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Managing Supply Chain Risk
 The latest automation supply chain tools help companies avoid problems, or deal with them quickly if they do occur, to minimize damage to their brands.
When internal inspectors at Georgia Nut Co. discovered salmonella in the company’s pistachio products in March, they immediately instigated a product recall downstream to their customers—including Back to Nature Foods, a Wisconsin firm owned by Kraft Foods Inc. that used the nuts in trail mix—and launched an inquisition to locate and eradicate the source of the contamination.
Consumer confidence is a delicate issue, especially considering the recent spate of similar recalls affecting a variety of products, and executives understood the potential damage such an incident would do to the company’s brand. However, Kraft was prepared and had the ability to track and trace ingredients and products both downstream to retailers and upstream through its supply chain, and rapidly identified and recalled suspect shipments, and traced the contamination to its source—a supplier in California.
“As part of our food safety program, we have systems in place at both Kraft plants and external manufacturers that help identify potential issues before they become problems,” says Adrienne Dimopoulos, a spokesperson for Northfield, Ill.-based Kraft Foods. “We require extensive monitoring and quality testing throughout the production process, and we require that each supplier and external manufacturer have a food safety plan in place.”
Because Kraft caught the problem early, it was able to avert the potential damage to the company’s brand. However, other companies haven’t been as diligent about their supply chain practices, or as fortunate when issues arise.
More recently, Peanut Corp. of America (PCA), Lynchburg, Va., filed for bankruptcy under Chapter 7 in a Virginia court after salmonella in its products led to 600 people falling ill, and as many as eight deaths in the United States. Some 1,800 products were stripped from retail shelves in one of the largest recalls in U.S. history. The contaminant was traced to irrigation water at a Mexican farm that supplied the company. Under Chapter 7, the company liquidates its assets to repay creditors, rather than reorganize. PCA will cease to exist... Read more
Workflow Automation Is Ready To Change Plant Operations
Plants are beginning to use workflow technology to guide production, capture operator knowledge and create templates of best practices.
Hammond’s Candies, in Denver, has implemented automated workflow even though the plant itself is not automated. The company proudly claims the title as the largest handmade candy company. But recently, Macy’s Inc. asked the company to automate its order processing, so Hammond’s turned to Minneapolis-based SPC Commerce to install a workflow system to handle the candy as it comes off the line.
“Typically, the first time a supplier adopts workflow, it’s at the request of a key customer who is pushing them to participate,” says Jim Frome, chief strategy officer and executive vice president at SPS Commerce. “But once they adopt it, they start using the technology with all of their customers.”
Hammond’s followed that pattern. Macy’s prompted the adoption of workflow, but now the non-automated manufacturer uses workflow automation for other large customers such as Bloomingdale’s, Saks and Pier One. “We don’t have to touch an order after it’s finished,” says Lori Schuman, director of marketing at Hammond’s. “The system breaks the order up into hundreds of different stores.”...
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A Change of Course for Pharma Manufacturing
The FDA’s Quality-by-Design initiative holds potential to transform the pharmaceutical industry’s approach to drug development and manufacturing.
In some ways, it’s like trying to turn a battleship.
When the U.S. Food and Drug Administration (FDA) in August 2002 rolled out a significant new initiative known as “Pharmaceutical Current Good Manufacturing Practices (cGMPs) for the 21st Century: A Risk-Based Approach,” the Agency signaled a major change in direction. The approach contained several innovative concepts that the FDA believed would enhance and modernize the regulation of pharmaceutical manufacturing and product quality, and, by extension, the way that the pharma industry would operate.
Indeed, many believe that the methodologies laid out by the FDA—an approach that has now come to be known as Quality by Design, or QbD—have the potential to significantly cut costs and boost the strategic importance of manufacturing in the research-and-development (R&D)-intensive pharma industry.
But change comes slowly in pharma, a $700 billion-plus global industry in which product development lifecycles can easily last from seven to 10 years. And while FDA regulators say that they have been pleased with the industry’s progress to date, pundits agree that industry implementation of the new FDA approach is only still in its early stages... Read more | 
