Lean, Mean, Mighty Machines
As Runs Shorten, Modular Equipment and Flexibility Aid Machinery Manufacturers in Staying Competitive
In custom automation, medical device manufacturers used to subscribe to the theory, “whatever it costs, whatever it takes.”
“That is not the case anymore in the industry, and has never been Kahle’s practice. However, today there are fixed costs and delivery dates that offer less leeway,” said Julie Logothetis, president of Kahle USA in Summit, NJ. “Deliveries are tighter, internal controls are tighter and more milestones are set in place.”
While in the past medical device manufacturers might have been satisfied with waiting nine months to a year to receive a custom-built machine, that timeframe has now slipped to several months or even weeks, depending on the type of equipment required. Concerns about squeezing costs out of the system everywhere—from capital equipment to scrap to rework expenses—have also magnified.
To meet customers’ needs in these areas, custom automation and assembly companies have continually worked to improve their processes, thus developing best practices and advanced technologies that not only allow medical device manufacturers to shorten their production timelines and operate within narrower budget parameters but also automate some manual processes.
What’s Driving Automation?
Last year, MPO reported that companies often didn’t consider automating a process until they were producing three million pieces a year or had four or more parts to assemble in two or more processes. While that guideline still holds true for the most part, exceptions are occurring.
“I don’t think anything has really changed enough to affect the paradigm of three million pieces or multiple processes to justify automation,” noted David Carlberg, president and co-founder of Kinematic Automation, Inc. in Sonora, CA. “However, a major driver for automation is improved quality, and this is enhanced by the use of machine vision systems for the inspection of assembled parts. The price of vision systems continues to come down, and these systems are becoming simpler and more powerful.”
Logothetis agreed, noting that the trend is to automate traditional, manually intensive assemblies such as specialty catheters. Some of Kahle’s customers are taking advantage of automated manufacturing to achieve better quality control, whereas in the past the outputs required dictated the type of automation investment. Obviously, automation alleviates human error and disparities between how different operators perform various functions, allowing for more reliable, repeatable results. Today’s easier-to-program and easier-to-use vision systems, which allow for total inspection of the product assembly, quality and sampling to meet FDA requirements, are now commonly incorporated into the automation process.
Of course, quality isn’t the only driver. Miniaturized parts and complicated, complex components such as multi-lumen tubing for drug-eluting balloon catheters often preclude hand processing, noted Scott Thompson, manager of sales and business development for Technical Innovations in Brazoria, TX. In addition, said Paul Beduze, business development manager for the Mikron Technology Group in Aurora, CO, some processes such as part inspection and leak testing are better left to automation than manual processes.
In the end, though, as Dan Adlon, vice president of strategic business development for Integrated Bio-Sciences (IBS) in Lewisberry, PA, noted, automating a process requires an economic justification.
“There is no cut-and-dried business formula,” he said. “Often an OEM can justify automating a process based on the labor content. It is a straightforward equation based on the cost of an operator, times the number of operators to be replaced, times the required return on investment time, which yields the amount of investment that can be justified. The baseline is easy as far as labor costs go, but intrinsic values figure into the equation as well. One is quality. With a human operator, there is always the opportunity for error. There may be certain critical processes that may be better accomplished using automation to reduce errors and resultant scrap.”
Ergonomic conditions are another concern. Some IBS customers outside the medical sector have reported lots of repetitive stress injuries such as carpal tunnel syndrome to workers. They’ve asked IBS to automate certain processes to avert worker injuries. Adlon said he believes that trend likely will carry over into the medical device manufacturing area. “In today’s market, these issues are being looked at more closely,” he said.
Industry players also are looking closely at ways to minimize costs. One way is by focusing on lean cell manufacturing and smaller automation systems. Such systems involve less risk to create, require a lower initial investment and provide for a quicker time to market.
“If you utilize smaller cells with some manual labor involved, you can bring a product online more quickly, validate more quickly and get it to market with fewer dollars. This approach also makes it less costly and time consuming if there are product changes or improvements,” Adlon said. By using lean cells, manufacturers also are able to incorporate those cells into other production lines as needed, allowing them to recapitalize their investment or spread the cost over multiple product lines.
In response to customer requests, custom automation and assembly companies have developed more standard solutions, too. In the past 18 months, Technical Innovations created its LT product line, which includes the Smart Driller LT and the Smart Puncher LT.
