Transcript of "Loftware Food and Beverage White Paper"
Food and Beverage LabelingOpportunities, Risks and Contemporary SolutionsLoftware, Inc. White PaperFor much of the past century, Food and Beverage product labeling was seen by many as merely a tacticalnecessity. In this century, it has rapidly evolved to represent strategic opportunity and risk. The opportunity isderived from the organizational and supply chain benefits of contemporary solutions that can drive a corpora-tion’s competitive standing, market share, and new market and product entry. The new level of risk, alternative-ly, stems from fines, shutdowns, supply chain failures, technological obsolescence, regulatory noncompliance,and a breach of label-related food safety measures that can ultimately jeopardize a company’s sustainabilitywhen labeling demands are not met. White Paper 166 Corporate Drive Portsmouth, NH 03801 1.603.766.3630
CXO-Level and IT Systems Management ObjectivesThis white paper is for a corporate audience that includes those who hold the chief responsibility for thesustainability, profitability, and growth of a Food and Beverage manufacturing operation and for those inInformation Technology who are relied upon to source, implement, integrate and manage the enterpriseapplications that help attain corporate objectives.Mitigating Corporate Risks and Capturing OpportunityIn the past, product labeling typically gained the attention of the executive suite only when label issues surfaced thatmight threaten, or worse, were already threatening, the company’s continuing operations. Today, major corporateobjectives are at stake. Labeling inefficiencies can affect overall capacity. Product costs and overall processing ef-ficiency can be derailed. Organizational optimization and growth can be slowed. CxO’s are gaining an appreciationfor the fact that by averting these issues in advance – with particular reference to seven specific risks – the sustain-ability and continued growth of the company can be the primary beneficiaries.These include,1. Mislabeling and related data errors: The wrong label or a label with incorrect or incomplete data, for ex- ample a carton case pallet label, typically sidetracks the product--often in distribution centers until the problem can be identified and corrected. Inventory carrying costs can soar or worse, products that linger too long can outlast their expiration dates.2. Customer and regulatory fines: Label production delays mean product shipment delays. With customers having agreements for timely delivery, delays often equate to monetary penalties. Labels in non-compliance with regulatory authorities can trigger recalls and fines as well.3. Loss of business: Chronic label problems resulting in delayed shipments or the delivery of the wrong product can turn customers away to seek alternate sources of supply. This can affect market share as well as margins.4. Label-related food safety compliance: Mislabeling and/or label data errors can dramatically impact a com- pany’s overall brand and reputation if they result in product recalls. In severe cases, many companies do not survive the reputational affects of a major food recall, e.g. in accurately describing the content of the food items in a container.5. Labeling inefficiencies in manufacturing, shipping and distribution center handling: In today’s food and beverage supply chain, speed and efficiency is the one area most manufacturers examine for value-added opportunities and improved economies of scale. When labeling inefficiencies slow everything down, or bring operations to a halt, the bottom line suffers. Visit Loftware’s Food and Beverage Industries page for more labeling info >>
6. Label-related recall execution effectiveness with a specific concern about track and trace solutions: One of the reasons for the dreadful effect of a major product recall relates to how long it can take to identify and find the product and complete a recall cycle. Contemporary track and trace labeling solutions speed the process, thereby minimizing costs as well as the potential downside to a company’s reputation in the market- place.7. Global readiness for emerging industry standards including GS1: Emerging product marking stan- dards, some even being mandated by sovereign governments, can mean the difference between market entry or exclusion. These standards can also have a significant bearing on the speed and efficiency with which a food and beverage company can work with supply chain, manufacturing, and distribution partners worldwide.While a failure to manage any one or more of these risks can jeopardize corporate sustainability, surmounting themcan win significant competitive corporate advantage. This is because the right products with the right labels go tothe right places, pass through the supply chain unimpeded and with greater velocity, arrive on time to avert fines,meet customer and regulatory requirements, and reduce product waste and manual effort. And, should a recall berequired, the right solution can comprehensively and quickly identify, find, and retrieve the product.Pain Points: IT RealitiesWhile all IT professionals understand and support corporate goals, many IT professionals in the Food and Bever-age sector are apt to recognize much of the following profile that characterizes some of the more common technol-ogy realities in the industry. For example, an organization is populated with many disparate and disintegrated pro-prietary labeling systems. Some are standalone, purpose-driven or silo systems with no relevance or connection toenterprise data and business applications. For Food and Beverage companies that have grown through mergersand acquisitions, multiple units will have multiple labeling methodologies and technologies. No overarching processor global product identification solution exists that will consistently generate labels by product, customer or plantidentities; or labels defined by type such as item, innerpack, case, pallet, customer required, regulatory, hazardous,special, or internal.The absence of an enterprise-wide and centrally managed solution generates localized rework on a routine basis.Frequent home-grown work-arounds, numerous extract modes, and broadly fragmented labeling knowledge oftenresults. This can lead to conflicting organizational behaviors, brand inconsistencies, and process failures with verycostly implications. Visit Loftware’s Food and Beverage Industries page for more labeling info >>
