Media Coverage
Stryker’s 4-Step Inventory Reduction Process
Medical device manufacturer Stryker goes real-time with its key suppliers.
By David Blanchard
April 1, 2007—Stryker Instruments, a manufacturer of surgical instruments, had a classic inventory problem: it wasn’t able to share real-time information with its key suppliers. While its inventory levels were too high, the company was hesitant to lower them for fear of stock-outs. Using an inventory management solution from TradeBeam Inc., Stryker instituted a new four-step process with its suppliers:
- Stryker sets monthly minimum/maximum targets for each part number. Suppliers are responsible for keeping inventory within the target inventory range.
- The inventory management system gives suppliers real-time visibility into Stryker’s on-hand inventory levels, forecasts, current and future production schedules, and order commitments. More than 90% of Stryker’s direct material supply is now managed through the min/max replenishment process.
- Using this data, the system helps suppliers determine how and when to ship to Stryker to ensure that inventory remains within the minimum/maximum levels.
- Suppliers enter into the TradeBeam solution promises for future ship dates with projected quantities, and they also provide advance shipment notice (ASN) information for products shipped.
As a result, Stryker has seen a 30% reduction in direct material inventory for its manufacturing facilities in Michigan and Ireland, as well as a 30% to 40% reduction in finished goods inventory sent to Stryker distribution centers in the UK and Japan.