“Even off-the-shelf machinery is customized to every project’s specific needs, but the costs and timelines are reduced dramatically,” Thompson explained. “Many applications out there aren’t complicated in nature and can fit standard equipment rather than lending themselves to a purely customized solution. For example, 60-70% of the catheter market can purchase similar, standardized equipment and customize it with a few options. Many companies are taking advantage of the resulting efficiencies and savings.”
Indeed, when companies are building automated systems today, many are focused first on flexibility. “We’re looking more at flexible automation that can be changed over to another technology because technology changes so quickly,” reported Carl Martin, CEO and founder of Advanced Scientifics, Inc. in Millersburg, PA. “We look at alternative uses and how to convert technology to be used elsewhere.”
Medical device manufacturers benefit as their outsourcing partners incorporate lessons learned from other customers and sectors into their medical device manufacturing processes and procedures.
Standardization is also allowing smaller-volume product runs to avail themselves of automation’s greater reliability and speed. In fact, some outsourcing partners have focused on serving these smaller runs because they may, in time, grow to larger volumes.
Mikron Technology Group last September introduced the G05 product line in the U.S. to address such a need. “We wanted to develop a scalable solution to give OEMs the ability to easily ramp up their production rates. Products generally go through product development stages or clinical trials before entering full production. In the beginning, companies are making just a few hundred or few thousand parts, not millions,” said Beduze.
He pointed out that companies that limit their work to larger runs may lose potential business to providers that can handle smaller volume. The OEM is more comfortable with the initial provider who understands the product from inception. Its G05 line is designed to allow medical device manufacturers incorporate proof-of-principal concepts and prototype assembly stations into mass production.
The G05 family of equipment includes a completely manual workbench, semi-automated cells and fully automated modules, allowing an OEM to easily move from lower-volume, manual and semi-automatic production to a fully automated assembly and test system.
Programmable machinery is also making automation and assembly more affordable for smaller product runs.
“In automation, we’re using programmable robotics to extract parts from our molding press and do further automated processing. Robotics offer added flexibility so we can readily change jobs,” explained Charles Heide, Jr., market development manager for Vesta, Inc. in Franklin, WI. “While robotics are a substantial investment, they’re also very scalable. They are used to produce fewer than a half-million pieces, particularly if higher volumes are anticipated in the future.”
Vesta employs programmable automation of commodity products such as those used in wound drainage. Heide noted that programmable, multi-task machinery on the assembly side also helps smaller customers. A more modular approach to manufacturing today allows for efficient set-up, training, manufacturing, validation and documentation so runs can be shorter, he said.
For example, say a company’s replacement feeding tubes span five diameter sizes, with each size available in five to seven lengths. In total, there are 35 items, but any one might be a low-volume run. Having flexibility in the machinery becomes important because manufacturers can switch between French sizes and length sizes seamlessly.
Flexibility has been a top priority for sortimat Technology US of Schaumburg, IL. Its Jetwing platform uses standardized modules to provide flexibility and versatility for the assembly of small parts and provides easy integration of other sortimat technologies. The standard system can be customized within three months, and one customer automated an entire product assembly on Jetwing but used manual loading, noted Tom Kramer, president of sortimat.
AccuPlace in Plantation, FL also has focused on serving smaller customers’ automation needs. “The notion that OEMs need a fully customized machine is no longer valid,” reported Manny Montero, the medical segment manager.
“We’ve developed a standardized technology that allows automation of shorter-run jobs or more product types on our machinery cost efficiently,” said Gunhild Schiller, AccuPlace marketing manager. The machines—which can be built in just six to seven weeks (16 weeks for fully automated assembly stations with more customized features)—are cost-effective for runs of a few hundred to a few thousand pieces, Schiller said. She added that one customer produces 6,000 parts a month, and he’s realized that a semi-automated machine can be cost efficient because it reduces scrap and rework to nearly nothing. Another customer produces fewer than 500 modules a month on a fully automated machine with similar results.
Tracking project status online is increasingly becoming a priority for medical device companies. “Customer expectations have increased significantly over the years. As a result, they’re requiring additional services and instantaneous alerts about project changes and updates. The latter is the most significant change I’ve seen,” said Logothetis.
