Having a crisis management plan assures your company protects its consumers, your company’s reputation, and brand, and avoids or minimizes financial implications in event a crisis were to occur. Every minute counts and how you respond to a crisis is critical to the outcome. Possible issues to a professional crisis response are lack of time to prepare, over or under reaction, multiple stakeholders, potential conflicts of interest, and media attention. With time being of the essence when investigating a potential recall, having the right technology is key to gathering pertinent facts to aid with the decision making process of a recall or crisis.
Communication
Designing the IT system to support the relevant business information your company needs is important. Records of supplier conformance may include specifications, lot coding details, certificates of analysis, quality testing, third-party audits, certificates of insurance, and supplier compliance or performance history. These programs require ongoing updates to assure records are current. Some IT systems have the capability to notify suppliers when key documents are expired or missing, allowing more time for quality or supply chain professionals to perform other key duties. This can also assure a company that with time differences across the globe, relevant information is shared instantly. As food companies rely on a global supply chain, it is more efficient to communicate relevant information as it may relate to a product recall or withdrawal utilizing a system of this design. These systems provide a documented notification time, persons notified, response time, person responding, or other designed records related to a product recall or withdrawal via email, text message, and phone messaging.
Identifying those who have not responded can be escalated to company management for follow up as necessary to maintain rapid communications and responses. It is especially helpful to have reports that can be produced to share with regulators as part of a company’s crisis management program. These documents are critical when determining how effectively the company has responded to the crisis. Knowing who, when, and how the communications take place in real time are vital to company viability.
Trending
Many companies use trend reports for monitoring customer and consumer complaints. Having established trigger points designed into the system allows for escalation of serious food safety issues to be sent to a predetermined group and senior management. In conducting a root cause analysis investigation to an upward trend in complaints, review of internal production records, and maintenance schedules is necessary to determine if the company has identified the root cause and taken necessary corrective actions to prevent them from occurring again. If the company has appropriate IT systems, this information can be made available in minutes. When a delay in getting to these records occurs, companies may see escalation from an issue that can be handled and contained to a crisis.
Having the right technology is key to gathering pertinent facts to aid with the decision making process of a recall or crisis.
The Supplier
A company needs to also consider its supplier history and trends when designing an IT system. Having the ability to monitor supplier performance can provide insight to a potential issue and prevent it from entering the company’s production system. The system should include a sampling and testing plan for materials as they are received into the warehouse. Hold control programs for products pending test results and product noncompliance should also be included in the system. No products ought to be released until all testing has been completed and verified to be compliant.
Companies that still ship product pend-ing test results or that do not require testing prior to shipment can cause a major issue if the lab results indicate a problem and the product in question has been used upstream in the supply chain. Having a properly designed IT system will provide visibility to test results, pending tests, and controls for a good hold and release program.
In designing an IT system, the company must determine the scope of product involved with lot size or batches for finished products. It is beneficial to minimize the scope of product for each batch or lot by having a method to segregate and distinguish products in commerce. The system should account for incoming materials including packaging. An ability to cross-reference the supplier’s lot numbers in the system is a necessity. It should have capabilities to account for samples of research and development, sales, shelf life, retained production, rework, employee sales, donations, and the company store. The system should define the lot start and end point, most likely correlating with a sanitation cycle.
The system should include a sampling and testing plan for materials as they are received into the warehouse.
Accuracy
Time is not the only factor in the crisis management process; accuracy of the information provided is instrumental to making decisions as it relates to the safety of the products in commerce. The company must consider impact to its brand if it cannot provide a confident scope of implicated products for its customers in a short period of time. For instance, if a company believes the product in question is one code date or lot, but later finds it had rework used on other code dates or lots, it must then make a notification that it has expanded the recall. Having clear and concise messaging for the distribution channels and consumers is key to getting a resolution, terminating the recall and preventing it from becoming a crisis. This means less production interruptions and a better chance of maintaining consumer confidence in the company brand.
Knowing the company lot coding system is an important validation within your IT system. Many companies manufacture products over a 24 hour time period. Decisions need to be made to determine if the day or lot code changes at midnight or at the next shift. This means the company has to validate that all records and systems are in sync with the determined lot change period. Not doing this can create uncertainty of the lots in commerce if trying to resolve customer complaints or tracing products related to an alleged issue.
In my experience, I have encountered a supplier that reported having a single day code of recalled product. When reviewing the records, it was found that the lot in question had been produced after midnight and marked with a new day code. The company needed to report this added day code to its distribution chain as this code needed to be traced and recalled. It was then determined the suspect product had been used as rework in other products. The scope of the recall went from one single product with a single lot code to a large variety of products with multiple day codes affected within 24 hours. The delay in getting this recalled from the start of the process allowed more affected products to be consumed resulting with a greater food safety risk. Needless to say, many long days and nights were spent trying to reconcile the recalled items. The company brand reputation was affected but did recover. Recovery of brand reputation can take time and affect the viability of the business.
Response Factors
When dealing with a crisis, a company needs to consider a reaction based on the available information and develop an immediate response. Factors to consider include the following.
- Are consumers at risk?
- Is the cause of the problem known?
- Is the lot number and product identified?
- Are there samples available for testing?
- Where has the issue taken place?
- Are the affected products within company control?
- How much was produced?
- When was it produced?
- Where did the product ship?
- Who received these products?
- How much did they receive?
- Do they still have the product?
Being prepared and testing your crisis management program provides your company with valuable insight to possible gaps in your plan and IT systems. Many companies perform product traceability exercises but do not go through a full scenario, testing their crisis plan to include senior management decision making and forming their response to the scenario. Taking time now to review these programs will provide more assurance that your company’s programs are strong. If there comes a time when the programs are needed, your company will have a better chance of a positive outcome if the crisis is handled correctly.
Assess your supply chain management system to determine if it has what is required to support key decisions needed for a crisis response. By verifying the accuracy and timeliness of your crisis response program, you will be confident that your time and money are well spent to protect your consumers and the company brand.
Piontek is executive vice president-the Americas, product safety and recall, for red24assist, which provides crisis management assistance services in relation to food quality, product recalls, malicious tampering, and extortion. Reach her at [email protected].
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