Operational managers are tasked with the responsibility of ensuring that the operations in their firms flow smoothly and without any major glitches. Every firm involved in the production of goods and services has the office of the operation’s manager. The occupant of such an office is in charge of the day to day management of the firm’s operations. It is his or her responsibility to ensure that all arms or branches of the firm function in sync with an aim of producing quality products that will add value to the final recipients who are mainly the customers. The essay that follows will present a directive letter drafted by Wendy Kouba (Wyeth Pharmaceuticals’ new VP operations manager) and sent to the firm’s QHs and MDs in different sites within Wyeth’s global network.
The Directive Letter
From: Wendy Kouba- Vice President Operations Management
To: All Managing Directors and Quality Heads- Wyeth Pharmaceuticals
Ref no. 2341/14
Operational Transformation Directive for All Wyeth Pharmaceuticals Branches
It has come to our attention at the head office that our company is trailing behind in sales and that the operations costs are still higher than desired. My predecessor Mr. Kamarck did a good job in spearheading the cost-reduction program that saw the firm cut down its operational costs by a whopping $40 million. This was a good achievement but still needs more to be done. The management of the firm has raised the bar and now we are expected to reduce the operations cost by another $200 million.
This is no simple task, but I believe that we are equal to the task at hand. In order for us to achieve the task set before us, we must join forces and work on the areas that will be highlighted and discussed in this directive letter. But first, there are certain operational inefficiencies that need to be addressed. I believe that after we have addressed these inefficiencies, then we will be ready to reclaim our position among the global leaders in the drug manufacturing industry.
The pharmaceutical industry in which we operate is very dynamic and it has experienced rapid changes in the recent past. There is no indication that this changes have come to a close. Matter of fact, all indications show that more changes will continue to hit the industry. Since we cannot control the direction of the wind, it is therefore prudent that we concentrate our efforts on adjusting the sails. Perhaps once we have done this we will then be able to “sail our ship” to a desired destination.
In other words, the changes hitting the pharmaceutical industry might be a little over our heads and out of our control, but we can adopt measures that will see us mitigate the effects of these changes while, at the same time, taking advantage of favorable changes. In this regard, the firm has seen it fit that we institute a raft of measures that will not only help us survive the changes but also thrive in the rapidly changing environment.
The primary challenge facing us as a firm relates to the high cost of operations incurred both at the HQ and at our network of sites. Moving forward, our primary undertaking will be to apply the measures enshrined in this directive letter with a sole purpose of achieving a cut in operational cost by over $200 million. Meeting this target is no small task; however, it is very possible. Many of you might be asking how exactly we hope to achieve that. Well, the first step is to believe, yes to believe that we have all it takes to deliver on the target. After believing, the next step entails coming up with strategic programs that will help steer the firm towards cutting the cost of operations
Traditionally, Wyeth Pharmaceuticals’ global branches have been operating independent of each other and most times, the various branches have been competing against each other to achieve high sales targets. Thus far, this system has worked perfectly and I take this opportunity to commend all the MDs and QHs in our global branches. The success achieved by the individual branches got us into thinking just how much success we would achieve when we start working together in collaboration rather than working independently in a competition.
It has come to our attention that the firm stands stronger united in its operations than operating independent of each other. In line with this assessment, I move to direct that the various QHs from our branches need to ready their branches for the various changes that must be instituted in order to achieve the set goals and targets on cost cutting.
There are many benefits that will accrue to the firm and its branches when the collaborative approach is fully embraced and implemented. Chief among these benefits is the fact that the approach will cause the branches to work in unison and they will be united in purpose. There will be no branches that will be working at cross purposes (“Wyeth.” Pharmaceuticals N.p). The network of sites will be connected from the head quarters to the various branches. This will allow for the sharing of certain resource and functions. This will in effect eliminate all costs that are associated with delays in dissemination of information, duplicity of functions and process, and delays in production.
Additionally, the collaborative approach will allow the firm to achieve quantum leap successes because of the unity of purpose that will arise from the firms working together. Moving forward, I direct all the MDs to embark on inter and intra branch discussions and seek areas of collaboration. This will be akin to the leadership coalition that was once instituted by Merrick McCracken. Kindly note, the job descriptions for all the workers will remain as they are. It is important that you get to understand that this transformation touches on operations and it is not meant to alter job descriptions in a major way with minor exceptions in areas where the job descriptions might have to be redefined to fir within the transformation agenda.
There are many improvement opportunities that can be implemented at the different sites. We have realized at the head quarters that some of our branches are operating at suboptimal levels while others are overstretched with orders and work. We therefore saw it fit to embrace and inculcate the tenets of supply chain management and process management, which we hope that it will help us deliver quality and value to our customers at a lower cost.
A well implemented supply chain management function will ensure that all our branches produce the medicine when needed and in the right quantity. This will in effect eliminate the costs associated with stock out and delays. I further direct that the QHs rethink and adjust their branches EOQ so as to include the summation of make-to-order and make-to-stock values. This will, in effect, ensure that the stock available matches with the demands of the market. Additionally, such a move will also help in reducing logistic costs because medicine will be produced as and when required.
The corporate management at the HQ is seeking ways by which we can have all our branches working corporately in fulfilling the vision of the company. Cooperation between the different branches will help in benchmarking and attaining of global optimization goals (Boyer, and Rohit 23). When all branches are optimized, this will allow the various branches to specialize in their functions and concentrate on producing the component that will cost them lower, in terms of investments, to produce. Further, global optimization will negate the effects of conflicting objectives at the different branches.
Global optimization will mean that all the branches meet the requirements leveled on them. Throughput time and cycle time must be reduced substantially to ensure that this vision is met if not surpassed. Furthermore, I direct that the MDs and QHs find ways of solving the process management problems that manifest in form of blocking, starving, and bottlenecks. This will in effect ensure that the production process proceeds without any hindrances.
Quality management is another gray area that has remained unattended to for the longest time. I direct that the QHs redirect focus to this component and ensure that the quality of the final product is top notch and standardized. I further direct the QHs to identify the bottlenecks in production and quality management and find innovative ways of overcoming the bottlenecks. The MDs must ensure that their branches attain the expectations placed on them by the HQ. This is only possible when the branches will be clear on the implementation of total quality management (TQM). This will ensure that the firm excels in all aspects of product and service delivery that are important to the firm’s customers.
Please note that these operational transformations will not be possible without your involvement as change leaders. I have faith in your roles as transformational leaders and I know that you are the best people to lead these transformations. Perhaps you should consider Deming’s 14 points on organization transformation. Pay keen and particular attention to leading and promoting change. Show the people under your command that there is no need to fear.
Support, help and improve the employees in your branches. Show them the importance of continual education. Remind the employees that they are all leaders in their own stations. Allow them opportunities to train and become current with the advancements in the field. Forward the names of employees that have shown exemplary and exceptional work so that they can be considered for promotion and reward. Above all else ensure that waste is eliminated as much as it possible and apply the six sigma quality measures.
In conclusion, I believe that once all these directives have been applied to the branches, then we will be able to achieve the goals set for the firm by the top management. Moving forward we are all working together to achieve the goal of reducing operational costs. By so doing we will then be able to register good success and attain quantum leaps within a very short time. Wishing you the very best as we work on implementing this directive.
C.C. Wyeth Pharmaceuticals C.EO
C.C. All Branch MDs and QHs.
Boyer, Kenneth K, and Rohit Verma. Operations & Supply Chain Management for the 21st Century. Mason, Ohio: South-Western/Cengage Learning, 2010. Print.
“Wyeth.” Pharmaceuticals. N.p., n.d. Web.