2017 Top 5 Trends in Enterprise Labeling

By Josh Roffman, Loftware VP Product Management  

Loftware conducts an annual survey to get a pulse on the impact of labeling on today’s supply chain. We polled over 800 supply chain and IT professionals from organizations across all major industries in 32 different countries to gather insights on what they saw as the major trends in Enterprise Labeling for 2017. Our fourth annual “Top 5 Trends in Enterprise Labeling” report outlines significant shifts in labeling that are impacting global supply chains at an unprecedented level.

Labeling and the Shifting Supply Chain Landscape

Supply chains and the solutions used for managing them have become increasingly important as businesses become more global and interconnected. Globalization and digital technologies are changing business, especially as companies look to accelerate growth and expand into new markets. To do this, companies must create efficiencies in their supply chain and be able to address complex and ever changing supply chain dynamics.

Companies that are open to innovation and those running enterprise operations in a collaborative fashion are the ones that will succeed in this new global supply chain landscape. Businesses must be able to achieve high levels of agility, consistency, control, and transparency to prosper. This is why it’s critical to identify, understand, and measure how labeling has a strategic impact on your supply chain and your company’s business growth. In order to be poised to sustain a competitive advantage in their market, companies must be aware of how labeling trends impact their supply chain now and in the future. Read more inside to find out about today’s labeling trends and see how company measures up.

global intiativeTrend 1: Labeling is Being Viewed as a Global Initiative

Approximately 65% of those surveyed claim that they recognize the necessity of having labeling addressed on a global scale. More than half of those work for companies that maintain labeling across a global operation, with five or more locations. Therefore, labeling, which intersects the supply chain at all levels, has become mission critical in meeting evolving customer requirements, keeping up with emerging regulations, and avoiding disruptions from the manufacturing line to the warehouse. At the same time, as companies are looking at labeling on a global basis they must consider how to effectively deploy and maintain their labeling solutions, how to support enterprise wide labeling changes and how to scale effectively as their businesses continue to grow and enter new markets. There are three important considerations when thinking about labeling globally:

Standardized Labeling Offers Global Consistency and Accuracy

Standardization is the single most important criterion for companies as they look to extend their labeling across a global supply chain. Although many companies reported that they are reluctantly still using multiple labeling solutions, over 90% expressed that they believe it’s important to standardize labeling. This is because standardizing on a single Enterprise Labeling platform provides labeling consistency, accuracy, and seamless IT oversight company-wide while also enabling business continuity. It works towards addressing a multitude of potential problems including mislabeling, relabeling, and more - regardless of the number of global locations. Ultimately standardized labeling increases efficiency, while helping to eliminate the costly errors associated with the use of many different custom, homegrown, and third party solutions.

Streamlined Deployment and Maintenance Aids in Scaling Globally

Those who think standardization is important listed consistency/accuracy, maintenance and support as the top three challenges of managing multiple different labeling solutions. The focus even when deploying solutions in a distributed fashion is to maintain the ability to leverage common data sources, components, and configurations across sites. Rather than manage multiple different systems, a standardized approach, which centralizes key sources of data, enables companies to simplify maintenance while supporting enterprise-wide labeling changes. To make global deployment and management a reality, labeling solutions must provide complete control over how labeling capabilities are deployed for locations, groups, and users across a company’s global landscape, from design to integration to print. In addition, control over the label templates, label content, and printers is vital for system management as different sites may have different requirements and a level of central control and oversight is required. Finally, the ability to seamlessly add new locations, labels, users, and printers is a must in facilitating global growth.

Multi-Site Deployment Offers Flexibility

Global corporations are often presented with the conundrum of choosing between deploying systems and software centrally to maintain consistency and streamline management or deploying locally to maximize uptime and reduce risk. A paradigm shift is taking place in the Enterprise Labeling space that allows companies to leverage ‘multi-site deployment’ capabilities to realize the benefits of both centralized and decentralized deployment at the same time. With these multiple site deployment capabilities, companies can manage labeling centrally and ensure alignment with corporate standards while enabling geographically dispersed locations to run autonomously without relying on uninterrupted access to the central instance. This multi-site approach offers the best of both worlds for companies that view labeling as mission critical, but are also looking to achieve greater control and consistency over global labeling. This is critical to global operations and 77% of respondents reported that disruption to connectivity for centralized applications would cause a production stop.

