Lean and Agile Engineering in pharmaceutical

industry-Case Study

MEGHA SUKUMAR

Lean and Agile Engineering

Submitted in partial fulfilment of

the requirements of Leeds Beckett University
for the Degree of
MSc Advanced Engineering Management

School of Built Environment, Engineering and

Computing

March 2023

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 Authorship Declaration

I, Megha Sukumar, confirm that this dissertation/assignment and the work presented
in it are my own achievement.

Where I have consulted the published work of others this is always clearly attributed;

Where I have quoted from the work of others the source is always given. With the
exception of such quotations this dissertation is entirely my own work;

I have acknowledged all main sources of help;

If my research follows on from previous work or is part of a larger collaborative

research project, I have made clear exactly what was done by others and what I have
contributed myself;

I have read and understand the penalties associated with Academic Misconduct.

I also confirm that I have obtained informed consent from all people I have involved
in the work in this dissertation following the school’s ethical guidelines

Signed: MEGHA SUKUMAR

Date:19/03/2023

Student ID No:77350560

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 Abstract

Lean engineering is a business improvement methodology that focuses on developing

new products, improving manufacturing and distribution processes to reduce overall
time required for a product and improving its quality, thereby increasing revenue and
reducing cost and investment.

Agile can help breakdown traditional internal silos within pharmaceutical companies
and build cross-functional teams that share knowledge more effectively. In addition to
increasing organizational agility and flexibility, it also increases employee transparency
and engagement.

Without any doubt , the pharmaceutical industry will continue to grow in a higher
pace globally ,simultaneously ,globalization and digitalization will lead to greater
volatility. Therefore, there is an increasing need to become leaner and more agile-to
reduce the time needed for production and to be able to react very quickly to new
situations.

The transition from fragile to agile is not a one-time endeavour; it’s a once-in-a-
lifetime journey of transformation that requires building the right teams with the right
mindset to become independent and nurture cooperation at all levels. The outcome is
an improved project management process that delivers projects on time(using less
time), at lower cost and with minimal waste even without compromising scope, quality
or risk.

This case study presents a framework that integrates lean and agile concepts to
structure and assess the sustainability of manufacturing systems. The purpose of this
study is to identify the key factors of lean and agile manufacturing that promote
sustainability and support economic, environmental, social, technical and ethical
considerations. The case in question pertains to an ancient Ayurvedic pharmaceutical
industry in India.

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CONTENTS

1 INTRODUCTION…………………………………………………………………....6
1.1 Aim…………………………………………………………………………………..............6
2 LITERATURE REVIEW…………………………………………………………….6
2.1 Introduction to lean……………………………………………………………………….6
2.1.1 Lean manufacturing…………………………………………………………………………………...7

2.1.2 Kaizen………………………………………………………………………………………………......7

2.1.3 Workplace productivity-5S…………………………………………………………………………....9

2.1.4 Dealing with 7 deadly wastes………………………………………………………………………...9

2.1.5.Practical problem-solving course………………………………………………………………….....9

2.1.6 Quick changeover-The SMED system……………………………………………………………....10

2.2 Six Sigma Technology…………………………………………………………………….10

3 CASE STUDY…………………………………………………………………….....12
4 CONCLUSIONS…………………………………………………………………….17
REFERENCES.......................................................................................................18
APPENDIX..............................................................................................................20

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LIST OF FIGURES

Figure 1 : Kaizen cycle suggested by Diann Daniel....................................................7

Figure 2 : PDCA cycle demonstrated by Gamba Academy........................................9

Figure 3 : Lean six sigma as explained by Ankit Rastogi..........................................10

Figure 4 : Industry under study – Nadeppilly.............................................................12

Figure 5 : Founder of the clinic – Late Dr.Ayyappan Nadeppilly................................13

Figure 6 : Medicines produced in Nadeppilly.............................................................14

Figure 7 : Traditional oil dripping equipment..............................................................15

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 1.INTRODUCTION
Many pharmaceutical , healthcare companies have realised that new dynamic market
conditions require changes in their operating models. Challenges such as the increased
complexity of customer environments and micro-targeted studies with low ROI potential
are forcing companies to find new ways to increase production speed, reduce
development costs and improve overall operational efficiency. Pharmaceutical
companies are already undergoing a digital transformation due to growing demand
(Hanna, 2019).

