Small changes deliver big-time for Pharmacia & Upjohn

Pharmacia & Upjohn's quick-changeover initiative (QCI) was one of several initiatives under the umbrella of a company-wide program referred to as Global Supply Vision. GSV began in 1994, shortly before the merger between Stockholm, Sweden-based Pharmacia AB and the Upjohn Co., Kalamazoo, MI. Essentially, GSV aims to meet and exceed customer expectations with high-quality products produced by fast, flexible and economic internal processes. "We enacted Global Supply Vision as the name of a plan to improve our overall packaging efficiency both here in Kalamazoo and at another packaging facility in Puerto Rico," explains Wayne Johnson, packaging project manager. "Reducing our costs also played a big role." By the end of last year, the company met its goals of reducing manufacturing costs by 20%, inventory by 30% and cost of nonconformance (products or packaging deemed unsuitable for sale) by 50%. Meanwhile, it improved delivery time by 40%. The improvements are all measured against 1993 figures. Johnson reports that total financial savings achieved by reaching these goals was in the $200 million neighborhood for the three-year period. One critical GSV strategy involves creating a self-directed work-team environment where all employees are empowered to participate with decision-making. The other key GSV elements were: (1) Creating a decentralized chain of command that enabled self-directed work teams to continually implement internal process improvements. (2) Developing a consistent strategy of planning and sourcing at a global level, operations planning at a regional level and scheduling/execution at the factory level. (3) Using a central network to maximize customer service globally and minimize internal costs. (4) Using information systems to support the process-focused, simplified supply chain. (5) Measuring performance with supply chain objectives, supported by work teams with accountability and clearly defined authority.