Take a moment to contemplate Murphy’s Law: everything that can go wrong in your supply chain (SC) will go wrong. You have a team of experts and partners that know what they’re doing, but sometimes things happen beyond your control. A data source system goes down, a tornado hits, a conflict breaks out, a labor dispute forces a port to close down, or an oil spill shuts down a larger ocean area. On the legislative side, what if a country where you source raw materials is suddenly embargoed, a supplier makes a misstep and can no longer export their products, a semi-finished goods’ supplier changes its strategy and is now sourcing in a country subject to new and very strict license requirements? On the positive side, how do you maximize profit from an unexpected resurgence of a long-forgotten product or from a new sales partner that opens new, yet remote, markets at lightning speed? Lastly, which risks are you and your partners’ IT systems subject to? Are there security concerns? Is system downtime an issue?
You do not know what the event will be, and you cannot wait, unprepared, for it to arrive. Consider it almost like in a fire drill. You hope you never need it, but you want to know where the weak spots of the plan are. There are four key components to consider as you examine both your readiness, and your SC partners’, to deal with adversity.
Your supply chain has to be adaptable to changing circumstances, and sometimes to rapidly changing situations. You want your supply chain to shift focus as needed, to be agile without losing focus on the bigger picture. This means the team has to keep its eye out for changes, and to solicit input from legal, sales, and IT to be better prepared. Be in tune with legislative proposals, with sales forecasts, with IT developments, and even with weather forecasts. It will be difficult to justify having a full time weather expert on your team, but reviewing where delays have occurred over the last 2 years due to the weather is not too much work. In similar fashion, work with your SC partners to ensure they are capable of adapting to new circumstances as well. Ask your Logistics Service provider about rerouting options when a port closes down, agree upfront on volume discounts in emerging markets, find out if your supplier has a compliance team that can obtain the necessary licenses should the export requirements change.
Configurable mostly applies to the applications used in the supply chain: why use a one size fits all if you like different sizes? But take care not to mistake configurability with customization. Typically, any and all applications can be customized; however, costs and timelines will likely not be in sync with your expectations when it comes to risk mitigation or a necessary change in the supply chain process. Configurable should mean that your systems can be adjusted by you and your vendors on short notice, without months or even years of development. For example, if you have a dropdown with possible ports of transit, you want to be able to change the dropdown on the fly when the usual port of transit is closed due to a strike and you have to reroute. Or if you want to change the warehouse picking location of a popular product to a more convenient picking location, you want to be able to make that change right away, and vice versa when the hype surrounding that latest novelty subsides.
If volumes, destinations, number and location of suppliers, etc. fluctuate, so should the bandwidth of your supply chain. From a systems perspective, scalability is a key element; ensure the solution offered is scalable, whether that means it is in the cloud or otherwise. From a partner perspective, you do not want to get stuck with logistics routes that are forced upon you because the provider does not have the right fleet on lanes important to you, with unnecessary inventory, or with suppliers that cannot meet your demands. It is vital that you not only consider scalability issues, but also contractually determine them. It is a hidden cost for many businesses. First, prioritize where to be scalable – is it tradelanes, volumes on particular lanes, or in a broader sense ‘options’? Then work with your SC partners to test capabilities, by volume testing, analyzing production capacity at the supplier’s various locations, and verifying inventory levels. Finally relate your findings in contractual parameters.
If nothing else, you want your supply chain and the applications you use to be stable. Downtime costs money as every SC is now 24/7. So be aware of your providers Service Level Agreements (SLAs), whether it is uptime, delivery time, or handling time. Ensure KPIs and metrics are available to proactively monitor the numbers. Add clauses to the contract with penalties and/or opt out clauses in case SLAs aren’t met. Be prepared for calamities by working with your vendors on unified Business Continuity & Disaster Recovery Plans, have a backup plan for vendors and partners, and never take stability for granted. Coordinate with your vendors on penetration tests to ensure your data is safe. The preventative money spent will be worth it to sleep better every night knowing you are prepared. And now and again, throw some coffee on a pc to see what happens.
