W H I T E PA P E R

7 Reasons Enterprise Labeling is Vital

to the Manufacturing Supply Chain

7 Reasons Enterprise Labeling is Vital

to the Manufacturing Supply Chain
BY GREG GRAHAM AND JUSTIN WARD

Labeling Challenges and Opportunities in Manufacturing

As manufacturers continue to focus on global growth strategies, the complexity associated with continuously improving
business processesincluding labelingis a bigger challenge than ever before. Robotics, the Internet of Things (IoT),
and increased automation on every level of manufacturing is demanding higher accuracy and increased speed, prompting
industry experts to describe the way goods must be distributed from now on as the new supply chain.01
Excellence in labeling has always provided a competitive advantage in the business of manufacturing, but today the
amount of critical data that needs to be printed on a barcode label far surpasses what was considered to be sufficient in
the past. From identification to grouping, shipping, locating and tracking products that flow upstream and downstream in
the supply chain, there is a great deal of information, often in multiple languages, that needs to be included on a simple
label. There are changing customer label requirements and even, in some cases, regional standards and regulatory
information to include. In fact, in the current manufacturing environment, labels are far from simple. Global manufacturers are beginning to understand that labeling solutions need to accommodate an increased level of complexity, whether
in creating a 1D or 2D symbologies, by including languages, regulatory information, pictograms, lot and batch number,
brand information, and more. The question is, what is the best strategy for accommodating this level of labeling
complexity in the global supply chain?
The cost of not reassessing the demands of new supply chain labeling can be high. Mislabeling, inefficient offline
labeling processes, a myriad of redundant and unnecessary label designs, and poor integration of multiple labeling data
sources can add up to wasted labor resources, customer fines, returns, delayed shipments, and even loss of business.
A robust labeling solution needs to include flexible label design that can be scaled and managed seamlessly at multiple
locations, integrate with a variety of enterprise applications in order to account for countless label permutations, and
automate the movement of labels seamlessly from test to production. The most comprehensive enterprise-wide solution
serving the entire supply chain is one which promotes the best allocation of resources for IT, operators, warehousing
personnel, global locations, customers, and ultimately, for all the participants in the supply chain.
Utilizing Enterprise Labeling Solutions02 can enable companies to address complex labeling challenges while improving
efficiency, accuracy, and speed, as well as delivery time and cost savings. Overall labeling quality improvements can dramatically improve a manufacturers competitive edge in the global marketplace. Here are seven reasons why Enterprise Labeling
is the most intelligent labeling strategy for improving and optimizing the flow of goods across the global supply chain.
01 Robotics and the New Supply Chain: 2015 2020, Next-gen Supply Chains: Decentralization, Digitization and Robotics,
Robotics Business Review, 2014.
02 Enterprise Labeling, A Supply Chain Strategic Imperative, by Loftware, Inc., January 2015.

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1. Speed Up Time-to-Market
In 2015, improving time-to-market speed is essential, and the need for acceleration is only going to increase in the
future. Robotics and a wide variety of advanced technologies for automation are disrupters that portend a sea change in
the requirements for manufacturers to be capable of faster and faster response times. Therefore, a companys ability to
rapidly manufacture and release existing, enhanced, or new products to a specific market has, and will continue to have,
a dramatic impact on both the bottom line and corporate growth.
As part of this increased need for speed, the actions of developing, integrating, and managing the output of compliant labels for a manufacturers products are a critical part of any product lifecycle. Labeling solutions need to be highly
responsive in order to support the businesses requirements for label content and formatting, while supporting the volume
and speed requirements for label printing now and for the future.
An Enterprise Labeling strategy gives manufacturers the ability to meet business requirements by streamlining label changes with advanced business logic. Business logic can dynamically change label formatting and content to support a myriad of
different label combinations with a minimum number of label designs. It allows users to support a wide range of regional, language, customer and regulatory requirements, while enabling the automatic routing of print requests. So as labeling design
changes are needed, they can be made by business users to respond to a wide range of standard and regulatory needs,
to add new anti-counterfeiting features, to represent the most current brand and product identification, and to respond to
customer requests. Any of these design changes, easily implemented, can result in much faster time to revenue.
The flexibility of Enterprise Labeling enables speed wherever labels are printed in the manufacturing supply chain.

