Malcolm Baldrige National Quality Award
2003 Award Recipient, Manufacturing Category

Medrad, Inc.

• Medrad has consistently achieved its growth goal since 1998, with an average annual revenue growth rate of 15 percent.

• Medrad is the market leader in the United States and Europe for its vascular injection systems and related services, with market shares significantly greater than its best competitor in many product lines and regions around the world.

• Since 1999, overall employee satisfaction has exceeded an industry best-in-class benchmark.

• In 2002, the company reimbursed employees $487,000 for tuition and has budgeted $535,000 in tuition reimbursement for 2003.
  
  
  

Medrad, Inc.

Type of Work: Medrad develops, manufactures, markets and services medical devices that enable and enhance imaging of the human body. Used in diagnostic and therapeutic imaging, Medrad products include vascular injection systems and magnetic resonance (MR) accessories. Medrad’s products are sold to hospitals and medical imaging centers worldwide. Medrad is a subsidiary of Schering, AG (Germany).

Sales: $254 million
Workforce: 1,194 employees
Locations: Two locations in the United States, Indianola, Pa. (headquarters) and Pittsburgh, Pa., and 14 locations around the world, including Africa, Australia, Canada, France, Germany, Japan, Norway, and Singapore.

Quality and Performance Results:

• Revenue growth has exceeded the average growth trend of comparable companies, increasing from $35 million in 1988 to $254 million in 2002. Medrad has consistently achieved its growth goal since 1998, with an average annual revenue growth rate of 15 percent.

• Operating income as a percent of revenue, which reflects the overall profitability of the company, has increased from 16 percent in 1999 to 20 percent in 2002 and is approaching best in class.

• Medrad is the market leader in the United States and Europe for its vascular injection systems and related services, with market shares significantly greater than its best competitor in many product lines and regions around the world.

• Results for on-time delivery, a key customer requirement, range from 98 percent to approaching 100 percent for syringes, disposables, injectors, and magnetic resonance coils. These results equal or exceed best-in-class levels.

• Medrad has demonstrated positive trends and leadership in results for its corporate scorecard goal of increasing customer satisfaction. In the 2002 Medical Imaging Magazine industry survey, Medrad ranked among the top four in all 10 of the performance areas measured, including two first place rankings. Medrad ranked third out of 57 for overall satisfaction and second for both quality of products and service and support. The company’s key competitor did not finish in the top 10 in any of the performance areas.

• Medrad measures progress on its corporate scorecard goal of increasing employee growth and satisfaction using results from its semiannual employee satisfaction survey. Since 1999, overall employee satisfaction has exceeded an industry best-in-class benchmark. Annually since 1994, Medrad has also outperformed the medical device industry benchmark of 5 OSHA reportable incidents per 100 employees.

• Medrad’s customers and employees have a high level of confidence in the company’s leadership. In the 2002 Medical Imaging Magazine survey, customers ranked Medrad third of the top 21 medical imaging companies for “internal company leadership.” Medrad’s major competitor ranked twenty-first. In addition, employee confidence in leadership as measured by the semi-annual employee survey improved from just over 60 percent in 2000 to 70 percent in 2003, surpassing an industry survey benchmark.

Processes

• Medrad’s Executive Committee uses a systematic strategic planning process to review the company’s five corporate scorecard goals, to set one- and five-year targets, and to identify the Top 12 Objectives to achieve those targets. Medrad’s “Waterfalling Process” is used to deploy the scorecard goals and Top 12 Objectives throughout the organization. Managers create departmental objectives and plans to support the corporate scorecard and Top 12 and then
  work with employees to develop individual goals to support departmental goals. This process results in the alignment of the corporate scorecard goals down to the individual employee.

• In support of its corporate scorecard goal of increasing customer satisfaction, Medrad uses a seven-step sales process to build customer relationships, acquire customers, meet their expectations, increase loyalty and repeat business, and gain positive referrals. In addition, Medrad uses its Field Force Automation system and InSITE database to capture customer information and complaints, to share that information throughout the organization, and to analyze and improve customer satisfaction, product performance, and sales.

• Medrad is committed to providing learning and development opportunities to employees. In 2002, the company spent $487,000 on tuition reimbursement and budgeted $535,000 for 2003, an increase from $325,000 in 1999. Medrad’s total training expenditure per employee of $2,233 in 2002 exceeds the ASTD Training Investment Leader benchmark of $1,655. (ASTD is an association of workplace learning and performance professionals.)

• Employee empowerment, innovation, and initiative are pervasive in Medrad’s culture, as evidenced through the many methods of capturing and capitalizing on diverse ideas and thinking. For example, Medrad’s VIP process captures, reviews, and acts upon cost-saving ideas generated by individuals and teams. “The Rack” is a team-focused system for identifying problems and issues related to quality, safety, and efficiency. In addition, the Product Innovation and Advanced Design (PIAD) process focuses on new technology and product innovations, including developing an intellectual property portfolio to support business growth.

• To develop new products or improve existing ones, Medrad uses its Integrated Product Development Process to collect ideas from employees, identify customer requirements, prioritize initiatives, and translate initiatives into specifications. In addition, the process proactively addresses regulatory compliance, product safety, and environmental concerns, resulting in risk mitigation plans that design safety, health, and environmental factors into production and delivery processes.

• Medrad’s top 33 suppliers receive monthly updates on their supplier scorecard performance, participate in audits and quarterly performance reviews, and are invited to attend Medrad’s annual Supplier Day, where additional information is shared and supplier recognition awards are presented.

Leadership/Social Responsibility

• Medrad has created an environment that fosters legal and ethical behavior. A Code of Conduct defines ethical behavior in all transactions and interactions and has been deployed to all employees worldwide as well as to Medrad’s suppliers. Code of Conduct training is part of the company’s employee orientation program, and the training is reinforced through a quarterly Code of Conduct Challenge distributed by email to all employees. In addition, Medrad has an anonymous ethics hotline and email address, a Business Ethics Committee, and a Legal Advisory Board.

• Medrad ensures management and fiscal accountability through external audits and monitoring of performance on its five corporate scorecard goals. The CEO provides monthly reports and meets semi-annually with Medrad’s Board of Directors as well as annually with its parent company’s Board of Directors.

• Medrad is committed to supporting and strengthening its key communities. The CEO serves on the boards of directors for many Pittsburgh area organizations, including the United Way of Allegheny County. In addition, the company encourages employees to personally support the United Way by matching 70 percent of employee contributions. As a result, total United Way contributions have nearly tripled from just over $60,000 in 1994 to $180,000 in 2002.

• Medrad encourages employee participation in volunteer community service through its Points of Light community outreach organization. Points of Light organizes approximately 20 events each year, including the United Way Day of Caring, during which the company suspends operations for a day to allow employees to participate in volunteer activities. In 2002, 750 employees participated in the Day of Caring, up from 630 in 1998. In recognition of Medrad’s support, the United Way presented the company with the Gold Award in 2001 and the Balto Award in 2002.

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Created: 11/25/03
Updated: September 17, 2004
Contact: inquiries@nist.gov