Based on the experiences of over 170 respondents, this report
explores how Food and Beverage (F&B) manufacturers achieve
operational excellence. Specifically, how Leaders in the industry
focus on three key areas of their operations — production
efficiency, product quality and safety, and sustainability costs —
to succeed as a business.
ACHIEVING OPERATIONAL EXCELLENCE IN
FOOD & BEVERAGE
July, 2015
Reid Paquin, Research Analyst,
Manufacturing, Product Innovation & Engineering (PIE)
Kevin Prouty, Senior Vice President,
Research
Report Highlights
The combination of
pressures around
rising operational
costs, production
efficiency, and
product quality form
a complex operating
environment for the
food & beverage
industry as a whole.
Leaders in F&B start
by focusing on
production efficiency
to achieve OpEx.
They outperform
their peers when it
comes to asset
downtime, OEE, and
yield.
Leaders don’t lose
sight of product
quality, achieving
99% production
compliance; while at
the same time
possess a lower total
cost of quality than
Followers.
While sustainability
related costs are
often overlooked
this is not true for
Leaders, who have
seen decreases year-
over-year in energy,
wastewater, and %
to landfill expenses.
p2 p7 p9 p11
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Achieving Operational Excellence in Food & Beverage
2
Operational Excellence (OpEx) has long been a philosophy that
manufacturers have striven to achieve. For an industry like Food
and Beverage, this is a challenging endeavor as the environment
these companies operate in can be complex. The products F&B
companies produce have a direct impact on the health and
safety of their consumers. This relationship with the consumer,
combined with the jump in high impact food recalls over the
past few years, has put an increased spotlight on product
quality. However, these companies still have to handle the
pressures that more traditional manufacturers face, such as the
need to improve operational efficiency, cut costs, and
differentiate their products from competitors. As a result, F&B
manufacturers are struggling to compete in this interconnected
and highly complex environment.
Being Successful in a Complex Environment
Executives in the Food & Beverage industry are generally
managing enterprises that are asset intensive, at the mercy of
global commodity markets, and face both low margins and high
demand variability. Given these industry characteristics,
companies must find new ways to achieve operational
excellence.
Figure 1: Top Pressures to Achieve OpEx in F&B
29%
38%
47%
54%
68%
0% 20% 40% 60% 80%
Need to reduce process
operations variability
The need to maximize
productivity
Need to ensure product quality
and consumer satisfaction
Need to comply with government
regulatory requirements
The need to reduce costs
Percentage of Respondents, n = 174
Source: Aberdeen Group January 2015
F&B Manufacturers
Sector Definition
For the purposes of this study,
Aberdeen Group defines Food and
Beverage (F&B) manufacturers as
those that supply bulk packaged food
to down-stream F&B consumer-facing
firms. In general, these organizations
can be either large or small, but very
often don't own consumer brand
name assets.
The combination of
pressures around
rising operational
costs, production
efficiency, and
product quality form
a complex operating
environment for the
food & beverage
industry as a whole.
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Achieving Operational Excellence in Food & Beverage
3
Top Challenges for
Sustainability
Food and Beverage respondents
were asked to select the top two
challenges they feel impact the
success of their sustainability
initiatives:
Measuring the Return on
Investment (ROI) for sustainability
initiatives: 45%
Many other projects are competing
for resources: 43%
Getting buy-in across the
organization: 25%
Cost has always been king for manufacturers, especially in F&B
(Figure 1), as margins are razor thin. These costs come in many
forms, from material and labor costs, to packaging and shipping
expenses. However, a large portion of operational costs for Food
& Beverage manufacturers are sustainability-related (energy,
water, wastewater, etc.). In the past these costs were primarly
viewed as givens — just the cost of doing business — but that
mindset is beginning to change in F&B. Indeed, over a third of
F&B respondents (37%) identified these costs as the top area
they are looking to improve upon going forward to differentiate
themselves. Limiting these costs is a challenge of its own, and as
the sidebar shows, justifying these efforts is the largest hurdle to
get past. Still, a reduction of even a small percentage in energy
or water consumption can result in millions of dollars saved over
time.
