"This Is Not A Drill"-Be Prepared For The Unexpected
Prior to installing the Highjump Advantage system, Earthbound Farm's trace capabilities were similar to many companies' today.
"Everything was tracked manually on pieces of paper. We had as our goal then to collect all the information within two hours of starting our recall drill. We could typically get there, but it was an extremely labor intensive process. We had to sort through paper bills of lading to identify all the product and where it went, then manually build lists of customers and get the names to sales to contact," explains Will Daniels, vice president of quality, food safety and organic integrity.
"HighJump has enabled us to do all that within minutes of getting a lot or date code. It's also taken much of the potential for user error out of the process. As long as the product scans are accurate and orders are loaded onto the trucks accurately, we have a pretty good chance of making sure that every case gets accounted for and not just what's in our warehouse, but everything that's gone out to customers."
"We can also search for product by pallet, by who handled it, and what line it came from, so we can get much more specific with our recall capabilities than we ever could with our manual process alone," adds Alex Brinsmead, senior software development manager.
"We can pinpoint a particular pallet, or by adding time stamps to our packaging we can get even more specific and narrow down to the precise hour or minute exactly when something was packed, rather than having to look at a whole shift or a whole day's worth of production."
Earthbound Farm installed HighJump in late 2004 with the help of Vitech Business Group, Bellingham, WA, which played a key role in customizing the package for its specific applications. It wasn't long before the system had a chance to prove its track and trace capacity, when in 2006 Earthbound faced a major recall of bagged spinach packed under another brand by its Natural Selection Foods packing company.
"The system provided us with accurate information very quickly. Before, we wouldn't have been able to react as fast. We would have gotten the information together eventually, but it would have taken a lot more time and manpower and been a lot more stressful," Daniels points out.
"With Highjump, once we had the date and lot codes we were looking for, we were able to pull together distribution lists within the hour and that doesn't mean just getting the computer printout, which actually took only minutes," Brinsmead explains.
"That two hours encompassed actually putting everything together, reconciling the production and inventory information with the shipping data, for example, cross-referencing and double-checking everything to make sure all the information was accurate."
Daniel's advice to other companies facing a recall is "Make sure you follow your plan.
"In the chaos of the moment, when you have so many things going on at once, and lots of pressure from different entities both internal and external to make sure action is being taken on a timely basis, you need to make sure you're sticking to your plan as best as possible. So included in your plan should be some form of regular review process to make sure you've covered all the specific points you've written into it when the time comes.
"Preparedness also goes back to making sure every member of the team understands their role and not just from having read it on a piece of paper, but from having had the opportunity to practice their activities in mock recall drills. That also includes talking through the processes in advance and defining common terminologies related to a recall, to make sure that everyone from different segments of the company understands what each other is talking about."
Milking The System
Another organization that's stayed ahead of the curve on recall readiness is Dairy Farmers of America, the giant dairy coop that processes 40 percent of all milk production in the U.S.
"Quality assurance and lot traceability were one of the key reasons we first purchased Infor's Adage system 10 years ago," notes Bill McCurry, supply chain systems manager. The coop has since installed the system in 18 of its operations, and continues to roll it out to additional locations among its total of about 30 manufacturing facilities.
"Where we run the system, the plants are lot-tracking every ingredient and every item of packaging that touch a product. We track vendors' lot numbers as well as our own lot numbers all the way through the manufacturing process, then out to the sales order to identify what customer and ship-to that item went to, all through Infor's Adage ERP system. So at every moment we know what finished goods we have, every vendor item and lot that went into them and where that product is now or has gone." McCurry points out.
In its mock recalls, DFA's quality control group gives plants a two-hour window in which to define all the items in which an ingredient was used, or where a product was shipped to.
"If it's an ingredient where you're putting just a few tablespoons into a big batch, you might use a single lot over as long as a month. It took a long time to track all of that without the system.
"A lot of the plants we roll this into were using notepads and pencils to capture lot information before and thought that adequate, but they're not accustomed to capturing data down to the level of granularity the system provides, or managing inventory by lot codes down to that level of detail. They may know the quantity of sugar they have on hand, for example, but not all the lot numbers each sugar vendor delivered, or what products each of those lots went into.
"It takes a fair amount of training to get your people on the shop floor to record this level of data, and it's almost impossible for them to do so without a system like Infor to track it for you," McCurry notes.
"We co-pack a lot of products and our partners' QC groups will come in to test our recall and tracking capabilities and we've won awards for how quickly we can produce lists, for example, of ever customer that received a product that used a certain vendor's item. The ability to pass those audits with flying colors goes a long way toward helping us sign contracts for the next year," he adds.-C.C.
Outsourcing The Recall Process
While every company is ultimately responsible for its own recall readiness, one option to lessen the burden is outsourcing some or all of the recall planning and/or execution process to a third party.
Carolina Logistics Services, for example, has been managing recalls for clients as part of its portfolio of reverse logistics services since 1985. Its full-service recall management programs range from pre-event services like protocol development and helping companies stage mock recalls, to event management including operating call centers, product retrieval, creating and disbursing returns kits, as well as all other elements that go into the fulfillment/replenishment process.
"We do expect recalls both voluntary and involuntary to increase given the increased regulatory requirements, offshore outsourcing and manufacturers' and retailer's safety concern for their consumers," notes Gil Hobson of CLS, which recently handled over 40 recalls on behalf of manufacturer clients in a single year.
"Reverse logistics is not a core competency of manufacturing firms," he adds. "Given the extreme cost of executing recall events poorly, having an expert partner on board to ensure efficient, cost-effective execution is like a good insurance policy.
Part of what makes recalls difficult for manufacturers, in fact, is their infrequency.
"Recalls are neither predictable, nor repeatable so it requires that a company be able to scale accordingly to handle the increased volume," Hobson points out. "This is a benefit of outsourcing to a third party reverse logistics company that has the experience and resources to be flexible and scale according to the requirements of the situation," he points out.
Manufacturers' forward distribution networks are designed to be effective at processing full-case, first quality goods, he adds. "They don't have the systems, the experience or facilities to deal with the individual items that are returned with a recall. Not to mention that many times the recalled product requires special storage such as a quarantined area to meet regulatory requirements."
Systems to collect and account for the returned products should be automated and capable of providing daily updates not only to meet credit needs, but also to fulfill reporting requirements for government agencies, he notes in addition.
A number of CLS clients were previously involved in recalls that they handled internally and decided to outsource the next time.
"There's so much more regulation and paperwork involved, both in identifying product and in its disposition vs. normal returns, which can overwhelm a distribution center if they don't have a solid plan in place. And in the event of a recall, all this activity is time sensitive. Part of our advantage is the flexibility we have to respond quickly, with approximately 40 warehouses around the country designed to receive returned product, and a field force we can deploy within 24 hours of notification to start going out to stores and pulling product off the shelf. These are not the kinds of activities a manufacturer is set up to respond to quickly," Hobson observes. -C.C.