How Paper Based Traceability for the Food Industry Became “Non”-Legal and a Major Liability

Guest Blog by

Dave Miller, President
Mobia Soultions
 davemiller@mobiasolutions.com
864-881-1505

When the Food Safety Modernization Act (FSMA) was first passed many initially interpreted it to mandate electronic traceability.  Given the industry push, the FDA’s often stated complaint about the ineffectiveness of paper traceability and the obvious preferences in the bill’s wording – that conclusion was understandable.  A closer reading showed that FSMA implied electronic traceability but stopped short of specifically requiring it.  But while FSMA did not directly specify the type of traceability technology required , it does require that the chosen technology work and work reliably – and that is where this story takes a sharp turn.

The concept of “efficacy” (working reliably) is an intrinsic part of every law and regulation that requires a specific function be performed. So, for instance, if you are required to keep grass below 6 inches high you don’t have to use a mower to keep the grass low, but if you are subsequently caught with high grass, then saying that you were using  “alien crop circles  to do it for you” would not be a valid defense. In the case of FSMA, there is no electronic traceability requirement per se, but your technology does have to work well and reliably – And now there are governmental and commercial studies are coming to light that prove paper traceability is not even close to meeting the efficacy standard.

In the absence of proof to the contrary – we as an industry have been assuming that manually searching of paper records for “words of interest”, such as lot numbers, item numbers, vendors, customers, etc.  , was slower, more costly, and a “little less accurate” than electronic searches. Until now that accuracy assumption had never been but to the test and we really had no idea of how much data was being missed in our manual searches.  Those tests have now been done – and the results ain’t pretty. There is now reliable proof that individual manual searches are only about 50% effective. 

To give you some idea of the problem, let’s do a simple test. Read the follow sentence one time, at your normal reading rate, and count the number of “f”s as you read.

 FINISHED FILES ARE THE RESULT OF YEARS OF SCIENTIFIC STUDY COMBINED WITH THE EXPERIENCE OF YEARS.

Unless you went letter by letter counting, you likely found three, and even if you’ve found all six, most people don’t.  Now consider how well you would do if you were reviewing boxes and boxes of documents.

According to several governmental and private sector studies1,2, manual searches of paper documents were only able to find  40% to 60%  of “words of interest” known to be in the documents. And unlike these studies, in real world conditions we never know how many times the “words of interest”  appear in our documents so we never know how many were missed.

So what affect does a 50% find rate have in a manufacturing environment? If, for example a vendor told us they had shipped bad lots, but after searching all of our boxes of documents we correctly identify only 50% of the actually received vendor’s lots, then have the same “failure to find” rate for the manufactured lots made from those vendor’s lots  and then the ship to customers as well   - we are down to identifying a mere 12.5%  (50% * 50% *50%) of actual impacted shipments!

cascade of error rates

 

 

 

 

 

 

 

Even the 50% search loss only includes the losses encountered when searching correct, clean typed text pages.  Now assume the search was of hand written documents and included transcription errors. With imperfect data collection and documents the 12.5% effectively rate can easily be assumed to drop below 10%.  If other members of the supply chain used paper traceability as well, their loss of accuracy would be multiplied by this loss of accuracy.  So potentially a find rate as bad as  12.5% * 12.5% = 1.56%.

The FDA’s experience with paper seems to backup this grim finding. Until now paper traceability has survived because electronic solutions were outside of the practical cost range of many organizations. But the recent appearance of low cost, online inventory management systems, such as Mobia, effectively removes what was a valid claim by companies that they could not afford nor technically support an electronic system.

It is no secret that many companies are more motivated by potential business risks than criminal concerns. Here too, paper traceability is a significant liability.  Given the demonstrably poor performance of paper traceability vs. electronic traceability -  paper based systems cannot be reasonably called  “current good practices”. In the event of an “incident”, the damage caused by a food company’s inability to reliably track product due, to paper’s limitations, would dramatically increase the likelihood and size of “punitive damages”.   “Foreseeable Risk” may become you least favorite term.

Two other non-criminal concerns are insurance and commercial accreditations such as Global Food Safety Initiative (GFSI). Up until now insurance companies and underwriters have assumed traceability was their insured company’s internal matter. After recent contamination events, the insurance companies began to be concerned that their exposure may not be limited to just their insured’s activities but their insured’s entire supply chain. As such underwriters are now beginning to seek waivers or to make traceability demands on their insured’s entire supply chain.

As for GFSI and other accreditation organizations, they have always required that companies meet all pertinent food laws as a requirement to achieve their certification.  In other words, for US food companies, if you aren’t meeting FSMA requirements, such as effective traceability, your GFSI and other accreditations are at risk.

In the end, while FSMA didn’t directly mandate electronic traceability – it seems obvious that paper traceability is a functional failure.  At the very least companies with paper traceability will have an enormous disadvantage in proving compliance and efficacy.  And legal or not would you like to risk your business and freedom, let alone the safety of your customers and perhaps family, on a safety system that was 10% reliable?

(You can view a recording of Dave’s webinar, “The Impact of New Regulations and Standards on Packaging Traceability” )

1 Richmond Journal of Law and Technology Vol. XVII, Issue 3 ; New York Times

2 John Markoff “Smarter Than You Think” March 4,2011

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2 Responses

  1. I think this is very interesting and a good argument for moving towards an automated or electronic system to provide better traceability. I would be curious to know what your thoughts are on storing electronic information – do you think that a cloud based system would be the best/safest solution?

    I am also to curious to know where the “10%” statistic came from and what the reliability percentage is on an electronic system.

    Great article.

    • Thanks Shannon.

      We sell both cloud & non-cloud but we believe the cloud offers significant advantages in many situation

      1) Ease of implementation & no technical or support requirements on site
      2) Cost
      3) Independence from other systems (accounting can’t take down inventory or vice-versa)
      4) Data is accessible from anywhere on the web
      5) Cloud servers are “more robust” than most manufacturing plants can justify on site

      The 50% loss of data was on data that had been gathered CORRECTLY. In the case of traceability data we have three important collection points in a manufacturing environment (receiving, manufacturing, shipping) If you experience the data loss at each point you are down to 12.5% (.5 x .5 x .5). But even the 50% loss was on data that was actually there and in nice printed format. I took it down to 10% because in manual data collection processes a lot of the data is not collected and / or written down incorrectly.

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