This morning, whilst grabbing a coffee and scanning through LinkedIn I spotted an advert posted by a former colleague of mine. The role was to help split the serialisation operations for GSK as the company prepare to “de-merge” their Consumer Health business.
That got me thinking, what are the key bear traps in splitting an organisation’s serialisation operation either due a divestment or in this case a de-merger. A couple of very specific things jumped to mind . . .
Firstly, the GTIN ownership and management. The GTIN is broken down into sections as shown in the diagram below. Part of the number represents the company which this range of GTINs has been allocated to and is between 7 and 10 numbers long.
The most important thing to establish is ‘who will inherit the GS1 company prefix’. Only one of the organisations can continue to use the company prefix after the divestment or de-merger. This becomes an issue if the same company prefix has been used on items that will be split between the two organisations.
This is relatively simple if the organisation only has a single company prefix, however this is often not the case. In a large multinational there could be dozens of company prefixes all of which need to be identified and analysed.
Simply allocating the company prefix to the organisation which has the most items may not be the most cost effective and easiest to manage. Although this sounds counterintuitive there are many other factors which need to be considered. GTINs are increasing being used not just by the supply chain but increasingly for traceability, e-commerce and to access digital content. The impacts on other stakeholders such as retailers, regulatory authorities and consumers needs to be factored in to understand the best approach.
So, the first issue of GTIN ownership and management has been taken into account, the second important factor is how to maintain serial number uniqueness.
The serial number can be up to 20 digits long and a combination of numbers and letters. When the serial number is combined with the GTIN is provides a globally unique identifier for the item.
It is good practice not to simply apply serial numbers sequentially, particularly where they are used to help prevent falsification. Therefore, it is common for IT systems to ‘randomise’ the allocation of serial numbers. Randomisation is easy to control all the time that the same IT system is allocating the serial numbers, but what happens if the GTINs move to a new organisation which will have a separate instance of the serialisation IT system or perhaps even a new IT system provided by a different IT vendor.
It is important to ensure that the same GTIN & Serial Number combination is never allocated to two different physical packs. Doing so could have consequences within traceability systems and even lead to real products being identified as fake.
There are several ways to ensure uniqueness is maintained, and the solution will depend on the specific circumstances of the divestment or de-merger. The simplest is to allocate a new GTIN to the item once transferred to the new organisation, however this is often simply not a workable approach as GTINs are already used extensively outside of the organisation within retail, supply chain, regulatory and traceability systems.
There are then other methods to address the issue of maintaining uniqueness such as the serial number length. Each method must be considered, and the most appropriate approach selected.
GTIN management and Serial Number Uniqueness are just two of the many factors which need to be addressed during a de-merger or divestment. Having worked on many such projects, Smarter and Safer Products have built up deep subject matter expertise in planning out the serialisation aspects of mergers and acquisitions. If you would like help in avoiding the ‘bear traps’ and factoring in key aspects of serialisation transitioning please feel free to reach out.
Written and published by Grant Courtney
To gain support for improvement in any area of business, it is critical that the appropriate group of senior stakeholders understand the area sufficiently well to be able to take appropriate and timely decisions.
In a previous article How big a risk is your packaging labelling and artwork capability? I discussed the significant risk and complexity involved in packaging labelling and artwork. The complexity of the area is often underestimated, involving not only technical, but also significant people and political elements. To work successfully, a typical packaging labelling and artwork capability needs to coordinate activity across many functions, locations and different organisations.
If we consider areas such as supply chain management or engineering for a moment, there is a well established mechanism for everyone involved to get the necessary education in the business processes in order for them to readily understand the big picture and equip them to make effective decisions. Unfortunately, the specialist and cross-functional nature of the end to end packaging labelling and artwork capability means that this sort of business education is not yet available.
The typical evolution of packaging labelling and artwork capability in an organisation often means that it evolves in a number of functional or geographic “solos”. Whilst those involved in the process understand their area of it, senior management often lack a comprehensive overview and understanding the end to end capability. Unfortunately, without an end to end understanding and governance of the process, decision making will often be sub-optimal at best.
A technique that we have found successful in tackling this issue is to bring the small group of senior stakeholders together for a small number of sessions to explain:
To be successful, this has to be explained in a manner, and using language that senior management understand. Furthermore, the message also should be put across by experienced senior managers who have credibility with the stakeholder group and, ideally, experience of working across a number of organisations.
Bringing the key stakeholder group together is important for this activity as it allows them to discuss the topic together and form a common understanding in the context of their own organisation.
It can also be powerful to combine this activity with feedback from a capability assessment, which I discuss in a related article. This allows the stakeholder team to immediately move into an improvement planning activity should that be necessary.
For more information on how we can help your organisation run this sort of activity, please do not hesitate to contact me at [email protected] or visit our website at www.be4ward.com.
Errors in packaging labelling and artwork presents a significant compliance and reputation risk to pharmaceutical and medical device companies, a topic which I have explored in a previous blog article . Here I will discuss how to assess your end-to-end capabilities in this area, in order that you can understand where you are and what, if any improvements you need to make.
The complexity of the area is often underestimated.
The devil is in the detail and there is a lot of detail!
