Preactor Delivers Multi-Site Planning Benefits for Laboratorios Raffo in 7 Months

05 Sep Preactor Delivers Multi-Site Planning Benefits for Laboratorios Raffo in 7 Months

Laboratorios Raffo is a pharmaceutical company with more than 110 years experience in the Argentine market and a strongly commitment to healthcare and its promotion. Headquartered in Munro, Vicente López, the company has 2 other locations in Buenos Aires with its main manufacturing facility located in San Juan province. The company’s workforce of over 1100 professionals is central to achieving its business aims and objectives and successfully establishing itself as a leader in this sector.

Other characteristics that identify the company as a market leader include its substantial investment in Research and Development which is matched by ongoing investment in the latest technology for its production processes and quality control. This combined with a primary commitment to quality, safety and affordability of new products has helped the company to become a licensee of major pharmaceutical companies from North America, Europe and Asia that rely on Laboratorios Raffo to market their products in Argentina. The company also exports pharmaceutical products to the countries of the Pacto Andino, MERCOSUR, as well as Asia and Africa with the approval of a number of demanding international organizations.

The Nature and Scale of Business

Laboratorios Raffo’s main manufacturing facility is more than 1000 km from its headquarters and has an area of 16600 m2 (178700 sq. ft.). Designed from the outset as a model production facility, it specialises in the manufacture of oral solid products such as tablets, capsules and sachets and currently produces over 1.3 million tablets per day for the Argentine market and for export. The site has been committed to the highest quality levels in the development of products since its opening in 1999 and is currently being expanded and provided with the latest equipment to meet growing production needs. Meeting the highest national and international health requirements and respecting the highest standards for environment, health and security as recommended by World Health Organization (WHO), the plant follows Good Manufacturing Practices (GMP), Pharmaceutical Inspection Cooperation Scheme (PICS) as well as CIRSOC regulations for seismic zones.

As mentioned, the heart of the company is the qualified team of professionals and technicians whose mission is to create, implement and audit the Quality Assurance (QA) program, designed to ensure that products are safe, effective and of a quality standard that meets local or international GMP. Complementing this are the facilities and high technology equipment operated by specialists and professionals that allows the Quality Control (QC) of active ingredients, other raw materials, and tablets. This ensures the efficiency of validated techniques at all stages of production – tablet production, primary packaging and secondary packaging.

Overcoming the Challenges

Laboratorios Raffo uses a combination of QAD Enterprise Resource Planning (ERP) with other complementary systems to manage its demanding computing and logistics environment and to provide a wide range of expertise in all areas. When it comes to the company’s manufacturing environment, this means managing over 130 primary resources and 150 secondary resources. This significant collection of resources, from a Theory of Constraints (TOC) perspective represents the constraints of the system, operating mostly in two shifts, while others work 24×7, depending on the production load. It also involves the task of managing a direct workforce of over 500 highly skilled personnel in Production, Quality Assurance and Quality Control. Add to this the fact that an ideal production plan can comprise the optimized scheduling of more than 25000 operations and the scale and complexity of the production planning and scheduling challenges becomes crystal clear. Such optimizing is simply impossible to do manually or in an intuitive way.

Why Laboratorios Raffo chose Preactor

When it came to selecting an Advanced Planning and Scheduling (APS) system to work seamlessly with the company’s existing QAD ERP system, only a system that could handle such complexity would be good enough. This is why, after a thorough and comprehensive selection process, Laboratorios Raffo chose to invest in Preactor APS from leading Argentinian Preactor reseller SIMLog.

Implementation Challenges

Implementation of this highly challenging project commenced in November 2008 and started with a visit from the SIMLog team to the San Juan facility. During this visit, Eduardo Behmer, Head of Programming in San Juan, was very clear in his request. His goal was to go from a manual Gantt showing one week of plant load to the electronic Gantt chart in Preactor. In addition, he wanted the reports he saw in the Preactor prototype configuration that he was shown during the selection process of an APS tool for Laboratorios Raffo.

On the other hand, Carolina Bacha Head of QC mentioned that QC was ‘the orphaned son’ of the company’s scheduling. Although QC work should be done in sync with production, it was in reality scheduled intuitively and driven by incessant phone calls.

As part of the business philosophy of Laboratorios Raffo, QA and QC are vital processes in the operation of the company, actively involved in each stage of production, from raw materials and drugs, tablet production, through to primary and secondary packaging. It was therefore vital to integrate QC and QA fully into the planning and scheduling process. At every stage an intricate logic of constraints must be taken into account for each package of raw materials and drugs to be sampled with traceability of batches needing to be maintained for the individual lots of intermediate products. In other words, QC must perform all required tests and analysis defined by GMP.