Also, although it is listed as the 4th pressure in Figure 1,
maximizing productivity and cost reductions go hand-in-hand.
Improvements in yield reduce the amount of waste that occurs
in the form of scrap and rework, unscheduled asset downtime
results in higher maintenance costs, late shipments, and lost
business. Clearly, there is a direct correlation with improving
production efficiency and lowering operating costs. Maximizing
productivity is easier said than done though. The top challenge
identified by F&B respondents when trying to increase their
production efficiency is the need to improve repeatability and
decrease variations in production processes (38% of
respondents). Methodologies like Lean and Six Sigma are seeing
a resurgence in manufacturing to help ensure predictablity and
cut out waste from production processes.
While the need to reduce costs and maximize productivity are
pressing concerns for all Food and Beverage manufacturers,
these organizations also realize that product quality and
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Achieving Operational Excellence in Food & Beverage
4
“Food safety and our consumer's
experience is one of our
organization's top priorities. This
focus starts right from the top, with
our CEO's constant message to the
company on the subject, ‘We are all
just one bad meal away from
bankruptcy.’”
~ CFO, Large Food Processor
compliance are equally as important. The introduction of
regulations like the Food Safety Modernization Act (FSMA) has
caused major changes in how Food & Beverage manufacturers
focus on the safety and quality of their products, as well as how
organizations will have to handle any issues. Tighter control,
documentation, and tracking of every ingredient and process
used throughout the enterprise is now required. Even though
FSMA was signed into law back in 2011, companies today are
still scrambling and focused on complying with this continually
evolving mandate and others like it (HACCP, GFSI, FSIS, etc.).
These regulations are all geared towards the same goal —
keeping the products that customers consume safe and of the
highest quality. Unfortunately, maintaining compliance to these
regulations adds additional costs and complexity to F&B
operations.
The main issue is that all of these pressures are interconnected
and combine to form a complex operating environment for the
Food & Beverage industry. The challenge is reducing your overall
costs and maximizing productivity, while maintaining quality in
your products. The combination of all of these concerns is
driving F&B manufacturers to question both the efficiency and
methods of their current approach. Luckily there is hope as there
are companies in the industry that have taken steps to succeed
in all three aspects.
Defining Leaders among F&B Manufacturers
Aberdeen Group used four key performance criteria to
distinguish the F&B Leaders from Follower organizations. These
criteria included metrics that measure an organization's ability
to respond to pressures around compliance, operational
efficiency, customer satisfaction, and margins. Table 1
summarizes the criteria used to define Leaders and Followers,
and the respective performance of each group.
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Achieving Operational Excellence in Food & Beverage
5
Table 1: Top Performers Earn Leader Status
Maturity Class Mean Class Performance
F&B Leaders:
Top 30% of F&B
aggregate
performance scorers
99% Production Compliance
89% Overall Equipment Effectiveness (OEE)
98% On Time and Complete Shipments
3.7 Hours Response Time to Non-Conforming Shipments
+9% Operating Margin vs. Corporate Plan
F&B Followers:
Bottom 70% of F&B
aggregate
performance scorers
92% Production Compliance
74% Overall Equipment Effectiveness (OEE)
86% On Time and Complete Shipments
23.2 Hours Response Time to Nonconforming Shipments
-5% Operating Margin vs. Corporate Plan
All F&B
Manufacturers:
All F&B aggregate
performance scorers
94% Production Compliance
80% Overall Equipment Effectiveness (OEE)
91% On Time and Complete Shipments
16.1 Hours Response Time to Nonconforming Shipments
-1% Operating Margin vs. Corporate Plan
Source: Aberdeen Group, January 2015
The metrics above clearly indicate the ability of Leaders to
manufacture and deliver compliant products in an efficient
manner. Also, if a non-conforming product has shipped, it takes
on average less than four hours to locate and hold the product
after detection. This is a stark difference from the Followers. Not
only are Followers less efficient and less likely to meet delivery
targets, but they also take almost a full day to respond to
shipments with quality issues. This greatly limits their ability to
minimize disruption and quickly identify a root cause. Without
the ability to track and trace shipments quickly, the risk and
impact of recalls can be substantial. As we will see, Leaders in
the industry accomplish such superior performance by
implementing capabilities and technologies that improve the
three areas identified earlier — production efficiency, product
quality and sustainability.
