Is It OK to Outsource Everything?

Heather Thompson

April 1, 2007

2 Min Read
Is It OK to Outsource Everything?



Best Practices

In most cases, if a medical device maker isn't outsourcing at least some of its needs, it probably isn't doing enough to focus its strength. But how much is too much? Is it possible for a device manufacturer to outsource almost every aspect of its business and still maintain the regulatory standards required for products?

It is. In fact, there are some companies that produce medical devices with no more than a few sales offices and a handful of staffed employees.

These companies outsource nearly every aspect of business. One such company is Biofisica (Odiham, Hampshire, UK), which provides products for the wound-care market. Biofisica's president and CEO, Rafael Andino, spoke about his experience during an MD&M conference session.

Andino says that outsourcing is more than just having vendors. The key, he says, is soft skills. “Trust and communication can't be overestimated. You really need people who know you well enough to guess what you are thinking.”

Andino says that his partners are just as valuable as his full-time employees. “Technology is secondary to personal relationships.” The other important ability, Andino says, is maintaining robust quality. “Whatever the service, quality must be present at every stage.” Biofisica uses a Web-based quality system, which Andino says is a good way for all of his partners to keep up-to-date.

In addition, the Web organization enables auditors to easily access a company's system. “[Our auditors] love us because they don't have to get on a plane. Everything they need to see is available over the Internet.” Andino explains that he can supply auditors with one-day access to everything. In addition, he says, all of the company's partners see changes and receive e-mails as new versions are approved.

Ultimately, the ability of an OEM to outsource depends on the type of product. Device makers need to ask themselves the following questions:

  • Is the product unique and proprietary or commodity?

  • Is the goal to have premium pricing?

  • Are margins critical to growth?

  • Does the process contain novelties or trade secrets? Is it patented?

  • Should manufacturing be close to the end-user or to the distributor?

  • Can the OEM afford to build a world-class manufacturing facility?

By answering these questions, OEMs can decide what aspects of outsourcing may best serve their needs.

Copyright ©2007 Medical Device & Diagnostic Industry

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