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The 2080 Group
Contrasting Technical Issues Facing the Pharmaceutical Industry with
Changes in the Domestic Automotive Industry from 1980 to the Present
Lessons to be Learned and Techniques to be Adopted
Allan WilsonLi Peckan
The 2080 GroupJune 12, 2002
The 2080 Group WHY is this comparison important to the FDA and the Pharmaceutical
Industry?
The automotive industry has already gone through a transition in response to external forces
We perceive that the Pharmaceutical industry is currently experiencing analogous forces
There are significant “lessons learned” which could result in savings of time, effort and resources
It is important to look at different manufacturing industries as a source of innovation and learning
The 2080 Group A Number of Events / Trends Occurred in the Period Between 1975 and 1985 Which Were The Impetus For Change in the Automotive Industry:
Pricing Pressures: An Increase in Oil Prices and the OPEC Embargos
Domestic Quality Problems
Growing Foreign Competition
The 2080 Group
Average Annual Cost of Crude Oil: 1975 to 1985
0
5
10
15
20
25
30
35
40
1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985
Year
U.S
. Do
llars
per
Bar
rel (
un
adju
sted
)
Refiner Acquisition Cost of Imported CrudeOil
The 1979 OPEC Oil Embargo
Data Source: The U.S. Department of Energy Office of the Strategic Petroleum Reserve
Factor 1: OPEC Oil Embargo
The 2080 Group
A 1973 Plymouth Duster
Factor 2: Increasing Pressure Around Product Quality Issues
The 2080 Group
1964 Corvair source: corvaircorsa.com
Unsafe at Any Speed!
The 2080 Group
1982 Toyota Celica Source: classic-celica.com
Factor 3: Foreign Competition
Increased quality and reliability and competitive cost resulted in:
increased perceived value
The 2080 Group A Typical Automotive Assembly Plant: 1980 vs. Today
Attribute Circa 1980 TodayProduction Volume: Avg Vehicles / day 800 1500 - 2000Assembly Plant Size
ft2 2.5 million0.8 to 1.3
millionWorkforce Involved in Product Rework 800 50Product Warranty Things Gone Wrong per 100 vehicles 500 to 800 15 to 30Onsite Inventory 7 to 10 days 2 to 24 hoursIncoming Quality Problems: rejected subcomponents
low percentages low ppms
Typical Values
The 2080 GroupLessons Learned from the Automotive Industry:
It is important to:
Understand what your customer values what they need, want, and are willing to pay for
Be mindful of your competition what they are doing to gain competitive advantage
Develop a strong focus on product qualityThis has not been a moving target but a rising bar
The 2080 GroupLessons Learned from the Automotive Industry:
It is also important to:
Adopt a culture of continuous improvement continuous improvement in quality, cost and timing are essential to survival – the tools are necessary, but not sufficient to drive the shift in thinking that is required
Focus on the integration of effort between product design, engineering, operations and quality functions
Redefine “mass production” by insuring quality at the source vs. inspecting quality into the finished product
The 2080 Group Similar Trends That Are Arising in the Pharmaceutical Industry:
Pricing Pressures
Regulatory Pressures
Patent Protection Pressures
Foreign Factors
The 2080 Group Our Current Thinking Around the
Applicability of Automotive “Lessons Learned” to the PAT
Movement:Learning to Manage Volumes of Data
Measurement Systems are Critical
Developing an Understanding of the Process
Simplicity and Parsimony in all Things
The 2080 Group Our Current Thinking Around the
Applicability of Automotive “Lessons Learned” to the PAT
Movement: Learn from other manufacturing industries that have
made similar transformations as a way of accelerating your progress along the continuous improvement curve
PAT is a step in the product quality journey, but you must also consider the other elements of that journey such as:
An emphasis on process stability and capability Quality assurance at the source In-Process Error reduction strategies Workforce dynamics that can help or hinder your
change management initiatives