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Achieving Operational Excellence in Food & Beverage
6
Building the Foundation for Operational Excellence
The first step every company should take (no matter the
industry) if they truly want to achieve operational excellence is
to get control over their manufacturing data. Effective decisions
are always based on data analysis and information, not
speculation or conjecture — this is no different for
manufacturing related decisions. Automated data collection is
the basis for creating the real-time enterprise, and differentiates
top performers from their poorer-performing peers (Figure 2).
Figure 2: Getting Control of your Manufacturing Data
This level of automation allows manufacturers to improve the
validity of collected data, more effectively use historical data to
optimize current decision making, and deliver data in real-time
to decision makers as actionable intelligence. In a manual data
collection environment, like Followers are more likely to rely on,
the data can be old and inaccurate, calling into question the
validity of conclusions drawn by the analysis. This automation is
further utilized by Leaders, as they are 33% more likely than
Followers to conduct statistical analysis on their data, turning it
into insight. Analyses like statistical process control (SPC) or
21%
36%
34%
60%
36%
48%
61%
77%
0% 20% 40% 60% 80% 100%
Executives have real-time visibility
into the performance of global
manufacturing operations
Statistical analysis used to monitor
real-time data
Manufacturing data (quality,
process, etc.) is collected
automatically
Standardized KPIs measured
across enterprise
Percentage of Respondents, n = 174
Source: Aberdeen Group, January 2015
F&B Leader
F&B Follower
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Achieving Operational Excellence in Food & Beverage
7
failure mode and effects analysis (FMEA) can be undertaken in
real-time to improve the reliability and predictability of
manufacturing processes.
Next, in an effort to synchronize operational and corporate
performance, while easily providing visibility into operations, the
entire business must use the same yardsticks. Large
multinationals, especially with manufacturing operations across
the world, have challenges to make sure that performance in all
plants is measured in the same way so that the best business
decisions can be made for the organization. When executives
have the same understanding of how operations are performing
in each location, they can take steps to address any
shortcomings, and ensure that lagging plants improve
performance to meet corporate goals.
Maximizing Production Performance
Having access to operational data is important, but what
matters more is turning that information into actionable
intelligence. With this control over manufacturing data, Leaders
can begin to focus on the first critical area of operational
excellence — production efficiency (Figure 3). By having robust
data like this at hand, F&B manufacturers can see how a
particular asset has historically performed, and compare that to
how it is running in real time. This is crucial in determining
whether an asset is running at its peak or if maintenance is
needed. In addition, by using trending data and predictive
analytics, companies are able to predict adverse events and
downtime before they occur. Leaders provide this information
on-demand, thus enabling easier information access, which
reduces unscheduled downtime, lowers maintenance costs, and
improves asset performance.
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Achieving Operational Excellence in Food & Beverage
8
The Impact on
Production Efficiency
Food & Beverage Leaders, in addition
to performing better as an overall
business, outperform their peers on
production centric metrics:
Unscheduled Asset Downtime:
• F&B Leaders – 4.6%
• F&B Followers – 8.9%
Overall Equipment Effectiveness:
• F&B Leaders – 89%
• F&B Followers – 74%
Yield:
• F&B Leaders – 97.8%
• F&B Followers – 87.9%
Figure 3: Improving Production Efficiency
Analysis can also be conducted to improve operator
productivity, an action Leaders are 48% more likely to take.
Often there are hidden inefficiencies in the handling of materials
which results in wasted time and resources. An initiative like raw
materials management is often a low hanging fruit for a F&B
organization to explore, as it helps to effectively minimize scrap,
as well as maximize yield and throughput. Also, Leaders are 79%
more likely to be able to plan and forecast for demand. In Food
and Beverage, this is an essential skill in order to manage
perishable materials to keep costs low. Also, by constantly
monitoring their processes, Leaders can dynamically assign
operators to complete tasks in real-time as changes occur within
their operations. It is the combination of these capabilities that
have such an impact on production efficiency. Leaders are more
likely to implement these capabilities, and the productivity
results speak for themselves (see sidebar).
