1.

Introduction:
Generally in an industry more focus is given on profit. Though there are different issues involved
in cost reduction internally spent by an industry through finding wastages, preventing and
correcting defective work would result in huge savings.. The changing environment forces
companies to be more flexible (Dreyer & Grønhaug, 2004) in order to face this challenge. The
importance of aligning production to customer needs while still being able to efficiently
manufacture good quality is rising. The perception of manufacturing’s strategic role is increasing
(Ward et al., 2007) and companies start to improve their production system in terms of efficiency
and effectiveness to develop competitive advantages.
A popular approach to reach this aim is the concept of lean production which allows a company to
on the one hand improve productivity of processes and assets and on the other hand to boost
flexibility. It can be understood as an integrated manufacturing system that is intended to maximize
the capacity utilization and minimize the buffer inventories of a given operation through
minimizing system variability (related to arrival rates, processing times, and process conformance
to specifications)”.
Over the last decades lean has become an often used term in operations management and several
studies have shown that the implementation and use of lean practices leads to superior performance
compared to competitors that do not implement such practices. Consequently, the adoption of lean
production is a central challenge for manufacturing firms. Although there is quite a number of
comprehensive literature on lean and its elements every company has its own idea of how to get
started. When discussing with representatives from the industry it becomes obvious that not all
managers have a holistic view of lean and that they rely on single elements without seeing the
whole.
Therefore, they are not able to use the full potential lean is able to provide. Another point is the
often missing consistency of the implemented practices with a plant’s business strategy. A lot of
companies already implemented elements of lean years ago whereas others are still on their way
to implement them. Particular industries, like the pharmaceutical industry and process industries

1.1 Lean System

Lean Manufacturing can be defined as "A systematic approach to identifying and eliminating waste
through continuous improvement of the product at the demand of the customer." Taiichi Ohno
once said that “Lean Manufacturing is all about looking at the time line from the moment the
customer gives us an order to the point when we collect the cash. And we are reducing that time
line by removing the non – value added wastes” (Ohno, 1988).
Lean always focuses on identifying and eliminating waste and fully utilizing the activities that add
value to the final product. From the customer point of view, value is equivalent to anything he is
willing to pay for the product or service he receives. Formally value adding activities can be
defined as: activities that transform materials and information into products and services the
customer wants.

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On the other hand non-value adding activities can be defined as: activities that consume resources,
but do not directly contribute to product or service. This non-value adding activities are the waste
in Lean Manufacturing. Waste can be generated due to poor layout (distance), long setup times,
incapable processes, poor maintenance practices, poor work methods, lack of training, large
batches, ineffective production planning/scheduling, lack of workplace organization etc. By
eliminating wastes in the overall process, through continuous improvements the product’s lead
time can be reduced remarkably.
By reducing lead time organization can obtain operational benefits (enhancement of productivity,
reduction in work-in-process inventory, improvement in quality, reduction of space utilization and
better work place organization) as well as administrative benefits (reduction in order processing
errors, streamlining of customer service functions so that customers are no longer placed on hold,
reduction of paperwork in office areas, reduction of labor turnover).

1.2 Lean Approach

Lean organizations are highly customer focused, providing the highest quality, lowest cost
products in the shortest lead time possible. According to the book “Lean Thinking” by James P.
Womack and Daniel Jones, the Lean approach can be summarized in five principles (Womack and
Jones, 2003):
 Specify what creates value from the customer’s perspective - Value should be specified
from the customer point of view not by the perspective of individual firms, functions and
departments. If the customer does not pay for an activity, it is a non- value adding activity
and should be eliminated.
 Identify all the steps along the process chain – This means identifying the value stream.
It can be used to identify activities where value is added to the product and those do not.
 Make those processes flow – The value added product must flow continuously from the
start to finish without interruptions, detours, backflows, waiting, scrap and stoppages.
 Make only what is pulled by the customer – The customer should pull the product from
the source as needed rather than process pushing the products onto the customer.
 Strive for perfection – After implementing above steps the team should be continuously
remove wastes as they are uncovered and pursue perfection through continuous
improvement. Lean uses practically proven tools and techniques to systematically
implement these Lean principles. If these are correctly applied, it will bring improvements
to quality, cost and delivery of the final product. Those tools help in implementing,
monitoring, and evaluating Lean efforts and its results. On the other hand if these were
used without proper understanding, it can spoil Lean efforts in one’s organization.