With Kahle’s online interface, the company and its customers can post the latest available project data and drawings. Customers also can see the machinery on the floor via webcasting technology. She said while the service has been around for some time, customers are now just embracing it—even during the RFP process.
Custom automation and assembly companies continue to search for better ways to manufacture. However, overseas manufacturers with access to cheap labor are making it increasingly difficult to compete.
“We’re adding as many services as we can. The problem is, everything you add costs money, and companies are continuing to be reluctant to make significant investments in capital equipment in the U.S. right now because offshore opportunities are still so attractive,” said Richard P. Bodine, Jr., chairman of BCA Contract Assembly and Manufacturing in Bridgeport, CT. “The U.S. tax code works against American manufacturers. If you go to China or the Dominican Republic, everything is expensible. If you build equipment in the U.S., you have a minimum seven-year depreciation schedule, and if your product has a three-year life cycle, it’s hard to make the numbers work. Therefore, our biggest strategy has been that rather than sell capital equipment, we sell contract manufacturing services.”
BCA has created a servo-driven indexing chassis that can be tooled robotically and can be built more quickly and less expensively than in the past. It offers extremely low scrap rates, and the company continues to improve its technology while assuming all risk of changing technology for medical device manufacturers, who simply “lease” the technology on an outsourcing basis.
Despite the attractiveness of low offshore labor costs, most companies that spoke with MPO noted that they’re seeing more American companies bring automation and assembly work back within U.S. borders and have even acquired international clients. Concerns about stolen patents, product quality and now rising labor rates overseas have some rethinking about offshoring.
“We are seeing a swing back to the U.S. for many processes,” noted Carlberg. “I think that while competition once drove price, and hence the need for offshore manufacturing, it is now tending to drive quality. That is to say, as prices of commodity products such as medical disposables have come down to ridiculously low levels, consumers are looking for better products, especially in U.S. markets. Thus, we are seeing more companies moving manufacturing operations from offshore back to the U.S. and using automated processes to achieve higher product quality.”
Most equipment changes in the assembly and automation areas are incremental in nature due to high capital costs, but a few companies are introducing new technologies that show great promise. For example, Advanced Scientifics has developed integration between its bags and the customer’s choice in aseptic filling. The entire product is sterilized prior being filled, which allows end users to maintain sterility without traditional sterility validation, Martin said. He added that this technology is especially helpful with kits and offers cost savings and just-in-time flexibility to end users.
In September, the Mikron Technology Group unveiled a new automatic feeding system called the Polyfeed. This feeder differs from traditional vibratory bowl feeders because a vision system can differentiate parts, saving the time and effort needed to switch out parts on other feeding systems. For example, a production line could have four red parts, three blue parts and one green part, and a traditional machine could not be expected to find a particular version. The Polyfeed incorporates a camera that looks at the parts to make sure the correct color, orientation, etc. is shown and selects only the color programmed into the system. The new feeder operates at speeds of up to 80 parts per minute.
Recently, sortimat introduced smaller yet more efficient feeding and assembly machines. “Manufacturing space is still at a premium, so we are introducing several compact solutions in feeding technology and assembly technology that use half the space to produce the same volume output,” noted Bob Coran, senior account manager for sortimat Technology US. For example, its Spaceline is a linear transfer platform with 24 to 60 stations designed for high-volume production that saves floor space due to its forward and backward indexing control of the palette.
ATS in Cambridge, Canada has worked to significantly advance conveyance technology with its Supertrak. It features programmable, repeatable stop positions (without the need for pallet stops), bi-directional movement (providing tremendous assembly flexibility) and greater reliability (through reduced number of components compared with other conveyance technologies), according to Laurence Oldacre, ATS manager of business development.
“The flexibility of Supertrak can also accommodate shorter runs demanded of higher product mix applications,” he said.
Custom assembly and automation—like much of the U.S. manufacturing market—experienced a downturn during the economic woes of 2001 that continued through 2004. This year, however, has been a turning point for the sector, observers reported. “We’re seeing low double-digit growth,” said Thompson, echoing sentiments expressed by other companies. “We’re seeing a lot more requests for automated equipment, higher production volumes and OEMs requiring automation over hand assembly.”
He and others predict that in 2006, a stronger economic foundation, coupled with leaner manufacturing techniques and advances in best practices, should combine to offer medical device manufacturers continued gains in productivity.
Stacey L. Bell is a freelance writer who specializes in business and marketing issues.