Product Safety and Quality Cannot be Sacrificed
While optimizing the plant performance is an important goal,
this cannot come at the cost of product quality. When it comes
to food safety and quality, process capabilities are perhaps the
most critical area of differentiation for successful companies.
25%
37%
37%
46%
0% 20% 40% 60%
Production data utilized to maximize
operator productivity
Historical (trends) and real-time
production data used as actionable
intelligence for minimizing asset
downtime
Percentage of Respondents, n = 174
Source: Aberdeen Group, January 201
F&B Leaders
F&B Followers
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9
“To give you some perspective on
how important food safety and
traceability is to our organization:
All Cap-Ex and Op-Ex requirements
for implementing the needed tools
for tracing and tracking product
across the supply chain receive an
easy ‘green light’ to execute at both
the executive and board level.”
~ Chief Technology Officer
Large Soft Drink Bottler
"Traceability is the ability to trace
and follow raw materials, work in
process and finished products
through all stages of receipt,
production, processing, and
distribution. We apply controls and
monitoring at critical traceability
points across our operations. These
are specific to the process, location,
material and product complexity,
and routes to market. Currently we
apply the ‘one up / one down’
approach."
~Manager of Food Safety, Medium
sized Food Manufacturer
Because of this, Leaders focus on aligning their quality initiatives
to support proven industry standards (Figure 4).
Figure 4: Make Compliance Integral to Production
These standards can be used to improve production processes
and develop best practices. It is also important to put in place
the change control and audit trail tools needed to ensure that
standards are adopted and maintained over time. By not
supporting these standards from the start, Followers are
consistently addressing compliance concerns throughout
production, severely impacting productivity and overall
performance.
Not only are Leaders utilizing compliance standards to improve
their processes, they are integrating quality results directly into
their production systems. Providing this quality insight
throughout the enterprise gives operators the ability to stop
quality problems from the onset — preventing off-quality from
occurring in the first place, stopping non-conforming products
from being shipped, keeping customers happy, and eliminating
the risk of costly recalls. Leaders understand that improving
64% 61%
54%
20%
43%
35%
0%
10%
20%
30%
40%
50%
60%
70%
Business processes
support and
incorporate industry
standards and tools
around quality and
compliance
Quality testing is
automated and
integrated with
production systems
Automated work flows
to manage non-
conformance, non-
compliance, and recall
events across the
enterprise
Pe
rc
en
ta
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o
f R
es
po
nd
en
ts
, n
=
1
74
Source: Aberdeen Group, January 2015
F&B Leaders F&B Followers
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Achieving Operational Excellence in Food & Beverage
10
The Impact on Product
Safety and Quality
Food & Beverage Leaders, in addition
to performing better as a business,
outperform their peers when it comes
to quality. Not only do Leaders have
superior production compliance, they
do so while maintaining a lower total
cost of quality (percentage of annual
revenue).
Production Compliance:
• F&B Leaders – 99%
• F&B Followers – 92%
Prevention costs:
• F&B Leaders – 3.8%
• F&B Followers – 4.9%
Assurance costs:
• F&B Leaders – 2.8%
• F&B Followers – 4.5%
Internal failure costs:
• F&B Leaders – 2.7%
• F&B Followers – 5.2%
External failure costs:
• F&B Leaders – 2.7%
• F&B Followers – 3.8%
quality comes directly from the systematic monitoring and
analysis of standardized processes.
However, an important aspect of quality management to not
overlook is having a plan in place if a non-conformance does
occur. The risk of a recall is always in the back of mind for Food
and Beverage manufacturers. From tomatoes and spinach to
ground beef and peanuts — all types of products have
experienced issues with quality and recalls in the past. The cost
of a recall goes well beyond the expense of replacing an order or
paying for damage caused by consumption. There can be
significant tarnishing of the brand name and lowered trust in the
company. It takes only one quality issue to potentially lose a
customer for life. That is why possessing automated workflows
to manage and escalate these events is so critical to food and
beverage manufacturers — and not suprisingly, Leaders are 54%
more likely to have in place.