labels are changingTrend 2: Labels are Changing

The barcode label is simply not what it used to be. Companies that understand this will find themselves ahead of their competitors in meeting evolving customer demands. As customer and regulatory requirements increase, companies have been forced to make a record number of label changes and add more and more content to their labels. Over 80% of respondents reported that labeling requirements have become more complex in the last three years. To meet these increasing demands, labels today must be flexible and data driven to support the nearly limitless variability in requirements that exist. In many cases, the key is enabling business users with a simple mechanism to make label changes as well as integrating with enterprise applications to automate labeling processes. This increases efficiency, leverages existing investments, and reduces the need for countless permutations of label templates. There are three key developments that are driving change on labels at an unprecedented rate:

More Data on the Label

Customers are more demanding than ever when it comes to the appearance, composition, and content on labels. Over 70% of those surveyed reported that customer requirements have been a driving force in making labels more complex. Also, nearly 50% of those surveyed said that not meeting current label requirements limits new business and inhibits their ability to enter new markets. Customer-specific labeling demands range from specific formats, barcodes, and logos to languages and content. These requirements are most often driven either by a customer’s desire to streamline supply chain processes or to improve the branding or appearance of a product. Additionally, regulations and emerging standards continue to impact businesses globally and result in another layer of requirements. To comply, companies are required to consistently pack more information on their barcode labels including product information, serialization numbers for traceability, industry-specific symbols, and pictograms for safety warnings. The ability to leverage business rules to determine label content and the ability to dynamically size and place content on a label based on the amount of available ‘white space’ is becoming increasingly important.

Rapid Label Change is Imperative

Companies are putting more and more pressure on suppliers to adapt quickly to their requirements while new regulations evolve around the globe all the time. Without the ability to streamline label changes to meet these quickly changing requirements, companies will be confronted with missed delivery dates, hefty fines and dissatisfied customers. Large companies often struggle to manage hundreds and thousands of label templates, which makes implementing mass label changes a very difficult task. Not surprisingly, more than 50% of those surveyed reported having more label templates than their business needs. There are two key aspects of dealing with this challenge. The first is to enable business users to make label design changes and the second is to leverage business logic that enables label formatting and content to be changed dynamically. This allows support for a myriad of different label combinations with a minimum number of label designs.

Integration with Business Systems is Becoming the Norm

The best way to manage the growing complexity in labeling in today’s global supply chain is to integrate labeling with business applications. Errors and inefficiencies driven by manual labeling processes, duplicate data, countless templates, and locally controlled data sources waste resources and inhibit growth. By integrating labeling with existing business applications, organizations can leverage existing business processes and data enabling them to standardize, improve accuracy, and offer consistency throughout their operations. This integration also maximizes investment in existing applications and eliminates the need for users to learn a new process or system.

bimodal supply chainTrend 3: Labeling is at the Heart of the Bimodal Supply Chain

As the complexity of a global supply chain increases, so too does the need to track goods and products that travel through it. Gartner indicates “Digital innovation will lead to a new approach to the supply chain.” They further claim stating, “The divide between what the supply chain provides and what the enterprise needs is widening. Closing that gap requires a new, agile approach to investment in technology, leadership and talent.” 1 More than 63% of respondents report that they are currently combining digital technology with traditional practices to improve supply chain operations. This intersection between physical and digital worlds within a supply chain is intended to “renovate legacy environments into a state that is fit for a digital world.”2 This approach allows manufacturers to gain “the best of both worlds” by embracing digital technology and new business models while continuing to use reliable physical processes that have worked well in the past. Labeling plays a key role in representing the bimodal supply chain considering the label is a physical representation of digital information, which is often encoded in a barcode. Here are some key considerations of how the bimodal supply chain is impacting business today:

1 Christy Pettey, “Innovate Under Every Condition: The Bimodal Supply Chain,” 2016

(http://www.gartner.com/smarterwithgartner/innovate-under-every-condition-the-bimodal-supply-chain/)

