Pack Expo 2008
•Als PPT, PDF herunterladen•
0 gefällt mir•219 views
Without a recall strategy good companies can go out of business when products must be recalled. This presentation offers advice on how to create a meaningful recall strategy.
![Presenters ,[object Object],[object Object],[object Object],[object Object]](https://image.slidesharecdn.com/packexpo2008chicago-100825143131-phpapp02/85/Pack-Expo-2008-1-320.jpg)
Empfohlen
Empfohlen
Weitere ähnliche Inhalte
Ähnlich wie Pack Expo 2008
Ähnlich wie Pack Expo 2008 (20)
Kürzlich hochgeladen
Kürzlich hochgeladen (20)
Pack Expo 2008
- 2. Controlling The Recall Boomerang David Habib Jerry Horne November 2008
- 7. Toxic Milk Recall: 54,000 Sick Courtesy of BBC - As of September 29, 2008
- 25. The MI Coding Portfolio Pallet Coding Print & Apply / RFID Tagging Thermal Transfer Printers Laser Coders Small Character Inkjet Item Coding $ 2.49 BEST IF USED BY: 03-2009 1A 199 19:56 20 234165 4659 Print & Apply / RFID Tagging Small Character Inkjet Case Coding Large Character Inkjet ACME CANDY 00036 – 8 OZ CHOC GR PEAS LOT: JUL081125
- 30. Case Study Raw Materials to Finished Goods Traceability/Recall Case Study Video
- 33. Questions and Answers For more information please contact us: Jerry Horne [email_address] 816-478-2473 David Habib [email_address] 603-283-2579 Or, visit us in booth: S-2247
Hinweis der Redaktion
- Opening slide… While people enter the room.
- 10:00am Welcome – Good morning everyone... Jerry and I are here to talk about the very hot topic of “product recalls” and how to help manage the boomerang effect of products going out-bound and then recalled. Effective recall strategies must start somewhere and we have proven case studies that indicate the best strategies start by using effective product tagging or coding integrity management.
- Let me start by asking: How many people have a line item in their operating budget for a product recall next year? I would expect so – most companies do not plan for or expect product recalls, but they do happen – everyday! Now - How many companies have had a recall? How many of you, or someone you know, have ever owned a product that was the subject of a recall? So this topic truly affects most people in one way or another – your work, your family, your friends, and our world! Today, we are going to discuss the recall issues that face all of us: What we need to do to control the situation! What solutions exist today to manage the situation! And, How some companies are being successful in limiting the scope of recalls with proven solutions! The key to a product recall strategy is all about time management: increasing or speeding up the access to decision data, and quickly minimizing your company’s risk of recall exposure by being able to get ahead of your supply chain if you should need to. Let’s spend a few minutes looking at recent events.
- During the past two years we’ve heard this scenario many times during the Presidential Campaign. Your company faces daily threats too! Threats that can bring serious financial implications, fines and penalties, lawsuits, and more. Some threats are large enough that they can ruin a company. Suppose the message you received at 3:00AM is that someone has been seriously injured by your products or that someone has been made critically sick by your products. Suppose the message is that many have been adversely affected by your products. How would you react? Suppose at 3:20AM, twenty minutes later, you receive another call. This time it is a ‘60 Minutes’ reporter wanting to ask you why your company makes bad products that hurt people. What is your response? Do you have any idea who might have your tainted products or where your tainted products might be? Do you have a plan in place to take appropriate action to recall your tainted products out of the supply chain quickly? Do you, or some executive you know, lose sleep at night worrying about this very real, very serious business issue? We bet you do!
- Recalls are serious business issues. There are three key components of recalls: scope, cost and risk. Any one of these components can critically impact your company’s future. The impact from any of these components can be managed to some degree by having proactive plans in place before a recall is issued. Recall plans vary by industry and by product. Let’s look at a few recent recalls and their impact.
- The recall story of the year! The Chinese milk industry continues to recover from a melamine-laced contaminated milk crisis. Melamine is a toxic industrial chemical that artificially boosts nitrogen-levels and fools quality checks in sub-standard or watered down milk products. In China over 54,000 children were stricken, with 13,000 admitted to hospitals with serious medical conditions. There were at least 4 infant deaths reported. Aside from health issues from directly drinking milk or infant formula made from contaminated milk-powder, many products with milk as an ingredient have been affected including candies, non-diary creamers, and baked goods like cakes and cookies. Additionally, the BBC reported in October over 1,500 dogs in China have died from eating pet food with contaminated milk-powder as an ingredient. China is the world’s third-largest volume milk producer; but with this recall, its global reputation has been adversely affected with this toxin scare. As a result, China’s Commerce Ministry has promised a strict crackdown and new reforms in safety controls and food safety laws.
