March 1, 2009 (Vol. 29, No. 5)
Partnerships between Manufacturers and Customers Are Critical to Effective Plans
Business continuity planning (BCP) is put into action by companies to prevent disruptions in operations. In the area of pharmaceutical and biotech manufacturing, it is extremely critical that raw materials are received in a timely manner to prevent disruptions in manufacturing. It is challenging, however, to accurately complete business continuity planning in the manufacturing environment. The evaluations must include all facets of the supply chain, from suppliers of raw materials to components used to create the end product; a supplier’s disasters can become a customer’s disasters.
Historically, manufacturers approached business continuity planning by using the requirements set by their suppliers, typically based on worst-case scenarios. Planning for the worst-case scenario can result in tying up millions of dollars for inventory that may never be needed. Financially based pressures on cash flow have contributed to the evolution of this methodology in recent years. The approach being applied today involves evaluation and ranking of risks that may occur, and planning for those that are most likely.
Improving a company’s risk-management strategy and strengthening its response to threats and disasters does not have to be overwhelming. If managed properly, a business continuity plan can give a company a flexible and focused framework for addressing various risks simultaneously and one that involves all critical business units in the design and execution of the plan.
Millipore has developed and implemented plans designed to anticipate and minimize interruption to key business processes, production facilities, and distribution sites. Every business unit has implemented these policies and procedures to ensure the health, safety, and welfare of employees and the continuity of supply to customers.
Our approach toward potential risks and applicable continuity and recovery operations is product-specific. Plans are created that document the continuity strategies, providing details on equipment, facilities, and resources needed for recovery of operations. The business continuity risk assessment process includes the review of over 90 separate risks covering technology, business process, man-made, and environmental events.
To meet emerging customer needs for a secure supply of product, companies need to maintain an active business continuity program centered on three elements: production reliability, risk assessment and mitigation, and crisis management. Implementation of these principals is critical for existing products, but must also be considered for products in development as well.
Millipore’s BCP strategy is built into new products being developed, in addition to those already sold to customers. Reviews and assessments in the design stage help ensure that the manufacturing process for a product is robust and repeatable, and the raw materials supply is stable and reliable, often through the qualification of dual raw materials sources. This is in addition to the evaluation of products that are currently manufactured.
Risk Assessment and Mitigation
In leveraging the results of a thorough risk/vulnerability assessment, risk mitigation measures are implemented to reduce the likelihood or impact of an interruption. Each plant and key supplier undergoes a thorough risk assessment; the corrective actions identified from these assessments are tracked to resolution in a formal corrective action system.
In the event that a disaster does occur, it is critical to implement a framework that includes site-based teams and procedures. This framework codifes the process for responding to disasters and business interruption. The goal is to minimize recovery times should an event occur. The entire supply chain, not just manufacturing, is reviewed to ensure the recovery time objectives are obtainable. Each plant has a specific crisis management plan and trained crisis-management and emergency response teams. These plans and teams are exercised on an annual basis to ensure the highest state of readiness and appropriateness of emergency recovery time objectives.
Business continuity planning comes down to partnerships—every company should have established risk-mitigation plans, but in the end, this is only one part of a complete business continuity plan. Manufacturers and suppliers must work together in a partnership to establish plans that are efficient and cost effective for both parties. This partnership includes a thorough understanding of: reliability of the production process, the risks and their likelihood to occur, establishment of obtainable recovery time objectives should a crisis occur, and a customer’s definition of-risk mitigation planning.
With these actions completed in partnership between the manufacturer and the customer, disruptions to critical manufacturing processes can be minimized in a manner that is efficient and cost effective for everyone.
Merrilee Galloway (firstname.lastname@example.org) is product manager, and Mark Dyment (email@example.com) is director, supply security at Millipore. Web: www.millipore.com.