This increased focus on compliance implies an increase in the
total Cost of Quality (COQ) for Food & Beverage companies.
However, when we examine Leaders among F&B companies (see
sidebar) we see that they do a great job of ensuring compliance
while limiting their COQ. For all four COQ metrics, the Leaders
outperform the Followers, and when we look at the metrics as a
whole, the gap is even more apparent (12% of annual revenue
for Leaders, 18.4% for Followers). As the aphorism goes “Highest
quality is lowest cost” — building compliance and traceability
into their processes has led to such improved performance for
the Leaders. Effective food safety and quality is essential for
manufacturers today, and by focusing on this area of the
business, Leaders are set up for success in both the short- and
long-term.
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Achieving Operational Excellence in Food & Beverage
11
Sustainability is Often an Untapped Source for Savings
Improving production efficiency and ensuring top quality are
important for financial success, but reducing the energy needs of
the enterprise is an often untapped resource in both the quest
for profits and social responsibility. Sustainability-related costs
(energy, water, wastewater, etc.) are a large percentage of the
total operational cost in most Food & Beverage plants. Leaders
understand this and are more likely than their competitors to
factor sustainability into their operational decision making
(Figure 5).
Figure 5: You Can’t Forget about Sustainability
The only way to make improvements is to know how you are
performing. Including energy data in the optimization process
and using it as a KPI for decision making will enable companies
to reduce their total operating costs; the top pressure driving
F&B manufacturers. This means that Leaders collect
sustainability data in a single repository and provide this
information to key decision makers. It is also important to
connect this sustainability information with production data.
Understanding how your energy costs vary with product mix,
56%
40%
30%
41%
28%
16%
0%
10%
20%
30%
40%
50%
60%
Sustainability (energy
consumption,
emissions, wastewater,
etc.) costs used as KPI
for operational decision
making
Environmental impact
of operations is
understood and
reported
Production data utilized
to minimize energy
consumptionPe
rc
en
ta
ge
o
f R
es
po
nd
en
ts
, n
=
1
74
Source: Aberdeen Group, January 2015
F&B Leaders F&B Followers
“We have started a formal energy
management program and hired
an energy manager. This has
resulted in savings of
approximately 6% electricity, 5%
gas, and 3% water in first year with
no capital costs. We are currently
installing sensors on the electrical
side and lighting upgrades, also
installing a new control system on
our refrigeration plant, as this is
the largest load.”
~ EH&S Manager, Small Dairy
Producer
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Achieving Operational Excellence in Food & Beverage
12
“Meat products are high value
consumable products, so the more
you manage the yield, the better
you can optimize margins, which
goes straight on the bottom line.”
~ Chief Information Officer,
FoodCap International Limited
The Impact on
Sustainability Costs
Food & Beverage Leaders, in addition
to performing better as an overall
business, outperform their peers on
sustainability centric metrics:
Energy Management Goals vs.
Corporate Plan:
• F&B Leaders – +10%
• F&B Followers – -8%
Change in total Wastewater costs*:
• F&B Leaders – 15% Decrease
• F&B Followers – No Change
Change in total Energy
Consumption*:
• F&B Leaders – 14% Decrease
• F&B Followers – 1% Increase
Change in % to Landfill*:
• F&B Leaders – 5% Decrease
• F&B Followers – 3% Increase
*Year over year change, normalized
for identical production levels
production volumes, and schedules is critical to improving
efficiency.
Gaining a full understanding of the environmental impact of
operations is also important. For example, if a wastewater
treatment plant is performing poorly, it can result in excessive
biological oxidation demand (BOD) when treated effluent is
released. This can result in violations of local discharge permit
limits and further add cost to the business. By collecting and
analyzing sustainability information, Leaders are more likely to
understand such environmental concerns and address them
before they become an issue.