A Five-Part Methodology for Optimizing IT Success and Meeting Corporate Goals1. Consolidation: Food and Beverage manufacturers with dispersed, departmental, standalone and multi-regional labeling sys- tems face a daunting task of meeting enterprise-wide consistency and control if the decision is made to sustain these systems. Reprogramming all of these separate solutions over many departments and across all labeling geographies is a time-intensive and costly initiative that in the end, does nothing to fix the underlying problems of a decentralized labeling approach. Consolidation around a centralized system, tied to enterprise business applications and data, insures corporate-wide labeling consistencies, compliance, and security.2. Integration: The integration of enterprise-wide business applications with labeling solutions leverages the investment in cen- tralized applications. But moreover, it also means that label data at any location and for any product is derived from the same centralized data and applications that principally drive all of the enterprise’s most critical func- tions. There are many benefits to this, not the least of which is having a single, accessible and familiar reposi- tory of label data, i.e. a “single source of truth”, in the event the source of label data needs to be examined for any reason including a compliance review or product recall.3. Automation: Mergers, acquisitions, consolidation, and even organic growth in the Food and Beverage industry have resulted in some instances in the use of standalone, limited function, and/or proprietary labeling solutions. In other cases, limited single-purpose systems have been installed principally to solve one issue at one location. These disconnected, incompatible solutions often require manual label data entry, often in remote locations and often by manufacturing workers that may be unfamiliar with labeling compliance and other issues. Centralized, “single source of truth” automated solutions provide a more reliable opportunity to make sure the right label is affixed to the right product at the right time at any manufacturing operation throughout the enterprise.4. Validation: This step is in every major software implementation methodology. However, what is often missing are the soft- ware services experts who can quickly and reliably perform the validation and have years of experience as well as thousands of validation events from which to draw upon. During this phase, manufacturers need Installation Quality, Operational Quality, and Performance Quality (IQ,OQ,PQ) experts who are knowledgeable about how new software must be implemented in ways that accommodate existing systems.5. Ongoing Support: In addition to the availability of 24x7 support worldwide global reliability is further enhanced through the use of solutions that have been consistently versioned, and proven to perform in virtually any setting and for any sup- ply chain configuration. Fortunately, for any centralized software architecture approach, support is more readily and cost-effectively delivered to the one site that most often presents the easiest and fastest support fix. Visit Loftware’s Food and Beverage Industries page for more labeling info >>
Summary: The Strategic OpportunityOnce considered a mere tactical necessity, contemporary Food and Beverage product labeling solutions can havemajor strategic implications. As noted in this white paper, there are at least seven major negative corporate out-comes that can result from product labeling errors and inefficiencies. Averting these issues is no longer a matter offixing one label at a time or refitting one product facility at a time with silo or purpose-driven systems. For labelingto be a core component of a manufacturer’s strategic mission, labeling must be integrated with core manufacturingapplications and data. The solution can’t be found in a patchwork of more systems and different systems, but in lessand fewer disparities and incompatibilities. By following the five-step methodology as outlined here, Food and Bev-erage manufacturers of all sizes and scope can consolidate, integrate, automate and validate centralized labelingsystems tied to overall corporate objectives and opportunities.Centralized labeling solutions for enterprise-wide implementation, integrated with core applications and data, bringinto alliance the parallel goals of corporate growth and marketplace efficiency with labeling accuracy and velocity.And, at a time when regulatory scrutiny and standards initiatives worldwide have never been more active, the timefor more labeling accuracy, security and flexibility has never been greater.About LoftwareLoftware, with more than 90 Food and Beverage , is the foremost authority and global market softwareleader in delivering innovative business solutions for meeting a company’s enterprise labeling require-ments. In all, Loftware’s enterprise label and print management software suites enable over 5,000 organi-zations running major ERP, supply chain and warehouse management applications from SAP, Oracle andother vendors to quickly develop and deploy complex barcode label and RFID smart label tags. Loftwarealso offers a full range of direct consultative and implementation services, reducing overall system deliverytimes and increasing efficiencies. Learn more about Loftware by visiting http://www.loftware.com. Visit Loftware’s Food and Beverage Industries page for more labeling info >>