Here we studied a pharmaceutical clinic located in a small Indian state called Kerala.
The institute is called ‘Nadeppilly Arya Vaidhyasala’ and uses Ayurvedic principles to
treat patients, especially poisoned patients.

They also manufacture and produce medicines in the same place. Lean and agile
techniques can be used in manufacturing to improve production aspects and reduce
the amount of waste generated. Some of the most important lean and agile techniques
that we planned to use after careful consideration of the clinic situation are
5S,Kaizen,Six Sigma, SMED, VSM etc...

1.1. Aim
• The aim is to conduct a thorough assessment of the theory and implementation of
lean product development and manufacturing practices , with a focus on fostering
greater agility and promoting organizational learning
• To conduct a critical evaluation of the fundamental principles of lean and agile
engineering , including but not limited to six sigma, SMED, SCRUM, Kaizen etc.
The objective is to find the significance of these principles in the engineering
environment.
.

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 2. LITERATURE REVIEW

2.1.Introduction to Lean
2.1.1.Lean manufacturing
Lean manufacturing refers to a collection of management practices and methods
aimed at removing waste (known as "Muda") and improving the flow of value-adding
activities within the production process of goods. The utilization of lean techniques to
eliminate the primary sources of waste in production can lead to a reduction in costs ,a
decrease in resource consumption, and a safer work environment for employees (Vinay
& Saleeshya, 2019).
An important factor in the pharmaceutical industry is the timely fulfilment of orders to
customers which requires product availability and highest level of service in healthcare
system (Patil & Sonawane, 2019)

2.1.2.Kaizen
Organizations globally employ Kaizen to enhance the value of production and promote
employee morale and safety (Chakraborty & Ghosh, 2019). The improvements brought
about by the kaizen process are minute and gradual, and important results can only be
seen post a certain period of time. Kaizen focuses on eliminating waste, increasing
productivity and continuously improving an organization’s targeted activities and
processes (Manjunath, 2015). A demonstration of Kaizen cycle is given in Figure 1
(Daniel, 2022).Here we tried to find different ways to reduce the Muda and increase the
productivity of the selected pharmaceutical clinic.

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 Figure 1:Kaizen cycle suggested by Diann Daniel

2.1.3.Workspace productivity-5S
The 5S methodology emphasizes the creation of visual order, organizing, cleaning
and standardizing procedures to improve profitability, efficiency, service and safety
(Hua, et al., 2019)
• Seiri /Sort : Organize (Hua, et al., 2019)
• Seiton /Set in order : Orderliness (Hua, et al., 2019)
• Seiso/Shine : Cleanliness (Hua, et al., 2019)
• Seiketsu/Standardize : Standardized practices (Hua, et al., 2019)
• Shitsuke/Sustain : Discipline (Hua, et al., 2019)

2.1.4.Dealing with the 7 deadly wastes

Waste exists in almost every pharmaceutical unit such as unnecessary movements,

procedural errors, communication errors etc.. (Bandyopadhyay, et al., 2019)

