By David Sharp

It seems that more customers in more industries require their products to meet certain standards of compliance and traceability. A decade ago, full traceability and compliance were the reserve of the medical sector, military/aerospace and some automotive solutions. Now, it feels like everyone needs traceability as a minimum and most must comply with a set of industry standards or certifications. This change over time makes sense, because with traceability and compliance, comes control and accountability.

In an era when product recalls can inflict heavy financial penalties and brand damage, knowing the source and history of every part helps to mitigate risk. Experience tells us that many customers are now looking for full compliance and traceability from their EMS partners, that the only sensible answer is to have systems in place that ensure all the products manufactured and all parts of the supply chain comply beyond the standard, with a more granular level of traceability.

Full traceability will provide numerous benefits, like being able to isolate a specific fault while in production or in the field. In the former, that might mean quickly rectifying the error, minimizing scrap and catching any potential problem before it leaves the premises. In the latter, it can minimize the number of products to recall or repair in the field. When you can identify a single part or process fault, then you need to recall only the products that contained that fault. Without full traceability, you must waste additional time and resources with the arduous work of identifying faulty or potential faulty parts.
Great traceability, like insurance, is only valuable when you need it. But when you do, the financial and brand benefit of having it in place is enormous. There are many examples of product field failure that cost brands millions of dollars and resulted in brand damage that took years to repair, from Toyota’s issues with stuck gas pedals to the infamous Tylenol cyanide poisoning recall.

Having full traceability makes compliance much simpler, and in the case of a fully digitally enabled solution, it can be automatic. For many, this opens new opportunities for certification and the ability to win new business. Often those industries that have the greatest requirements for compliance will attract premium pricing since both compliance and full traceability will limit the size of the competitive field.
Traceability and therefore compliance are best achieved through digitally enabled systems. A full digital thread that starts from the design data and runs to the end of a product life will, by its nature, contain full traceability. In fact, it might be better described as the digital twin of the product and of the processes that product has undergone. In a digital utopia, component batch failures trigger focused, appropriate and rapid recovery steps.

For CQ and in the case of materials management, that means enabling traceability in the processes used at the bid stage, at the order stage, and at the stock control stage. Having a secure, reliable system to help trace part order history is a key benefit of using a digitally transformed bidding, purchasing and inventory management system. In our case, the most important traceability requirement for users is from receiving on, because that is when the lot/batch information is fixed. We also track the quoted MPN to ensure the buyer gets an approved MPN at or below that cost, and in ShopCQ, we record the purchased MPN to confirm the supplier sent an approved MPN.

Perhaps most importantly, the traceability built-in to the systems and software we operate, means that whatever the certification or compliance requirement requested by a customer or new prospect, it can be quickly delivered. And because it is digital, it is available in real-time at the touch of a button.

Like compliance, digitally enabled full traceability is no longer just the requirement of the so-called ‘high reliability’ industries, it is becoming table-stakes for just about any manufactured product and will be even more so in the future.

Categories: BlogIndustry Insight