Enabling item level serialization: Ten key steps to ensure success

Pharmaceutical CommercePharmaceutical Commerce - May/June 2013

Fig. 1. Assembling the right leadership team for a serialization project.

Item level serialization (ILS) and traceability fosters supply chain integrity. Whether to expose counterfeits, identify sources of product diversion, improve integrity in the reconciliation of returns or comply with increasing regulation, the ability to establish uniqueness at the item level provides unparalleled supply chain accountability and visibility benefits. ILS illuminates transaction activity and enables the manufacturer, distributor, pharmacist and/or regulator a greater insight into the who, what, when and how of network activity after initial shipment.

Attaining a common, yet integrated, approach requires participation and consensus of diverse stakeholders. Often the route to ILS and traceability requires the traversing of organizational boundaries and teams with cross-functional competencies in areas such as product packaging, distribution, warehousing, process automation and information systems. Consensus building across divisions, geographic regions and corporate structures, while necessary to assure a common approach to serialization, is difficult to manage and control.

Adherence to a comprehensive, disciplined approach is necessary to clarify objectives, align priorities and facilitate a successful project outcome. Consider the following ten steps when establishing your ILS and traceability program.

1. Recruit leadership; mobilize troops

ILS requires cooperation and coordination from internal departments and external trading partners, many of which do not typically work together. Establishing a serialization enablement leadership team is complicated by the typical decentralized organization structure found in pharmaceutical manufacturing; management is often diffused into various operational units with differing objectives and little understanding of each other.

Selecting a leadership team which is passionate, motivated and empowered to unite diverse interests into a common effort will be critical for the success of the project. Who is responsible for ensuring the customer experience meets the promise of the brand? Can they commit sufficient time to leading or actively participating in a project of this scope and scale? Will they be given sufficient authority, time and resources to effect change?

What groups need representation on the leadership team? Select representatives from areas impacted by ILS changes. These include product labeling, package design, packaging, logistics and order fulfillment, as well as the information systems needed to support each of these functions. Other departments will need to modify or implement new processes to facilitate serialized supply networks; impacted departments include: quality, regulatory, legal, security, finance and training.

2. Establish vision of success

With the disruptive nature and complexity of enabling uniqueness into a batch-oriented process, a concrete, credible vision can save the initiative from losing its way. Gaining alignment of business operations with diverse and potentially competing interests will be essential to keeping the program on track. Being able to refer to a concrete description of desired outcomes is often necessary to avoid being trapped in the weeds.

Is your serialization enablement effort driven by the need for visibility, accountability and transparency, or simply by regulatory compliance? With hard-to-quantify business benefits many pharmaceutical manufacturers discount the potential market advantage gained from supply integrity and focus exclusively on attaining compliance.

If the focus is purely compliance, avoid building a rigid solution to address current laws. Understand current and emerging regulatory requirements from a global perspective and how they impact serialization efforts. Many track-and-trace regulations are continuing to evolve; expect that. Set a vision that establishes a platform for compliance and incorporates flexibility to adapt to changing legislation.

3. Formulate an attack plan

Establishing ILS is a process, not an event and as such, getting there is neither quick nor easy. New, more-disciplined processes will be created and these will impact internal operations and external supply and trading partners.

As a result, adherence to a comprehensive, disciplined approach is necessary to clarify objectives, align priorities and coordinate deployments. It is important to understand the end deliverables first and establish a plan and timeline that sets the organization up for success.

Consider structuring the ILS program around transforming the following three areas: information systems, packaging and logistics. Define the desired outcomes for each of these areas and detail all the activities that must be understood and addressed to facilitate the transformation from “as is” to “to be.” By placing each area into a separate workstream, independent efforts can progress concurrently. Dependencies from one workstream to another should be visibly depicted. Sequence the tasks, actions and milestones on a common time grid to communicate critical touch points.

4. Assess readiness - understand gaps

Starting with the end in mind, determine the necessary workflow, product and information exchange needs to attain the project vision. Assess the current state and understand the gaps with the desired states. Document how the objectives, workflow, data elements, process and equipment must change to support the project deliverables. Use this baseline assessment as an opportunity to communicate and educate the organization.