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 • Waste of defects : The occurrence of defects results in a significant waste of
time, as the defective product must be reworked or remanufactured, which incurs
additional expenses (Hugh, et al., 2019)
• Waste of inventory : This is the waste associated with unprocessed stock.
These include wasted capital associated with excess inventory, containers to store
excess product etc…Excess inventory can also mask other forms of inefficiency
generated by current workflows (Hugh, et al., 2019)
• Waste of processing : Lean manufacturing relies on products that deliver value
to customers, not on overdesigning a product (Hugh, et al., 2019)
• Waste of waiting : It is any form of waiting that the humans and machines
undergoes to accomplish a task. This usually happens when a process on the
production line takes more than the usual time which wastes worker’s time (Hugh, et
al., 2019).
• Waste of motion : Waste of motion is any movement that serves no use or that
could be used for other purposes. This leads to wastage as it is useless effort and time
(Hugh, et al., 2019).
• Waste of transportation : Transportation is a non-value adding activity that does
not contribute to the quality of the product. Therefore, it is necessary to minimize
transportation. One way to accomplish this is to relocate factories closer to each other,
thus reducing transportation costs (G, et al., 2019)
• Waste of overproduction : The objective is to manufacture only what the
customer requires. Lean manufacturing principles operate on the basis of ‘just-in-time’
meaning that products are produced only when they are needed not beforehand (G, et
al., 2019).

2.1.5. Practical Problem-Solving Course

Practical problem solving helps in defining the problem of an organization so that a

fast solution can be obtained.A standard problem-solving approach help the
organization save the time lost for unnecessary debates, discussions, brainstorming
etc… (J, et al., 2019). Figure 2 shows an 8-step process for practical problem solving
as explained by Gamba Academy (Anon., n.d.). A dominant problem-solving approach
is Six sigma methodology.

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 Figure 2: PDCA cycle demonstrated by Gamba Academy

2.1.6.Quick changeover-The SMED system

Formally defined in manufacturing terms, “a changeover is the time taken to change a

piece of equipment from producing the last good piece of a production lot to the first
good piece of the next production lot” In a pharmaceutical industry changeover refers
to the change of areas and equipment after processing one product and before starting
to process another product (Mrunal, et al., 2016)

2.2.SIX SIGMA METHODOLOGY

Six Sigma is a data-driven approach to quality management that strives to eliminate

defects in products or services by reducing variability and improving process efficiency
(Gijare & Khaparde, 2018). It is a vital component of lean and agile engineering , as it
helps organizations to streamline their processes and identify area’s improvement

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(O'Sullivan, et al., 2019).Figure 3 shows a lean six sigma explanation (Ankit, 2020).The
methodology consists of 5 phases:
• Define (O'Sullivan, et al., 2019)
• Measure (O'Sullivan, et al., 2019)
• Analyse (O'Sullivan, et al., 2019)
• Improve (O'Sullivan, et al., 2019)
• Control (O'Sullivan, et al., 2019)

Figure 3:Lean six sigma as explained by Ankit Rastogi

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 3.CASE STUDY
The pharmaceutical industry has always been slow to catch up with new approaches
and technologies due to strict regulations and long product development cycles. In
recent years, however ,many pharmaceutical companies have adopted lean and agile
techniques to increase efficiency, reduce costs and improve overall product quality.
One example of a pharmaceutical company that has successfully implemented lean
and agile techniques is Pfizer. Pfizer's global supply chain team has adopted lean
principles to streamline operations and improve production efficiency.
The pharmaceutical industry I selected for my case study is a clinic where medicines
are produced and delivered. Even though there is patient consultation in this clinic I
have taken into consideration only the manufacturing and production side. The clinic is
a Ayurvedic clinic located in Kerala, India. Ayurveda is an ancient Indian medical system
and the treatment and medicine is mainly based on the ancient writings that depends
on a “natural” and “holistic” approach to physical and mental health (Gopalakrishnan &
Venugopal, 2018). Ayurvedic medicine is one of the world’s oldest medical systems and
remains as one of the India’s traditional health care systems.
This clinic is a 3 storeyed building where 85 employees work apart from the 3
doctors.The building’s image is shown in figure 4. There are 15 rooms for treating
patients and 5 rooms for production and manufacturing procedures.

Figure 4 : Industry under study – Nadeppilly

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The founder of this clinic is Late DR.Ayyappan Nadeppilly shown in Figure 5.
I observed two main types of processes here which were extraction and separation.
Extraction used the principles of membrane rupturing and solute diffusion while
separation employed volatility and adsorption.

