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Correcting course to achieve resilience

Using crisis mode to ensure delivery chain MDR compliance.

Covid 19 Rapid Reaction

Correcting course to achieve resilience:
Using crisis mode to ensure delivery chain MDR compliance

Politics and business are setting new priorities during the Corona crisis. Companies in pharmaceutical and medical engineering, for example, are shifting their focus away from the implementation of government regulations and toward daily operations. With help from policy makers, as can be seen with the European MDR [Medical Device Regulation, EU No. 2017/745]: the transition period has been moved to May 25, 2021. This extends the period for meeting requirements, such as vendor management, by a year.

Deadline extension as opportunity and risk

Given the current crisis situation, the deadline extension is naturally a reasonable measure that provides space for more pressing matters. Particularly since this is not the first time the MDR has been rescheduled: the EUDAMED and UDI were, for example, corrected and the transition period for risk class IR medical products was extended.

 However, delayed is not, after all, denied. The opportunities that arise from the MDR deadline extension also hold two considerable hidden risks for affected companies. First, the authorities’ expectation that all requirements be implemented in full grows with each additional deadline – something many companies in the industry experienced with the transition from MedGV to MDD (MPG).

 Second, the considerable impact the MDR has on the proper functioning and deliverability of manufacturer, vendor and service provider delivery chains should never be underestimated. After all, the regulation undoubtedly means an increase in requirements for vendor management, product labeling, storage and transport, as well as many other business-critical aspects of value chains. Thus, while an implementation period of a year may seem like a long time, it is not something that should be taken lightly. Furthermore, many manufacturers need to factor in the significantly larger number of vendor audits they have to perform, i.e., auditing their suppliers to ensure MDR compliance.

How can a healthy balance between
compliance and cost be achieved in vendor management?

Find out more

Focused protection of the value chain

It is important to keep a cool head in the current situation. Meaning: developing an effective set of measures that is designed to fully satisfy the MDR, including business aspects. Failure to do so could mean costly corrections after the new deadline – or, if worse comes to worst, the product may not be marketable at all, preventing you from even offering it on the European market. Not to mention the topic of staying competitive: non-compliant manufacturers could be shut out of the market.

The good news: companies have learned from previous times of crises – the financial crisis and Fukushima come to mind – and have bolstered the resilience of their delivery chains. We have been able to work with our customers to develop strategies and measures for this, and many other projects within the industry, as well as in other key industries; measures that combine compliance, transformation and efficiency enhancement as part of vendor management. The initial and key focal points for ensuring the correct implementation of the MDR, even when in “crisis mode”, are:

1. Vendor management: Watch your step!

Try not to generalize your vendor relationships. Instead, take a very close look at the extent to which each vendor meets customer needs. The vendor is a know-how carrier and thus needs to advise as well; not only do suitable vendors need to cooperate, they must actively work to compensate for any possible deficits the customer may have. One example is the 13485 or 9001 certification “Communicating with Customers” – what exactly does that mean? What is important to remember here is that: a supply relationship cannot be entered into until all aspects involved in the delivery of the product have been bilaterally coordinated.

2. Product labeling: Prepare for change!

Identification and traceability, including for the identification of potentially illegal products. All of these expectations are directly related to product labeling. The completion of article master data, definition of attributes for labeling, or the preparation of data for uploading into the EUDAMED database are the challenges all manufacturers and vendors now face. Now is the time to address these tasks, which are often underestimated.

3. Intralogistics: Cut your spending!

Traditional “efficiency killers” in warehouses are established processes from the category “we have always done it that way”: long distances, unnecessary search times, manual activities, uncoordinated processes or lack of support from the employed software, quickly add up to significant losses. Companies need to prepare for re-start now and increase the efficiency of their intralogistics through short, effective projects and savings in the two-digit percentage range.

4. Purchasing organization: Change your sense and sensibility!

Purchasers often have a hard time working in a dynamic vendor relationship. In this case, vendor monitoring is the perfect tool. The key to using it is “less is more”; i.e., only defining and monitoring criteria that are truly important! Criteria should be defined using the traffic light system and vendor relationships rated as green, yellow or red on a regular basis. Tolerances can be adjusted up or down depending on how significant a vendor is.

5. Quality assurance agreement – QAA: Know your responsibility!

Something is delegated every time an order is placed. But – what exactly is that? Responsibility? Authority? Companies often fail to set any or simply set insufficient boundaries here and transfer responsibility for this task to the vendor. While this approach gives a manufacturer a sense of security, in reality, it holds considerable hidden risk. After all, it is the manufacturer who remains responsible for the medical product!

Failing to define clear tasks or responsibilities in quality assurance agreements makes vendor management like flying blind and you can be guaranteed a rough landing. Bearing the potential impact on the ability to satisfy legal requirements, safety aspects or service aspects in mind, manufacturers must thus see their due diligence obligations as a responsibility. Furthermore, they must demonstrate that they are systematically upholding their obligations at all times.

6. Modularisierung

der in Anspruch genommenen Services und Planungssicherheit durch inhaltlich und zeitlich eindeutig definierte und bepreiste Servicepakete, die flexibel kombiniert werden können;

7. Kosteneinsparung

durch Standardisierungs- und Pooling-Effekte, Entlastung besonders knapper und teurer Humanressourcen sowie Vermeidung von Reise- und Präsenzkosten.

msg advisors is happy to assist you with all aspects of your company’s MDR compliance. Work with us to make the most out of the deadline extension by using fast-acting measures to implement the regulations, while also strengthening the resilience of your delivery chains.

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Thomas Praska 345

Thomas Praska

We are looking forward to hearing from you!

Christoph Piller

Christoph Piller

We are looking forward to hearing from you!

Further topics

  • Post-​Covid-19 Supply Chains

    Post-​Covid-19 Supply Chains

    Redesigning global value chains after the Corona crisis.


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  • Management and leadership in the crisis

    Management and leadership in the crisis

    How to quickly gain transparency and make sound operating decisions.


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msg industry advisors ag
Robert-Bürkle-Str. 1
85737 Ismaning

+49 89 96 10 11 300
+49 89 96 10 11 113

advisors@msg.group

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msg is an independent international group of companies with autonomous regional companies and subsidiaries and over 8,000 employees.

The msg group is active in over 25 countries in the banking, insurance, automotive, food, life science & chemicals, public sector, telecommunications, travel & logistics and utilities sectors. msg also develops integrated software solutions and advises its clients in all aspects of information technology.

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