Baxter International Wins Team Excellence Award Competition
Wins Team Excellence
B axter International, Inc., is a directly translates into market
Beverly Smith, and global healthcare company share. As a result, Baxter North
Andrea Williamson that, through its subsidiaries, Cove has developed a strong history
assists healthcare professionals of continuous improvement and
and their patients with treatment operational excellence based on a
of complex medical conditions quality leadership process that
including hemophilia, immune focuses on customers and total
disorders, kidney disease, cancer, employee involvement (Figures 1
trauma, and other conditions. and 2).
Baxter maintains 67 manufacturing Through the strategic planning
facilities around the world, one of process, Baxter North Cove’s senior
which is the North Cove plant, leadership team chose to apply
located in the foothills of the Blue Lean methods to its key produc-
Ridge Mountains in Marion, NC. tion and administrative processes.
This plant was built in 1972 and is Through benchmarking and case
the largest manufacturing employer studies the senior leadership team
in western North Carolina. North realized that implementing Lean
Cove produces approximately 300 would successfully create tremen-
ﬁnished IV, peritoneal dialysis, and dous value for the organization
contract manufacturing codes and by reducing inventories, providing
is the world’s largest manufacturer more available ﬂoor space, and
of IV solutions in ﬂexible containers. improving product ﬂow through
This facility is challenged to remain the plant. Because these results
competitive in a commodities would best address the plant’s
market where product quality is strategic challenges, Lean was
expected and product pricing chosen as the operating strategy
32 THE JOURNAL FOR QUALITY & PARTICIPATION Summer 2005
Figure 1: Baxter North Cove Quality Leadership Process includes bag making, ﬁlling, sterilization, packaging,
and material transport between processes via product
carriers. This team was charged with identifying and
removing waste from this large-scale production process.
Evaluation Criteria One:
ty Leadersh Project Selection and Purpose
As stated earlier, North Cove’s senior leadership
team created a vision to build a Lean enterprise in order
to address plant ﬁnancial performance and capacity.
This project was selected to support this vision and
the plant’s strategic objectives. Pareto analysis of all
A Formal A Disciplined ﬁnished goods codes produced at North Cove indicated
Deployment Operating that one-liter saline IV solution represented a large
Structure Mechanism portion of both plant volume and value of production.
The senior leadership team recognized that waste
reduction within this process could have a signiﬁcant
within the quality leadership umbrella to drive the
impact on meeting strategic objectives.
next phase of continuous improvement. The plant
began its Lean journey by creating two product and Stakeholder Analysis
seven administrative value stream teams. These teams Potential stakeholders for this project included the
were charged with value stream mapping each process North Cove senior leadership team, internal suppliers
from start to ﬁnish. The mission for each team was to and support functions, employees, the Replenishment
identify and remove waste. Center, Baxter’s corporate supply chain, and the
All nine teams achieved signiﬁcant results. The team ultimate end users. Because Lean methods remove waste
that was recognized by ASQ as the International Team from a process, not people, production employees were
Excellence Gold Award winner was North Cove’s One- involved in project implementation, but not in project
Liter Saline IV Solution Value Stream Team. This team selection. Improvements made in the production
was selected to represent Baxter North Cove in this process must maintain current customer service levels
competition from a pool of outstanding value stream and maintain or improve product quality, therefore not
and process management teams active within the affecting the end users of this product. Senior leadership
facility. The One-Liter Saline IV Solution team consisted team members, representing all areas of production,
of cross-functional members from all affected stake- internal suppliers, and support functions were respon-
holder groups, including all areas of production, sible for selecting this project. The Replenishment
internal suppliers, the release department, engineering, Center, our external customer, also encouraged the
and the Replenishment Center (external customer). selection of this project because of potential efﬁciency
The production process for one-liter saline IV units improvements within its areas of responsibility.
Figure 2: Baxter North Cove Five Foundations of Quality
DEFINITION Meeting Requirements Quality is meeting requirements.
STANDARD Defect-Free Work Defect-free work meets requirements 100% of the time.
METHOD Prevention Prevention is the way we achieve defect-free work.
ORGANIZATION Total Employee Involvement Total employee involvement is essential to achieving quality.
ATTITUDE Ongoing Improvement Ongoing improvement keeps us ahead of our competitors.
Support of Organizational Goals for possible improvement. We analyzed these data
As part of the annual strategic planning process, to understand the potential effects on our strategic
the North Cove senior leadership team developed five objectives.
strategic objectives. After considering the impact of In addition, managers and key value stream team
this project on each objective, the team realized that members attended “Lean Boot Camp,” a highly inten-
the project would significantly impact three of the sive, off-site, one-week training course. A key element
of Lean Boot Camp was that current organizational
five strategic objectives, thus providing justification
leaders, not consultants, conducted all instruction.
for its launch.
