American Medical Case Study
“When we began working with e-BI, we quickly learned how much we didn't know about manufacturing this product. e-BI engineers, both USA and China-based, communicated very well. We felt like we were part of their processes and this gave us a feeling of integration within their organization. “
— Bob Ranieri, Vice President of Sales, American Medical Systems
(Please note that due to the competitive nature of this product line, the actual product and company names have been substituted)
American Medical Systems, Inc. is a privately held company of approximately 200 employees that manufactures medical de-vices. The company offers physical medicine and rehabilitation products, nuclear medicine supplies and accessories, and medi-cal imaging tables and accessories.
American sought an organization with proven capability in prod-uct design and manufacture to support a new, lead-lined con-tainer for transporting nuclear medicines. American believed that bringing this new product to market could, in addition to facilitating American’ own transport needs, potentially open a new market in medical transport packaging in which American would have competitive edge.
American Medical System: Nuclear Medicine
A secondary, but growing segment is the related test equipment as dose calibrators and wipe test counters. The majority of sales are the con-sumed products within this industry, which includes items such as chro-matography test kits and tests for quality control of radiochemical and radiopharmaceutical products. The American facility manufacturers these test kits under strict quality guidelines.
Developing and marketing a new, lead-lined container for transporting nuclear medicines presented American with an opportunity for a new strategic direction. The specific product requirement was the design and production of two components:
- A canister that would hold nuclear elements, such as radioactive syringes
- A medical grade bag that could hold the canisters for easy trans-port.
Development of these products would enable American to establish and supply products to serve an emerging, rapidly growing market, which in turn would help the company remain competitive and profitable. Ameri-can estimated that sales of the canister and the bag could, a few years, represent over 12% of sales, and generate an additional $4 or 5 million in new annual revenue. To actualize the opportunity, American needed to strategic partners able to help them achieve their mission.
American realized that bringing the new products to market depended on finding an organization that could not only handle both product de-sign and manufacturing, but could also meet their stringent quality stan-dards. “Our reputation rests on our promise to bring functional and ele-gant design to products that are exceptionally functional, durable and user-friendly,” said Bob Ranieri, Vice President of Sales at American. “American customer satisfaction drives every American decision, and American in turn seeks partners that are dedicated to our satisfaction.”
Solution American researched the field of outsourced service and manufacture providers, and selectively narrowed the field of contenders. e-BI emerged as the company with superior capabilities, said Ranieri, based on four key factors:
- E-BI’s Global Supply Chain Management (GSCM) system American had never made a product outside of the United States, there-fore, it was important to align with a company that could hand-hold them during the manufacturing and quality control process. e-BI's 14 dimension tracking and logistics GSCM system provided American with insight into every step of the manufacturing process with transparency “that goes far beyond an email, phone call or visit,” Ranieri said. “e-BI has spent years developing this system and it gave us the confidence that e-BI is a state-of-the-art vendor. It exceeded our expectations to have capability, at any time of the day, to get on the web, log on, and quickly find out any details about our RFQ, order, and detail about who is doing what and when. With the GSCM we experienced that it does not make any difference if e-BI makes our product in China or next door, as long as we have the ability to tap into the e-BI's system. I know of no other potential partners or vendors that offer such capabil-ity.”
- E-BI’s Design Center. Utilizing e-BI’s design center eliminated the need for third part services. This reduced the communication prob-lems and increased the effectiveness of our processes. In a very short time American had a new design seamlessly moving into manufacturing.
- eBI Support during the RFQ process. American was able to discuss every step with the open communication and detail needed to establish 'comfort' with eBI as their pri-mary supplier. “Obviously, we wanted someone who was price competitive,” Ranieri said, “but not at the expense of quality or service. Our ability to discourse during the RFQ process helped us make a selection we could strongly justify and stand behind.”
- Open communication. Initial American concerns about the quality and reliability of communication with Chinese manufacturers were quickly laid to rest. “We get just as much communication with China as we do with partners here in the USA,” Ranieri said. “Engineers are talking to engineers, accounting talking to accounting, managers talking to managers.”
Collaborative dialogue between American and eBI throughout the product management cycle produced the unexpected benefit of triggering “out-of-the-box” considerations. American, in discussion with e-BI, is now exploring potential markets for additional de-velopment through product offerings made by outside manufacturers.
In looking at American’s existing and potentially expanded utilization of e-BI design and manu-facturing services, Ranieri reiterates the importance of strategic suppliers. “If I look back on the last 18 months, e-BI has certainly shown impact and value to achievement of our mission.“