The process of each Ayurvedic Herbal Drug Production is divided into three steps
according to modern pharmaceutical drug preparation process, namely pre-processing,
extraction and separation. Pre-processing includes washing, drying, cleaning and
dusting of medicinal plants .

Figure 5 : Founder of the clinic – Late Dr.Ayyappan Nadeppilly

Extraction composes of activities that releases biologically active or undesirable

compounds. Various methods they used are mechanical pounding, hot solvent
extraction, pressurized liquid extraction and fermentation. Separation includes
processes to separate desired compounds from unwanted plant parts using techniques
like filtration, chromatography, liquid-liquid extractions and electrophoresis.An image of
the medicines is shown in figure 6.
Medicines require raw materials which includes substances and gases are brought here
in trucks every alternative day.

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 Figure 6 : Medicines produced in Nadeppilly

Also I hereby attach a video of Mr.Rajesh Nadeppilly,Managing Director of the clinic

talking about the company.

(Nadeppilly, 2023)

Some of the lean techniques they claimed to use were :

• SMED : When handling new products in the manufacturing and packaging

sectors, contamination of previous products must be avoided. Single minute exchange
of dies, abbreviated as SMED, focuses on the reduction of the time taken for
changeovers or setups (Mrunal, et al., 2016).The team working in the clinic were well
aware of the current changeover process including all the steps involved in switching
between products(both internal and external setup activities).They identified the tasks
which can be performed in parallel, those can be eliminated or streamlined. They found
the internal and external tasks in the clinic which are the tasks which can be performed
when the machine is shut down and the ones which can be performed while machine
is running respectively. An image of an equipment used in the clinic is shown in Figure
7.They converted as many internal tasks as possible to external tasks to reduce the
time of changeovers. The remaining internal tasks were streamlined, simplified or even
eliminated altogether. They trained employees on the new procedures and provided

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them with necessary tools and equipment to support the smed process. Finally, they
implemented this and evaluated its effectiveness. The clinic is satisfied with this process
and told that this increased their production flexibility and product quality. They
benefitted significantly since their processes involve frequent changeovers between
different medical products.
• Six Sigma : Lean six sigma is used here to improve the quality of the
manufacturing processes and reduce the risk of product recalls. They analysed the data
on product defects and non-conformances from the customers and identified area
where quality control processes can be improved to reduce defects and improve product
quality (Gunasekaran & Kobu, 2019). They also identified the potential risks and
implemented preventive measures to reduce the likelihood of those risks occurring(Risk
management).Risk management in pharmaceutical industry involves identifying
potential risks or hazards associated with the manufacturing process or product,
evaluating the likelihood and severity of those risks and implementing measures to
mitigate or eliminate them (Gijare & Khaparde, 2018). They also used six sigma as the
part of a continuous improvement in the clinic. By analysing data on process
performance, defects and customer feedback, six sigma helped them identify areas of
improvement and track progress over time.

Figure 7 : Traditional oil dripping equipment

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 • Even though the organisation was unaware of the right term to use for 5S they
explained that they sort, ordered and cleaned the workplace on a daily basis and also
had a standardize cleaning procedure. They do this on a daily basis without fault. I
identify this as 5S-workspace productivity. 5S system is a step-by-step approach
transforming a workplace from clutter and chaos into one that is organized and
efficient.5S helps you improve work safety, productivity, quality and efficiency and this
is accomplished by eliminating Muda (Hua, et al., 2019). Expired medications, unused
equipment and outdated documents were not sorted from what is needed(which is
arranged in a good manner).They labelled the shelves, organized tools and arranged
workstation in a manner that maximises efficiency and reduces error apart from the
sorting issue. They regularly clean the equipment, disposed waste in a satisfactory way
and implemented a pest control system. However, I found documentation and training
programs lacking in them. They maintained checklists, conducted training programs
and did documentation which ensures that everyone is following the same procedures.
Also, regular audits, employee feedback and ongoing training programs should be done
to reinforce the importance of 5S methodology.
There are a few recommendations from my end which helps in increasing the
sustainability of the organisation. More lean techniques can be used here. Some are:
• The presence of waste leads to inconsistent care, unreliable delivery and
disruptions in healthcare delivery systems leading to high costs, errors and lack of
motivation in workers (G, et al., 2019).The clinic produced large batches of
particular drug in anticipation of high demand only to find that the demand did not
materialize. I would recommend them to switch to ‘just-in-time’ manufacturing
approach by producing only the amount of drug that is needed based on the
current demand(overproduction). Overproduction is the most visible and
prominent form of waste, resulting in the depletion of raw materials, wasted stock
space and an excessive investment in unused products. In addition, if
overproduction continues, companies may need to dispose of the excess
products, leading to severe environmental consequences. Disposing of the
surplus stock can also be labour-intensive and potentially hazardous for workers
who may be exposed to dangerous waste materials.
• They have previously held large amounts of inventory for certain drugs ,leading to
increased storage costs and the potential of production expiration. To address this,