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1.3 Elements of Lean
Those concepts that lead to the implementation of lean manufacturing successfully are called
elements of lean manufacturing. The basic elements of lean manufacturing are waste elimination,
continuous improvement, pull system, one-piece workflow, cellular manufacturing and 5S’s.
When these elements are focused in the areas of cost, quality and delivery, this forms the basis for
a lean production system.
*Elimination of waste:
Waste is anything that doesn’t add value to the product. Seeing whether the process is adding value
to the product or not is the best way to identify wastes.
Out of the complete processes in an industry only about 5 % actually add value to the product.
Rest of the process does not add any value. Rest 35% activities are such that even though this
doesn’t add any value but still it cannot be eliminated as it is necessary. For eg. Inventory cannot
be completely reduced, scrap materials cannot be made zero, it may take few minutes to load
unload and load for next operation etc. So focus should be on complete elimination of waste
activities and reducing the necessary non-value adding activities.
* Continuous improvement:
Japanese looked at improving their work every time they do it. This lead to the development of
concept called continuous improvement. Japanese rather than maintaining the improvement they
have achieved they concentrated in continuously improving their work. This improvement can be
in any field like quality, error proofing, lead-time reduction etc. So the focus should be on how
you can improve your work than the same done last time.
Improvement is classified into innovations and kaizen. Innovations are those improvements which
cause drastic changes. These occur due to huge technological advancements in the field of research
and development. These are mostly done by high level engineers. Kaizen include small small
improvements done by lower order employees.
In order to achieve continuous improvement the work culture of the workers should be modified.
The workers should be aimed at improving their work each time they do it.
*Pull system
Manufacturing system can be divided into two
1) Push system: Here the products are made according to the market forecast and not according
to the current demand. So here the information flow is in the same direction as the product flow.
So there may chance of piling of finished goods as there are always fluctuation in demand. Thus
the product is pushed through the production line.
2) Pull system: Here the product is made according to the customer demand. So the information
of the quantity and type of product flow in the opposite direction to that of the product. Here no

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piling of finished products occurs as the production is according to the customer demand. Hence
the customer pulls the product through the production line.

*One-piece flow:
One piece flow is one of the important techniques in implementing lean manufacturing. Traditional
batch production in mass production is replaced by one piece flow in lean manufacturing. Here
batch size is reduced to almost one. This reduces the total lead time and also reduces waiting
between operations or queuing.
Following figures show how effective is one piece flow over batch production.

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From the above example it is clear that the lead time can be reduced to almost 40% of the lead
time when it was batch production. Also it can be noted that it takes about 85% less time for the
first part to be produced. Thus product can be produced according to current demand quickly.
*Cellular manufacturing:
In traditional mass production machines are arranged according to its functions. But in cellular
manufacturing machines are arranged according to the processes involved in production. The
plants layout is designed in such a way that transportation between machineries is reduced to
minimum. For the implementation of such a good plant layout deep knowledge of processes as
well as proper analysis of processes involved in production is necessary.
Following figures shows the diagrammatic representation of both forms of floor arrangement.

FUNCTIONAL CELLS

Cell advantage over Functional department:

1. Shorter Lead Time
2. Improved Quality - Quicker problem identification
3. Improved Quality - Less potential rework or scrap
4. Less Material Handling