Again, the importance of these capabilities is shown when
examining the metric performance of Leaders and Followers (see
sidebar). Leaders have seen all of their primary sustainability
related costs decrease over the past year, while Followers have
seen no change or even an increase in costs. As we saw earlier,
justifying sustainability initiatives is the number one challenge
F&B manufacturing companies must get past. With the approach
that Leaders take to sustainability, the reductions in costs
provide all of the justification needed to make this part of the
executive’s agenda.
Operational Excellence and Continuous Improvement
Operational Excellence must be viewed as an ongoing, evolving
process where there is always progress to make. Continuous
improvement is a very important mindset (one that all
manufacturers are very familiar with) to strive for. For Food and
Beverage Leaders it starts with regular audits to provide visibility
into historic and current operational performance (Figure 6). You
can’t improve what you don’t measure; having these
benchmarks available allows F&B Leaders to improve metrics
like yield, productivity, and ultimately, profitability.
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Achieving Operational Excellence in Food & Beverage
13
Analytics to Bolster
Continuous
Improvement
Analytics are used to provide
predictive insights based on the
captured data:
• F&B Leaders - 37%
• F&B Followers - 25%
Furthering these efforts, Leaders form cross-functional teams
aimed at improvements across the enterprise. These teams are
well proven tools to drive buy-in throughout the organization
and help to change culture. Leaders have gone all-in for Lean,
Six-Sigma, and other continuous improvement techniques that
keep all their manufacturing business processes running at peak
efficiency. Finally, as data is turned into insight and inefficiencies
are identified, business processes must be updated across the
enterprise as these best practices are discovered. Leaders are
65% more likely than Followers to have a formal process in place
to dynamically incorporate best practices.
Figure 6: Stressing Continuous Improvement
Incorporating continuous improvement practices is the final step
for achieving operational excellence. Small improvements add
up over time, and the companies that perform the best as a
business are the ones that are never satisfied. Leaders take this
to heart, and the benefits to the business are clear when
examining the performance on the three key aspects identified
for operational excellence in F&B.
88%
70%
43%
78%
48%
26%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Internal audits are
performed regularly and
benchmarked to
improve performance
Cross-functional
continuous
improvement teams are
focused on improving
manufacturing
operations
Manufacturing business
processes are
dynamically updated as
new best practices
emerge
Pe
rc
en
ta
ge
o
f R
es
po
nd
en
ts
, n
=
1
74
Source: Aberdeen Group, January 2015
Food & Beverage Leader Food & Beverage Follower
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Achieving Operational Excellence in Food & Beverage
14
"In terms of consumer safety and
satisfaction, this is at the very top of
our pyramid in terms of investment
prioritization. We review food
quality weekly as part of our Sr.
Management meeting. Regarding
technology, ERP is the foundation
for quality management, which
includes lot control and traceability.
At the manufacturing plant level, we
also use a Manufacturing Execution
System to ensure lot traceability
and compliance for goods,
movement, and consumption. At
the supply chain level, tracking
product is an integral part of our
overall business process."
~Vice President, Large Food
Manufacturer
The Importance of Having the Right Tools
In order to support these OpEx goals, Food and Beverage
manufacturers must rely on technology to provide the necessary
visibility and communication across the enterprise. Enterprise
systems (like ERP, QMS, MES, SCM, etc.) go a long way towards
creating the needed foundation in processes control and
automation that Leaders use to enable the capabilities that were
just discussed. It’s all about the breaking down of silos between
functional groups that standalone solutions can bring.
Combining systems into one overall solution creates a platform
for cross-functional communication and collaboration that
synchronizes and ingrains operational excellence across the
value chain. Leaders also focus on automating their processes
with technology to ensure that OpEx initiatives can be effectively
carried out (Figure 7).