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 they can implement inventory control techniques such as JIT manufacturing
techniques and implementing inventory tracking systems.
• Kaizen :-
Kaizen is a continuous improvement methodology that originated in Japan and
has been widely used in the manufacturing industry to improve quality, reduce
waste and increase efficiency. The pharmaceutical industry is no exception to this
methodology and it has become increasingly important in recent years as the
industry faces new challenges such as increasing regulatory requirements,
pressure to reduce costs and demand for greater efficiency and quality. The
pharmaceutical industry is one of the most developed industries in recent decades
as well. Given all the quality regulations and health standards in the industry, there
is still a lot of waste in the end-to-end processes. Excessive inspections, cleaning
and preparation tasks generates all kinds of Muda (Ahmad, et al., 2018)
The key principles of Kaizen including identifying and eliminating waste using a
data driven approach to problem solving and engaging employees at all levels of
the organization in continuous improvement activities. Here Kaizen can be applied
to various processes such as drug development, manufacturing, quality control
and supply chain management.
▪ 5S – One way to implement Kaizen is through the use of 5S which I have
already mentioned above. This methodology can be used in different
areas of a pharmaceutical industry such as manufacturing of drugs or
laboratory testing.
▪ Continuous improvement – In addition to the specific tools and
methodologies of Kaizen , the philosophy of continuous improvement is
also essential to its success in the pharmaceutical industry. By
continually improving processes the industry can response more
effectively to changing customer needs, regulatory requirements and
technological advances. This approach can lead to increased
competitiveness and greater customer satisfaction. Agile engineering
can also be used to improve drug development processes. This
approach involves breaking down the development process into smaller
iterative cycles allowing for rapid feedback and adjustment. According to
me, this may help them to deliver products that better meet customer
needs while also reducing the time and cost required for development.
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 Also, continuous improvement is not just a methodology but also a
mindset. It requires companies to engage their employees at all levels of
the organization in the improvement process, empowering them to
identify opportunities for improvement and make incremental changes to
processes and systems.
By implementing Kaizen principles, the industry can become more responsive to
changing customer needs, more efficient and more competitive in global marketplace
(Gupta, et al., 2020).

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4.CONCLUSION
In conclusion this case study demonstrates the potential of lean and agile engineering
methodologies to improve efficiency and reduce waste in the pharmaceutical industry.
By applying these methodologies to various. Through the implementation of lean
engineering, the company was able to identify waste in manufacturing process
resulting in significant cost savings and improved efficiency than how they worked
years before.

However, the success of lean and agile engineering techniques relies on a culture of
continuous improvement and employee engagement. Empowering employees to
identify opportunities for improvement and make incremental changes to processes
and systems can create a culture that values efficiency, quality and customer
satisfaction.

Moving forward, it will be important for companies in the pharmaceutical industry to

continue to explore and implement new strategies for improving efficiency and
reducing waste. As the industry faces new challenges such as increasing regulatory
requirements and changing customer needs, lean and agile engineering will remain a
valuable tool for companies looking to stay competitive and deliver value to their
customers.

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APPENDIX
APPENDIX A
Communication with the company

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