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 5. Improved Coordination
6. Reduced Inventory
7. Departmental conflicts eliminated
8. Simplified Scheduling
9. Less Space Required
*The 5 S’s:
5S represents Japanese words that describe the steps of a workplace organization process. English
equivalent words are shown in parenthesis
1. Seiri (Sort)
2. Seiton (Straighten, Set)
3. Seiso (Shine, Sweep)
4. Seiketsu (Standardize)
5. Shitsuke (Sustain)
In simple terms, the five S methodology helps a workplace remove items that are no longer needed
(sort), organize the items to optimize efficiency and flow (straighten), clean the area in order to
more easily identify problems (shine), implement color coding and labels to stay consistent with
other areas (standardize) and develop behaviors that keep the workplace organized over the long
term (sustain).
Here is a breakdown of each ‘S’:
1. Sort (seiri) – Distinguishing between necessary and unnecessary things, and getting rid of what
you do not need.
 Remove items not used in area – outdated materials, broken equipment, redundant
equipment, files on the computer, measurements which you no longer use
 Ask staff to tag all items which they don’t think are needed – this improves understanding
about need and use
 Classify all equipment and materials by frequency of use to help decide if it should be
removed – place ‘Red Tag’ on items to be removed
 Establish a ‘holding area’ for items that are difficult to classify – hold item for allotted
period to enable others not on 5S team to review
2. Straighten (seiton) – The practice of orderly storage so the right item can be picked efficiently
(without waste) at the right time, easy to access for everyone. A place for everything and
everything in its place.

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  Identify and allocate a place for all the materials needed for your work
 Assign fixed places and fixed quantity
 Make it compact
 Place heavy objects at a height where they are easy to pick from
 Decide how things should be put away, and obey those rules
3. Shine (seiso) – Create a clean worksite without garbage, dirt and dust, so problems can be more
easily identified (leaks, spills, excess, damage, etc)
 Identify root causes of dirtiness, and correct process
 Only one work activity on a workspace at any given time
 Keep tools and equipment clean and in top condition, ready for use at any time
 Cleanliness should be a daily activity – at least 5 minutes per day
 Use chart with signatures/initials shows that the action or review has taken place
 Ensure proper lighting – it can be hard to see dirt and dust
4. Standardize (seiketsu) – Setting up standards for a neat, clean, workplace
 Standardization of best practices through ‘visual management’
 Make abnormalities visible to management
 Keep each area consistent with one another
 Standards make it easy to move workers into different areas
 Create process of how to maintain the standard with defined roles and responsibilities
 Make it easy for everyone to identify the state of normal or abnormal conditions – place
photos on the walls, to provide visual reminder.
5. Sustain (shitsuke) – Implementing behaviors and habits to maintain the established standards
over the long term, and making the workplace organization the key to managing the process for
success
 Toughest phase is to Sustain – many fall short of this goal
 Establish and maintain responsibilities – requires leader commitment to follow through
 Every one sticks to the rules and makes it a habit
 Participation of everyone in developing good habits and buy-in
 Regular audits and reviews
 Get to root cause of issues

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  Aim for higher 5S levels – continuous improvement.

*Value Stream Mapping

Value Stream Mapping is used to illustrate the flow and relationship between work processes. A
key component of VSM is differentiating value adding activities from non-value adding activities.
Reducing or eliminating non-value adding activities is of paramount importance and a principle
goal of Lean Manufacturing. Upon careful and detailed examination of your processes through
VSM, it soon becomes obvious where improvement opportunities lie.
Utilizing the skills and experience of area employees and operators is essential. Engaging in a
powerful discovery process that exposes hidden non-value adding activities. Once these items are
known, the stage is set for significant progress toward eliminating them.
Going through the Value Stream Mapping process may be quick and relatively easy for simple
operations, or it may take much more time with considerable difficulty when examining complex
operations.
Mapping processes and where value and non-value adding activities occur will yield a baseline of
information from which tremendous improvement opportunities can be realized.

