Industries that have a requirement to track their product movements via batches, whether it is legislated or based on a need for mature supply chain economics, find it difficult to perform these tasks in an efficient manner. Why the inefficiency?
- They battle to track batches, serial numbers or handling units / packages across the various disparate systems that are involved in the supply chain. Multiple systems come in to play and generally any solutions that may be available to provide for the tracking of these objects are bound to one system and one system only.
- They have no easy way to view the upstream products, suppliers and customers impacted by a defective batch (bottom up view). In the same breath there is no view in to products, raw materials, orders that fed in to that same defective batch (top down view). Finding a defective product at a customer or on the shelf requires a combination of top down and bottom up analysis to determine the breadth of the issue. The complete genealogy, for both upstream and downstream impacted batches and objects, simply cannot be easily determined and reported on. This task can often take many weeks to complete. If the defective batch led to bad press, sickness or at worst a fatality, the timeliness of determining the root cause to mitigate the impact is business critical.
- Inconsistent, inaccurate or missing data in the product genealogy leads to an incomplete analysis being performed and often is very difficult even to determine that the chain has not actually ended but is actually continued elsewhere.
So where does SAP Global Batch Traceability (GBT) fit in to the picture?
SAP GBT is not:
- A batch management solution – You still need to perform proper batch management in your ERP system by flagging materials and process as batch relevant and capturing the proper batch information as the goods movements are executed.
- A replacement for a poor system with poor data. Garbage in – Garbage out… All movements related to batches need to be executed correctly in the system in order to reflect a complete and correct genealogy for the respective batches
SAP GBT is:
- An add-on tool provided by SAP to give companies immediate insight in to your product batch genealogy
- A tool that allows for fast and efficient analysis and reporting on product batch or multiple batch distribution records. I.e. where these affected products were sent?
- A repository of batch related objects and relationships between these objects
How does it work, practically speaking?
If I take a simple process and walk it through with you we can see how it works in practice. The first scenario is one where we uncover an issue at the end-customer side…
STEP 1: We have a problem with this product.
STEP 2: Find all the applicable batches that fed in to this product (Top down report)
STEP 3: Isolate the bad batch or raw material at the lowest level.
STEP 4: List all batches / semi-finished / finished product that used this bad batch together with the locations (addresses) of each of these products (bottom up report)
STEP 5: Take action! Send out a notice of recall, withdrawal or hold
A second scenario might be if you uncover an issue with a raw material that you used in producing a product that you have now shipped…
STEP 1: We uncover a problem with this raw material batch.
STEP 2: List all batches / semi-finished / finished product that used this bad batch together with the locations (addresses) of each of these products (bottom up report)
STEP 3: Take action! Send out a notice of recall, withdrawal or hold
Why do you need to react quickly to these types of issues? What value lies in it for you? Greatly improved Time to Insight (T2I) gives you more time to take corrective action because you are aware of the full extent of the issue much earlier on in the process. This allows you to following benefits:
- Customer protection – Stop those customers from consuming the product if they have not already done so. You have the ability to limit the impact to your customer base by quickly addressing communication directly to each customer who received the affected product
- Brand protection – Following from customer protection is naturally brand protection. The fallout to a company that does not quickly limit the exposure of a bad product to their customer base could face a very real threat of losing credibility in the industry and thus lose market share and business.
- Contain corporate liability – By taking early, efficient and effective action to address the issue, you have done all that you could possibly do to contain the issue, thus minimizing any potential fallout relating to the issue.
- Financial Exposure – Similarly to the previous point, by taking fast corrective action you can limit number of affective parties and show that you did everything possible to address the situation in a timely fashion. Of course this does not absolve you from accountability and financial action but it does contain and limit actions that could have been brought against you had you reacted slower and the problem had been more widespread.
- Regulatory report – Some industries are regulated and are thus required to be able to report in a very timely fashion exactly where certain products have been sent or from where they were received.