2 Gartner IT Glossary (http://www.gartner.com/it-glossary/bimodal/)

Labels Offer Key Source for Curating Digital Information

Companies are looking more and more to Enterprise Labeling to optimize the benefits of doing business in a bimodal supply chain. The labeling solutions that render barcodes, integrate transactional data from enterprise applications, and apply serial numbers are, by definition, translating digital (data) to the physical whenever labels are printed. These labels are placed on boxes, cartons, pallets, and crates representing the product’s passport through a global supply chain. Later these same labels can be scanned for information (81% are scanning for product information) - transforming physical information to digital systems, for traceability, inventory and warehousing purposes, and more. For instance, a medical device could have an electronic Instruction For Use (IFU) so that patients or doctors could scan a barcode to find out specific instructions as related to the device. These barcodes could also convey marketing, brand related or product related, for consumer information or use.

The Internet of Things (IoT) Continues to Impact the Supply Chain

A growing trend across multiple industries, IoT impacts how businesses communicate and connect. One way this is happening is through labeling. Labels are vehicles for storing information, which can be easily accessed through scanning or sensing. This is an activity that’s becoming more prevalent in obtaining digital information in today’s bimodal supply chain. And, although 52% believe that IoT impacts the supply chain today, 82% believe this trend will continue to grow and will have a greater impact three years from now. This opportunity to monitor and manage an entire network of devices, sensors, and other components provides untapped opportunities for a wide range of solutions including labeling. Enterprise Labeling is a component that needs to be considered as businesses evaluate their IoT strategy. As companies are imple­menting their IoT initiatives they are looking to rely on their labeling solutions to manage global printer networks, update device settings, send print requests, and monitor status.

Rising Interest in Cloud Based Deployments

It’s not just the supply chain that is embracing the move from physical to digital. Enterprise applications are no longer physically being installed simply on premise. In today’s supply chain they are often being hosted and delivered in the Cloud. Companies are moving their IT infrastructures to the Cloud to simplify maintenance, improve total cost of ownership, and to streamline their on-demand provisioning of hardware and software. The Cloud model embraces the bimodal supply chain approach, provides flexibility to scale, eliminates the need for extensive disaster recovery plans, and provides automatic software updates.

These systems, which must still connect to the physical world of warehousing, distribution, and manufacturing, are able to store data in the Cloud. Business users embracing this new technology need labeling solutions to work in the Cloud or, at a minimum, are able to integrate with their Cloud-based enterprise applications. Accordingly, Enterprise Labeling needs to offer the flexibility of supporting Cloud based, on premise, and hybrid deployments as companies begin their migration to the Cloud.


Trend 4: Labeling Extends both Upstream and Downstream

Companies that don’t attempt to connect business partners across the global supply chain are missing opportunities to meet new customer demands, grow into new markets, and increase competitive advantage. Over two thirds of those surveyed (67%) see value in having suppliers print labels using a shared solution to ensure proper labeling. This is because labeling plays an important part in generating value from the supply chain network to improve efficiency and meet customer demands. When businesses extend labeling to partners and suppliers, they are able to avoid downstream processing errors and eliminate the need for relabeling. It also removes the risk associated with shipping preprinted labels and allows companies to realize savings from cost of returns, improve brand consistency, and ensure label accuracy. Extending labeling both upstream and downstream has a host of benefits:

  1. Importance of Extending Labeling for Supply Chain Partners

For many global companies there is too much risk and cost involved in relying on suppliers to label goods correctly. An incorrect label can disrupt receiving and warehouse processes that may result in downstream impacts on manufacturing and even customers. By allowing supply chain partners to collaborate in labeling, companies can ensure labeling accuracy and avoid unnecessary relabeling, remove the inefficiency of manual processes, and reduce overall costs. When companies allow partners to access shared Enterprise Label­ing capabilities, they ensure that those partners print the right label with the right content in the right format. This also allows adherence to corporate and brand standards and safeguards label accuracy, which is important considering that 58% of respondents report that ensuring accurate label data is a clear benefit to extending labeling to suppliers.

Eliminating Costly Re-Labeling

Relabeling is a major source of inefficiency and cost. Companies waste millions of dollars each year relabeling goods that are received but lack the necessary label information and formatting required. They relabel goods and products to ensure that the proper barcode symbols, images, branding, and data content is available to support subsequent processing. However, nearly 60% of respondents surveyed believe extending labeling capabilities to suppliers can eliminate the need for relabeling. In past, some companies would send preprinted labels to their suppliers, however, this introduces both unnecessary cost and risk, considering that labels may be applied to the wrong product or may find their way into the black market. This is why companies today are extending labeling to their suppliers so that they may ensure that suppliers adhere to existing labeling standards to avoid relabeling costs and guarantee compliance.

