A Leading Medical Device Manufacturer Implemented FMI’s Solutions for Redesigning its Logistics and Procurement


The Challenge

A U.S.-based leading manufacturer in the medical devices market was witnessing incremental growth, and had expanded its business network in various geographical regions, including the European Union, Latin America, and Asia Pacific. The company’s business operations spread across the world, comprised on various legal entities that followed different logistics and procurement processes in various countries. Though the company was growing through various mergers and acquisitions, logistics and procurement operations for each legal entity across the world were becoming more and more complex with the company’s growth. Redundancy and complexity of logistics and procurement processes, which further created more complications in the financial operations of the company, triggered the need for centralizing the client’s logistics and procurement operations. The client wanted to streamline a logistics and procurement strategy for its legal entities spread across the globe, in order to improve the efficiency of its business operations and strengthen its position in the global medical devices market.


The medical devices market has been witnessing incremental growth with the growing demand for technologically-advanced devices in the ever-expanding healthcare sector. With ongoing research and development in the healthcare sector, the global market for medical devices is expected to surpass US$ 400 billion by 2020. FMI finds that, the potential for next-generation medical devices is triggering technology companies to enter the medical devices market and capitalize on the lucrative sales opportunities. Increasing competition in the medical devices market is pushing market leaders to adopt innovative strategies that can help them in maintaining an edge in the market. FMI finds that, leading manufacturers in the medical devices market are reevaluating their existing policies and goals to further enhance their business efficiency, and thereby, strengthening their positions in the market.


FMI assessed the client’s existing procurement processes and finance operations, only to find major redundancy, which added to the company’s operational costs and made the overall production lengthy. FMI suggested a new, centralized approach and rollout strategy for logistics and procurement, as well as for financial procedures, to improve the quality of each new service. FMI also identified performance gaps and improvement opportunities, and proposed a new internal strategy to enhance the efficiency of the company’s existing logistics and procurement practices. Improvements in internal service levels and a new operation model for logistics and procurement could help the client strengthen its position in the intensely competitive medical devices market.

The Result

Implementing FMI’s new business model helped the client streamline its logistics and procurement processes, which ultimately led to a significant cost reduction. FMI’s recommendations helped the client in outlining its financial tasks, which resulted in a significant reduction in the company’s staff. Purchases were documented and managed with a more efficient procurement model developed by FMI, leading to substantial cost reduction. The revamped process followed in logistics and procurement operations also improved the client’s procurement ability, and simplified the task complexity for the finance executives in the company. Thereby, the company could attain more return on investments (ROI), and the client recorded historical performance.