All too frequently, a story appears about tainted food that has traveled through the supply chain undetected until it causes illness and triggers a costly recall. This scenario not only puts the health of the consumer at risk but is also invariably expensive and can destroy a company’s reputation.
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Explore This IssueApril/May 2012
In a global economy, supply chains are growing more complex and extensive. The ingredient list of a typical processed food product found on a store shelf can easily reach 50. Today’s complex global supply networks allow for simplified sourcing of products from global locations. As a result, a modern food producer may have hundreds of unique suppliers with ingredients passing through many different hands before reaching the consumer. It’s easy to see how food producers at any point in the supply chain are at risk. A well-regarded company’s reputation and brand, which have taken decades to build, can be destroyed within days by a single tainted product from known or unknown suppliers.
Recently, we’ve seen stories that bring up E. coli, Listeria, and Salmonella—terms we wish consumers didn’t need to know. In reaction to these stories, consumers have become well educated about foodborne illness and can share those ideas more easily in today’s socially connected networks. Within minutes, a limited product recall can become a fast-trending topic on Twitter and Facebook.
Industry-driven compliance programs and federal regulations are rapidly taking center stage, adding pressure to manufacturers from multiple directions. The Bioterrorism Act of 2002, FSMA, HACCP, GFSI, Safe Quality Food, and British Retail Consortium, among others, apply their own unique stamp of regulation in a sometimes overlapping and redundant fashion. It’s easy to see how food manufacturers struggle to keep up.
To solve these problems, food manufacturers would traditionally choose from a few painful options: Create a new spreadsheet, perhaps install an expensive software product that addresses a narrow issue, institute manual record keeping, and purchase a few new filing cabinets. Or perhaps make a bigger investment, in “hope”—as in hoping the FDA wouldn’t come calling.
A tipping point has been reached. No longer is it possible to add more paper-based recordings of production, quality, and CCP measurements to already exploding filing cabinets. No longer is it possible to show the complete manufacturing genealogy for a product by accessing various disconnected systems, collating data into reports, then struggling to respond within a four-hour window. Food processors are demanding an enterprise approach that provides total coverage to the organization, eliminates redundancy of data and systems, and allows instant access from anywhere in the world.
A cloud-based ERP system should include comprehensive food safety management capabilities (FSMS) that deliver manufacturing operations management, a dynamic, database-driven electronic HACCP program, and easily produce traceability records instantly in a single solution. These systems are taking the lead in helping food manufacturers comply and excel in today’s complex world. So what does a cloud-based FSMS look like?
Plant Floor Control
The key to an effective food safety program is found in laying a solid foundation. Likewise, the foundation to an enterprise FSMS is rooted in real-time plant floor control of production and the disciplined use of MOM. MOM not only implies plant floor control but goes a step further, providing a methodology for viewing end-to-end manufacturing processes, with a focus on optimizing overall efficiencies. Typically, a MOM system provides tools for recording production and machine metrics, enables performance analysis, and is managed through a touch-screen human machine interface designed for use in a variety of environments.
Once implemented, a MOM system provides real-time information about batches and orders, labor and materials, machine status, and product shipments. Data collected can also provide enterprise or situational metrics for determining overall equipment effectiveness.
With a solid foundation in place, quality, food safety, and traceability become more easily managed and accessed.
Cloud-based food safety management systems that deliver manufacturing operations management and a dynamic, database-driven HACCP — and can produce traceability records instantly — are taking the lead in compliance.
The FDA and USDA have adopted HACCP as the standard for risk-based quality monitoring during food production. FSMA not only mandates a preventive approach to quality for all food manufacturers but also introduces additional oversight and gives unprecedented authority to the FDA for enforcement and compliance. The ultimate goal of structured HACCP planning is to scientifically approach prevention through proactive measures, rather than the reactive approaches of the past.
The origins of HACCP can be traced to the early days of the U.S. space program and the munitions manufacturing industry’s use of failure modes and effects analysis to predict and control high-risk manufacturing processes. Over time the primary objective has remained unchanged: Identify how contaminants or hazards can enter the manufacturing process and determine the severity of the risk, the likelihood it could happen, and how likely it is the problem will be detected. These three factors determine the priority for eliminating each risk. The producer is then expected to address each identified risk and take positive action to eliminate the risk or reduce its probability as much as possible. Meanwhile, this enhanced understanding of the risks provides a baseline for formulating contingency and remediation plans should the problem actually present itself.
