The Medical Device Production Transfer Process
A production transfer is a common occurrence in the medical device industry. However, what often...
On December 31st it was first informed that “pneumonia of unknown cause” had been detected in Wuhan, the largest city in Hubei province in central China. By January 30th it was declared a new disease and a public health emergency of international concern.
As the spread of the virus rapidly progressed the Chinese Government implemented various types of lockdowns of approximately 760 million people – slightly over half the country’s population as of the 23rd of January. Quasar was only granted permission to resume operation on February 13th.
Quasar was recognized in local publications as a role model to organizations for a demonstration of resilience in the face of the coronavirus crisis.
Ensuring the safe return of over 1,300 employees with zero cases of infection found and resumed operations in just 3 weeks.
Crucial steps in the success while also effectively mitigating the risk involved actively supporting the safe return of employees to the facility from all over China while documenting all travel information. Constant monitoring of all personnel’s health status upon return. And the safety of employees against the further spread of the virus.
Labor Return: How to organize the safe return of over 1,300 employees to our facility.
Supply Chain: All China-based suppliers were similarly shut down as the country entered lockdown. Upon Quasar’s restart, our suppliers averaged less than 15% operational capacity.
Customer Communication: Many customers outside of China did not recognize the magnitude of the crisis in January and early February. Expectations for production need to be managed quickly.
Prior to the shutdown Quasar’s executive team wasted no time and order from all vendors to overstock on inventory.
Upon the shutdown, CEO, Ayal Amitai assembled and led a task force to identify challenges, craft solutions, and create procedures for operating safely. Other items of priority included external and internal communication, vendor status, inventory status, and logistics.
Quasars management went to great lengths to ensure the safe return of the workforce to our facility in Dongguan. Upon the employees’ return, the organization facilitated an in-house mandatory quarantine so that no risks were taken. Furthermore, operations resumed with strict guidelines set in place for maintaining a safe distance between employees in addition to other essential protective measures.
Our supply team quickly identified key suppliers and materials provided by China-based suppliers. We immediately ordered extra inventory to ensure that production would not be held up by suppliers being closed.
Communicating with our customers outside of China from the very beginning of the crisis played an important role in Quasar’s fast recovery. We worked to inform customers about the magnitude of the situation and provided frequent status updates. This allowed us to firmly establish trust and credibility with our international customers.
“Given the speed with which the coronavirus outbreak expanded, both in Hubei province and throughout China, the leadership team at Quasar recognized that time was of the essence. Quasar’s culture of operational excellence and a ‘production-first’ mentality played significant roles in the organization’s flexibility and speed to recover. Clear plans were devised and set in motion for making up on all production setbacks” – Aviel Bohnik, Program Director
In the wake of the crisis our Operation returned 90% of employees by February 24, compared to less than 50% for manufacturers across China and less than 25% for manufacturers in Shenzhen. We resumed 100% of operations by March 6, three weeks after reopening.
Quasar was one of the first companies to be removed from customers ‘at-risk suppliers’ lists as of early March.
Today, we are on track for meeting all customer commitments for the second quarter. As of early March, companies around the world began to manage an ‘at-risk lists’ of their Chinese suppliers who reported on suspended production. Due to Quasar’s rapid and successful response, it’s partner’s were confident in removing Quasar from their at-risk list almost as soon as the lists were compiled.
Going forward, we are in the process of beginning operations in a recently completed manufacturing facility in Thailand. This comes as one of the steps taken in a strategy to insulate our operation since events such as trade tensions between China and the US. The COVID-19 experience further demonstrates the need for Quasar to Diversify the geographic span of our operations.