2. Standardize Labeling Across the Enterprise

As manufacturers continue to expand globally both organically and via acquisition, they inherit many different ERP, MES
and WMS applications that are responsible for triggering labeling.
The prevalence of home grown and custom labeling solutions, third party labeling solutions, as well as a combination of
these different solutions, that accumulate over time create a dilemma of major proportions. Manufacturers experience
the best and the worst of all of those solutions combined, lacking a single consistent labeling approach that can be easily
maintained and replicated. Just as companies choose to standardize ERP solutions for their global operations, manufacturers need to understand that the same option is available for labeling.
In addition, manufacturers that deploy multiple solutions must deal with an increased maintenance level to accommodate
all of the varying platforms. More IT resources become necessary, adding significant time and cost. Additionally, these
manufacturers run the risk of not having the specific solution knowledge to react to critical business requirements. This
limited flexibility means there is no single platform for growth, impacting a companys ability to scale.

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If a business wants to represent itself with labeling consistency to its customers, standardizing labeling across the enterprise is imperative. Essentially, standardization of labeling throughout the supply chain through an Enterprise Labeling
Solution solves a multitude of problems at one time, preventing mislabeling, and relabeling,regardless of the number of
locations. Rather than manage multiple different systems, standardization allows companies to streamline maintenance
while supporting enterprise-wide labeling changes. In addition to reducing cost and simplifying maintenance, having a
single, scalable solution facilitates expansion to new global locations.

3. Respond to Customer Requirements

As global competition for new markets grows, manufacturers are looking for better ways to keep their customers satisfied
and lock in a closer customer relationship. Changes to labels are often being driven by customer-specific requirements,
and labeling requirements are more demanding and variable today than ever. Failing to meet requirements in a timely
fashion can result in dissatisfied customers who may turn to competitors. Viewing labeling as a key enabler in customer
responsiveness provides increased opportunities to better serve an organizations client base and drive revenue.
Manufacturers today need to manage variability across multiple customer segments and regions to meet the rigors of the
customers global requirements, including variability in languages, images, formats, and printers.
Traditionally, developing customer specific labels has required the creation of custom labels with custom logic that needs
to be developed and maintained. But in many cases, customers compliance standards change over time, putting further
strain on a businesss IT resources needed to react to these changes. Implementing a flexible labeling solution means
that as customer needs change, manufacturers can more easily and quickly accommodate those requests with minimal
delay and disruption to business processes.
For example, General Motors updates its customer requirements frequently. Their communique titled GM Customer
Specifics ISO/TS 16949, Effective January, 2015, Including GM Specific Instructions for PPAP 4th Ed. (see
Section 5),03 is a 34-page document outlining many requirements, including labeling. 4.2.2.2 Shipping Parts Identification Label Standard, (GM 1724), other requirements for Continuous Improvement, and many other stipulations are
included in this detailed guide of instructions. To work with a large global customer such as GM, Walmart or Target, very
specific guidelines for suppliers of manufactured products are often modified and updated as in this GM example, which
is a revision from November of 2014, just two months prior. Suppliers may be asked to modify labeling at any time, too,
depending on market needs, trends, or in response to other special circumstances impacting the customer.
With Enterprise Labeling, business users can also be securely enabled to take ownership of the design process when
necessary, which means reducing the need for costly and scarce IT resources. The ability to respond quickly, accurately,
and efficiently to customer requests and requirements is decidedly a competitive advantage, and Enterprise Labeling is
particularly architected to achieve this aim.

03 GM Customer Specifics ISO/TS 16949, Effective January, 2015, Including GM Specific Instructions for PPAP 4th Ed. (see Section 5)