- The scope of this problem has been world-wide with Chinese milk, milk-powder, and milk-related products like yogurt and cheese being recalled or banned on nearly every continent. The number of companies and countries involved continue to grow as additional testing reveals problems. Cost estimates for this milk problem recall and ban are still being calculated and are expected to be in the millions.
- Last year, Melamine contamination in pet food cost Menu Foods more than $45 million. Additionally, the company lost market share, consumer faith, and depressed shareholder values from the recall. The impact of this recall continues to this day as the company struggles to recover. The source of the Melamine was traced to ingredients purchased in China.
- Here’s a company that did not recover. You may recall the news on October 5, 2007 from Elizabeth, NJ when Topps Meat Company, made this announcement: “In one week we have gone from the largest U.S. manufacturer of frozen hamburgers to a company that cannot overcome the economic reality of a recall this large. We sincerely regret the impact this will have on our employees, our customers and suppliers, and the community. Most of all, we regret that our products have been linked by public health agencies to recently reported illnesses. We hope and pray for the full recovery of those individuals.” Topps Meat, a 67-year old company, closed its doors because it could not manage the economic impact of a 21.7 million pound recall of ground beef products – the fifth largest meat recall ever.
- Here’s one that may be a bit more personal: couldn’t find any tomatoes for your salad earlier this summer? Blame it on the mysterious salmonella outbreak that made hundreds sick and took months to trace its source, which finally turned out to be peppers grown in Mexico. Obvious flaws in tracing grown food products in the supply chain were uncovered in this outbreak. Hundreds of farmers lost their entire tomato crop estimated at millions due to the scare. The total tally is still being counted.
- In another very serious tainted food scare, in August 2008, Toronto-based Maple Leaf Foods products issued a recall for 220 meat products linked to a listeriosis outbreak that killed 13 people. Recently, the company estimated the cost will exceeded $20 Million Canadian dollars.
- Remember the toy recall in the late summer and fall of 2007 that was due to a lead paint scare? The recall costs exceeded $50 Million. Last Christmas the impact of the toy recall to Mattel was costly in terms of money incurred and market share lost to other toy vendors.
- As a result of the lead paint toy recall and subsequent lead paint problems discovered on additional toy products during the winter of 2008, Congress enacted a new law to ban all lead paint from children’s toys. President Bush signed this law on August 21, 2008.
- As we’ve already noted, recalls can be global. In the Summer 2007, a laptop battery recall cost Sony up to $430 million worldwide.
- In September 2008, Sony was again hit with a worldwide recall for nearly half a million laptop computers with an overheating problem. The cost impact is still being calculated.
- Manufacturers are not the only ones facing penalties and the threat of penalties. Retailers also feel the effects of recalls and they are reeling. In August 2008, several infants were injured and there was at least one death due to strangulation because of a faulty bassinet design. Six of the largest retailers – Wal-Mart, Toys “R” Us, Kmart, Big Lots, Target and JC Penny – agreed to stop sales of this product to protect their customers and most importantly to lessen their risk of being included in a wrongful injury or wrongful death lawsuits.
- Looking for statistics? The European Union is looking very closely at a number of product recalls issues and their related causes. One area concern in the UK has to do with recall incidents resulted from labeling or packaging problems. The UK Food Standards study for 2007 documented over 1,312 instances of food-based product recalls. And 5.5% - 72 instances - were simply bad information on the product label or packaging (codes or legends)! I will now pass the presentation to Jerry to discuss the scope of the “global problem” and what companies can do to use information and procedures in your supply chain to minimize your recall risk exposure.
- Thanks David – As David indicated, recalls are a worldwide issue. There are few physical boundaries left in today’s global economy. Materials and ingredients are sourced globally. Products are manufactured and assembled globally. Finished goods are distributed globally. The “real” supply chain today is a global chain with global consumers. So when there are product problems, these problems become global problems. A global economy now demands global recall strategies. And with global recalls, the number of issues to resolve grows exponentially. Let examine a few common strategy issues that must be addressed...