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1.4 Wastes in Lean Manufacturing
The waste can be categorized into seven types which are commonly referred to as the “Seven
wastes”. Taiichi Ohno suggests that these account for up to 95% of all costs in non –Lean
Manufacturing environments. These wastes are:
 Overproduction: Producing more than the customer demands. There are two types of
overproduction (Shingo, 1989): 1. Quantitative – making more products than needed. 2.
Early – making products before needed. Overproduction is highly costly to a manufacturing
plant because it obstructs the smooth flow of materials and degrades the quality and
productivity. Overproduction manufacturing is referred to as “Just in Case” whereas Lean
Manufacturing is referred to as “Just in Time” (McBride, 2003). The corresponding Lean
principle is to manufacture based upon a pull system, or producing products just as
customers order them. Anything produced beyond customer order ties up valuable labor
and material resources that might otherwise be used to respond to customer demand. Ohno
considered the fundamental waste to be overproduction, since it leads to other wastes such
as overstaffing, storage, and transportation costs because of excess inventory.
 Waiting: Whenever goods are not being moving or being processed, the waste, waiting
occurs. Typically more than 99% of a product’s life cycle time in traditional mass
production is spent in idling. This includes waiting for material, labor, information,
equipment etc. Lean requires that all resources are provided on a just-in-time (JIT) basis –
not too soon, not too late by linking processes together so that one feeds directly into the
next and can dramatically reduce waiting.
 Transportation or conveyance: Moving product between processes does not add value to
the product. Excessive movements and handlings can cause damages and can lead to
reduction in quality. Materials should be delivered to its point of use. Lean requires the
material be shipped directly from the vendor to the location in the assembly line where it
will be used. This is called Point-Of-Use-Storage (POUS).
 Over processing or incorrect processing: Taking unneeded steps to process the parts.
Some of the more common examples of this are reworking, inspecting, rechecking etc. This
is due to poor layout, poor tools and poor product design, causing unnecessary motion and
producing defects.
 Excess Inventory: Any type of inventory (raw material or in process or finish goods) does
not add value to the product and it should be eliminated or reduced. Excess inventory uses
valuable floor space and hides problems related to process in capabilities. Excess inventory
results in longer lead times, obsolescence, damaged goods, transportation and storage costs,
and delay.
 Defects: Defects can be either production defects or service errors. Having a defect results
a tremendous cost to organizations. In most of the organizations the total cost of defects is
often a significant percentage of total manufacturing cost. Repairing of rework,
replacement production and inspection means wasteful handling time, and effort.

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  Excess Motion: Any motion that employee has to perform which does not add value the
product is an unnecessary or excess motion. Unnecessary motion is caused by poor
workflow, poor layout, poor housekeeping, and inconsistent or undocumented work
methods.

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2. Company profile:
Aristopharma Ltd. is one of the Top 10 pharmaceutical companies in Bangladesh. The company
started its journey in 1986 with the honest promise to provide quality medicines at affordable prices
to the countrymen. Its state-of-the-art manufacturing plant is equipped with highly sophisticated
and advanced facilities. The facility is planned and designed to meet the local as well as
international demand both qualitatively and quantitatively.
Aristopharma manufactures medicines of wide range of therapeutic classes like antiulcerants,
antibiotics, NSAIDs, antipyretics, vitamins & minerals, laxatives, cardiovasculars, antidiabetics,
steroids, antispasmodics, antihistamines, antipsychotics, antiemetics, antiseptics and many more.
It started manufacturing sterile ophthalmic products in 2002 and presently is maintaining no. 1
position in ophthalmic market in Bangladesh. In 2010 Aristopharma expanded its plant & started
manufacturing hi-tech products like inhalers, lyophilized injections, pre-filled syringes,
suppositories, insulin & other bio-tech products. Recently Aristopharma has opened its new UK
MHRA standard plant at Gachha, Gazipur with dedicated facility for cephalosporin products.
Construction work of dedicated Ophthalmic & Oncology plants are also running in full swing in
this new campus.
In Aristopharma, quality is a journey, not a goal. It continuously sets higher standards and feels
passionate to achieve that. The motto of Aristopharma's quality policy is “Quality – the unit we
count” and by quality we don’t mean only product quality rather it is infused in every activities
that we do.
With the aim to cope with the challenges of globalization, Aristopharma ltd. stepped beyond the
boundary of Bangladesh in 2000, Vietnam being the first country to export. Today Aristopharma
exports it quality medicines to 34 countries of 5 continents and is moving aggressively to expand
and extend its export market.
As a recognition to its Quality Management System, Aristopharma achieved ISO 9001:2000
certificate in 2005. The certificate was issued by Orion Registrar Inc. USA, one of the prime
certification bodies in the world. Later on the certificate was upgraded to ISO 9001:2008 standard.

2.1 Quality Management System

A Quality Management System, often called a QMS, is a set of internal rules that are defined by a
collection of policies, processes, documented procedures and records. This system defines how a
company will achieve the creation and delivery of the product or service they provide to their
customers. When implemented in your company, the QMS needs to be specific to the product or
service provide, so it is important to tailor it to needs. Some general guidelines exist in the form
of ISO 9001 (Quality Management System – Requirements), which is intended to help standardize
how a QMS is designed.