2015 Loftware, Inc. All Rights Reserved. All other marks are the property of their respective owners. www.loftware.com

4. Understand that The Only Thing that Does Not Change in Manufacturing,
is Change Itself
Change has always been a reality, but there is a revolution brewing in manufacturing, stemming from the new technologies such as robotics, IoT, and 3D printing that are poised to influence rapid changes in many aspects of manufacturing
and the global supply chain. A recent Gartner report states:
Recent technology developments like the Internet of Things and 3D printing are redefining digital manufacturing. New emphasis on speed, productivity and sustainability provide strategists opportunities to innovate
the role of production in the value chain. This creates new revenue opportunities and changes the competitive landscape. Few companies are prepared to sustain this shift.04
New technologies, therefore, are beginning to influence how business is conducted throughout the global supply chain
and demand the agility to deal with all the nuances of todays correspondingly complex labeling requirements. Labeling
solutions that can flexibly support high levels of manufacturing variability, productivity, and sustainability are a powerful
stabilizer against the winds of change. The ability to maintain high performance and flexibility without requiring extensive
coding or customization is critical, and Enterprise Labeling Solutions are the intelligent way to accommodate these manufacturing trends within the new supply chain.
Peter Senge, author of The Fifth Discipline, The Art and Practice of the Learning Organization, writes about the
need to understand dynamic complexity in crafting plans to meet rapid changes as follows:
Unfortunately, most systems analyses focus on detail complexity, not dynamic complexity. Simulations
with thousands of variables and complex arrays of details can actually distract us from seeing patterns
and major interrelationships. In fact, sadly, for most people systems thinking means fighting complexity
with complexity, devising increasingly complex (we should really say detailed) solutions to increasingly
complex problems. In fact, this is the antithesis of real systems thinking.05
With labeling playing such a critical role in the global supply chain, manufacturers need to develop a systems thinking
approach and implement labeling solutions that can dynamically manage abrupt and unforeseen changes. The price
of unpreparedness includes additional labor costs, time losses, customer fines and penalties, and disappearing market
share. Patching up labeling gaps with short-term fixes will only create more chaos in the supply chain. In answer to this dilemma, Enterprise Labeling Solutions are designed with the capability to manage label changes with a systems thinking
approach, in which needed changes can proliferate swiftly, in a standardized format, throughout the supply chain.
Manufacturers are not always able to predict the future, but a flexible Enterprise Labeling Solution can accommodate many
changes quickly and efficiently, even when those changes are unforeseen. Whether in the face of an environmental crisis,

04 Digital Business Is Redefining the Scope of Manufacturing Operations, a webinar by Gartner, www.gartner.com. (Our italics.)
05 Senge, Peter M. (2010-03-25). The Fifth Discipline: The Art & Practice of The Learning Organization (Kindle Locations 1288-1292).
Crown Religion/Business/Forum. Kindle Edition.

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recalls, or other technological innovations that swiftly take hold and challenge the status quo, Enterprise Labeling Solutions
have built-in flexibility made to manage change that can help manufacturers protect themselves against the unknown.

5. Adopt Enterprise Labeling to Improve Your Bottom Line

Manufacturing downtime can add up to a multi-million dollar impact on businesses. But since the operations of many companies are increasingly knit together by their information technology, system downtime now hampers the productivity of
almost everyone in the organization, and sidelines a growing percentage of an organizations capacity to get work done.
Additionally, inefficient label design and difficulty deploying label changes can adversely affect time to market and impact
a companys bottom line. The result of delays to the market can include lost revenue, increased cost of development, and
slowdowns that negatively influence other related projects, contributing to the accumulating cost.
Eliminating time consuming, costly processes by employing a flexible labeling solution can help reduce time-to-market
and produce substantial business value. Since labeling is a mission-critical part of manufacturing, labeling downtime
equates with production downtime from a cost/impact perspective. Enterprise-wide labeling efficiency and flexibility can
lead to significant time and money saved.
By implementing Enterprise Labeling Solutions, large manufacturers have empowered their business users to create
and maintain labels that greatly increase their ability to quickly meet regulatory, customer and country specific market
demands. For example, using an intuitive label design tool and leveraging business logic to automate labeling output from
their ERP system, corporations have often been able to speed up time-to-market and improve maintenance by reducing
thousands of label designs to less than ten. For these manufacturers, this approach has led to millions of dollars worth of
savings. When relabeling upon receipt (supplier labeling), 3rd party labeling cost and errors, and counterfeiting and branding errors can be eliminated, significant time and cost savings are the result. These add up to concrete, measurable gains.
Enterprise Labeling is a multi-faceted strategy for precisely addressing these types of financial objectives simultaneously,
efficiently removing the burden of large amounts of wasted time and resources from the business equation.
According to industry analysts at VDC Research, a leading technology market intelligence and advisory firm, enterprises
are streamlining the flow of products and information across channel, network, and organizational boundaries to create a
flexible and competent demand-driven supply chain while also meeting their profitability objectives. 73% of organizations
surveyed by VDC cite operations improvement and cost savings as leading barcode technology investment criteria.06