In the end, it is clear that despite the randomness of nature, legislative proceedings, or sales driven events, preparation goes a long way. It is difficult enough to be great when it is business as usual, but when you document scenarios and scripts on how to deal with the unknown, work with your buyers, manufacturers, logistics service providers, and sellers to discuss potential scenarios and create a cross company team to anticipate the steps to take in a crisis situation, you can be great even when adversity hits.
For any manufacturing organization, achieving the highest levels of operational excellence is built upon the engagement of its employees. Employees are expected to be active in collecting information, surfacing and resolving problems, and recommending improvements that could be made as a result.
Unfortunately, all too often their insight is not acted upon, and the impact on factory-floor morale is considerable. They feel like they are simply doing it 'for the sake of doing it.' When an employee feels that the tasks they are being asked to do have no positive impact on them and the way they work, they almost immediately become disengaged with the entire process.
They might feel that their voice is not being heard or, in the worst case, that the feedback and data they are providing is not trusted by their superiors. That, in essence, indicates to them that their professional integrity is being questioned, and they are not truly valued, rather they are simply a workhorse whose intellectual contribution is effectively irrelevant.
This is the worst use of people, the strongest asset companies have available. These are the people who have the benefit of years' of experience; they understand the issues, and it is of utmost importance that their innate knowledge is collected as data, transformed into information, and converted into the knowledge that a company needs to improve operational efficiency.
Finding a means to engage your people on a company-wide basis is the route to achieving this.
The tools to perform
By giving operators a simple, unobtrusive tool that makes their working life easier, it becomes very straightforward to enter their knowledge and experience into the company's system. But not only that, it should be a sophisticated, intelligent tool that allows this feedback to be presented in real-time, meaning it can be acted upon immediately, and employees can see that their input is being used and is trusted.
This real-time element is key. Waiting until a shift has ended is too late to analyze performance and quite often, valuable insight gets lost among the noise. This gives the impression to the employees that the company is 'driving in the rear view mirror'- without focused direction, missing the factors that can keep a business on track.
The ability to review the data, both in real-time and at key intervals during the shift, means action can be initiated to ensure inefficiencies are removed from the process in-flight. By performing these frequent reviews, operators see that their input is being used to drive continuous improvement. They feel trusted. They feel engaged. They feel motivated to continuing to perform to the highest standards, not just for their own sake, but for the sake of the team. Quite simply, they won't see any reason to consider leaving, which of course has its own business benefits in terms of preventing high staff turnover and the associated costs of employee churn.
Furthermore, satisfaction and pride in their employment will inevitably lead to them vocalizing this outside of the workplace- to their familiy and friends, or to potential customers and even prospective employees.
Developing a coherent, lasting working relationship- from the upper management through to each individual contributor- will only service the company well in the future.
Good data in equals good data out
Of course, realizing this operational nirvana is dependent on the quality of the data and the system being used to capture it, and on how this system is integrated into day-to-day operations.
That means collaborating with a software partner that not only installs and implements the software, drawing upon years of experience of successful projects in the specific business vertical, but implements a system aligned to common manufacturing metrics. At the same time taking care to balance the organization's needs and its working culture, to ensure high awareness and engagement so employees can execute their roles in the most productive manner. Factory-floor employees are the ones who can identify the biggest, most frequent pain points that need resolving. Then, the solution can be tailored to match, and thus, built to make positive gains in the key areas.
A business might have a problem with a wasted product, a culture of costly overtime, or an issue with machines not being optimized to their full capacity. There are so many factors that impact operational efficiency that, if neglected, impact employee engagement. It may surprise you how quickly an effective manufacturing execution system will deliver a return on investment- not only in terms of efficiency gains and your company's bottom-line- but in the overall happiness of employees.
Having insight into manufacturing inefficiencies means businesses can be more agile in production and allows them to continue to meet production demands and growth targets in a structured, manageable way. A way that says to the employee, 'you are what makes this business work'- from the operators, to line managers, to data analysts. Once the stream of data flows into a sea of knowledge, the strategic decision makers will be better placed to identify historic trends, build analysis and make changes for the better.