A particular feature of the QC processes in the pharmaceutical industry is that they are essentially made up of two ‘trains’ of operations: those that correspond to chemical analysis and those that correspond to microbiological analysis. These should both flow in parallel and independently. An additional degree of complexity comes from the company’s aim of minimizing the stocks of intermediate products and minimizing total production time. This results in the various stages of production flowing continuously while QC Tests are performed in parallel. On the other hand, plant resources are divided roughly in half between those that are used by QC and those used by actual manufacturing resources.

In summary, the manufacturing processes (tablet production, primary and secondary packaging) should flow continuously, while the QA/QC processes are undertaken in parallel. The latter are divided into two sets of operations that also flow in parallel.

Development of the Preactor Solution

The original proposal was for a solution with a Preactor P400 APS and 7 Viewers to share the information and schedules with different sectors of the plant as well as with planning in Buenos Aires. After analysing the processes defined in the company’s QAD ERP system, SIMLog Project Leader Gabriel Gaspari and expert Developer Mariano Martinez quickly reached the conclusion that although the BOM (Bill of Materials) and stocks should be taken from QAD, the BOO (Bill of Operations) did not have sufficient detail to be used by Preactor. As Preactor has the rich functionality and flexibility required to handle the complex parameters to be included in each of the operations/processes identified for each product, it therefore made more sense to use Preactor to hold the BOO definitions.

The Preactor configuration for Laboratorios Raffo is therefore highly customized for a number of reasons. Firstly, the ERP system does not have either QA or QC Work Orders meaning it was necessary to develop additional Preactor logic to generate these orders in response to the requirements of Quality Auditing and unequivocally link them to the related Production Order. Secondly, there are both Machinery Resources and Human Resources whose activity must be scheduled but to maintain an acceptable degree of flexibility the latter were defined as Work Centres when defined as Secondary Resources in Preactor. Thirdly, the interfaces between Preactor and other systems used by Laboratorios Raffo are fairly complex because they had to cater for a variety of situations such as intermediate products made in Buenos Aires and finished in San Juan, quality controls made in Buenos Aires and used by San Juan, as well as transfer times of materials received in Buenos Aires to be used in San Juan, etc.

The complexities identified were shared with Preactor International experts, who with their considerable experience in the system participated and helped in the design of the Raffo configuration. With the complexities detailed above, SIMLog developed additional logic to complement the Preactor scheduling engine using the features of the “Open Planning Board”.

Implementation of the Preactor Solution

The central objective of SIMLog together with the key users of San Juan Planning was to develop a programming logic that, complementing the Preactor engine, would be able to respond to the complexities mentioned above while at the same time allow the user a simple and intuitive operation of Preactor.

To achieve this, the following strategy was developed and executed. The starting point was to create a strong team comprising all plant personnel and particularly the people of planning, quality control and IT, in the areas of San Juan as well as Buenos Aires. A ‘day to day’ working environment of ‘Hands on Training’ was established so that these personnel could familiarise themselves with Preactor and how it worked from the outset of the implementation. The development of the configuration was then subdivided into the three main production stages. Whereas Laboratorios Raffo used to have an individual planner for each stage, with Preactor there would be a master planner in San Juan (Vanesa Carrizo) and collaborators for each stage. Carolina Chavez worked together with Vanesa Carrizo to ensure that QC was included from the very beginning of the project in order to input its resources and operations for each stage of production into Preactor.

Alongside this a proactive approach between all relevant IT people was encouraged in order to develop the seamless interfaces that allow smooth communication between the existing systems running in Laboratorios Raffo and Preactor. This was possibly the most challenging task during the implementation, but the team work between Sergio Ayala (Raffo´s QAD Manufacturing Module and Logistics IT expert) and Mariano Martinez (SIMLog expert in Preactor development) enabled this to be developed. A custom GUI was developed for the QAD System so that the master planner can input a variety of data including the number of days for the planning horizon to be imported, the status of orders to be taken into account (released, suggested), the type of products to be imported (raw materials, tablets, etc.) and other input parameters.

Go Live and Business Benefits

The first complete scheduling run, including a special development to take into account the Initial Status of the Plant (ISP) took place in August 2009, less than 8 calendar months from start. Allowing for the Argentinian holiday period of January and annual maintenance, upgrade and expansion elsewhere in Laboratorios Raffo, the complete deployment of Preactor actually took less than 7 months. An equal period of time was then required for any live adjustments and fine tuning of Preactor.

Laboratorios Raffo is now using Preactor to assist the programming of its manufacturing environment with more than 130 Primary Resources and 150 Secondary Resources. The fast pace of business forces Central Planning, operating from the Central Administration, to run MRP at least once a week. Planning in San Juan, using the specially developed interfaces, inputs all the new data regarding plans and stocks of both raw materials and intermediate products manufactured in San Juan, Buenos Aires and/or third parties into Preactor to update the schedule.

