Manufacturing Data Emphasize Initiative, Information

Washington, DC (Oct. 13)-In a four-year study of pharmaceutical manufacturing, two business scholars-Jeffrey Macher at Georgetown's McDonough School of Business and Jackson Nickerson at Washington University's John M. Olin School of Business-have found that information and initiative correlate with high productivity. The pair studied 42 manufacturing facilities owned by 19 manufacturers, including plants producing oral and topical formulations, injectables, and active pharmaceutical ingredients. They then correlated management practices with productivity measures, including cycle times, yields, failed batches, and deviation-management outcomes.

The 462-page Pharmaceutical Manufacturing Research Project-Final Benchmarking Report (available online at http://www.olin.wustl.edu/faculty/nickerson/results/) found that:

• Organizations actively using information technology to monitor quality-with automatic electronic deviation reports, tracking deviations by lot and type, and following staff through the resolution process-“universally” enjoy “superior manufacturing performance metrics.”

• Organizations that give “decision rights” for resolving deviations to the staff closest to the problem perform better than those that manage problems remotely.

• Contract manufacturers “generally, although not in all instances,” show “inferior performance metrics.”

• Facilities that use process analytical technology (PAT) tools “generally, although not in all instances,” demonstrate worse performance metrics.

Macher and Nickerson stress that the correlation “does not imply causation.” For example, manufacturers often install PAT approaches as they try to fix problem processes, so that manufacturing shortcomings “cause” PAT, rather than vice-versa. And the study, which began in 2002, covers a fairly early period in the evolution of PAT. Further, correlation between using PAT tools and batch failure among finished-dose manufacturers was low, with a coefficient of +0.07. The coefficient of correlation between failed batches and contract manufacturing was also low,  +0.04 among finished-dose manufacturers and -0.05 for API manufacturers.

Basically, says Macher, the results show that “manufacturing is a problem-solving exercise,” and that “how firms prioritize the problems they face within the organization matters.”