Participants learned to identify and eliminate waste
using Lean techniques. Each attendee also studied the
book Lean Thinking by Jim Womack.
Stakeholder impact was determined by evaluating
the degree of job change for the internal stakeholders
Final Improvement Identiﬁcation
and impact to service levels for external stakeholders.
Of all the metrics identified, our team determined
• Managers and production employees would see
that improvements to cycle time, inventory, cost per
a high degree of impact as a result of significant
unit, and service level would have the greatest impact
reporting structure and job sequence changes.
on meeting the metrics associated with our strategic
• Internal suppliers and support areas would see more
objectives. We utilized the value stream map as the
consistent demand and therefore a medium degree
primary tool to illustrate these data and evaluate the
• The Replenishment Center and corporate supply
chain would see a signiﬁcant beneﬁt through Final Improvement Validation
decreased labor costs and reduced inventory. An ideal state process was then developed. Analysis
• One-liter saline IV solution is a critical code for of the ideal state indicated that by achieving best-case
our end users. Therefore, it was imperative that cycle time, in-process inventory and cost per unit
any changes made during project implementation would be reduced with no impact to service levels. As
could not disrupt current world-class service levels. a result, cycle time reduction was chosen as the final
Evaluation Criteria Two: The team borrowed the capability study from the Six
Current Situation Analysis Sigma toolbox to evaluate product release performance
We began by performing case studies and bench- in number of days. This study indicated that current
marking companies that had successfully implemented performance was equivalent to a 0.1 sigma quality
Lean. During benchmarking visits, we observed real-life level. In other words, batches were released within the
applications of Lean tools, which resulted in increased Replenishment Center’s requirement only 8% of the
available floor space and reduced inventory. Like time. This study revealed that there was signiﬁcant
these facilities, to understand our current situation room for improvement.
we chose to value stream map the one-liter saline IV
production process. A value stream is defined as all Evaluation Criteria Three:
actions, both value added and non-value added, Action Plan Development
required to bring a product from raw material to the The initial step in the improvement process was to
customer. The value stream map was the primary implement 6S. The 6S’s for North Cove are: safety, sort,
tool used to identify improvement opportunities straighten, shine, standardize, and sustain. 6S was the
and served as our blueprint for prioritizing Lean foundation for Lean implementation at North Cove
improvement activities. as it created the mental state of refreshment necessary
Brainstorming sessions were used to identify and to implement standard work and other Lean tools.
evaluate value stream data. Output, cycle time, cost The team then performed the value stream map
per unit, inventory, service level, batch size, production during a two-day focused improvement Kaizen event.
time, and distance between production areas are a Data such as cycle time, production triggers, and num-
few examples of process data that were considered ber of operators were documented on data collection
34 THE JOURNAL FOR QUALITY & PARTICIPATION Summer 2005
cards for each step in the production process. After
the initial mapping exercise, each step in the process
was further analyzed to generate ideas for removing
waste. These ideas were documented on “starbursts”
and added to the value stream map as potential
improvement opportunities. A few examples of
improvement opportunities include: use of kanbans,
cellular flow, pull systems, and production triggers
Validation of Action Plan
The team validated potential improvement
opportunities against stakeholder requirements. GOLD AWARD WINNERS: Capturing the coveted Gold Award for the
Improvement opportunities that did not remove waste International Team Excellence Competition does indeed take a team
from the process, improve release time, or reduce effort as demonstrated by members of Baxter Healthcare’s winning team.
product cost were not considered. Any solutions that Team members pictured are (front row, l to r) Chuck Nelson, Andrea
Williamson, Beverly Smith, Jennifer Buchanan, and Dennis McKinney.
might compromise end user service levels were also
(second row) Mark Smith, Mike Banner, Doris Smith, and Jeff Higginson.
disregarded. The team also used paper layouts to
(third row) Janet Clark, Gene Gordon, Donna Davis, and David Boone.
model proposed product flow through the value
(back row) Chris Gladwell, John Cone, Wyatt Younts, and Terry Foxx.
stream to ensure other production lines would not
be negatively impacted.
the facility; however, this investment in our people and
the potential for future savings through other Lean
Selection of Final Improvement Action
initiatives easily justified the training costs.
The ﬁnal improvement actions were selected based
on the potential to reduce waste, and as a result,
Evaluation Criteria Four: Project Buy-In,
improve release performance and overall cycle time.