2.2 Quality Management System Common Elements

Quality Management System processes start with the initial management planning stages of a
company, which define the goals of the company including what products or services the company
will be offering. The system then deals with all processes needed, from sales of the product or
service through creation and finally delivery of the product or service to the customer.

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Additionally, the support processes for this to happen are controlled as part of the system. This
will include managing resources like people and equipment, procedures to control documents and
records, and documents defining how to control products or services that do not meet requirements.

Finally, there are processes as part of the QMS that are designed to monitor the processes of the
system and lead to improvement. These processes will include a method of auditing the system
processes, means of applying corrective and preventive actions for problems and a way for
management to review the system to ensure requirements are met and plans are made for
improvements.

One of the best ways to ensure that system has included all applicable processes is to refer to a
standard set of requirements for Quality management Systems. The ISO 9001 standard is one such
set of requirements (for other examples, see Quality Certification) that defines and outlines all the
typical policies, processes, documented procedures and records that are needed for a successful
QMS, and can be used and tailored for the needs of any organization.

2.3 Some challenges of developing a QMS

Quality Management System development can have some challenging aspects. One of the first is
to overcome the misconception of thinking a QMS only refers to the processes necessary to deal
with inspection and disposition of non-conforming products, often designated to members of a
quality control department.

Such a system only manages the inspection of product, while not managing the inputs that help a
product or service to be compliant in the first place, effectively trying to inspect quality into the
product or service.

Once this is overcome, the biggest challenges are in demonstrating the commitment of
management by having the overlying policies defined and communicated to all levels of the
organization. Then the QMS can be made to work as a method of ensuring that all necessary
requirements are defined and met, and improvements are made.

The seven quality management principles are:

QMP 1 – Customer focus

QMP 2 – Leadership

QMP 3 – Engagement of people

QMP 4 – Process approach

QMP 5 – Improvement

QMP 6 – Evidence-based decision making

QMP 6 – Relationship Management

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2.4 SAP

The organization is now planning for new lean system with SAP (Systems, Applications
& Products in Data Processing). According to their employees it can start within next year.

SAP software system delivers distinct solution for production of drugs in an automated approach.
Economy management of pharmaceuticals effectively done through integrated software package.
Business entities from finance, accounting, sales, and production to customer relationship are taken
care under single structure. Medications are produced in accordance with rules and regulations of
government. Implementation of SAP gives effective planning to increase production. SAP is
considered the industry standard ERP system for pharmaceutical enterprises.

SAP SE, a global software company, is one of the largest vendors of ERP and other enterprise
applications. The company is headquartered in Walldorf, Germany.

According to its 2016 corporate fact sheet, SAP serves more than 335,000 customers in 190
countries, of which 80% are small- and-medium sized businesses (SMB). The latter fact is a more
recent departure from the company's previous focus on large organizations.

According to SAP, 75% of all global business transactions come in contact with an SAP system.
The company offers on-premises, cloud and hybrid deployment models, with cloud computing
options being the focus for the company's future. On the Forbes 2016 list of "The World's Biggest
Public Companies," SAP was ranked the third-largest software and programming company, behind
Microsoft (1) and Oracle (2).

SAP's ERP system enables companies to run their business processes, be they accounting, sales,
production, human resources or payment, in an integrated environment. The integration ensures
that information flows from one SAP component to another without the need for redundant data
entry, and it helps enforce financial, process and legal controls. SAP's ERP system also facilitates
effective utilization of resources (the R in ERP), be it machines, production capacities, manpower
or other assets of an enterprise (the E in ERP) through detailed planning (the P in ERP) of
resources.

2.5 History of SAP

SAP was started in 1972 by five former IBM employees in Mannheim, Germany. The original
name for SAP, Systeme, Anwendungen, Produkte, is German for "Systems, Applications and
Products." The original idea for SAP was to provide customers with the ability to interact with a
common corporate database for a comprehensive range of applications in real time.

