Information technologies: Keep track
Tom Kozenski: We provide a comprehensive suite of supply chain applications that efficiently manage the end-to-end flow of inventory from the supplier, through manufacturing, distribution, retail stores, and all the way to the consumer’s home.
Editor’s note: Refrigerated & Frozen Foods spoke with three industry experts to learn about the latest track-and-trace technologies and issues. The following is a discussion with Tom Kozenski, vice president of product strategy for RedPrairie Corp., Waukesha, Wis.; Patrick Pilz, president and chief executive officer for CSB-System International, San Diego; and Jack Walsh, marketing manager-Brand Protection Solutions, Videojet Technologies, Wood Dale, Ill.
Refrigerated & Frozen Foods: Please describe your products or services related to track-and-trace procedures.
Tom Kozenski: We provide a comprehensive suite of supply chain applications that efficiently manage the end-to-end flow of inventory from the supplier, through manufacturing, distribution, retail stores, and all the way to the consumer’s home. This control applies to both raw materials as well as finished goods. We provide global services for warehouse management, transportation management, workforce performance management, manufacturing execution, and retail store execution.
Patrick Pilz: We provide food processors with business technology solutions – consisting of hardware, software and business consulting. As far as traceability is concerned, we have been developing country of origin labeling (COOL) systems for more than 10 years and have unique experience in that field. We provide bar-coding solutions for the identification side of the solution, and computer software for the data analytical side of traceability.
Jack Walsh: Videojet marking and coding solutions play a crucial role in food packaging. Product identification plays a significant role in enabling manufacturers to meet FDA lot coding requirements. In addition to bar codes, lot codes and other variable data, consumer packaged goods companies employ Videojet solutions to print expiration dates for consumers and to better manage inventories, both on the shelf and in process.
R&FF: What factors are driving food processors’ interest in track-and-trace technologies?
Kozenski: Processors are no longer satisfied with only a simple track-and-trace reporting tool. They need to associate the source (supplier) to the finished good, as well as track every person and company that “touched” the inventory in the warehouse, the store, or on the truck.
They also need to automate their recall capabilities to be “event-driven” and find the inventory wherever it may be in their supply chain network. Processors are concerned about increasing their processes related to brand protection and ensuring their compliance to governmental regulations.
Pilz: In the forefront of the processor’s mind is a timely recall – as would be required by USDA or FDA. This is what they are telling me. Personally, however, the economical impact on yields [related to inaccurate tracking] should drive our discussion. This would turn a legislative requirement into an economical advantage and improve the bottom line.
Walsh: Many food processors would like more visibility surrounding a product’s chain of custody. Some food items are sold through territories that the manufacturers must protect. In addition, processors are concerned with recalls and adhering to requirements of the U.S. Bioterrorism Act. In cases like these, manufacturers want to be able to recall product in a more targeted fashion, in order to remove questionable items from the supply chain in the most expedient manner.
R&FF: How are processors approaching this issue? Are they tracking everything from incoming raw materials and through finished products traveling through the supply chain?
Kozenski: Yes, they are evaluating their entire process and are looking for the “weakest link.” They may do some processes very well and – other processes – not so well. Track-and-trace technologies affect both operations and the supply chain, in that (A) the inventory genealogy (lot, serial, bill of material) is created within operations, and afterward, (B) the inventory is distributed across a complex supply chain network. Both areas need to be tracked in order to provide end-to-end visibility and control.
Pilz: Processors approach this mostly from their own [internal] processes. To my knowledge, they don’t do much on the supply chain side to make sure that the information of others is included. I think there is a great opportunity to have a traceability system that ties into the customer loyalty cards on the retail level – and includes detailed lot numbers captured at the cash register. As far as I know, nobody is really doing this.
Walsh: Yes, Processors are addressing the entire process from end to end. Ultimately, they are responsible for the end product regardless of who sourced the materials and who sold it.
R&FF: How has your company responded? Please describe any new products or product improvements during 2007.
Kozenski: Our product suite is well suited for managing an end-to-end track-and-trace process from manufacturing to the retail store and consumer. This includes a recent orchestration tool that allows a food processor to automate their track-and-trace business processes not only across our application suite, but also across their legacy business applications and the systems of their suppliers, partners, and customers.
Pilz: As I mentioned earlier, COOL was introduced in Europe more than 10 years ago. At that time, we started developing standards in conjunction with the UC-Council (now known as GS1, a global group that oversees barcode standards). The goal was to allow all supply chain participants to share detailed information on the origin of raw material. In 2007 we took this idea a step further. We began using GPS location methods to capture origin data for produce while it was being harvested. We wanted to get even closer to the origin of product.
Walsh: For starters, we formally targeted the market and – to improve our implementation capabilities – we acquired Prism, a software and controls company, in 2007. Videojet recently launched a scalable, turnkey track-and-trace solution for the production process and supply chain. One of the program’s main facets is CodeMaster, which distributes unique codes and maintains relationships between products and pallets for tracking purposes.
Videojet also has become a preferred system integrator for Cognex Corp. to improve our overall solutions capabilities.
R&FF: Without naming names, can you share an example of one of your track-and-trace projects involving a food processor during 2007? Any results, to share?
Kozenski: There are a few positive track-and-trace examples that have occurred within our client base regarding their ability to manage the “identification and notification” process of a recall. Some of the latest implementations have also included the positive “confirmation” process of validating that the recalled items were in fact sent back to the warehouse.
Lastly, there are also examples involving our food retail and 3PL (third party logistics) client base, where companies use their track-and-trace capabilities to differentiate themselves in the marketplace.
Pilz: I’ll follow up to my earlier comment about tracking data down to the point of origin – in this case, produce in a field. I’ll note that the results of this approach are still outstanding. Even so, we expect better yield management because we are not only capturing the location, but also grades [of product] and other information to allow better planning of the utilization of the crops.
We can even go back to sections of the field, and tie the processing results to it, resulting in changes of fertilization and irrigation. This is a complete new approach and very promising. However, we still need to wait for the actual results as the system is utilized, and then learn what we can from the data collected.
Walsh: Videojet helped a major beverage company marry cans to pallets and track the items through its distribution network. The solution enabled the processor to prevent unauthorized distribution of the product, which can have multiple negative consequences, including brand equity damage.
R&FF: In your opinion, what might be the most important development in 2008 involving track-and-trace issues?
Kozenski: I think that an important development in 2008 will be the increased governmental regulations and controls that are currently being discussed in Washington. They are an outcome of the high number of recalls that have occurred over the recent past – involving a broad number of industries. These new regulations will require companies to place more controls into their operations and supply chain.
Processors also will need to better document and report on inventory movements and testing procedures. Without efficient processes, these new regulations will bear a large impact on manufacturing costs, warehousing costs, transportation costs, and internal labor costs.
Pilz: On the hardware side, there will be more costs related to radio frequency identification technology (RFID). The cheaper these solutions become, the more adapted they will be. This will drive the application side – so, more than ever before – processors can develop inter-company traceability programs. This is the leading interest of processors, lawmakers and, of course, technology companies. Eventually, the FDA will not need to deal with all the steps along the way to locate where a particular lot of spinach came from.
Walsh: I believe the industry continues to look for breakthroughs in RFID – from the perspective of both cost and ease of implementation.