Using ERP to make lot tracking a precise process
In pharma manufacturing, getting to the source of a problem is critical
It’s 2 a.m. when you get a call from your largest customer. Your No. 1 drug has been linked to illnesses throughout the country. You identify a bad raw material that created the problem. Meanwhile, CNN is camped out on your customer’s lawn, demanding a response to this crisis. How do you properly handle the situation?
If you’re using a number of spreadsheets, custom software programs, or “bridged” packaged software solutions to handle your business processes %%MDASSML%% including laboratory, purchasing, sales, inventory, production, and accounting %%MDASSML%% you’re probably handwriting lot numbers on batch tickets to track your materials. So in this case, your only option is to try to pull batch tickets for the months around the date the product shipped, and then manually go through them to identify which batches used the bad lot.
The problem is that’s a slow process in which it’s hard to account for all materials. Telling your reporter-dogged customer that Cindy is in the filing room and she’ll be back in a few hours or days isn’t going to please him %%MDASSML%% especially if Cindy can’t find 100% of the affected drugs by then. In the end, if you’re unable to recall all your tainted products quickly, you’re not only losing business, you’re jeopardizing your reputation and exacerbating a potentially life-or-death situation.
Business processes out of control
A manual lot tracking and recall process, like the one described above, is the typical option when you use multiple software systems because your business processes aren’t integrated in one, central location. Without integration, you have no way to establish and maintain process controls. So although manual lot tracking may seem easier initially, it certainly isn’t better.
Take production, for example. You pull inventory items listed on a batch ticket, write down the lot numbers, and make your product. It seems straightforward enough. But all it takes is one worker putting 50 pounds of item 123 instead of item 123A into a batch, and you’ve got a tainted product, angry customers, and a major recall situation.
The same is true of allowing negative inventory in your system. It may be faster to use materials without entering them into your software. But when you ship products made from those materials, you’re shipping from lots that don’t exist. So when you need to find the lots associated with those products, you’re forced to pull months worth of shipping orders and batch tickets. Theoretically, you could do it. But with transpositions and filing mistakes, you wouldn’t be batting a thousand. And if you’re shipping scores of products this way, these errors add up. Needless to say, this isn’t an ideal process when your biggest customer has TV crews blocking his driveway. Negative inventory and true lot control simply cannot coexist.
In order to establish proper lot control, you need to do three things:
• Integrate all your business processes in one, central system
• Prohibit negative inventory
• Post transactions in real time
Only a well-designed Enterprise Resource Planning (ERP) software system specifically developed for the pharmaceutical manufacturing industry can satisfy these requirements intuitively.
Controlled processes, traceable lots
Well-designed ERP software should integrate all the data of a pharmaceutical manufacturer, including formulation, regulatory reporting, purchasing, production, inventory, sales, and accounting in one system. If all business processes are connected in a single system, you enter data only once. This allows you to force process controls and achieve accurate lot tracking.
A key element in an integrated ERP system is bar coding. The system should let you generate bar code stickers to assign items to lots. Using hand-held scanners, you can then scan the lot data into the system to track items as they move through inventory, production, and shipment. Bar-coded pick lists and batch tickets also help ensure items pulled for production are correct, as scanners alert you if a mistaken item is scanned. By establishing this ERP system-based process for tracking lots, you avoid transcription errors and accidental substitutions, while saving the time spent writing on batch tickets.
Similar process controls also should prohibit workarounds caused by negative inventory. The system should prevent you from filling an order if it uses items that are not yet listed in inventory. That way, you would have to follow a proper order of operations for receiving, using, and shipping materials. This ensures you create traceable, electronic lot histories.
Finally, the system should post transactions in real time so you can view up-to-date lot histories at any moment. For example, receiving a purchase order (PO) should instantly impact inventory and accounts payable, with the adjustments tying back to the PO. This is only possible with a system that integrates all of your business processes.
Then if a customer calls you at 2 a.m., you would pull a lot tracking report that shows you everywhere that lot has been, and everywhere it is at that minute. The report, stamped by date, time, and signature at every step, should include:
•The original PO
• Jobs that included the lot
• Products made from those jobs
• Shipped orders containing those products
• Any of the raw materials or finished goods still on hand
With all these features combined in a single, integrated ERP system developed for the pharmaceutical industry, you can establish an efficient and effective lot tracking process and prevent the costly workarounds that can break down your business.
You never know when you’ll need to issue a recall. That’s why it’s important for pharmaceutical manufacturers to have the proper lot tracking tools in place. Only by using a well-designed, integrated ERP system that’s specifically developed for your industry, can you achieve true lot tracking %%MDASSML%% and be ready for a fast and thorough recall response at any moment.
Jay Deakins is the President of Deacom, Inc., a producer of integrated accounting and ERP software for mid-to-large-sized manufacturers of pharmaceuticals. The DEACOM ERP System seamlessly integrates all areas of a company - from formulation and lot control, to order entry and invoicing %%MDASSML%% giving you a comprehensive view of your entire operation. For more information, contact Jay at email@example.com or visit www.deacom.net .
- Events & Awards
- Magazine Archives
- Oil & Gas Engineering
- Salary Survey
- Digital Reports
Annual Salary Survey
Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.
There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.
But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.
Read more: 2015 Salary Survey