In 1973, SAP released R/1, a financial accounting system. R/1 ran on IBM servers and DOS, and
it had a single-tier architecture in which presentation, applications and data were on one platform.

In 1979, SAP released R/2, a mainframe system that provided real-time data processing across
accounting, manufacturing, supply chain and human resources. R/2 used a two-tier architecture,

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where presentation was on one platform and applications and data were on another. R/2 helped
power SAP's growth, and the vendor expanded its customer base to about 200 companies.

In 1992, SAP released R/3, which represented a switch from mainframe computing to the client-
server model, and from a two-tier to a three-tier architecture, in which presentation, applications
and data were housed separately. R/3 was a critical product for SAP that launched the company
onto the world stage.

In 1999, SAP launched mySAP, which marked a new strategy for the company of focusing on
combining e-commerce software with the applications in R/3. One year after R/3's release, SAP
partnered with Microsoft to port the new version to Windows NT. By 1997, SAP employed 13,000
people.In 2004, the company launched SAP NetWeaver, and it reported that more than 1,000
customers acquired the application development platform that year. Also in 2004, the successor to
R/3, the SAP ERP system (or SAP ECC, for SAP ERP Central Component) was released.
Customers already using R/2 or R/3 were still supported, but new customers were required to
implement SAP ERP. By 2005, SAP was generating $8.5 billion, with upwards of 35,800
employees around the globe.In 2006, the company claimed hefty revenue from SAP Business All-
in-One and SAP Business One, its SAP ERP systems for SMBs.

In 2009, SAP Business Suite 7 became available to customers worldwide. At the time, SAP called
it "the company's next-generation software suite enabled by service-oriented architecture."

In 2011, the company launched SAP HANA, an in-memory database platform. HANA was a major
development project for SAP, and an important new strategic direction for the vendor, which has
said it intends HANA to take the place of the traditional databases SAP has used for its business
applications. SAP has offered HANA as a deployment option for Business Suite, and, in 2015,
released S/4HANA, an ambitious rewrite of Business Suite optimized for the HANA platform.

2.6 Activities of SAP implementation process

Activity Sub-Activity Description

Refine and communicate a SOLUTION VISION of

the future-state of the SAP solution, to sketch a
design that meets both business and financial
requirements. The focus should be on the
company’s core business and how the SAP solution
Project
Craft solution vision will better enable that core business to be successful.
preparation
Some of the guidance and key requirements for how
to put together an ERP and SAP business case for
ROI, business benefit, and success includes
focusing on competitive pressures, value
propositions, and how the solution enables success.

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 Design and staff the key positions of the SAP
Technical Support Organization (TSO), the
Design and initially staff
organization that is charged with addressing,
the SAP TSO
designing, implementing and supporting the SAP
solution.

Perform a COST OF OWNERSHIP ANALYSIS to

determine how to get the best business solution for
Perform ownership
the least money i.e. to determine where and when
analysis
the costs are incurred within the context of the
SAP solution stack.

Determine all HIGH AVAILABILITY and

Identify high
DISASTER RECOVERY REQUIREMENTS, to
availability and recovery
plan what to do with later downtime of the SAP
requirements
system

Select the best

Engage SAP stack SAP hardware and software technology partners for
vendors all layers and components of the SAP SOLUTION
STACK, based on a side-by-side sizing comparison
Sizing and
blueprinting
Staff the bulk of the TSO, i.e. fill the positions that
directly support the near-term objectives of the
Staff TSO implementation, which are to develop and
begin installation/implementation of the SAP data
center.

Train the various members of the SAP TSO, high

availability specialist and network specialists and
Execute training
train the end-users to give all the required
SAP knowledge and skills

Build a new SAP DATA CENTER facility or

Setup SAP DATA
transform the current data center into a foundation
CENTER
capable of supporting the SAP SOLUTION STACK

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 Install the (My) SAP components and technological
Perform installations foundations like a web application server or
enterprise portal.

Identify and staff the remaining TSO roles, e.g. roles

Round out support for
that relate to help desk work and other such support
SAP
providing work.

Develop a planned approach to the changes in

the organization. The objective is to maximize the
Address Change collective efforts of all people involved in the
Management change and minimize the risk of failure of
implementing the changes related to the
SAP implementation.

