Bottom Line: Food & beverage manufacturing’s future is being defined by the over 60 customer quality audit requests a typical manufacturer receives every year, combined with the need to excel at FDA audits and compliance to stay competitive.
Food and beverage manufacturers need to find new ways to scale auditing if they’re going to keep growing and attracting new customers. Audits are one of the most powerful catalysts driving continuous improvement, contributing to greater customer satisfaction, and ultimately more revenue. Market leaders can take quick action on quality data gained from these audits and modify customer outcomes immediately.
- Excelling at audits is one of the most overlooked yet powerful ways to increase sales by correlating organization-wide quality initiatives to increase customer satisfaction across food and beverage manufacturing.
- ISO 9001 certification generates an initial sales bump that can be turned into long-term sales acceleration if combined with new products and programs.
- Food and Beverage manufacturing quality initiatives have reached an inflection point where audits need to be automated to scale more efficiently, providing more valuable data than in the past.
These and many other fascinating insights are from the Harvard Business School Working Paper, Quality Management and Job Quality: How the ISO 9001 Standard for Quality Management Systems Affects Employees and Employers by David I. Levine and Michael W. Toffel. As the first large-scale study to determine how employee outcomes such as employment, earnings, health, and safety change when employers adopt ISO 9001, the researchers underscored how periodic internal audits drive continual improvement. The study focused on single-plant firms across an array of industries with Dun & Bradstreet finding nearly 1,000 companies in California meet the criteria of being a single plant firm. The study has direct implications for the food and beverage industry as it reflects the need to scale customer and regulatory audits to retain existing customers and attract new ones.
Quality Audits Need To Become Routine For Food & Beverage Manufacturers
Getting into a regular cadence of quality audits creates the intelligence and urgency needed to keep improving every aspect of product quality. Presented below are five reasons why quality audits need to become routine in food & beverage manufacturing:
- More accurately track major and minor non-conformances by a given food or beverage product, prioritizing them, and what action is needed to resolve each faster. Product quality problems can turn into customer and public relations problems incredibly quick. Completing periodic internal audits to track major and minor non-conformances by product is essential for staying on top of any potential major product non-conformances. Capturing trending data based on noncompliance/corrective action (NC/CA), Corrective Action/Preventative Action (CAPA) and customer requests, then scoring nonconformances using a quality management system can help in defining which quality issue gets addressed first. Having a fresh set of data on these areas every month to 60 days in invaluable in solving quality challenges on the customers’ behalf.
- Audits are indispensable in building a knowledge base capable of tracking and predicting quality performance. An MES designed to capture, aggregate, and provide predictive analytics is invaluable to any food & beverage manufacturer today. The more detailed and robust the data captured in audits, the better. With reliable quality data, an MES and Quality Management system can provide insights into points of product and process weakness not visible before. Every new insight discovered adds to the knowledge base available for solving future quality challenges too.
- Maintain a high health and safety level plant-wide while keeping injuries down by using audits to track conditions and improve. A globally-known food products manufacturer uses audits every 60 days to evaluate the health and safety compliance of their lead production facility in the Midwestern U.S. Using periodic audits the quality management team found that work instructions often required workers to perform preventative maintenance on machines to keep production running including spraying WD-40 on presses if they appeared to lock up periodically. The audit found that preventative maintenance on machines needed to be stepped up in addition to tool calibration. The overall quality and production yield rates improved based on the audit and a more systematic approach to preventative maintenance planning.
- Providing improvement recommendations based on recent audit data to senior executive quality champions get results. Make the most of the time communicating with senior executives and leadership by providing clear recommendations for quality improvement based on actual data. By anchoring recommendations on audit data, the senior execs who are championing quality have what they need to take action. The Harvard Business School study also found that by doing audits regularly, manufacturers learn how to make cost reductions permanent at the process level.
- Keep customer-based metrics and Key Performance Indicators (KPIs) at the center of audits and track how operations plant-wide are performing versus plan. Often the most valuable audits find where internal disconnects are causing customers lost time, orders, and the potential to generate more revenue on their own. Audits need to track and trend order entry accuracy, warehouse pick accuracy, on-time delivery percentage, orders shipped without damage (% of orders shipped damage-free) and percentage of orders invoiced correctly. These five factors define perfect order performance. Excelling at perfect order performance is the first step to driving up customer trust and the opportunity to sell to them again.