Q&A: A Total Systems Approach

Brand owners are increasingly taking a total systems approach to manufacturing to enhance efficiencies and decrease costs.

Leading up to PACK EXPO Las Vegas (September 26-28; Las Vegas Convention Center), this year’s largest resource for packaging and processing innovation in North America, we spoke with Jonathan Titterton, Director of Sales & Marketing at Bosch Packaging Technologies (Booth #1423), Brian Barr, packaging sales manager at Heat and Control (Booth #2433) and Maria Ferrante, vice president, Education & Workforce Development at PMMI, to gain insight into the trend towards integration.

Brian Barr: One of the biggest trends we’re seeing across the food processing industry is the need for more equipment options, higher rates of speed and added flexibility in system solutions. Our customers want to have that flexibility built into the solutions that we provide, while also trying to minimize footprint and energy and material use. There’s also an increased focus on the sanitation and safety aspects of equipment.

Jonathan Titterton: I would certainly second that line flexibility is critical to our customers. They want to be able to reconfigure their lines to enhance capability or sustainability and have the ability to accommodate future new products without having to make significant changes.  

Maria Ferrante: The need for flexibility definitely transcends market silos. For example, in PMMI’s recent Machinery Communications study, end-users indicated that a major goal for automation on a line is increased flexibility. Consumers want variety in package formats and products, and to deliver that, manufacturers need flexibility in both processing and packaging. Making significant changes to manufacturing operations can be challenging for companies, so investigating new technologies to see what fits into their current line is critical. To help them mitigate these challenges, PMMI has expanded the PACK EXPO shows to include processing innovations.

We are also seeing a growing need for skilled workers to manage increasingly complex and automated lines. As equipment becomes more advanced to deliver the flexibility required by end-users, the workforce must possess an understanding of electrical and mechanical issues. PMMI has been working with industry experts and schools to indentify the mechatronics skills required, develop a series of tests to help employers indentify skilled workers and create tools to advance the skill level of existing workers — all as part of our Mechatronics Certificate program.

How have your customers changed the way that they address processing and packaging on the line?

MF: The manufacturers that frequently attend the PACK EXPO shows have told us they do not categorize themselves as processors or packagers, per se. They see themselves as professionals within an industry, such as food, confection or pharmaceuticals, so taking a holistic approach to the way they address their processing and packaging operations is important.

JT: When we talk to customers about processing and packaging, we tend to focus more on the packaging side. But as we discussed, manufacturers have to address a number of different concerns across their processing and packaging operations — including speed, capacity, sustainability, sanitation and safety. We need to be there for our customers not only at the time of purchase, but later down the road, so engineering and after-market support is important.

BB: I agree. Everyone’s looking for added value from their supplier, all the way from the pre-sale stage through the post-sale stage. It’s a simpler, faster and better approach. Brand owners want to have a single point of contact at a supplier that will help them with a broader scope of purchases and carry them from the quote to the engineering phase. They also need a supplier that’s going to be able to provide after-market support to ensure they reap the most benefits from that equipment through its lifetime.

MF: Part of that support — and what our members tell us their customers are demanding — comes with training. End-users need and want as little downtime as possible, and to get that, their employees need to know the machines inside and out. PMMI’s Certified Trainer program helps create leaders within organizations that can teach their colleagues or customers how to use the machinery. We conduct these ‘train the trainer’ sessions all year long, and will conduct a workshop at PACK EXPO Las Vegas.

What is driving the shift to a total system systems approach? What benefits do end-users stand to gain from integrating processing and packaging?

BB: No matter how far upstream or downstream we’re going with the equipment, our customers have limited resources today. They’re trying to optimize not only their purchasing dollars, but also the people they have. By combining the processing and packaging areas with one supplier or a single source supplier, they’re able to do more with fewer resources. And that’s at the engineering level, it’s at the service level and it’s at the design and implementation levels as well.

JT: Manufacturers are also trying to leverage their investment. Capital equipment is the significant piece of our customers’ procurement budgets. With the number of SKUs that are always being developed and presented to the manufacturing floor, the ability to seamlessly utilize processing and packaging equipment — even through new installments — is the end goal here. Of course, it’s not as simple as that, but this is the objective that more and more of our customers are sharing with us. They need to be able to leverage their investment over the greatest period of time, to manufacture the greatest number of products so that they see the best possible payback. By combining the efforts and plans of the processing and packaging teams, they stand a better chance of getting the right equipment to efficiently meet their production goals.

BB: And I don’t know if you’re seeing the same thing, Jonathan, but speaking of payback, our customers want to have a much quicker return on their capital investments.

JT: Absolutely, Brian.

BB: We’re seeing that across the board.

JT: I think that stems a great deal from the short lifecycle that so many products seem to have today. The equipment has to generate ROI at a faster pace. This again, puts the pressure on the equipment manufacturer to provide processing and packaging solutions that offer flexibility and longevity so that the customer can maximize payback on a capital investment.