Create a foundation for the SAP

Address SAP systems
SAP systems management and SAP computer operations,
and operations
functional by creating a SAP OPERATIONS MANUAL and
management
development by evaluating SAP management applications.

Test the SAP business processes, by executing

functional tests to ensure that business processes
Perform functional, work, integration tests to ensure that the
integration and regression organization’s business processes work together
tests with other business processes and regression tests to
prove that a specific set of data and processes yield
consistent and repeatable results.

Plan, script, execute and monitor SAP STRESS

Perform systems and
TESTS, to see if the expectations of the end users,
stress tests
defined in service level agreements, will be met.
Final
Preparation
Plan, prepare and execute the CUTOVER, by
creating a CUTOVER PLAN that describes all
Prepare for cutover
cutover tasks that have to be performed before the
actual go-live

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 Go Live Turn on the SAP system for the end-users

2.7 Validation
In the SAP system, nearly all input values are validated by a program or against tables or master
files. Since some types of validations cannot be standardized, Validations program is used to create
validations for specific requirements

Validation refers to establishing documented evidence that a process or system, when operated
within established parameters, can perform effectively and reproducibly to produce a medicinal
product meeting its pre-determined specifications and quality attributes.

*Validations in Pharmaceutical Company

Process Validation: This involves validation of Manufacturing Process, Plant & Machines, and
Manufacturing Techniques etc.

Cleaning Validation: This involves validation of Labs, Production, Packaging (Proof of clean),
Equipments, Machinery, Instruments, Cleaning Techniques etc.

Method Validation: This involves validation of Laboratory methods (R&D…), Quality

Verification methods, Analytical Equipment etc.

Computer System Validation: This involves validation of Computer Related Systems (any
place), Computer Systems & Operating procedures, Design, Installation, Performance etc.

2.8 V Model Concept for System Validation

User Requirement Specifications (URS) : This step defines what user wants from the system and
makes sure that requirement is met

Functional Specifications: This step defines or creates a document in user understandable format
based on URS. This is developed by developer or vendor or service provider.

Design Qualification DQ: This step provides a document which states that the computer system
requirements have been clearly defined and is approved in the form of URS. It also provides
document that states all additional system specifications are developed, reviewed and approved.

Installation Qualification IQ: In this step document is provided which gives the guarantee that all
hardware installation aspects are considered according to appropriate codes and approved design.
Also software installation is also considered.

Operation Qualification OQ: In this step document is provided which gives the guarantee that
installed system works as specified.

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Performance Qualification PQ: In this step document is provided which gives the guarantee that
entire system performs as expected under all operating ranges.

2.9 Benefits of SAP

1. Staying Compliant and Progressing Ahead

One of the crucial success factors in leading pharmaceutical companies is Compliance. Today, all
of these pharmaceutical companies need to follow a varied set of regulations imposed by various
agencies such as FDA, DEA and EPA. Hence, they are in search of better ways to efficiently
account for and manage the increasing number of rules and regulations.

This is where SAP comes in. Ranging from methods to pay, compliant manufacturing and
equipment manufacturing to field sales and laboratory operation management, SAP offers a myriad
of flexible options to help companies stay compliant and progress ahead.

2. Identifying and Fixing Problems

Pharmaceutical organizations tend to face a major challenge all the time- huge amounts of data. It
acts as an obstacle in identifying the problem areas. Moreover, this makes it extremely difficult
for the organizations to ensure product safety and maintain product integrity.

With the help of SAP Solutions and the integrated approach provided by it, companies have access
to all the information that they need, which in turn helps them to quickly recognize problems with
respect to raw materials, supplies and in manufacturing, quality control and packaging.

3. Quick and Easy Execution of Business Strategies

A shift is increasingly being observed in majority of pharmaceutical companies; from the R-&-D-
centered business model to a dual focus model that helps in the significant growth of sales. This is
an attempt to identify different sorts of opportunities in the market. Now, this step requires a major
understanding of the market and its various aspects: maintaining relationships, increasing mind
share, identifying appropriate physicians and improving sales efficiency.

SAP with its CRM (Customer Relationship Management) technology helps companies perform
market analysis, execute multichannel campaigns, work with physicians and acquire mind share.

