Global Traceability and Food Manufacturers: The Next Generation

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Manufacturing News, Source : The Manufacturer US
Zone : Logistics and supply chain
Published : 25 Jun 2007 20:50

By Beth Berndt, CDC Software
The latest recall notification regarding 5.7 million pounds of fresh and frozen ground beef by the USDA Safety and Inspection Service has just been reported, due to possible E. coli contamination. Looking back from 1994 to today, meat and poultry product recalls reported by this organization now exceed 770 federal cases, averaging more than four product recalls per month over the last 14 years. More than 75 percent of these cases have been identified as Class 1 recalls, i.e., involving a health hazard situation in which there is a reasonable probability that eating the food will cause health problems or death.

Traceability is an important concern for food manufacturers around the world, as a company’s brand reputation can be jeopardized in the event of a massive food recall. But the issue of traceability isn’t specific only to the food industry, nor is it a problem that U.S. manufacturers face alone. Traceability is a global concern for all manufacturers – however, there is something to be said for the recent spotlight being shone on the food industry. Given the increased concerns around overall safe food handling and manufacturing, the importance of automated enterprise business systems to enable today’s food manufacturer’s ability to track and trace the immediate links between sources and recipients, has become an equally important contributor to the overall quality and safety of the food products they deliver. Companies who manufacture, process, pack, transport, distribute, receive, hold or import food must establish and maintain such records for a specific period of time, in many cases, up to two years to allow the proper authorities to identify the immediate previous sources and immediate subsequent recipients of food, including its packaging.

Regulatory compliance mandates have had a clear impact on manufacturer’s investment in enterprise business applications to support accurate record-keeping for manufacturers of all kinds, and especially food and beverage manufacturers. However, more recent customer and competitive market pressures have generated added business drivers that both underscore and extend existing requirements to be able to track and trace from supplier sources, through manufacturing and the sale of products to other manufacturers, wholesalers, food service and consumer retail market channels.

What’s Changed

A clear and emerging business trend that is impacting food and beverage manufacturers around product traceability is related to the continued acceleration of the rate of business between manufacturers, their supplier base, as well as their increasingly demanding customers. With lean initiatives and the pressure to reduce inventory buffer stocks, manufacturers receive, produce and deliver products based on a greater frequency of inventory turns and replenishment cycles. This means material moves through the supply chain faster, which in turn has resulted in the investment into inventory data collection mobile devices, with the use of inventory bar coding and RFID tags containing container, product, lot and quantity information. This information can be rapidly captured and passed on to enterprise business systems. As a result, customer expectations about the acceptable minimum length of time for a manufacturer to be able to construct a clear picture of where all quantities of a product lot are in their supply chain have also shortened. The acceptable time frame set forth by customers to manufacturers to complete a product lot recall is often much stricter and a point of negotiation when establishing contracts today, well beyond compliance to current regulatory mandates established by governing agencies in the U.S.

Customers today also solicit tighter relationships with their suppliers and manufacturers in other ways, as part of improving brand protection and consumer confidence. This may include periodic requests to conduct unannounced mock audit recalls as a condition of their contractual supplier relationship. Such mock traceability audits are also often a mandated condition of manufacturers who outsource some or all of their manufacturing processing to other manufactures. Being able to provide timely receipt, usage, and quality testing information about product lots from purchased ingredients, as they move through manufacturing processing by specific production equipment line, into and out of inventory warehouses, and ultimately out to the customer, are now fundamental expectations of today’s manufacturing customers, as part of earning a passing grade during such mock lot audits. Without the automated capture and reporting of all such related plant level activities, it is very difficult for today’s manufacturers to demonstrate they can adequately protect both their own and their customer’s brands. And both customers and outsource manufacturers often also introduce onsite sampling of the quality of ingredient and product inventory lots even before they leave the plant, as well as auditing operational processes and adoption of standards, best practices and continuous improvement initiatives throughout the manufacturing process. The result is that today’s manufacturers must consider the capabilities of their enterprise business systems to communicate and enforce product and processing standards and best practices throughout production and inventory. This is an integral part of delivering effective product lot traceability, in support of perfect order customer commitments.