While creating an HACCP plan may seem simple on the surface, managing the details can become quite complex. Implementing the plan involves establishing tight control over quality, understanding when a process is operating in or out of control, maintaining extensive document control, and determining whether or not record keeping proves the food was produced safely. Simply keeping up with the plan as it changes with evolving production processes can be daunting. In most companies, all HACCP plans are managed and maintained in disconnected spreadsheets, three-ring binders, and multiple paper logbooks and HACCP checklists.
According to a recent Aberdeen Group report, best-in-class (top 20%) food processors and manufacturers are nearly 50% more likely than laggards to integrate automatically captured quality testing data with production systems. With the advancement of technology and the availability of modern FSMS, all quality, statistical process control, corrective and preventive action, record keeping, and general administrative document control functions should be database driven and fully integrated. As the production process changes, the eHACCP system should reflect those changes immediately. This ultimately simplifies risk-based quality control as most best-in-class processors have done.
Traceability: The Cornerstone
Yesterday, knowing what item you sent to whom was the extent of the requirement for traceability. In today’s world, you must know the items, the logistics path, and lot details manufacturing genealogy for every product and ingredient anywhere in your supply chain, past or present. In most cases, a manufacturer needs to produce this information within a small window of time.
While this may sound like an unrealistic expectation, the effective implementation of MOM enables manufacturers to keep pace. The disciplined use of systems with integrated traceability functions creates a real-time product genealogy for products through the capture of information on receipt, the creation of bar-coded labeling, and tracking ingredients consumed during production.
Standards organizations are working to connect manufacturers’ information beyond the four walls through programs like the Foodservice GS1 U.S. Standards Initiative and the Produce Traceability Initiative. Soon it will not only be a requirement to trace within your own business but also to provide information to a third party, connecting all links in a global supply chain of food production.
A new phenomenon has hit the software world recently. Terms like cloud computing and software as a service, often used interchangeably, are driving changes in the industry. Previously, the only option a food manufacturer had for managing software systems to help with these problems was to buy the software and hardware, hire the IT professionals to manage the infrastructure, and hope it all worked. This was very costly, especially in the low-margin business of food and beverage. But cloud computing is changing the way we do business.
A simplified definition of cloud computing means a third-party solution provider offers its software through a monthly subscription fee, with no upfront fees for hardware and software. This drastically different model carries many other advantages aside from lower upfront costs. Because Internet access is the only requirement, managing your business is now achievable anywhere in the world an Internet connection can be found. Cloud-based solutions enable manufacturers to focus on their core business without the traditional IT management concerns of system upgrades, database management, virus patches, system integration, and data archiving and retrieval. Cloud solutions enable the processor to be more agile in responding to changing business requirements. These benefits give manufacturers a significant competitive advantage in a low margin, highly competitive marketplace.
A recent study released by the Aberdeen Group indicated that most food and beverage manufacturers are below industry standards in four key metrics:
- Percentage of products in compliance;
- Complete and on-time shipments;
- Use of overall equipment effectiveness, a composite metric accounting for availability, performance, and quality; and
- Response time to non-conforming shipments.
A possible explanation can be found in the manual nature of today’s data collection related to product movement, production recording, and risk-based quality control—resulting in overall lack of visibility into a manufacturer’s operations and the inability to find specific information quickly. In the same Aberdeen study, three areas are mentioned as requirements to move beyond laggard status into best-in-class:
- Food safety must become a corporate priority;
- Traceability and compliance should be built into a manufacturer’s production process via enablers such as automated HACCP and CAPA; and
- Solutions that deliver real-time visibility and traceability across the entire supply chain must be implemented.
Although most food manufacturers and processors have adopted an enterprise resource planning solution, they frequently haven’t embraced an enterprise-wide, integrated food safety management solution that enables real-time shop floor control, electronic document control, quality, and traceability. Aberdeen identifies best-in-class manufacturers based on success in two key areas: integrating production and quality data and providing real-time alerts when required by adverse conditions.
In summary, the requirements remain and the pressure is increasing, but technology has advanced to answer the needs of today’s producer. By reaching to the cloud, food and beverage manufacturers can now afford to reach best-in-class status with an enterprise food safety management solution in an affordable delivery model. Investment in the appropriate technology will also help to avoid the damage that can result from an unnecessarily large or cumbersome recall.
When the data integration is automated and available in real time, better decision-making is the result—and producers and consumers win.
Tom Nessen is a senior solution engineer with Plex Systems. He has more than 12 years of experience as a technology consultant to large, small, and mid-size companies. Senior account executive Jon Cowan has spent more than 13 years in manufacturing, providing plant floor automation, MES, and ERP systems. For the last eight years, he has provided enterprise software solutions to process manufacturing industries, with a focus on food and beverage processors.