Quality data and a quality system to capture it are the keys to driving a collective culture to never stop improving. Only by recognizing and acting upon employee input can the circle of engagement be complete.
Roughly one in six Americans (or 48 million people) are estimated by the CDC to get sick from foodborne diseases each year. When someone reports a foodborne illness, the immediate response is to figure out where the contamination occurred and issue a recall. However, with the Food Safety Modernization Act (FSMA) coming into play, the focus in the food industry will go from responding to contamination to preventing it. FSMA is also increasing the need to track what happens to food across the entire supply chain.
Tracking your food across the total supply chain ensures that manufacturers and distributors take a “one up and one back” approach. This approach enables everyone to know where it came from (one back) and who it was sold to (one up). Confirming the integrity and safety of your food is not just an issue of what happens inside the manufacturing walls anymore. It’s all about being able to promptly respond to a recall during the unfortunate event of a food safety issue, mock recall or demonstrate compliance.
One Back to the Supplier and One Up to the Distributor
Many producers, manufacturers, and retailers have product tracing systems already in place. However, they vary on the amount of information the system records and how far forward or backward in the supply chain the system tracks.
One part of the FSMA focuses on tracking back to the supplier. For example, if you are a tomato sauce producer, it is likely that you do not get your tomatoes directly from the farm. You probably buy them upstream from a tomato supplier and process it into the tomato sauce that is sold in stores. While it is important to know which supplier your tomatoes came from, FSMA focuses on the immediate supply chain – one up and one back. If tomatoes come into your sauce factory contaminated, they will need to be traced back through each system to find the source of the contamination.
The other part of the FSMA focuses one up to the next step, either distribution or customer. It is necessary to trace who you’re selling the product to, where it’s going and how it got there. Traceability plays a tremendous role in this and as the importance of track and trace moves downstream into the food supply chain, manufacturers and distributors will benefit by using traceability solutions to meet FSMA standards and compliance and understand where their product is going. There are other benefits as well. With traceability, labor in the supply chain is more efficient and easy to track and trace. Food is being moved more rapidly through the supply chain and with less risk of spoilage or contamination.
Tracking Your Way Through the Supply Chain Round Trip
While the FDA does not require companies across the supply chain to use electronic traceability solutions, many are recognizing that keep records electronically is the only way to comply with the FSMA. When it comes to tracking up and back through the supply chain, electronic traceability gives manufacturers the capacity to view information at both a high level and a more drilled-down version.
Having access to these different views empowers everyone within your organization to gain a better understanding and track the supply chain process round trip – from receipt of raw materials to shipment to customers and back again. In the end, no matter which part of the supply chain your organization falls in, ensuring the safety of your consumers puts your company’s reputation on the line all the time. FSMA sanctions manufacturers to take a proactive stance and commit the necessary time and resources toward compliance planning for prevention and supply chain traceability implementation.
The number of U.S. food products recalled, and the cost associated with those recalls, has nearly doubled since 2002, according to several reports. With the recent influx in food safety issues, it's no surprise the spotlight is burning brightly on supply chain management.
Fatal mistakes made by well-known brands, like Blue Bell Creameries, have called into question how manufacturers - and supply chain executives specifically - are executing two major components of food safety: prevention and response. Could it be time for supply chain executives to recall their own processes?
Some still leverage antiquated and error-prone manual techniques, while others aren't properly using the track and trace technology they have. With advancements in these solutions, supply chain executives have no excuse for not being more proactive in mitigating risks.
When it comes to reducing the number of food recalls, preparation is prevention's greatest ally. Continual process refinement paired with the proper use of track and trace technology can greatly reduce the occurrence and effects of food safety issues. Establishing automated preventative measures, including mandatory product checkpoints and quality tests during the procurement and manufacturing stages of the supply chain, can help identify issues faster and more consistently.
If used correctly, track and trace solutions can notify manufacturers in real-time so issues are addressed before the product leaves the production floor. Furthermore, accurately implementing track and trace technology into the supply chain provides you with greater visibility and actionable insight to improve pre-distribution processes. At the same time, in the event that a recall needs to be issued, track and trace technology can also quickly and easily kick-start the recall process in a more strategic manner - aiding in avoiding common pitfalls.