- These are the real recall realities, as reported by the companies involved, by the public and by media that watches over them. But, first, let me ask two simple questions: (1) How many of you work for companies that are planning to have a product recalled next year? (2) How many of you work for companies that have a line item in their fiscal budgets for next year that would cover the cost of a product recall? As I suspected no one does. Without knowing the scope of the specific recall, it is impossible to fully plan ahead so how could you possibly budget ahead? And the sad economic reality is that the entire cost of a recall event comes directly off your bottom line. Here is what has been learned and reported about product recalls: Recall plans are never complete, they are rarely tested for the worst case, and they are almost always out of date or incomplete. This means that when a recall event happens, company resources are quickly overwhelmed – from executives to warehouse guys. The short-term fix for overwhelmed resources is often to outsource to companies that specialize in things like managing public relations, transportation, warehousing, reworking and more. This short-term fix can be very expensive. Of course, if the company is publicly held, then other issues quickly arise as negative publicity often decreases the price of stock and dissolution with the company can cause sell-offs. Management usually has to figure out the root cause of the recall and if there is a physical problem at the plant from contamination, then plants may be closed, cleaned, retooled and in some cases possibly re-certified. Those are all expensive issues to manage. When a recall event happens the first priority is to get the word out. With a global economy, messages, ads, commercials etc. must be created in the local language – which can be very expensive and when recalls are time-sensitive or life threatening – cost savings and efficiencies are not the objectives. Often special web sites are created to provide consumer information. Those don’t happen overnight and companies must be prepared in multiple languages. Recalls can be public relations nightmares, especially if tainted products cause bodily harm or death. The last thing any company wants is for a “60 Minutes” news crew to arrive at your door and announce they want to discuss your recall. If there is bodily harm or death from a tainted product, you can always count on a lawyer to hold the company accountable. The same is true if there is a sudden decrease in shareholder value. For example, institutions that hold shares of companies for retirement IRA accounts will try to recoup lost funds if they can. All of which points to the reality that in the aftermath of a recall, there will likely be: Staff layoffs – at least temporarily from production stoppages Staff firings – if there are specific staff members that can be held responsible for the recall event, and... Almost always some mid-level or executive-level staff member will be made the scapegoat and be fired or worse, jailed.
- There are extremes when it comes to recall: best case and worst case. And, of course, every shade in between. Let’s examine two extremes: Best case – a defect is caught quickly and the scale for the recall is small. At best consumer confidence may be temporarily shaken and there may be a temporary loss of sales, but the recall costs should be manageable and the risk of litigation or prosecution may be low. You may recall last year a bagged lettuce recall started in Canada was quickly contained and controlled. Worst case – a defect is not caught for an extended period of time and actual illness, damages or death might happen. Products may be pulled from the shelves never to return as consumer confidence in the product bottoms out. If the period of time is a “guesstimate” because you’re simply not sure of the scale, then more products than necessary are recalled and heavy costs may be incurred. In a worst case scenario, litigation will always be looming and, in some cases, fines or legal prosecution may happen. You may recall over the past several years there have been several infant care products - like bassinets, cribs and car seats - that have been recalled after the most serious health problems occurred. The current bassinet recall event in September 2008 after several infants died is a prime example of a worse case scenario.
- So, based upon the real world product recall realities we’ve discussed, at which “extreme” does your company stand if a product recall event were to happen this afternoon? Answer these questions: Do you have a formal strategy for recalls? Does your company have enough market strength and brand credibility to recover from a worst case extreme recall? How about consumer confidence in your company and your products? Even if your company survives the recall, will your consumers remain loyal to your brand or jump ship to rival products? And will your suppliers continue to be business partners though the rough times? Most important of all, can your company legally comply with governmental traceability requirements related to recalls? Are your product recall plans reliable enough to initiate a recall to your supply chain within 4 hours in Europe or 48 hours within the US? Has your company ever truly practiced a worst case product recall plan?
- If answering the previous questions left you with doubts about your recall strategy to help you manage a recall boomerang – products going out and then unexpectedly coming back – you’re not alone. Markem-Imaje offers a few key steps to help your recall strategy get on track.
- These are Markem-Imaje’s key steps for all product recall strategies. Simply put the keys are: effectively and uniquely tag products, data verification and capture, data integration to other systems, data management for quick research, all in an effort to provide useful product information to make timely business decisions. Valid information is critical to be able to generate a tainted product traceability report in minutes versus days. This capability is very important to know where products are right now...or to know where products have been shipped in your supply chain. The quicker you can react with timely business decisions, the quicker you can resolve all issues. Key components of any recall strategy must be to optimize production systems with data integrity – which is getting the right code on the right product, networking coding device applicators together, and automating data verification and data capture for all tagged products. The speed of data capture, as well as the accuracy of the data, is critical in any product recall strategy to minimize any harmful consumer effects and lessen financial exposure and legal risks.