Figure 7: F&B Leaders Digitize Their Processes
A large portion of hardships felt in manufacturing can be
attributed to the manual or paper-based systems that are being
relied upon. These systems are simply not accurate enough and
30%
26%
41%
31%
41%
49%
42%
39%
42%
52%
54%
55%
60%
67%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Maintenance Management
Compliance Management
Traceability and Genealogy
Document Management
WIP (Work in Process) Inventory
Optimization
Non-Conformances / Corrective and
Preventive Actions (NC / CAPA)
Manufacturing Process Planning
Percentage of Respondents, n = 174
Source: Aberdeen Group January 2015
F&B Leader
F&B Follower
Benefits of Eliminating
Manual Data Collection
Processes
Top benefits seen from automating
internal processes (All Respondents):
• Increased visibility: 49%
• Reduced operator error: 40%
• Reduced response time: 37%
• Increased operator efficiency:
33%
• Promotes effective decision
making: 31%
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15
Food and beverage Leaders are
30% more likely than Followers to
use automated dashboards.
These applications help reduce
the overwhelming load of real-
time events and automate the
monitoring and analysis of critical
indicators that impact
performance.
cannot provide the necessary visibility that Leaders rely on.
Demonstrating compliance to Food and Beverage specific
quality standards and optimizing asset performance is too time-
consuming when going through three-ring binders or notebooks
of production data. Smaller or fast-growing companies are the
most likely to still manage production through these methods,
which simply cannot scale with the business. This puts this
group at the highest risk, as they may not even be aware of a
problem until it is too late. Also, one of the primary drivers for
“digitizing” all the paperwork in F&B is being able to extend
traceability into the distribution network.
In the analysis of specific technology functionalities enabling
Leading performance, it was found that these functionalities
span the plan, make, maintain, and deliver business processes
fairly evenly without any clear winner. Therefore, in assessing
where any organization should invest, it is important to first
understand which of these processes are most important for
success, and where gaps in technology investment currently
exist.
Key Takeaways and Recommendations
Food and Beverage manufacturers face constant pressures
around costs, quality, and efficiency. Making effective decisions
to address all three of these concerns can be a major challenge
for companies that are not properly structured. The operational
excellence program that Leaders rely upon is one that aims to
maximize productivity, ensure product quality, and limit
sustainability costs. Those Food and Beverage manufacturers
looking to achieve the same level of operational excellence
should:
Survey Demographics
Total Respondents: 174
Revenue Size:
• 21% Small (under $50 Million)
• 37% Medium ($50 Million - $1
Billion)
• 42% Large (Over $1 Billion)
Geography (Headquarters):
• 63% North American
• 19% Europe
• 12% Asia Pacific
• 4% South/Central America
• 3% Middle East, Africa
Sub-Verticals:
• 53% Packaged Foods
• 47% Food Service
• 36% Distributor
• 33% Juice
• 27% Frozen Food
• 24% Dairy
• 24% Beef
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Achieving Operational Excellence in Food & Beverage
16
Improve the flow of manufacturing data across the
enterprise to increase visibility and optimize
performance.
Build the unique F&B compliance and safety mandates
into your production processes.
Establish role-based visibility and automated
workflows in the case of a quality, non-compliance, or
product recall event.
You can’t overlook sustainability costs — factor the
environmental impact/costs into operational decision
making.
Implement enterprise systems like ERP, QMS, and
MOM/MES to build the foundation of process control
and automation that Leaders rely upon.
Digitize your manufacturing processes (Document
management, WIP, HAACP, etc.) to eliminate
inefficient paper-based systems and provide a timely,
unified picture for decision makers.
Operational Excellence is an evolving journey; take a
continuous improvement mindset to your operations.
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Achieving Operational Excellence in Food & Beverage
17
For more information on this or other research topics, please visit www.aberdeen.com.
Related Research
Driving Operational Insights through Enterprise
Energy Intelligence; November 2014
Best-in-Class Product Compliance: Going Beyond
the Four Walls; July 2014
Bridging the Gap Between Product Development
and Operations; June 2014
A Tale of Two Standards: ISO 9001:2008 and ISO
14001:2004; July 2013
Author: Reid Paquin, Research Analyst, Manufacturing, Product Innovation & Engineering (PIE)
([email protected])
About Aberdeen Group
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Achieving Operational Excellence in Food & Beverage
Based on the experiences of over 170 industry executives, this report explores the 7 secrets for the Food and Beverage Industry that maximize productivity, ensure product quality and limit sustainability – revealing how the most successful food and beverage companies approach operational excellence and turn it into a competitive advantage.