Implementation, Progress, and Results
Improvement opportunities that met these criteria
Stakeholder buy-in was achieved as a result of
were evaluated according to feasibility, cost, time
communication, Lean training, and the potential of
to implement, and potential benefit. Based on this
the project to drive results tied to strategic objectives.
information, opportunities were ranked in a matrix
The team’s involvement of all affected stakeholders in
and then prioritized on a 6-, 12-, 18-, and 24-month
every aspect from project selection through implemen-
plan. The team used this priority list as a working
tation was key in achieving buy-in and preventing
plan to track the status of process improvements and
to measure its performance.
As implementation progressed, our team identiﬁed
“rocks in the stream.” Rocks in the stream are simply
Expected Beneﬁts and Justiﬁcation
obstacles that are disturbing the flow of product
Expected beneﬁts included a reduction of work-in-
through the value stream. As these rocks were identiﬁed,
process, cycle time, and required product carriers, as
responsible parties participated in team meetings to
well as increased inventory turns. The team realized
that these metrics tied directly to the plant’s strategic help resolve issues.
objectives and had the potential to drive bottom-line
Validation Buy-In Existed
plant ﬁnancials. We also expected intangible beneﬁts
We implemented these changes over a short period
like a significant reduction in non-value-added
of time and maintained day-to-day discipline to
activities, and therefore, more time for 6S and safety
manage our new Lean process. Soon after the initial
initiatives throughout the plant.
implementation, employees from other production
Opportunities identified during the Kaizen event
areas began inquiring about when Lean product flow
involved optimizing current resources and equipment
would be implemented in their areas. This proved to
and did not require capital expenditures. There was a
our team that we had buy-in from employees.
small cost associated with Lean training throughout
Figure 3: Spaghetti Diagram of Product Carrier Movements Reduced labor costs for Replenishment Center
• Reduced finished goods inventory by 9%.
These changes required no capital and have
increased available assets, decreased labor costs,
and improved cash flow. Most important, this was
accomplished without impacting one-liter production
or customer service levels. One of the project’s biggest
intangible results was improved employee morale. By
removing non-value-added tasks, we increased available
time for value-added activities, such as 6S and safety
programs. Employees now work to optimize the entire
Implementation product value stream, rather than internal department
Our initial change was to streamline product efficiencies. The success of the One-Liter Saline IV
through the plant by creating a product cell with Solution Value Stream Team has solidiﬁed Lean as the
dedicated equipment and ﬂoor space for the one-liter operating strategy to achieve continuous improvement
saline IV product value stream. This reduced non-value- and meet our strategic objectives. We have created a
added product movements (see Figure 3) and made passion for Lean enterprise improvements where all
control of product through the cell much more visual. team members have developed genuine “eyes for value”
Another significant change was to implement a and “eyes for waste.”
“pull system.” A pull system exists whenever there is
an explicit signal from the downstream operation to
produce. Kanbans were established between depart- Jennifer Buchanan is a quality manager at Baxter
ments to provide this visual production trigger. Healthcare, North Cove facility. She has held various
Batch processing was eliminated in order to smooth positions in quality management operations at North
process flow. Cove for more than five years. Buchanan earned a
bachelor’s degree in pharmaceutical sciences from
Campbell University School of Pharmacy. She can
The following results were measured to ensure
be contacted by e-mail at firstname.lastname@example.org.
expected cycle time reduction was achieved without
impacting customer service levels:
Beverly Smith is the supply chain manager at Baxter
• Release performance.
Healthcare, North Cove facility. She joined North
• Last hold for batches. Cove in 1997 as an analytical chemist in the quality
• Customer service levels. department and has held various positions in
• Total one-liter output. manufacturing operations for more than six years.
Smith earned her bachelor’s and master’s degrees in
Results Realized chemistry from Western Carolina University. She can be contacted
By implementing Lean techniques this team: by e-mail at email@example.com.
• Improved overall cycle time by more than 70%.
Andrea Williamson is a manufacturing manager at
• Reduced required product carriers by 25%.
Baxter Healthcare, North Cove facility. She has held
• Eliminated 2,400 wasteful product moves per day.
various positions in manufacturing operations at North
• Reduced work-in-process by 30%.
Cove for more than seven years. Williamson earned a
• Increased process WIP turns by 64%. bachelor’s degree in chemical engineering from Clemson
• Increased available ﬂoor space by 22,000 square feet. University. Williamson can be contacted by e-mail
• Eliminated two daily production schedules. at firstname.lastname@example.org.
36 THE JOURNAL FOR QUALITY & PARTICIPATION Summer 2005