6. Industry Regulations and Standards Are an Unavoidable Part of Global Business

Manufacturing is reputed to be an industry that is less bound by regulatory restrictions than others. But as a large category of
industry, manufacturing often intersects with business areas that are indeed regulated, and the trends strongly indicate that
06 VDC Research, Barcode Label Generation Software End-User Survey (respondents include 162 data capture technology
professionals) 2013

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standards and regulations will be increasing, not decreasing. Manufacturers products containing hazardous chemicals already must comply with USAs OSHA and the Globally Harmonized System of Classification and Labeling of Hazardous
Chemicals (GHS). Contract manufacturers of products containing electronics need to be aware of international regulations
such as the EUs RoHS2. These are just two types of the commonly required regulations manufacturers may encounter.
And as more and more products are manufactured with Internet-ready components, smart products will include IoT for
manufacturers to remotely monitor and service equipment, measure vibration, temperature, pressure, and other factors
that can cause disruption and downtime. These products incorporating IoT components will often need to be regulated in
order to ensure accuracy for manufacturers and to provide safety for users.07 And as to the dramatic nature of the impact
of IoT on the flow of goods in the global supply chain, Verizon, one of the major corporations that will be carrying IoT data
from products to the Cloud, states in a recent report, The Internet of Things 2015: Its not hype. The Internet of Things
(IoT) is already having a massive impact on business...53% of manufacturers will offer smart products by 2016
Regarding regulations associated with the proliferation of IoT, Oxford Economics, a consulting group affiliated with Oxford
Universitys business college to provide economic forecasting and modeling to UK companies and financial institutions expanding abroad, reported in a recent study of 300 manufacturing executives that Increased regulations arising from environmental concerns and standards-based factors like ISO complianceapply across an increasingly inter-connected world.08
So even if manufacturing appears to be devoid of regulations and standards in some sectors, depending on the market,
there will undoubtedly be aspects of the regulatory and standards landscape that must be explored in order to successfully gain global market share. Being proactive and building the readiness to accommodate regulations and standards
can give a manufacturer a definite competitive edge. With increased customer, environmental, and end user concerns for
safety, and with many regions of the global marketplace establishing unique sets of standards and regulations to meet the
rapid changes in manufacturing technologies and products, it pays to be ready for regulatory compliance.
Enterprise Labeling Solutions already contain the ability to easily incorporate regulatory label data while meeting all the
other labeling requirements of a manufacturing operation.

7. Support Mission-critical Business Processes

With the integration of labeling with mission-critical business processes, the performance and high availability of a
labeling solution becomes increasingly important. Labeling must be optimized for high output performance and highly
available 24x7, 365 days a year.
Who can forget the tragedy of the earthquakes, massive tsunami, and related nuclear power plant disaster that struck the
northeastern coast of Japan in 2011? The value of the loss of lives, homes, and entire communities was immeasurable
07 State of the Market: The Internet of Things 2015Discover how IoT is transforming business results. Verizon 2015
08 Manufacturing TransformationAchieving competitive advantage in a changing global marketplace, Oxford Economics 2014

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and can never be replaced. In the early days of the disaster, even routine communication to the Tohoku area was impossible. Six of Sonys manufacturing plants were shut down. Honda, Toyota, Apple, Canon, Panasonic, Toshiba, Sapporo,
Nikon, and Nissan all experienced plant closures or long shipping delays due to the earthquakes. In financial terms, the
damage was estimated to total more than a staggering $300 billion.
It is clear that natural and man-made disasterswhether a storm, a flood, a fire, or geopolitical unrestcan wreak havoc
with a companys supply chain and have significant financial consequences. Companies with worldwide operations that
include manufacturing and distribution facilities across the globe must ensure continuous flow of goods to customers
without interruption. However, when it comes to business continuity, companies most often think about manufacturing and
shipping but frequently overlook an essential elementlabeling. Even when issues with production and distribution are
addressed, if products cannot be labeled during a crisis, continuity is still broken.
Providing a clear standard for labeling allows businesses to maintain consistency and to provide another level of scalability and reliability to support a global network of printers. The focus, even when deploying solutions in a distributed fashion,
is to continue to maintain the ability to leverage common data sources, components and configurations across sites. This
is essential to handle the rigors of global infrastructures, allowing users to manage outages and connectivity issues, while
providing high availability, failover and disaster recovery capabilities. The advent of modern, multi-tier architectures and
browser-based labeling solutions offers even more flexibility to enable centralized and decentralized deployment options.
Enterprise-wide labeling provides a structured path to production with a way to test out scenarios for outlier events and
challenges even before they happen. Large companies with global supply chains want to know that a labeling solution
includes a variety of risk management options and best practices, and Enterprise Labeling Solutions provide this peace
of mind for manufacturers and their customers. No one wants disaster to strike, but if and when it does, making sure
products can be labeled accurately and reach their intended destination in the most efficient and timely way is a critical
part of a manufacturers mission.

