How Terumo Americas grew through digital transformation

About Terumo

The year 2021 marked many things – a global pandemic, the beginning of a new decade, and more. But it also marked the company Terumo’s 100th anniversary. Terumo is a global leader in medical technology and is based in Tokyo, Japan. Terumo Americas is its largest business – headquartered in Somerset, New Jersey – with four divisions, including interventional systems, injection and infusion therapy devices, and drug delivery devices. All of these include life-supporting and sustaining Class III medical devices.

Company challenges

Terumo America is the fastest-growing regional division. Management had a clear vision to transform manufacturing into the smart factories of the future and not just implement new applications. The goal was to integrate its business logistics layer (ERP) with its manufacturing operations layer (MOM) and connect with automation to build Industry 4.0.

“We set out to build our digital factories of the future. This initiative was not about technology. It was about transforming the way we did business.”

Kalyan Balsubramanian, Vice President & Chief Information Officer of Terumo Americas

However, the company needed to scale its production not only of quality products but quality processes. Terumo faced many challenges, including eliminating compliance risks from paper-based manual quality processes and accelerating time to market. In addition, the team recognized that their product nonconformances were almost exclusively related to errors in compliance documentation, not the product. The company wanted to streamline quality and production to create a more efficient process.

The solution

Leadership invested resources in charting a path forward. They chose SAP S/4HANA as their ERP standard and Siemens Opcenter™ Execution for Medical Devices as their MOM solution. These solutions involved shop floor personnel early in the process definition. They also help Terumo Americas achieve a paperless manufacturing process with electronic device history records (eDHRs). Business logistics and manufacturing operations were finally starting to connect.

“We knew we had to have best-in-class people, best-in-class software, and best-in-class partners. The secret path to achieving success was to build the knowledge base in-house. The partners we selected were those that would work with us to create this end result.”

Kalyan Balsubramanian, Vice President & Chief Information Officer of Terumo Americas

The decision paid off with significant results. Terumo Americas was able to reduce batch material release from days to minutes. The company dramatically reduced errors in nonconformance reports and reduced costs of goods sold. With the adoption of this digital process, Terumo was able to grow tremendously.

For more information on Opcenter™ Execution for Medical Devices, learn more here.

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This article first appeared on the Siemens Digital Industries Software blog at https://blogs.sw.siemens.com/medical-devices-pharmaceuticals/2022/06/16/how-terumo-americas-grew-through-digital-transformation/