Meditech Surgical Case Study 1
Meditech Surgical Case Study
Darrell Smeltzer
School of Business, Liberty University
Author Note
Darrell Smeltzer
I have no known conflict of interest to disclose.
Correspondence concerning this article should be addressed to
Darrell Smeltzer
Email: dwsmeltzer@liberty.edu
Meditech Surgical Case Study 2
Meditech Surgical Case Study
Introduction
Meditech Surgical was spun off from their parent company Largo Healthcare
three years ago. Meditech has captured much of the endoscopic surgical instrument market.
Meditech has competed aggressively to develop new instruments. Meditech became a success
story in a short amount of time. Meditech has produced innovative, low cost products and these
products were brought to market quickly. Meditech concentrated its sales toward hospitals,
material managers and surgeons to gain the majority market share. Meditech new product lines,
which were crucial to get to market need to be flawless to protect their reputation. Meditech had
an issue with the initial orders which took six weeks to get to their customers.
What are Meditech’s problems in introducing new products? In manufacturing all
products.
Meditech has many issues in introducing new products into the market. The first
thing, Meditech could not keep up with demand on its initial orders. The production capacity
became strained as customer had to wait over six weeks for them to be delivered. Each new
product introduction has resulted in a nightmare of supply problems. The issue is, the supply
chain at Meditech cannot accurately supply and keep up with demand, when the ordering is
based on costs and delivery by material managers. This will cause inconsistence in the ordering
process, this will make dealers and affiliates start to “panic order” because they do not know
whether or not the product will be delivered and increases the size of their orders.
In manufacturing all products, the internal structure of the company is broken. All
the reports on production, distribution, are sent to the operations vice President. The reports
should be sent out to all the various departments within the company. The operations vice
Meditech Surgical Case Study 3
President is not doing his job in communicating between this departments. The operations
organizations hierarchy is centralized where there is a definite lack of communication. The
operations should be decentralized, which each person on the ground can make their own
informed decisions about suppling, distribution, and package.
What is driving these problems, both systemically and organizationally?
The biggest problem systemically that is going wrong is basic supply and
demand. Meditech has the customer base but is in the verge of losing them due to not being able
to provide products efficiently. The driving force behind these supply and demand issues is an
inadequate forecast. Meditech’s forecasting has been a problem but determining its extent was
difficult. The data used to measure forecast accuracy has not previously been tracked, nor had
forecast and their demand information kept. Meditech’s forecasting problem effects the
efficiency of inventory management and the distribution process. Organizationally, Meditech has
quality management problems since there is a serious delay in production and deliver of
products.
Meditech Surgical Case Study 4
References