The Label is Your Passport to Your Global Marketplace

In considering the history of commerce, it is apparent that business customs and values are traded back and forth just
like the products corporations ship through the global manufacturing supply chain. W. Edwards Deming09, the engineer
and statistician born in 1900, wrote his seminal book Out of the Crisis, inspiring the Japanese industrial renaissance
after World War II. Those same principals of quality control and quality management, taken seriously to heart by Japans
manufacturers, in turn greatly influenced the Kaizen10 (, or literally, change + goodness) methodology of continuous improvement, which is now taught in the United States and all over the world. Over one hundred years later, Demings influence, shared with the people of Japan after World War II, is still felt around the world as manufacturers continue
to strive for better ways of making their products and managing their businesses. The global marketplace has grown and
diversified, becoming more complex and moving faster by the day, but there has been one constant in the development of
09 For a profile of W. Edwards Deming, Wikipedia. 2015.
10 Definition of Kaizen, Wikipedia 2015.

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industry that the global supply chain shares in common. It is the goal of discovering and making progress toward continuous improvement as manufacturers account for their products while they travel through the supply chain.
As the industrial environment becomes more global and complex, companies need to view excellence in labeling as one
of the biggest opportunities to solve the challenges of new multi-faceted, dynamic supply chains. Todays supply chains
are enablers of business and growth, driving top line revenue and overall efficiency, and leading to greater profitability. Labeling has become a mission-critical segment of the modern supply chain. Companies today are recognizing the integral
part that labeling plays in gaining true supply chain efficiency, achieving higher levels of customer satisfaction, maintaining business continuity and meeting evolving regulatory demands.
In conclusion, a label is much more than it may first appear to be. Labeling actually reflects the intentions and best practices of an organizations commitment to its global marketplace. With a labeling strategy firmly in place that is scalable in
the enterprise, the opportunities for greater efficiency in managing the global supply chain can be seamlessly addressed
on multiple levels for continuous improvement and enterprise excellencefor increased speed, better accuracy, opportunities for real cost savings, improved customer satisfaction, and enabling easier compliance with labeling regulations as
necessarybenefitting all manufacturing global supply chain stakeholders in the process.

About the Authors

Greg Graham: As the Manufacturing Industry Specialist (Southern Region) at Loftware, Greg Graham has more than 25 years experience selling highly engineered industrial automation equipment instrumental in running production lines for Fortune 500 companies
such as RR Donnelley & Sons and Quad Graphics. Greg has also sold enterprise software solutions to global manufacturing and supply
chain companies such as AO Smith, ABB, Southwire, and many others, for streamlining operations, improving efficiencies, and reducing operating costs.
Justin Ward: As the Manufacturing Industry Specialist (Northern Region) at Loftware, Justin Ward has more than 15 years of experience selling Enterprise Output Management solutions to global manufacturing and supply chain companies. Justin is highly knowledgeable about the business issues global manufacturing companies face today and provides guidance to help companies achieve their
financial and operational goals with the implementation of Enterprise Labeling Software.

About Loftware
Loftware, Inc. is the global market leader in Enterprise Labeling Solutions with hundreds of manufacturing customers in over
100 countries. Offering the industrys most comprehensive labeling solution, Loftwares enterprise software integrates SAP,
Oracle and other enterprise applications to produce mission-critical barcode labels, documents, and RFID Smart tags across
the supply chain. Loftwares design, native print, and built-in business rules functionality drives top line revenue, increases
customer satisfaction, and maximizes supply chain efficiency for customers. With over 25 years of industry leadership, Loftwares Enterprise Labeling Solutions and best practices enable leading companies to meet their customer-specific and regulatory
requirements with unprecedented speed and agility.

2015 Loftware, Inc. All Rights Reserved. All other marks are the property of their respective owners. www.loftware.com