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Systagenix | Understanding the cost of Quality

The vision of Systagenix is to develop and market advanced diagnostic and therapeutic systems that enable clinicians to heal every wound predictably and cost effectively.

Systagenix is committed to providing innovative products and services that provide breakthrough clinical and economic outcomes in the treatment, management and healing of chronic and acute surgical wounds.

The balance of costs to manufacture these products “on quality” need to be clearly understood to enable investment in improvement projects to address the root causes of the “costs of poor quality”.

Assignment

Oakland was engaged to work closely with a cross functional team to design and implement a dashboard of the current costs of quality (CoQ) within Systagenix and use this data to identify key areas for improvement that could deliver significant and verifiable savings.

Approach

The Prevention, Appraisal and Failure (PAF) model for the CoQ was selected as the overarching framework for the respective metrics as shown in the following diagram.

This model is often time consuming to set up and complex to implement. However, an innovative approach to the collection and analysis of CoQ information enabled the team to rapidly extract meaningful data from the current financial control systems. Grouping of similar products into families further streamlined the data collection and analysis process.

The project outcomes were successfully delivered on time and to budget using a simple five point plan:

1. Categorise the product range into a number of representative groupings to simplify data collection and analysis.
2. Define a set of categories and clear definitions for current costs, agreeing some approximate estimates for each category using existing data extracted from the existing finance system
3. Refine the current cost treatment to more accurately understand the prevention, appraisal and internal and external failure costs
4. Design and create the CoQ dashboard to draw aggregated information from the finance system, enable easy drill down for more specific details and provide input to the annual business planning process.
5. Analyse costs and supporting data to determine the root cause of problems, particularly the cost of failures, and create terms of reference for a number of key improvement projects.

This new approach minimised the need to collect additional data, avoiding any additional burden on the operational teams.

Achievements

The project has successfully delivered:

• A sustainable approach to improvement prioritization and project selection
• A greater visibility of the calculation of quality performance against targets and better understanding of internal terminology
• Senior management support and sponsorship for improvement projects
• Consistency in data comparisons