Let's say you manufacture a particular type of sauce and leverage a variety of outside vendors to source its ingredients. You also supply the sauce to thousands of grocery stores throughout the country. News hits about a listeria outbreak at one of your vendor's plants. Now what? Without a clear understanding of the flow of product and materials coming and going, you jeopardize your brand and the well-being of consumers.
Properly using track and trace technology can allow you to document your sauce's ingredients and suppliers while also identifying - in real-time - where sauce produced during the outbreak is located within the supply chain. This enables you to quickly determine every point of possible contamination and recall accordingly.
Seemingly simple answers to questions like where, when, and what quantities of products were shipped to and from, are being missed daily by supply chain executives. Not knowing the ins and outs of your product's lifecycle during a recall can truly cost you. In fact, according to Food Safety News, in more than half of the recalls occurring over the past 15 years, the recall cost each affected company more tha n $10 million. Some lost more than $100 million, and a few closed their doors for good because of the excess cost.
Many supply chain executives have product tracing systems, but they differ in quality based on precision and how far forward or backward in the supply chain they can track. Whether or not they can provide full control over the end-to-end process is critical to meeting compliance and maximizing efficiency.
Amidst growing consumer concern and compliance demands, increasingly more changes to the supply chain are necessary. Now is the perfect time to re-evaluate your recall processes to ensure you're using the right technology to minimize revenue losses and maximize consumer safety.
Image what would have happened if we had all been treated like adults from birth. No assistance or guidance- just expectations that are challenging to meet. We wouldn't have gotten very far, and others may have been disappointed by our lack of progress. The technology and processes we use day to day, such as our CRM programs, need the same care and attention to flourish, just as we did in our own infancy, so they can provide the best experience possible for users, customers and the company overall.
The Infancy Stage
At the very start of its life, a brand new CRM system and program will inspire energy and enthusiasm for a bright future- something really exciting has arrived. Naturally, it will need lots of attention as it is introduced. Positive encouragement will help with user adoption, and regular check-ups around data quality, compliance and usage make sure it is developing in the right direction into a healthy system. During the infancy stage, the basics of the system will be mastered- and a few late night feedings and hiccups are to be expected along the way.
The Adolescent Stage
Now that the program has been established, and users have mastered a core set of skills, it is time to start school and introduce some challenges. They absolutely shouldn't be adult-sized challenges; they have to be appropriate for the development of the program. We wouldn't ask a group of school children to read War and Peace before mastering the ABCs. This is the right time to start evolving processes to the next level of complexity in terms of steps, tasks and requirements, and asking the system to provide insight back to the business to see what has been learned.
Management should lead by example and show how CRM can be used to run the business, giving users a role model by standing at the front of the class.
Now that it has reached adolescence, the program has already been built into the culture of the organization, but there can be a danger of complacency now that everything is up, running and working for the company. it is really key that leaders, especially the executive owners of a CRM program, keep setting the homework, and the users keep turning it in.
The Teenage Years
Often known as the most rebellious years, this is when an organization needs to start showing the business value and impact of the CRM program. If the users and customers see no value, they will start questioning why they are still using the system, and whether the investment has been worth it.
Teenagers don't like to be force fed; they want to be able to challenge the system. If their bike no longer needs training wheels, despite them being there from the beginning, take them off. If a process that was introduced in the CRM program's infancy stage is no longer an efficient one, it needs changing.
This is the stage in a CRM program's life when it could become disillusioning. The glitz and glamour of a new arrival has worn off, and the daily grind has set in. The executive owners need to show they are just as invigorated and energized as the first time they saw the program, providing focus and investment, and securing user buy-in, thus allowing the program to keep moving onward and upwards.
Now that the program has reached adulthood, it's time to expand. The changes and developments in this stage will be much less radical, but will have just as much impact. They can be made according to taste and preference; for example, if you start out with a sales automation program, this is the stage at which to bring in marketing automation that would provide richer visibility of prospect relationships. And just because the program has developed into a well-adjusted, popular member of the organization doesn't mean that expansion and growth have to stop. Your industry and customers are constantly evolving, and your CRM program should evolve in sync.
