Fisher prof’s pharma research highlighted in ‘U.S. News’ article

As pharmaceutical recalls continue to hit headlines, an ongoing focus of research for one Fisher College of Business professor is taking on a new urgency.

John Gray Fisher College of Business Ohio State
Prof. Gray, speaking at the Center for Operational Excellence’s April “Leading Through Excellence” summit.

Fisher Prof. John Gray and two co-authors of an unpublished paper recently wrote an article featured in the online edition of U.S. News & World Report that highlights the ongoing challenges pharmaceutical manufacturers face in maintaining quality, particularly when production has been outsourced or offshored. U.S. News published the article just days after GlaxoSmithKline announced a recall of asthma drug Ventolin and several months after dozens of people died because of quality issues at the New England Compounding Pharmacy in Massachusetts.

Gray, along with Prof. Aleda Roth of Clemson University and Associate Prof. Brian Tomlin of Dartmouth College, took a close look at the performance of pharmaceutical plants run by firms that own the brands, versus those run by contract manufacturers. There was not an overall difference, but their research did indicate less-experienced and less-regulated contract manufacturers had a higher risk of quality issues.

“Our research provides empirical evidence that drug manufacturers are hard-pressed to consistently maintain high quality operations even in their own domestic facilities,” Gray and his co-authors wrote, referring to multiple research papers. “This challenge is magnified when production is performed in offshore and outsourced plants.”

The challenging business of making and supplying safe pharmaceuticals has been a topic of interest in Gray’s research for years.  In 2011, he co-authored a study published in the Journal of Operations Management that found drugs produced in offshore manufacturing plants – even when run by an American company – pose a greater quality risk than those produced stateside. They attributed this result to differences in language and culture between the plant’s personnel and those at headquarters.

Gray told us then that “just one quality error that hurts customers or leads to a recall can be extremely costly to a company responsible.”

What makes Gray’s research with his co-authors so resonant these days is the underlying truth that goes beyond organizational borders and language barriers: Successful quality reforms come from far-reaching culture change across the entire supply chain, a feat that isn’t easy, cheap, or quick. For any industry, defeating a culture of silos, miscommunication, and blame is a hard-won battle.

It’s an urge in the pharmaceutical industry, and countless others, to turn to technology – buy Gray and his colleagues write in the U.S. News article that the solution, instead is in people and day-to-day processes.

“Absent such an organizational mindset,” they write, “quality failures will occur even with the best technology.”

Fisher profs honored with ‘Best Paper’ award for health-care research

Last year, COE talked to Fisher College of Business professors Aravind Chandrasekaran and Kenneth Boyer about fascinating new research they were preparing to publish about the health-care industry. That their work didn’t go unnoticed is an understatement.

From left, Chandrasekaran, Senot, and Boyer

The Institute for Operations Research and the Management Sciences, or INFORMS, recently honored Chandrasekaran, Boyer and co-author Claire Senot, a doctoral candidate at Fisher, with their Best Paper Prize for 2012. INFORMS is the single largest professional society in the world for operations researchers and those in the management sciences and business analytics fields.

The researchers’ paper, “Process Management Impact on Clinical and Experiential Quality: Managing Tensions Between Safe and Patient-Centered Healthcare,” was chosen for the top honor among 843 papers published in INFORMS journals. It originally appeared in Manufacturing and Service Operations Management, and Boyer spoke in a breakout session at our Leading Through Excellence conference in April on the topic.

The awards committee told Boyer and his co-authors that their work stood out for the clarity of a concept that’s far from simple, but a fact of life for anyone who has spent time in a hospital as a patient or visitor. They found that as hospitals work to keep in step with government mandates and reduce medical errors over the long term, they’ll also see improvements in the overall patient experience. The catch: Those same experience scores are prone to take a dip in the short term.

In other words, as health-care providers work in overdrive to give patients better and safer care, they’re initially skimping on good communication and catering to individual patient needs. That changes, but it takes time.

The research does more than simply highlight this initial “trade-off” between clinical quality and patient experience – it charts the path to narrowing that gap. Chandrasekaran told us in a Q&A last year that hospitals see very little of that trade-off if they track patient experience along with clinical quality right off the bat. And because money never hurts as a motivator, the government’s Center for Medicare and Medicaid Services is now linking reimbursement rates with patient experience scores.

This all points to a very exciting culture change for the health-care industry – a domino effect of sorts. As the industry digs deep into how it can provide better clinical care, that same scrutiny is making its way to the patient experience. Even if money’s the motivator, any patient would say that’s a good thing.

The invisible made visible

A common complaint from those resistant to lean thinking is that it can’t be applied to processes that aren’t visible, particularly office processes where most decisions are made with e-mail and phone calls. The InBox Simulation our Master of Business Operational Excellence students recently ran with the help of Peg Pennington, Gary Butler and yours truly disproves it.

The simulation uses MoreSteam.com’s SigmaBrew case study, which looks at a large (and fictional) specialty coffee retailer struggling with quality and customer service issues amid an increasingly competitive commercial market. Senior management identifies the unacceptably long cycle time required to open new stores as one of the major issues to be addressed in a Kaizen event.

Each MBOE student had a role to play in the process involved in opening a new store, from market and site research workers to lawyers, landlords, government officials and more. The catch: The communication occurs mostly through e-mail. After the first simulation, students realized they needed a lot more information than they were working with. They also needed to know they were working with to get the work done efficiently. This is how a lot of processes exist in reality. People know only their jobs. They do not know what is being done with the information they generate and how it impacts the whole process.

In one full day, students created an A3 to describe the problem, a value stream map to highlight the problems, and a future state map to design a new and efficient process. The students had the ability to run as many simulations as possible to try their improvements. Each group came up with improved processes that were very different and yet very promising.

Our students return in June to begin the second half of the MBOE program year…