Another business trend now influencing food manufacturers, is a new level of awareness that being able to provide accurate, timely, and complete product traceability also now includes the ability to collect and relate product formulation and operational processing standards, as well as actual information about production results regarding every aspect of the manufacturing process itself - not just about the movement of ingredients, intermediates and finished products in and out of inventory, or to and from suppliers, distributors, and customers. Manufacturers are realizing that having an historical audit trail that provides both ingredient, intermediate and product movement through inventory, as well as value add manufacturing process activity at the necessary level of granularity, requires standardized and automated interaction between point-of-action plant personnel and business systems in a real-time manner. Furthermore, these standardized best practices that also support product traceability must be repeatable, scalable and transferable in order to produce consistent quality products that are auditable. Auditability is now being based on ingredient inputs and the use of specified plant equipment flowing through detailed processing operations and value-add operator activities that also include quality sampling, electronic signatures and recorded quality test results.

Managing Complexity

For food manufacturers, the inherent complexity, variability and uniqueness within this industry introduces another level of granularity, when defining manufacturing processes by product and production line. This level of granularity in production standards makes it necessary to collect the same level of detailed information in a timely manner during actual processing, to ultimately provide the right level of performance metrics, actionable information and control. While Manufacturing Execution Systems can pass parameters and monitor capital equipment performance, they aren’t designed to evaluate or respond to multiple performance metrics in combination in the same manner that operations personnel review, decide and take action on performance results as required every single day. Such decisions are often based on many concurrent data points such as quality sampling and testing, quantity rates and throughput, equipment performance and especially changes in demand and supply availability or specialized operator scheduling and task activities which may be required under exception situations. This means that enterprise business systems need to be able to drill back from product lots into another level of production performance results. For complete support of product lot traceability to be effective, process performance information must therefore be collected at the point of action by the production operators taking action, in order to provide illumination about how a product was manufactured based on using which production line and process given specified quality testing and results with each activity being associated with a specific date and time.

It is certainly still true that the primary goal of enterprise business systems that automate process instructions and activity reporting on the plant production floor has always been to ensure consistent decisions and actions are taken and that these results are captured in real time and made visible as part of the enterprise business system. But the hidden and just as important added benefit in implementing automated business systems for today’s manufacturer lies in making action unavoidable during production processing while also capturing real time information about each product and process. This provides an added dimension of product traceability from supplier ingredient receiving through the many production levels of processing steps that can merge and divide quantities, before finally emerging as one or more unique inventory products and lots for ultimate customer sale.

An added element of managing production around the inherent complexity of food manufacturing today is also now recognizing the need to empower today’s production operators with the necessary tools, information and flexibility to be able to make approved and allowable adjustments without loss of critical capacity due to seeking supervisor or managerial review. Setting clear and controllable parameters around resolving exception conditions such as ingredient substitutions, formulation corrections and fine tuning of processing equipment in order to meet the consistent OEE standards of quantity throughput and production efficiency – automating the ability to take corrective action as part of inline processing, further supports delivering the necessary levels of quality measurement and reporting that end up being part of the accessible history of each traceable product lot.

Concluding with Consistent Production Processes

It’s the combination of all of these automated product and process standards and collection of real time information about production processing, inventory movement, quality testing and operator accountability that will best support today’s manufacturers through a consistent production process with high quality delivery and product lot traceability, from the customer, through manufacturing and back to initial ingredient suppliers. Providing competitive differentiation through automated and enforceable operator best practices, in support of continuous improvement and accurate collection of real-time detailed feedback regarding the setup, processing, quality sampling and testing, and clean-up/changeover for every required task and operation required to manufacture each food product by individual production line. This is the next generation of business automation that is already delivering a new level of control and performance analytics in support of improved product traceability for food companies today.

Beth Berndt is the director of industry solutions for consumer products for CDC Software’s Ross ERP.

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