How will you know when it's ready?
Just like all children, adolescents, teenagers and adults, CRM programs will develop at different times. There is certainly no set time frame as to when your program should fall into one of the above stages. The time it takes to progress and evolve will depend on how you as a business implement the changes, as well as managing the processes, technology and people along with it. It will also be based on your customer ecosystem and the speed of your industry.
There could also be a danger of rushing your CRM program to evolve before it, and its users, are ready. We wouldn't give children sharp utensils to eat with when they are very small; the same way we wouldn't equip CRM users with tools that are too advanced for the stage are at. On the other hand, the program should not be stifled when it is ready to move on. Wrapping it in cotton wool in its infancy may preserve the existing functionality, but it will be left far behind as competitors and other aspects of the business get their driving permits and aim for the horizon.
Determine Your Stage and Take Action
In order to find out what stage organizations are at regarding their CRM program, they need to go through a critical self-evaluation. Three elements that need to be considered are:
Challenging and evaluating a CRM program across the three elements above, along with the four growth stages, will help to highlight any gaps, such as the users are at their rebellious teenage stage, but the system is still in its infancy. The first goal is to make sure everyone is on the same page before taking steps forward, and then to have a clear road map to advance and evolve the entire program with all elements in sync.
Expecting a CRM program to have intelligent and well-established processes right from day one is a set-up for a disaster. Making sure it's nurtured and well cared for as it grows with your company will make sure it provides everyone from executive owners, through users, to customers with the experience and service they expect and deserve.
Staff on the frontline are the face of your company, and customer service staff in particular have the important role of putting things right when they go wrong. If a customer has a poor experience here, it could make or break their relationship with you.
Demands on frontline customer service staff are increasing as consumers expect a higher standard of response. If you cannot provide it, your customers will simply look for other companies who can satisfy their expectations. Martin Ellingham, Respond Product Manager at Aptean, discusses why empowering frontline staff ultimately results in higher standards of customer care and overall profit. It’s about staff quality, not quantity.
Today, it has never been easier for consumers to change their supplier or service provider. This has become particularly apparent in free markets in recent years, as governments have attempted to break up oligopolies of numerous industries – for example energy providers and financial services – to increase the competition and ultimately benefit consumers by enabling a wider range of choice.
In years gone by, many businesses could rely on low customer churn because it was both inconvenient and difficult to switch supplier or provider, but now it is a relatively pain free process with agencies and switching services literally knocking on customers’ doors.
With that, how a business interacts with its customers and their problems is fast becoming of greater significance. Customers don’t necessarily want to switch providers, but if they feel that inadequate customer service is forcing their hand, they will – and they won’t be coming back.
A business’ frontline is the first and the best opportunity to either reverse a negative situation or build on top of a good situation. Therefore, frontline staff need to be operating at a level that can both handle the demand and satisfy customer queries effectively in order to reduce churn and keep customers loyal.
Depending on what study you read, the cost of gaining a new customer compared to retaining an existing one is about 10 to 20 times more expensive for a business. But what many studies do not account for are the long term ramifications of losing a customer to a competitor. Consider a bank or building society; many customers will potentially be committed to one for decades. If poor customer service results in a number of customers looking elsewhere, it could leave a significant hole in a business’ long term financial projections and results.
A single click can send a bad review around the world
The challenge of providing satisfactory customer service has been exacerbated by the evolving digital landscape and how it now essentially dictates brand reputation.
Customer service departments are no longer a 9-5 operation; many are already running 24/7. The nature in which customers get the attention of their service providers has never been broader or more varied, both online and through the more traditional channels like phone calls and letters.
Now, there is nowhere for a company to hide if a customer is dissatisfied. Evidence of poor customer service no longer dies out once it has done the rounds at the coffee shop, office or gym – it lives on in the virtual world as a permanent reminder to anyone researching their next service provider.
It presents a real challenge for businesses, and has dramatically increased the reliance on their frontline staff. If customer service representatives are not adequately trained or do not have the resources to effectively handle customer interaction across several different channels, it could lead to a serious breakdown in customer trust.
