Commentary | IT Matters

Regulation as an Opportunity

Tags: Logistics I.T., Legislation, Public Policy, and Regulations, Food Logistics

Par Wetterlof is VP Product Management, IMI Supply Chain, Aptean, 855-411-2783

Manufacturers are facing an increasing number of regulations in a variety of areas from increasing food safety to meeting specific ground-level ozone policies.

The FDA Food Safety Modernization Act of 2010, signed into law in 2011, is just one example of recent legislation. Resulting from widespread cases of tainted eggs and peanut butter, the sweeping overhaul of the U.S. food safety system allows for stronger government oversight and more accountability from food companies.

Many food companies supported that legislation as a way to keep unsafe products off the shelves and restaurant tables. However, not all legislation stems from such drastic and tragic circumstances. As a matter of fact, manufacturers should always look at legislation as an opportunity to achieve better control and supply chain integration, gain flexibility, and build vertical integration to improve quality control.

One of the first steps in improving quality control is increasing visibility – a step that often starts with sharing information such as master data and product characteristics with suppliers. For the food processor, this visibility, which is required, starts with tracking all ingredients by source identity, while also tracking the disposition of the ingredients in all intermediate and finished products.

However, manufacturers in other vertical markets, such as retail, need to create visibility during transportation between supplier and customer, as well as execute supply chain best practices such as crossdocking to simplify goods handling and increase throughput.

Global standards also play an important role in increasing supply chain visibility while enabling companies, regardless of location, to input and retrieve data into a common global framework. Allowing trading partners to speak a common language that identifies products and the logistics units of package sizes and containers on a global basis goes a long way in creating a foundation for lean supply chains and collaboration.

The biggest benefit of increased visibility is the flexibility it provides to adapt sourcing and routing models through manufacturing, warehouses, and transportation.

Some industry regulations also require that manufacturers capture data in real time. While this step may seem arduous and time-consuming, when done correctly and with the right technology, it eliminates costly and sometimes deadly errors, while ensuring immediate action on deviations.

The challenge for manufacturers looking to deliver quality products, increase productivity, and meet consumer expectations is to capture the granular data, and stay as close to the important “events” as possible. In sum, the closer manufacturers can stay to the transactions, the better.

Regulation is not the enemy, or even a necessary evil in the manufacturing world, although it can create an environment where evaluations seem more rigid. Yet, the business case is simple. The more transactions a manufacturer has, the more benefit they receive from real-time transaction control (both efficiency and compliance). By automating processes and taking proactive steps, manufacturers can better control everything from delivery flow to consumption, and make better decisions that save time, money, and build credibility.

 






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