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Meditech Surgical: Presented by

This document summarizes a case study about Meditech Surgical, a medical equipment company that deals in endoscopic instruments. Meditech faces issues with introducing new products due to high lead times, inaccurate forecasting, and a focus on sales over customer service. The customer service manager is the first to recognize major issues as they directly interface with customers. Key problems include high inventory levels, long supplier lead times, and a lack of data analysis. Implementing an ERP system, reducing new product launches, improving forecasts, and developing better supplier relationships are proposed to address the issues.

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Siddharth Ojah
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552 views15 pages

Meditech Surgical: Presented by

This document summarizes a case study about Meditech Surgical, a medical equipment company that deals in endoscopic instruments. Meditech faces issues with introducing new products due to high lead times, inaccurate forecasting, and a focus on sales over customer service. The customer service manager is the first to recognize major issues as they directly interface with customers. Key problems include high inventory levels, long supplier lead times, and a lack of data analysis. Implementing an ERP system, reducing new product launches, improving forecasts, and developing better supplier relationships are proposed to address the issues.

Uploaded by

Siddharth Ojah
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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SCM CASE STUDY-

MEDITECH SURGICAL

Presented by:
Aishwarya Banerjee(BAM09001)
Namrata Sharma(BAM09002)
Meenu Joshi(BAM09003)
Disha Bhuyan(BAM09004)
Priyanka Amonge(BAM09015)
About the organization..
Parent company : Largo Health Care
Company
Deals in : Endoscopic instruments
Primary competitor : National Medical
Corporation
Target segment : Hospitals, Material manager
and surgeons
Strengths : Innovation and introduction of
new products , effective sales force
Weakness : Failure to meet demand and
customer dissatisfaction
Distributors : Domestic Dealers, International
affiliates
Internal operations : Assembly, Packaging and
Sterilization
External Supply Chain

Client

Domestic
Dealers

Part Meditech Meditech


suppliers Assembly Warehouse
Client

Int’l
Meditech
Affiliates
Production planning and scheduling
process

It is divided into two parts.


1) Planning : It is based on monthly forecast of assembly
and component part order.
i. Annual forecast determined
ii. Based on months forecast finished goods “transfer
requirement” : demand forecast- current finished
goods inventory level + required safety stock
iii. Assembly schedules and replenishment orders based
on monthly demand forecast and current inventory
level
iv. Material requirement planning system (MRP system)
2) Packaging and sterilization : Based on finished
goods inventory level
i. One week for complete batch of instrument
ii. Scheduling done on order point / order
quantity basis
Internal Supply Chain

Parts Assembly Bulk Inventory Packaging & FG Inventory


Inventory Sterilization

2 - 16 2 1
weeks weeks week
Product introduction, High inventory
level and poor service

Introduces new products by updating


existing ones.

Each new product introduction resulted in


supply problems.

Actual service level disappointing despite


high levels of inventory.
Q1) Meditech’s problem in introducing new products. I
manufacturing ALL products.
Most of the new products are only upgrades of old
products. This considerably reduces the life-cycle of the
products.

Majority of Meditech customers are Material Managers


whose primary focus is on cost and delivery schedules
but not on innovative product features.

Every new product launch requires a lead time of around


5-19 weeks ,which is very high.

With every product launch, pushing the product into the


market becomes the primary consideration of the sales
force thereby neglecting customer service for older
products.
The implications :
Supply side shortages
Delayed deliveries (6 weeks)
Low customer service
Low customer satisfaction
Inaccurate forecasts
High FG inventory levels
The product portfolio of Meditech
comprises about 200 separate end-products.
These wide ranges of products make
Meditech rely heavily on suppliers wherein
the lead time is 2-16 weeks.
Meditech organizational structure has a
long chain. Information dissemination
becomes difficult.
Q2) Cause of the problems, systematically and organizational

SYSTEMATICALLY ORGANIZATIONALLY
Too dependent on Weak Strategies
Suppliers Very long chain
High lead times of 2-16
Slow information
weeks
High FG Inventory levels Flow
High Safety Stock levels Frequent changes in
No data collection process flow
Incorrect Forecasting Focussed on Sales
Short Product Life Cycle Weak Service Levels
Panic Ordering
Q3) Why is customer service manager the
first person to recognize the major issues

The representatives work in direct contact


with dealers and affiliates and are often in
direct contact with hospital personnel i.e.
their consumers.
Customer Service deals with occasional
customer complaints to establish strategies
to improve delivery service.
4.)How would you fix these problems?

Implemention of an ERP System, which


would help in better data storage &
warehousing, analysis and forecasting.
Reduce the frequency of new product
launches.
Emphasis on better forecasts with a shorter
horizon of 1-2 months
New and better supplier relations to reduce
the supplier lead time from the current level
of 2-16 weeks.
Thank you!

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