Friday, October 30, 2009

Building upon Reactive Product Safety Strategies to “Proactive Product Safety” Strategies

Companies can implement a sound process manufacturing enterprise resource management (ERP) system like Infor ERP Adage [evaluate this product] at both the lot and sub-lot level or Infor ERP LX [evaluate this product] at the lot level only. Enterprises can than immediately capture extended lot and sub-lot data that can be used to actively protect product safety. They can integrate data from quality assurance (QA), analytics, specifications, and lot tracking modules to actively manage product safety and minimize the chance of a recall.

With every lot-based transaction, companies can initially capture and incrementally add safety, compliance, performance, and cost data. With information like vendors’ location and risk rating, dates for shelf life, effective and retest dates, allergens (or other labeling data), proof of absence of harmful attributes, etc., automated specification matching ensures that lots or sub-lots can only be used for safe or approved usages.

This can stop cross-contamination or reduction of the product’s value based on co-mingling of high value lots with lower value lots. As an example, the higher value of organic or specific farm lots or sub-lot is reduced to the value of product to the lowest co-mingled lot value. Since co-mingling of an organic lot with an inorganic lot reduces all the lots to an inferior inorganic value, not only are you overpaying for the organic lot but also the price of associated products is reduced.

Integration of QA data from Advanced Shipment Notice (ASN) through inventory, production, shipping, and logistics modules (and their respective departments) enables companies to actively protect their product safety. Until all tests are completed and approved, a higher risk or lower quality material lot or sub-lot cannot be used throughout production and logistics.

Based on risk or quality ranking of a lot or sub-lot, additional testing for contaminants can be required to provide the coveted “proof of absence”. Not only is safety ensured this way, but also the ability to prove the origin (or another proof of absence) can improve the value of the end product. Active monitoring can actively identify risks or issues and preempt suspect lots from being used or shipped. Companies can actively monitor from initial shipment into inventory to production and through distribution.

Based on the risk and quality rating of the material, formula, or recipe, the appropriate level of testing can be activated and managed. This could include increased sample testing sizes (or more frequent intervals) and more extensive testing. More frequent sampling will identify issues earlier and ensure timelier issue mitigation.

As companies improve the depth and accuracy of supplier, material, and production data, performance analysis can be used to more accurately rate supplier, material, and production quality. Use of Supplier Scorecards with risk ratings can help drive purchase order (PO) volumes to more reliable suppliers and reduce safety risks. Since many suppliers are not staffed to implement advanced quality and compliance programs, many manufacturers are moving from just auditing to value-added supplier education.

Improved supplier quality can help reduce both manufacturer’s and supplier’s costs and improve the manufacturer’s quality and product consistency. While companies find that non-value-added costs are reduced and throughput can be increased, improved shelf life and quality can reduce returns and quantities of non-saleable or expired products. With higher quality products with value added lot genealogy, the ability to prove country of origin or organic type claims can increase the value of the products.

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