Ensuring Integration of Aftermarket Services

Global manufacturers are increasingly faced with the challenge of integrating their aftermarket parts and services business with their supply chain infrastructure. Notably, companies often struggle with enabling their customers or service partners with the ability to ensure that labels created in the field for parts align with corporate standards for identification, branding, and product information. Companies are now providing partners and customers with controlled access to Enterprise Labeling as a means to enable labeling downstream so that those items will be labeled accurately and efficiently. This aids greatly in ensuring brand compliance and improving customer and partner relationships. It also is significant in identifying and tracing parts and products - supported by the survey that revealed over 45% of respondents saw this as a benefit from extending labeling to customers or aftermarket service providers. Additionally, over 60% of respondents felt that sharing label templates helped to ensure labeling consistency.

labeling successTrend 5: Labeling Success Is More Than Just Software

Businesses today are relying on seasoned labeling professionals for best practices, implementation consulting, training, and knowledge transfer to help ensure success.

They understand that working with these experts can help minimize or eliminate production stoppages, optimize supply chain operations, improve customer satisfaction and ultimately increase business. These professionals are able to help them deal with the many unique labeling requirements to address dynamics of different industries, products, geographies, regulations, business models. More than 92% of respondents using professional services found great value in those services. With this focus, expectations have increased for labeling professionals to understand and provide guidance on evolving industry standards and regulations, business processes, and regional nuances, along with expert around-the-clock support to enable continuous operations. Managing a global operation requires:

The Need for An Uninterrupted Supply Chain

Companies with worldwide operations that include manufacturing and distribution facilities across the globe must ensure continuous flow of goods through the supply chain. Labeling plays a big part in maintaining that continuous flow of goods considering over 87% of respondents report that a stoppage in labeling causes operational disruption or production downtime. To that end, companies are enlisting solution providers to properly set up environments to maximize reliability and provide 24x7x365 support for mission-critical labeling operations. Global companies are requiring labeling partners that provide the knowledge, support, and troubleshooting capabilities needed to maximize reliability and uptime. The provider must know how to react quickly and efficiently regardless of the day or time or where your business is in the world. Tailored support direct from a labeling solution manufacturer ensures maximum production uptime, reduces the need for costly IT resources, and increases overall supply chain efficiency.

Tailored Labeling to Meet Evolving Requirements

There is no “one size fits all” labeling solution configured to meet the needs of each company. As regulations and emerging stan­dards continue to impact a wide range of industries, labeling is a specific area where constant change is neces­sary to comply with evolving requirements. Therefore, with the increasing amount of customer and regulatory requirements it’s important to be able to tap into industry-specific knowledge and best practices so labeling can be configured and optimized to meet each company’s unique needs. This only happens when providers have an understanding of industry nuances, different business and supply chain models, regional considerations, and differing user communities within an organization. However, over 47% of respondents reported concern that they did not have properly trained resources to manage their labeling solutions and over 66% believed that this could result in labeling errors. Providers that offer a unique understanding of industry-specific considerations are able to tailor deployments, services, and support to meet each customer’s unique requirements and stay ahead of compliance deadlines.

Global Deployment, Professional Services, Training & Support

As global companies continue to expand their presence, they must consider how to efficiently deploy and maintain labeling solutions so they can continue to scale. They must be able to handle the rigors of global infrastructures, manage outages and connectivity issues, while providing high availability, failover, and disaster recovery capabilities. A best practices approach calls for the software provider, who is by design most familiar with their solutions, to assist in installing and configuring the labeling environment that will most often consist of a test environment, development environment, and production environment. These types of on premise environments or those in the Cloud are important to ensure that the appropriate processes can be followed for system updates, as well as to ensure that changes can be properly staged into production environments. Training is also a critical step in educating users and administrators on the capabilities and options available to best meet the labeling requirements for the business. And getting that training directly from the people who developed the solution offers a clear advantage ensuring the company’s labeling is running optimally and that the business is getting the most out of its investment. 

 

 

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