As businesses have adapted to these developments, expectations have risen. We as consumers want answers quickly. We want immediate access to real people. We want them to be aware of our situation and have solutions tailored to our specific requests. No matter how strong a staff member’s personal skills might be customers always expect more. Apologies and empathy may pacify the customer in the short term – be it face to-face or digitally – but it does not solve the whole problem.
To ensure truly content customers, those skills need to be complemented with the expertise that the customer ultimately wants. Frontline staff need to be empowered with support that genuinely makes their jobs easier while providing exemplary service.
It is no longer a numbers game. More customer service staff does not necessarily fulfil customer expectations. More informed, more efficient staff – that is the answer.
Embracing technology for an efficiency drive
With this digital age comes the need for customer service staff to be technologically equipped – with technologies that really benefit their capability to keep customers happy across the ever expanding list of communication channels.
For frontline staff, there are any number of queries that they could receive via a call, email or face-to-face enquiry. It is impossible for them to know every single answer to every single situation off the top of their heads, and they should not be expected to.
But that does not mean they cannot communicate some form of useful information to the customer. A vague response that delays things further – such as “I’ll have to go and find out” – hardly inspires confidence in the customer that the business is doing everything in its power to help them in a timely, effective manner. For staff on the frontline, understanding why an issue has happened is not easy; understanding why when they are only armed with basic summary information is even harder.
By utilizing holistic Complaints Management software, the frontline – and as a result the overall business – will feel considerable benefits. This is because it truly integrates the whole setup into a manageable and easily accessible format.
It gives staff the ability to provide customers with instant updates, rather than making them wait for an answer. If the problem cannot be solved instantly, the software can streamline the redirection of a customer complaint to the correct subject matter expert. Company-wide system updates within the software can provide clarity into how similar issues have been resolved – resolution information captured at first point of contact is logged, so the customer need not wait for an answer that already exists.
For large companies whose customer service teams are spread far and wide, this kind of streamlined internal communication is vital in driving complaints handling efficiency.
By investing in the right tools which improve the frontline’s effectiveness, it will prove to customers that company profits are being reinvested into areas that will be there to help them – eradicating any perceptions that the profits are simply lining the shareholders’ pockets.
Short-term action for long-term prosperity
Businesses need to separate themselves from the crowd, and doing so means investing in customer service that exceeds the competition. Consumers have never been better informed about the products and services they use, as well as their rights, and ignoring that will be to the long-term detriment of the company.
Simply hiring more customer service staff is not the solution to improving complaints handling efficiency. In fact, adding more components to an already inefficient system will go only go towards making things worse.
The key is to identify ways to make staff more efficient. This means implementing inter-connected software systems that allow greater detail to be captured, without disrupting a slick customer-facing experience.
There is no one-size-fits-all solution, but enhancing staff capabilities through a complaints handling restructure does not have to be costly, particularly in the context of the long term gains of doing so. By working with complaints handling management experts to tailor a software infrastructure that improves frontline customer interaction, businesses will gain customers’ trust – and acquire their loyalty for years to come.
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP. In part 3 of this blog series, we look at selecting a Best-in-Class ERP.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Best-In-Class - Set Your Business Up to be the Best
Overall, organizations need to be using as much of their ERP investment as possible. A Best-In-Class organization may have detailed plans for what they hope to accomplish with their ERP. However, if a solution that employees cannot actually use is selected, those plans become useless. According to Aberdeen Research Group’s report, How ERP Can Make Your Job Better on a Day to Day Basis, top performers will select a solution that enables users to take advantage of functionality designed to improve their jobs on a day-to-day basis.
The same Aberdeen report states that as compared to all others, leading companies are:
The bottom line is that the best-in-class invest in an ERP solution that is easy to use. Even the most functional of ERP solutions can end up being a waste of money if employees can’t use it. A user-friendly ERP solution leads to a higher adoption rate among employees and the benefits of the solution will more quickly and profoundly exhibit themselves throughout the entire organization.
Is ERP worth the cost?