5. Establish an information architecture

Information management is the lifeblood of ILS. Shifting from a batch understanding to an item level view is dramatic; in addition to the handling of uniqueness at the item level (hello Big Data!), every aspect from master data management to interoperability to change management needs to evaluated. Will the integrity system be independent, interoperable or integrated into ERP? Does the organization outsource some or many areas of storage, information management or support? Are the appropriate providers in place or do changes need to be made going forward? Integrate the user community into the requirements definition and decisionmaking process.

Understand workflow and system requirements for serial number management, serial number exchange and regulatory requirements. Review current information management approaches to production planning, order fulfillment and pedigree generation and define information fields and event transactions that need to be captured, stored or communicated between product planning, packaging, warehousing, and order fulfillment.

If the goal is compliance, most will not venture past regulatory reporting and passing a pedigree. Yet the wealth of insight possible from serialized data capture is astounding. Spend the time and effort to harness the value embedded in item level event repositories. With the appropriate feeds and dashboards in place a real-time, comprehensive view of supply network activity is possible. Worker productivity, quality, supplier performance, market insight, inventory turns, and proactive risk monitoring can be assessed at a greater level of accountability.

6. Packaging uniquely marked items

This is the heart of the matter. Resist the impulse to start ILS efforts at the packaging line. As detailed above, ILS involves much more than applying a unique identification to an item.

Start the design process by first understanding the information needs. What information on packaging events must be captured, associated and transmitted? What information is coming from process execution? What will be required from each plant, packaging line or machine? Document the business needs based on the gap assessment into a requirements definitions without any consideration of solution suppliers or existing technology.

Evaluate the impact of serialization on current product package design, labeling and package-line configuration. Identify package design and packaging process gaps to determine unmet serialization needs. Establish functional requirements, metrics and use-cases. Select vendors and allow adequate time for staging, installation, pilot testing, and validation.

7. Managing serialized logistics

Examine warehouse and distribution operations to understand information exchange needs and gaps in current receiving, inventory and fulfillment procedures. Establish plans and requirements to modify information exchange, workflow, and systems to receive and validate incoming shipments as well as fulfill serialized orders. Select vendors and allow adequate time for staging, installation, pilot testing, and validation.

Serialized information handling should also be infused into reverse logistics. Items being returned or scrapped now contain an event life history. A wealth of important insight can be gained if the information is adequately captured and managed. Establish procedures to inactivate serialized items at end of life to avoid reincarnation of expired identifiers.

8. Managing change

The transition from lot tracking to ILS cannot happen at a single point in time; rather serialization enablement must flow throughout the supply network, starting with the packaging of one product.

Establish a detailed transition plan to prepare the organization. How best to navigate change will depend greatly on the manufacturer’s product portfolio. Understand package design variability. Solutions for serializing bottles will differ greatly from marking cartons, blisters or pouches. How complex is the packaging process? What about consumption volume? Selecting high-value, high-volume products first can adversely impact profitability.

Choose representative products that have low risk of impact to business performance. The early deployments want to proceed as smoothly as possible, however they need to be representative of subsequent products or they risk creating a false sense of certainty.

9. Rinse and repeat (Deploy and scale)

Start small. Use a single product or packaging line to serialize at the item level and prove out new processes and procedures. Engineer a representative test case for each packaging type. Be a critic. Stress it. Try to break it. Dissect what worked, what did not. Reconsider the design and execution. Get the kinks out before scaling.

Every company will have different consideration for scaling their operations. Understand what works for your company. Scale plans can be sequences by many means, including by product, by supplier, by region or some combination of each.

10. Effectiveness monitoring

At each major milestone the organization should evaluate what works and what does not. Start this activity while the project is underway to realize the benefits of continuous improvement. How can things be improved? Can these improvements be applied to subsequent packaging lines or is it better to wait for subsequent phases? Learning the limitations and deficiencies of the current efforts will enable the organization to plan and make improvements.


Gary Lerner, founder of BrandSure, LLC, is an expert in the design and deployment of successful supply chain integrity and item level serialization solutions. Since 2000 he has worked with more than 45 leading brands around the world, serving the supply chain needs of many industries including pharmaceutical and medical device manufacturers.

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