program was rolled out across the Pfizer organization, an immediate challenge was overcoming confusion about Pfizer's definition of, and approach to, continuous improvement. Subsequently, we developed the five Pfizer principles of continuous improvement. These five pillars clarify Pfizer's continuous improvement approach and support Pfizer's goal of tying continuous improvement to leadership improvement.

SUMMARY

The support of site-level leadership was the single most significant factor behind PGM's successful implementation and adaptation of RFT and Lean. By fostering innovative thinking and problem-solving autonomy, Pfizer's continuous improvement program fosters leadership at every organizational level; as its principles remind us, everything is a process on the journey toward improvement, including leadership.

Gerry Migliaccio is vice president, Quality, EHS & Agility, and John Scott is vice president, Operational Excellence, both at Pfizer Global Manufacturing, Peapack, NJ, 908.901.7233, gerry.migliaccio@pfizer.com