Whilst significant omissions and errors can be the cause of packaging labelling and artwork errors, it is often the smallest of details that are the cause of incidents and recalls, e.g. missing decimal points or a vital piece of text being masked by an image. Therefore, to be successful, any packaging labelling and artwork capability needs to ensure that the smallest of details are correct. If we also consider that each artwork is unique and, more often than not, contains thousands of individual elements, the overall capability has to have a very high degree of accuracy.
To a large extent it’s about people
An effective end-to-end packaging labelling and artwork process relies on coordinating activity across several functions in an organisation and between several different organisations. Often, many of the people involved in the process change for each product and market being considered. Furthermore, many of these individuals perform their packaging labelling and artwork activities as a very small proportion of their overall role. In a large company, it is entirely feasible for the process to involve many thousands of people. Therefore, ensuring that every person know exactly what to do and when becomes a significant challenge.
For additional reading, please refer to my other articles on Processes and Organisation Design , both of which deal in one way or another with the human aspects of the end-to-end capability.
Technology is critical to success
Today, it is impossible to conceive of a packaging labelling and artwork capability not involving some element of technology. At minimum, organisations all use technology to create source text documents and artwork in order that they can efficiently and effectively communicate them with the different participants in the process. Tools such as electronic proof reading technology provide excellent safety nets to detect errors if used in the right context. At their most sophisticated, organisation use integrated technology suites to manage the end-to-end capability and automate many aspects of it. Given that the smallest of error can lead to a patient safety risk, many of these tools need to be managed under a strict quality assurance regime, often referred to as validation.
For additional reading, refer to my article on Technology.
As we discuss at length in our book, Developing and Sustaining Excellent Packaging Labelling and Artwork Capabilities, we argue that designing and implementing an end-to-end capability involving many different elements is the only way to deliver error free packaging labelling and artwork. Whilst there are many ways in which one could break down these capability elements, we define them under the following high level areas:
One of the starting points for understanding your current risks, issues and opportunities is to perform a comprehensive capability assessment against each of these areas of the end-to-end capability. Typically, such an assessment would consist of three stages: current situation assessment; gap analysis; improvement recommendations development.
Current Situation Assessment
A capability assessment should seek to understand the current situation for each element of the capability. In all but the smallest of companies, there are often different groups or organisations that perform the same function, but often in very different ways. Any assessment needs to ensure that it looks at a representative sample of the way in which activities are performed.
An excellent starting point for assessing any capability is to have a comprehensive model from which to base the assessment. Using such a model ensures that all elements of the capability are assessed against a proven benchmark. It is also helpful if such a model recognises that there are several ways to achieve the same result.
Gap Analysis
This stage looks at the current situation and assesses it for gaps, which in turn will lead to the development of improvement recommendations. In order to do this effectively, it must be recognised that not all organisations need to be at the same level of sophistication or maturity to meet their particular business needs. Any particular solution needs to be “fit for purpose”. Therefore, a gap analysis needs to reflect these different levels of sophistication.
A scale of capability levels that I have found useful is:
In discussion with senior stakeholders, their current business situation can often be translated into an appropriate target capability level for each of the elements of the end-to-end capability. This then allows an appropriate gap analysis conclusion to be reached.
Improvement Recommendation Development
I would recommend that all studies of this type result in some concrete recommendations about what to do next. Depending on the particular circumstances of an organisation, the degree of activity in this stage of the study can vary significantly.
At one end of the scale, an organisation may simply be looking to understand where they are and if there are indeed any significant issues, risks or gaps. In this case it may be appropriate to end such a study with some high level recommendations for the consideration of further work to assess options to resolve particular gaps. Often a number of “quick wins” or “just do it” type recommendations will also be possible.
At the other end of the scale, an organisation may need to move straight from this type of study into approval of subsequent activities requiring significant investment. In this case, the development of improvement options, their assessment and the subsequent planning and costing activity is significantly more onerous than in the previous case. The time and resources required to perform this additional activity needs to be factored in to such a study from day one.
Therefore, the exact requirements of this phase of a study need to be agreed up front with key stakeholders in order to ensure that their needs are appropriately met.
Key Stakeholder Involvement
Such a study also provides an excellent opportunity to engage with the key management stakeholders associated with the end-to-end packaging labelling and artwork capability, to ensure they understand the area and involve them in the appropriate decision making. Indeed, unless the recommendations for improvement activity are small and well contained in impact, it will be impossible to implement any recommendations without this engagement.
A well designed study will integrate this stakeholder engagement into the core of the way in which the study is done to ensure the key stakeholders are brought along with the work as it progresses and that they are appropriately prepared and equipped to make key decisions when necessary.
As an absolute minimum, the key stakeholders responsible for the different groups and organisations will have to agree to the study being performed, as resources in their area will be impacted (however minimally) with the assessment study. Furthermore, they need to be given the opportunity to communicate the study and it’s purpose to their teams to ensure the work is positioned in the right way.
And finally....
Whilst such a study always has some level of impact on people across the organisation, this can be minimised if the study is designed and implemented well. Indeed, the study itself can be very motivating for individuals in an organisation as they potentially get an opportunity to contribute their thoughts and ideas to improving the current situation.
Please do not hesitate to contact me at [email protected] if you feel that your organisation could benefit from this type of study. We have significant experience in performing this type of activity for all sizes of organisation and have the proven underlying capability model, methodologies, consulting skills and experienced staff to do it efficiently and effectively.
Request a copy of our proofreading guide by emailing me at [email protected].