- The most efficient and economical place to begin any recall strategy begins on the manufacturing production line and that strategy begins with uniquely marking products. Just like you have fingerprints or your car has a license plate, unique marking can focus the daunting task of finding specific products very quickly. The absence of unique markings alters the challenge of recalls from being manageable to being un-manageable. Markem-Imaje manufacturers a wide-range of coding equipment that can uniquely tag products: items, cases and pallets. More about that in a moment. Unique markings must be managed to insure that you have the right marking or code on the right item at the right time . When multiple line or plants make the same products, the likelihood that manually controlled codes might be duplicated increases exponentially unless automated controls are engaged with coding integrity software, like CoLOS software from Markem-Imaje. If you can streamline or automate the process to capture and validate that you have the right code on the right package, then you have the beginnings of a real product recall management strategy. Networking coding devices and data collection devices together in one network controlled by CoLOS offers a valuable and time-saving alternative to manual methods. Being able to use the data you’ve captured quickly to respond to a recall event is critical. You must have software solutions that can provide you with business information to make business decisions quickly. Additional strategy steps to consider should include: a strategy must be scalable for today and tomorrow’s needs a strategy should use standards-based software and, to validate the solution: test it annually So the first task is putting information on products. Let’s take a closer look at the coding devices Markem-Imaje offers…
- For marking items, cases or pallets, Markem-Imaje offers a broad portfolio of coding product hardware for nearly every coding need. Here is a brief overview: Markem-Imaje offers complimentary high-speed coding technologies which can print text and bar codes on a wide variety of primary packaging surfaces ranging from PET bottles, to glass, to film, to chipboard, and more. From the left – first is Markem-Imaje’s small character continuous ink-jet printers. Next is Markem-Imaje consumable-free laser coders. Finally, Markem-Imaje offers thermal transfer printers which can print on film and corrugate boxes. So, if you need unique UPC codes, price codes, bar codes, or text information on primary packaging Markem-Imaje meets your needs. For case coding, Markem-Imaje offers complimentary high-speed technologies for text, bar codes, and graphics. From the left – first is Markem-Imaje’s small character continuous ink-jet printer which is popular for case coding in addition to its role in primary pack coding. Next is Markem-Imaje’s hot-wax, instant-dry large character inkjet. This popular coding device has the ability to reproduce high-quality logo graphics or other art work – in addition to its ability to print text and bar codes. Finally, Markem-Imaje offers several models of print and apply thermal and thermal transfer label applicators. Thermal and thermal transfer coding devices produce very high quality text and bar codes as well as graphic images for demanding applications such as retail or pharmaceutical compliance. So, for marking or labeling cases that go on pallets or for creating compliance case labels for shipping, Markem-Imaje covers all of your bases. Pallet coding most often utilizes high quality thermal and thermal transfer coding devices and Markem-Imaje offers several models from which to choose. Markem-Imaje pallet coding applicators can be configured multiple ways to work in conjunction with automatic palletizers and other end-of-line conveyor controls. Whether you’re printing license plate labels, SSCC labels, or shipping labels Markem-Imaje can address your pallet labeling needs. Come by our booth S-2247 to learn more about our hardware.
- While all Markem-Imaje coding devices can work in a stand-alone mode, the real power to be gained is when all Markem-Imaje coding devices are networked together. With a network of Markem-Imaje coding devices centrally controlled by Markem-Imaje’s CoLOS software, a higher, more sophisticated degree of control will empower your business. This is the second step in our recall solution which is to put the right code on the right product at the right time. We call this network capability “coding integrity.” With our starter program: CoLOS Enterprise, you can enable your production lines to automatically update coding formats and field data information every time you have a product production change over. You can have a central repository of coding formats that are designed for each specific coding technology on your production lines. And best of all, if you have multiple lines or multiple plants, you can link them all together to have uniform coding consistency, uniform informational data, and since this process is automated, you eliminate the potential for human error – which is the number one reason for misinformation causing recalls.