MF: Capital investment dollars are still being held pretty tightly. As a result, end-users and PMMI members have told us that when companies do decide to invest in equipment, they want and expect to see their investment pay off quicker than ever before. Within two years, even. Another thing we’ve learned is that the “build a better mousetrap” model for technical innovation and marketing is flawed, and in fact, services for spare parts, technical support and training are becoming almost as important as the machine itself. As Jonathan and Brian have said, end-users are trying to get the biggest possible return from their capital investments. And while anyone can mark down a price, it’s a one-time function. With training, parts and tech support you have a “gift that keeps on giving,” in the form of more efficient operations and less downtime.

Do you see end-users shifting their internal organizations to reflect the unified approach to processing and packaging?

JT: I definitely see a more unified approach to processing and packaging on a procurement level, which has become more involved in the capital spend. In past years, we used to be involved a great deal with plant level personnel - engineers, plant managers and so forth. We still work with them directly, but now we see a greater involvement on the procurement, divisional and corporate levels that are trying to manage the total spend. We’re also seeing opportunities to match this total systems approach by providing additional engineering and project management support to help customers reduce downtime on new installations and maximize both their processing and packaging investments. This is especially true as more and more companies consolidate.

BB: I agree. There’s definitely consolidation on the commercial side, and to some degree, on the technical as well. On the commercial side, companies are trying to optimize their buying power by focusing on the total cost of ownership. They’re not just looking at the initial investment in their processing and packaging purchases. They’re looking at the lifetime cost of this equipment. Suppliers that provide additional services and support — tailored to their customers’ total systems approach — will deliver the most value. As suppliers, we need to keep in mind that our customers don’t have the resources they used to, which, in turn, means sales process needs to be more consultation based than even before.

As the two teams increasingly work together at building new lines and enhancing old ones, how is your role as a supplier changing? What are you doing differently as you guide them through the technologies that they need?

MF: During the most recent Vision 2015 focus group at last fall’s PACK EXPO, end-users said they’re asking OEMs and materials suppliers to be involved in projects starting with the R&D stage. If suppliers are also collaborators, they can contribute technical and ‘outsider’ perspectives that make a project more viable, and they can address lessons up and down the entire line, from raw materials to palletizing.

JT: Brian just mentioned greater consulting. Some have speculated that this approach is fading, but I believe quite the opposite.  It’s becoming more necessary for suppliers to take a consultative approach in working with product manufacturers due to the broader scope of their demands. So whether it’s project management, engineering or after-market services that they’re looking for, we have to act more like a partner than a supplier.

BB: I definitely agree with that. We see our role exactly the same way, and as product manufacturers continue to unify the packaging and processing operations, Jonathan’s group and our group are getting brought into early-stage conversations about the products themselves, what’s the best way to handle and package them and how to get those products to market as efficiently as possible.

JT: That’s exactly right Brian. We’re getting involved in projects even before they’re defined as projects — much earlier than we ever saw before.

We know that this September’s PACK EXPO Las Vegas will spotlight processing solutions in addition to packaging technologies. How does an integrated show floor benefit the buying team?

BB: I believe it gives them a venue to view the full spectrum of equipment and solutions that they’re looking for. So many of our customers, especially in this economy, are limited in the number of trade shows they can go to. When they can see processing and packaging solutions in one place, buying teams can maximize their time and effort by seeing as many prospective and current suppliers as possible.

JT: As buying teams get smaller, they’re always trying to minimize their costs and maximize time. By defining areas specific to certain industries and needs, the show helps attendees manage their time because they know where to find the technologies that they’re looking for.

MF: And that’s exactly why we’re doing it. It’s integral to the customer-centric approach we’ve implemented for this year’s event. By providing features and services that hone in on the needs of specific vertical markets, we’re giving those attendees additional resources to draw from, and frankly, making it easier to navigate this very large show. When attendees experience a high return on the time and resources they’ve invested in attending PACK EXPO, everyone wins.

For more information about PACK EXPO Las Vegas 2011 or to register, visit www.packexpo.com or contact PMMI’s Show Department at 703.243.8555 or [email protected].

PMMI is a trade association with more than 560 member companies that manufacture packaging, processing and related converting machinery, commercially-available packaging machinery components, containers and materials in the United States and Canada. PMMI’s vision is to be the leading global resource for packaging, and its mission is to improve and promote members' abilities to meet the needs of their customers. PMMI organizes the PACK EXPO trade shows: PACK EXPO International, PACK EXPO Las Vegas and EXPO PACK México, connecting packaging and processing equipment and materials suppliers with their customers around the world. Coming Up: PACK EXPO Las Vegas at the Las Vegas Convention Center Sept. 26—28, 2011. Learn more about PMMI and the PACK EXPO trade shows at PMMI.org and Packexpo.com.