One of the most common causes of delay in purchasing an ERP solution is trying to figure out which software to use. While having access to the trendiest features and functionality of an ERP solution sounds like the most obvious reason to invest, sometimes that doesn’t always make the most sense. It is up to each individual business to analyze the costs of purchase and implementation and compare it with the net annual benefits to calculate their ERP pay back opportunity. Finding the functionality that works best for your employees and empowers them to utilize all of the ERP features for better business is what’s going to pay for your system.
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP. In part 2 of this blog series, we look at the traceability functionality of your ERP.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Traceability - Don't Let a Recall Ruin Your Brand
Food safety is all about prevention – including recall prevention and brand reputation – as well as response. Track and trace technology documents all of a product’s details in its lifecycle from ingredients to customer shipment. In addition, track and trace solutions can include built-in controls to provide manufacturers with visibility into qualified suppliers and the ability to specify incoming inspection requirements.
It only takes one bad ingredient to force a food and beverage manufacturer into issuing a recall. Tracing the ingredient fast is the key to minimizing consumer risk and protecting a company’s reputation and brand. Without an effective track and trace process, you could easily be the next brand making headlines for unintentionally causing consumers harm, thus losing more money for your business than the cost of an ERP investment itself.
Stay tuned next Thursday for part 3
When beginning your quest to purchase an ERP solution, building a case for the cost benefit should be priority. However, focusing on all of the bells and whistles of a new ERP often overshadows looking at an actual cost benefit and understanding the overall value you are getting with your ERP.
ERP enables you to automate the tasks involved in performing your business process and gives you insight into all of the aspects of your plant. ERP is an expensive investment but it’s important to understand the cost benefits of a full solution.
ERP COST BENEFIT EXAMPLES AND SUCCESSES
Data Collection - The Case of the Expensive Italian Meat
The first week after go live with their ERP, a regular customer ordered their usual type of meat from a well-known Italian meat producer. The user scanned the same meat he had been pulling for years with the data collection application in their new ERP system. The ERP’s data collection system however, failed and would not let him pull the ham. Or did it actually fail? It turned out that the reason the meat wasn’t able to be pulled was because the user had been pulling a higher quality meat at a much higher cost for several years. Thank you to the ERP’s data collection, fixing this one instance alone actually paid for the entire ERP system.
While the instance of the Italian meat may be extreme, cases like this can and will happen. However, there are several other successful ROI opportunities that pay for the cost and help your business benefit from your ERP investment.
Stay tuned next Thursday for part 2
There are a number of existing and emerging trends in the industry that will affect ERP users, buyers and implementers this year. Below are our top 3 predictions for ERP in 2016.
In the digital age, relationships between machines and people are becoming more of a mandatory need. Smart machines (i.e. smartphones, tablets, etc.) are acquiring the capabilities to perform more and more daily activities at a fast pace. Users want the flexibility to work anywhere inside and outside of the factory and have more timely and accurate information for all aspects of the business at their fingertips. The best ERP solutions will become integrated into the daily work life of a user, putting real-time information on mobile smart machines for the back office and throughout the factory. Adapting to the fast-paced user environment is critical to being proactive and empowering all ERP users to make impactful business decisions.
A system’s ability to understand its users, the tasks they perform, and their system-related goals is crucial for optimizing human and computer interactions. Users need easy access to information and the capacity to personalize necessary information for them. Repetitive and recently used tasks should be immediately available for users, rather than having to drill through different screens to find the data they are looking for. Staff should be able to perform daily tasks easily and quickly within their system. Designing ERP solutions with an experience that empowers the user is an important shift toward the new year for ERP solutions.
SUPPLY CHAIN CAPABILITIES
Specifically for the food industry and with the Food and Safety Modernization Act (FSMA) coming into play, confirming the integrity and safety of your food is no longer just an issue of what happens inside the manufacturing walls. Implementing an ERP solution that seamlessly tracks the food downstream and upstream through the supply chain will ensure that manufacturers are able to rapidly respond to a recall in the unfortunate event of a safety issue. FSMA will warrant manufacturers to take a proactive stance and dedicate necessary time and resources toward compliance planning. ERP solutions that work with customers and suppliers up and down the supply chain will help protect your reputation and your consumers.