- CoLOS Software is the backbone of our recall strategy. The entire network is empowered to manage your coding process. Let’s briefly look at the key components. Beginning on the left, these are the network operations that CoLOS manages. First, there is the capability to synchronize appropriate information from other systems such as ERP, WMS, MES or custom applications. This is a two-way communications capability – we can pull information down to the network or we can push information from our network upward. Information pulled down - or - accumulated to be pushed up - is written to and controlled by CoLOS databases. CoLOS also manages the user experience with easy to use, easy to understand graphic operator displays and/or PC interfaces. CoLOS interfaces with standard PLC conveyor control systems as well as a variety of verification technologies such as bar code scanners, vision systems, and portals. In the center section, there are a few examples of common coding output controlled by CoLOS. CoLOS Enterprise includes an easy to use tool for creating coding formats for all Markem-Imaje devices. Finally, on the right side are examples of reports that can be generated from CoLOS software. These reports can come from the informational data in the CoLOS SQL databases. CoLOS is modular and it can be tailored to work in many environments. Data integrity – which is generating the right code for the right product at the right time – is just one example of how CoLOS can help your company.
- Of course, the best asset we can bring to address your recall concerns is our people. Markem-Imaje has the reputation for hiring and retaining the best technical resources in our industry. Before the project starts, during the implementation phase, supporting the go-live processes, and helping when required as the project matures – Markem-Imaje stands ready to help your project be successful and on-time.
- Let’s review a few case studies. A Markem-Imaje client - Unilever - needed a solution to meet EU mandated requirement of a 4-hour product recall. Unilever was integrating SAP and they needed to control and automate the coding of product on their packaging line. They needed to mark “best before dates” and lot information on the selling unit package. They needed bar codes and item information to be printed on their shipping cases. They needed to conform to GS1 pallet labeling standards. As part of their SAP implementation, Unilever also eliminated the warehouse at the end of the production line. Products were now shipping to an outside distribution center directly from the end of the line. Unilever wanted to track which pallets were being loaded onto specific trailers so that they could control and manage their supply chain for a recall event and to eliminate errors caused by manual data input.
- Astra Sweets needed to manage their total manufacturing processes for raw materials in a MES and SCADA system to create a batch of product. Then they needed to track which batch/lots were used to create finished goods. This was done to manage the supply chain traceability. If a supplier called with a potential issue, Astra Sweets would be able to determine where the tainted raw materials are in their warehouse or if the tainted raw materials had already been used in a batch/lot. Astra Sweets also needed to track where specific batch/lot finished goods were located in their finished goods warehouse or had been shipped to customers. Astra Sweets can now manage a product recall for only the specific cases and pallets that have been affected by the tainted raw materials and recalled by their supplier. This strategy enables Astra Sweets to eliminate the need for a total mass recall for a product, and only target the pallets of tainted items that were shipped to specific customers. Astra Sweets also added the capability to trace a product unit to a specific case, and a case onto a specific pallet thorough the use of code serialization at the case and pallet levels. With good tagging/coding practices, networked coding equipment, and a database with validated information, Astra Sweets is able to better manage their risks and control their inventory. They reported an ROI on the project of less than 1 year.
- Which product recall scenario is your company prepared to handle? You must have a plan that is ready and tested for your worst case product recall. You must establish internal and external priorities on how you will manage a recall event. All product recall strategies begin with efficient tagging of products and the centralized control of all appropriate code printers and applicators. Validate and verify the data you’ve printed by automating data capture points. The solution implementation should be fully integrated with all appropriate MES, ERP or WMS solutions that run your business. Test and certify that your solution strategy works for data capture and data integrity. Test and certify that your solution strategy addresses your worst case product recall need. Test and certify your solution strategy annually as your company needs will grow and evolve. Annually practice your product recall strategy. And remember that “hoping for the best” is not an effective business strategy. Finally, put a strategy in place that can grow as your business volume or needs grow.
- What should you do next? Here is our best advice: Think strategically. Implement tactically. Plan accordingly. Be ready for the worst case. Adopt scalable strategies that use configurable solutions that can change as your company grows. Centralize print functions and automate data capture to ensure the right code is on the right package...every time. Make your goal to be as “real-time” as possible with your data capture and try to eliminate all manual data collection. Utilize software databases and solutions that will provide timely access to information so you can make timely business decisions for targeted recall campaigns. Pick a logical starting point for your recall strategy. A point that makes economic and business sense for your company. Choose a partner like Markem-Imaje that can assist you with the critical set-up and follow-through required to map your product recall strategy.
- Are there any questions? Here is our contact information. We would welcome the opportunity to discuss your recall needs. Please come by our booth S-2247 Thank you for your attendance today.