MedTech: Building a Resilient Future

In today's rapidly changing world, the ability to adapt and thrive in the face of disruptions is crucial for businesses. As per a recent Accenture survey, disruptions in engineering, supply chain, production, and operations across 11 industries resulted in a significant rise in manufacturing inventory levels (totaling $1.9 trillion) and a 40% increase in product order-to-deliver lead times. However, for resilient companies, these disruptions presented an opportunity to capture over 3.6% additional average revenue growth.

The impact of disruptions and the opportunities ahead

The recent disruptions have exposed vulnerabilities in MedTech industry. Production, operations and supply chain disruptions have resulted in a significant financial impact, with an average revenue loss of 8.3 percent, a 3.4 percent erosion of profit margins, and a 40% increase in product lead times. These numbers highlight the urgent need for MedTech companies to address these challenges and reinvent themselves around technology, with a focus on analytics and data, to be able to seize the opportunities ahead.

Embedding Solutions for Resiliency

While functional capabilities in MedTech may be mature, there is an opportunity to continue to embed solutions within companies. Looking ahead, MedTech companies expect to more closely integrate their engineering, manufacturing, and supply chain functions using technology, analytics and data across functions to optimize their operations and empower their workforce. This will help MedTech companies enhance their resilience and adapt to changing market needs.

Building Resiliency: Key Actions for MedTech Companies

The survey highlighted three core actions that can help build resiliency as a competitive advantage:

1. Investing in visibility, predictability and continuity-focused tech: By transforming their supply chain, manufacturing, and quality processes, companies can automate and digitize their operations, making them disruption-proof. Anticipating challenges and adopting technologies like dynamic data-driven planning and hyper-automated production lines can help resolve issues proactively.
   
   
2. Adopting 'shift left' engineering capabilities to embed resilience in design: Moving activities earlier in the development process allows companies to get products, processes and ways of working right the first time. By embracing digital twin co-engineering and a resiliency-by-design approach, MedTech companies can adapt products to market-moving events and protect lead times.
   
   
3. Developing a multi-skilled workforce for agility: Upskilling the workforce in data, AI and digital technologies is crucial for making data-driven decisions and optimizing workforce models. Decentralized decision-making, remote expertise capabilities and a versatile/multi-skilled workforce can help navigate critical skills shortages and create a culture of agility.

Getting Started

To build resiliency in engineering, supply chain, production and operations, MedTech companies should follow a few key steps:

1. Evaluate current capabilities within each of these areas in scope and identify gaps.
   
   
2. Develop a vision for a resilient future-state function and engage in collaborative workshops to iterate and refine the vision in a manner that seeks to reinvent across functions.
   
   
3. Balance investments in relocation, digitization and automation to deliver desired results.
   
   
4. Establish financial and executional governance to streamline and accelerate digital maturity.

Conclusion

In the face of disruptions, MedTech companies must prioritize building resiliency as a competitive advantage. By investing in technology, embedding resilience in design and developing a multi-skilled workforce, these companies can navigate challenges and capture market share. The time to invest in resiliency capabilities and a strong digital reinvent core foundation is now, before the next disruptive event occurs. With a proactive approach, MedTech companies can build a resilient future and ensure sustained growth in the industry.