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Rx for manufacturing quality: Shingo winner looks to continuous improvement. (Medical Manufacturing).

Strict adherence to its Quality Leadership Process helped Baxter Healthcare's North Cove plant in Marion, NC, capture the coveted Shingo Prize for manufacturing excellence last year.

Several achievements contributed to Baxter receiving the award--a lead time reduction of 84 percent, first-pass yields at 99.65 percent; on-time delivery rate above 99 percent; energy requirements reduced by 51 percent; work-in-process inventory turns in excess of 170; and a pipeline inventory reduction of 36 percent.

Founded in 1931, Baxter Healthcare was the first manufacturer of commercially prepared intravenous solutions. The company, with its headquarters in Deerfield, IL, serves healthcare providers and patients in 100 countries. Baxter is known for several firsts in the healthcare industry including the first commercially manufactured intravenous (IV) solutions, the first artificial kidney, and the first concentrated clotting factor to treat hemophilia.

The North Cove facility has been situated in the foothills of the Blue Ridge mountains since 1972. The 1.4 million square-foot plant manufactures IV solutions and peritoneal dialysis (PD) solutions for home kidney dialysis. The 2,500 employees help produce more than one million containers of IV solutions each day. The North Cove facility has been ISO 9000 certified since 1994

Eye on the prize

The Quality Leadership Process (QLP), a continuous improvement management process, was instituted at the North Cove facility in 1985. It establishes the foundation for providing quality products and services to customers, says Phil Batchelor, plant manager at Baxter. The QLP includes eight deployment strategies.

1) Customer responsiveness and growth-generating customer knowledge and responding to requirements which will help grow customer loyalty and new business.

2) Quality operating system-gaining knowledge, predictability, training and the assurance to continually raise quality standards.

3) Value improvement program--managing projects and improving costs and quality.

4) Supply chain management--managing relationships with suppliers and customers. Improving speed, while managing costs.

5) Leadership/ownership -- motivating employees through involvement, training, tools and the appropriate environment. Maximizing employees' potential, and at the same time recognizing them as individuals.

6) Public responsibility -- becoming partners with the community through service projects and other efforts.

7) Information management -- generating an information system to manage processes that will enable more timely and accurate decisions.

8) Equipment effectiveness--getting people more involved and encouraging them to take ownership of the equipment which in turn improves the reliability of the equipment.

Growing strategies

"The deployment strategies have grown from two or three to eight," Batchelor says. "They are dynamic, meaning they change on an ongoing basis. We are in the process of reviewing them now. This foundation is the reason behind us receiving the Shingo Prize."

The QLP was based on an integration of quality management and lean manufacturing systems. Batchelor says the total quality management system and deployment principles were born from this integration.

Baxter also uses state-of-the-art instrumentation including micrometers, comparators and vision inspection equipment to insure quality.

"In the pharmaceutical industry, we make sure that our processes and products are validated and monitored," Batchelor says. With this in mind, the deployment strategies take the product from the research and development stage, through the facility to the customer.

Established in 1988 to promote world-class manufacturing, the 2000 Shingo prize for excellence in manufacturing was also awarded to Cydsa, Tlanapantla, Mexico; Delphi Automotive Systems, Matamoros, Mexico and Saginaw, MI; Ford Motor Co. of Canada, Windsor, Ontario; Freudenberg-NOK, LaGrange, GA; Lockheed Martin, Fort Worth, TX; and Lucent Technologies, Mt. Olive, NJ. The College of Business, Utah State University and the National Association of Manufacturers administer the prize.

Stephanie J. Fellenstein is editor of Quality in Manufacturing magazine, also published by Adams Business Media.

RELATED ARTICLE: The man behind the prize

Born in 1909 in Japan, Shigeo Shingo was impressed early on by the idea of streamlining processes to eliminate waste.

He wanted to teach the world to see manufacturing processes rather than separate operations. Before production management could be improved, Shingo said two things had to be understood clearly: 1) what a production management system is and 2) how to carry out improvements.

The Shingo prize was established in 1988, two years before he died. Utah State University awards the prize annually.

The aim of the Shingo Prize is to facilitate an increased awareness in the manufacturing community of excellent to world-class manufacturing practices and techniques. The prize also fosters understanding and collaboration of successful methodologies, and encourages research in business and manufacturing processes.

Manufacturers in the United States, Canada and Mexico, and researchers throughout the world are eligible.

The award recognizes manufacturing companies, divisions, and plants who demonstrate excellence in manufacturing leading to superior customer satisfaction and business performance. It also awards research and writing that addresses innovative methods, systems and processes that follow the Shingo prize's achievement criteria.


Shigeo Shingo, The Shin go Production Management System. Improving process functions. (Productivity Press, Cambridge, MA. 1992)

Shingo prize web site:

Baxter Healthcare, IV Systems Division, North Cove facility, Marion, NC. or or circle 359.
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Title Annotation:Baxter Healthcare
Author:Fellenstein, Stephanie J.
Publication:Tooling & Production
Geographic Code:1USA
Date:May 1, 2001
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