Eduardo Behmer, Laboratorios Raffo’s Project Leader for Preactor, comments on the success and impact of the implementation. “Preactor is not only a very efficient scheduling tool, it has also been an impressive driving force to improve our logistics chain. Preactor has forced us to re-define the parameters included in our MRP Module including the update of the suggested orders generated by it, the update of the raw materials lead times, and other logistics parameters with the objective to improve the starting dates for the production processes. The implementation of Preactor has allowed us a better integration of the supply chain including different areas like Quality, Purchasing, Stores, Production, and Maintenance. We now have a clearer understanding that we are all linked together in the supply chain and have committed to better integrating each area.”

He continues, “Another consequence of the Preactor implementation is that it has permitted a deeper understanding not only of our production processes but also of our administrative efforts that are significant to the overall throughput of the plant. This was not taken into account by our MRP/CRP system. As part of our ongoing development of Preactor we are now looking more deeply into our own standards for each process and this has been of paramount importance for our last plant expansion completed at the beginning of 2010.”

Looking to the future

Enterprises are alive and dynamic and as such they are continually adapting themselves due to external and/or internal factors. Effective IT systems should have therefore have the ability and flexibility to adapt to these changes and to continually optimize a company’s ability to manage its human and/or material resources. This is why Eliyahu Goldratt, one of the most important authors of TOC, mentions as his final thought in ‘The Goal’ that the big challenge for any successful company is to have the “attitude and the flair to integrate changes as a process of ongoing improvement.”

One such challenge that Laboratories Raffo faced in 2010 concerned Quality Auditing. Here chemical analysts have to be taken as nominated resource and individually responsible for all tests related to a specific product, be it a raw material, an intermediate product or a final product. This became a big challenge for Preactor as the company had to interchange the roles of the 16 HPLC’s, originally taken as primary resources and the 47 chemical analysts working in different shifts, originally defined as secondary resources. In other words the company has had to reverse the roles between primary and secondary resources. At the time of writing, Laboratorios Raffo is still deeply involved with Carolina Chavez and Carolina Bacha in the final test stage of this important change in the Preactor configuration.

The company is also actively working with the planning team in Buenos Aires, training them in the use of Preactor Viewers with the objective of providing on-line visibility of what is happening in the San Juan plant over a thousand kilometres away. This required setting up the Preactor Viewers on a Citrix environment.

Once complete confidence in the operation of the San Juan Preactor P400-APS configuration is achieved combined with a stable state of plant activity, Laboratorios Raffo will begin investigating additional projects that will benefit from Preactor. This will include among others a Graphical Master Planning System (GMPS) configuration to allow long range planning (3 to 5 years). The company also plans to use a new P400 APS in Buenos Aires planning with the objective of scheduling activity in the Buenos Aires facilities as well as third party providers; it also anticipates additional use of the Cost Module.


Gabriel Gaspari, SIMLog President and Project Leader, reflects on both the challenges and successes of the Laboratorios Raffo implementation.

“In the many and varied projects I have been involved in during my professional career, this has been one of the most demanding for several reasons, from its magnitude right up to the distance to the San Juan Plant that was the heart of our patient. In the face of these difficulties, it is only thanks to the teamwork of all the people involved that such positive results were obtained. If I must qualify SIMLog’s effort of the long dedicated hours, I would say that 30% was ‘inspiration ’and 70% was ‘perspiration’ in completing the Raffo configuration.”

He continues, “In addition to the outstanding commitment shown by SIMLog during the implementation, I want to thank all of the people involved for their expertise and knowledge –each of who was indispensable for the successful conclusion to this stage of the project.”

“Firstly all the people in the San Juan Planning area, and in particular Eduardo Behmer as Leader and Champion of this project, especially in the difficult moments and for his intense efforts to overcome unfavourable conditions. Also Vanesa Carrizo, for her huge perseverance and for being the person that did most of the hard work and effort to learn and operate Preactor, and then train and teach her colleagues. To all people in the QC area, and in particular Carolina Bacha, who surprised us with her insight and capacity to analyse the intricate QC processes even if she provided us with more than one surprise when she used to say ‘Sorry, but I forgot to mention another restriction in our process …..’. On those occasions we were shocked and worried but at the same time, we quickly learned that Preactor could do it.”

“Thanks also go to the IT people in Buenos Aires and San Juan and in particular to Sergio Ayala for his help and knowledge in developing the interfaces between different systems. To all plant and Buenos Aires managers, especially to Accountant Luis Ghio, Raffo’s Operations Director, who when needed, gave us a vote of confidence in the achievements and the effort of the team.”

“To the development people of Preactor International, especially Jon Christensen, Global Partner Manager, who advised us in the re-design of the Preactor engine complementary logic to make it more efficient, faster and flexible.”

“Finally I must give special mention to Mariano Martinez, our young development expert in Preactor who with his sustained effort (50% perspiration and 50% inspiration) had the courage and the knowledge to respond to “imaginative” requests to be incorporated into the configuration. It was interesting to see his expression when I started another question with “Mariano, what do you think if ……” but I knew he could do it. My thanks to each and every one.”

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