Combatting Fraud with Product Lifecycle Management – ONLINE EXCLUSIVE

The food industry is fraught with risks at every stage—from farm to fork. Instances of food adulteration, such as the “Horsegate Scandal” in Europe in 2013 and frequent Salmonella issues in the U.S., affect the reputation of all market players badly, even though they may not pose any direct health hazards. Thus, it is imperative for food and beverage companies to keep a close eye on each and every process, lest a small misstep leads to a dire crisis or loss of reputation with resulting loss of revenues.

Coping with pressing issues like rising demand, cutthroat competition, and operational challenges, food and beverage companies strive hard to strike the right balance between improving productivity and increasing profitability. Since they cater to a diverse customer base, they also need to recognize the religious sentiments of consumers, which differ from one geographic location to another. In addition, investigations revealing noncompliance, mislabeling, or fraud often lead to product recall, trade compensation, loss of contracts, lawsuits, imposition of trade restrictions, or bankruptcy—and subsequent business closure.

In most instances, these cases, in addition to contamination, lost trails of origin, and non-adherence to facility standards and preventive processes, are a result of a lack of visibility in the complex supply chain, insufficient testing, and infrequent supplier audits and inspections. The only way companies can put a stop to rampant food adulteration is by taking a closer look at all the procedures, plugging loopholes, and monitoring every step involved in the process of manufacturing and distribution.

Thus, companies should focus on defining strict rules for governing conformance of materials and products to specifications. They must ensure full specification testing, including risk management at various points in the food chain. Ensuring complete traceability of food products from end to end is of utmost importance. This could be done by ascertaining visibility to certified suppliers known for their inspected food safety management systems, planning surprise inspections on the basis of pre-determined criteria, and facilitating smooth functioning through collaborated efforts from all teams involved.

Having a Product Lifecycle Management (PLM) system in place is one way to combat problems that crop up in the process. PLM, a complete solution with a flexible and collaborative framework, cannot only help fight food fraud, but also ensure smooth functioning of the entire supply chain in conformance with accepted standards.

Food compliance and regulations vary depending upon the area in question. Therefore, companies may have to use different sets of ingredients for producing the same product for consumers in different markets. An efficient PLM can aid food and beverage companies in managing variations and specifications by product, source, destination, etc.

PLM also makes it possible for organizations to ensure end-to-end traceability and quality control, be it in product development, procurement, manufacturing, packaging, or distribution. It enables them to impose a check at every step to ensure that all raw materials conform to specifications, and that products are packaged and labeled as required, stored keeping care instructions in mind, and transported with care to avoid unnecessary damage.

What complicates matters further is that some quality-tested products could also be adulterated, and products manufactured using such ingredients could have an adverse effect on consumer health or sentiment. The only way to overcome this problem is to keep a tab on continuously changing customer preferences. PLM can help organizations capture consumer feedback and use it to better understand their offerings through a proper testing mechanism, thus ensuring product safety.

Moreover, product lifecycle management can help companies to streamline their processes by incorporating best practices like supplier management, formula and recipe management, process automation, and document control. It can also help ensure that unwanted inventory is properly disposed of and all material transactions are recorded correctly, which will help businesses meet targets, reduce overhead costs, and maintain a good bottom line.