4. Minimizing Delays

One important thing to note is when it comes to product launch and peak sales of the
pharmaceutical companies, there is a huge time difference. And this difference needs to be
minimized. It is important as companies lose patent protection for flagship products and experience
major declines in revenues.

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There’s a huge risk of negative cash flow and so it needs to be seen that companies execute their
sales operations effectively and within time. Now, SAP offers many amazing and powerful tools
that help in minimizing the huge time gaps and thus the delays. The tools include contract
management, improving campaign management and performance and quick identification and
reconciling charge backs and rebate volumes.

5. Taking Advantage of Emerging Outsourcing Opportunities

When it comes to working on company’s cost savings, pharmaceutical companies tend to consider
that their core processes are too complex to survive outsourcing. But it’s important to see that there
is a significantly growing and capable base of IT support companies to support outsourcing
activities both off-shore and at home. Companies just need to know how to take advantage of these
opportunities.

The SAP NetWeaver helps companies to a huge extent in this process. It helps companies take
advantage of various opportunities. It offers hosting services, such as implementation and
application hosting that help companies in ramping up operations and ensuring a simple and
smooth transition process. This as a result helps in successful outsourcing irrespective of location
and time zone.

6. Easy tracking and tracing of Products

That one thing which immediately leads to creating a positive or negative reputation of the
company is accidents and the factor of trustworthiness. When it comes to tracking products in
today’s times, paper-based tracking processes definitely don’t succeed.

SAP NetWeaver’s component- SAP Auto-ID Infrastructure provides a ready-made RFID

platform, one that can be quickly deployed and integrated with core supply chain and ERP
processes. This as a result helps in providing companies new useful capabilities to monitor
products, track them and prevent any sort of accidents and hence maintain a positive public image.

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3. Conclusion
Lean is a combination of the best processes and practices that optimize resources and yield the
best product, in the fastest time, at the lowest cost. Lean is an umbrella for “total quality
management,” “continuous improvement, “zero defect,” “six sigma,” “DMAIC,” and other similar
terms that focus on doing the right thing, at the right time, in the right place, in the right quantity,
and doing it right the first time. SAP is combination of PULL and PUSH. SAP has the ability to
execute takt-based scheduling, perform line balancing, pull with eKanban, level demand with a
heijunka sequence and even combine a planned, level sequence to reserve capacity and purchased
parts, with a Kanban withdrawal from an actual demand signal. With integrated into the SAP
environment, the organization will have the ability to review the performance of individual
manufacturing sites and of the group, by comparing like-for-like data. From an inventory point of
view all suppliers and supply chains look for cost savings. With standardized purchasing, payment
terms, finance and logistics across all the sites organization will generate economies of scale and
reduce inventory levels. By taking the SAP approach, management will be able to gain an accurate
picture of every element of the business, such as inventory, finance, sales, maintenance and more,
helping to tune the business and increase shareholder value.

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4. References:
 http://www.aristopharma.com/
 https://www.exelop.com/solutions-to-operational-excellence/lean-sap-implementation/
 https://www.lean.org/WhatsLean/
 https://en.wikipedia.org/wiki/Lean_manufacturing
 https://blogs.sap.com/2014/04/19/lean-manufacturing-with-sap-erp/
 https://www.sap.com/products/supply-chain-iot/manufacturing.html
 https://www.ptonline.com/articles/lean-versus-quality-management-they-dont-have-to-
conflict
 https://en.wikipedia.org/wiki/Quality_management_system
 http://the9000store.com/iso-9001-2015-requirements/what-is-iso-9001-quality-
management-system/
 https://www.iso.org/files/live/sites/isoorg/files/archive/pdf/en/pub100080.pdf
 https://advisera.com/9001academy/knowledgebase/quality-management-system-what-is-
it/
 https://en.wikipedia.org/wiki/SAP_SE
 http://searchsap.techtarget.com/definition/SAP
 https://fenix.tecnico.ulisboa.pt/downloadFile/563345090413180/Artigo%20-
%20Pedro%20Jonet%20(68645).pdf
 https://www.scribd.com/document/347799430/Advancing-Lean-in-Supply-Chain-
Planning-with-SAP-Applications-pdf

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