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Leveraging SAP for a Complex Global Supply Chain

Today's global supply chains are more complex than ever. To manage their dynamics, and stay ahead of the competition, leading companies have turned to SAP to optimize their supply chains. These solutions maximize efficiencies and extend the possibility that the supply chain offers to achieve healthier top and bottom lines. Businesses choose SAP because of its ability to meet the requirements of a global enterprise, which include a range of capabilities, scalability, reliability, and availability. Allowing organizations to drive all of their business processes through SAP means that companies are better able to meet their global operations and supply chain requirements.

To better run their enterprise, and better manage their supply chain that is so central to enterprise success, these organizations rely on SAP to provide a unified solution that integrates their processes across the supply chain. They deploy SAP modules like Order Management, Materials Management, Extended Warehouse Management, Environment Health and Safety, and Transportation Management to leverage the capabilities and efficiencies that enable an organization to succeed.

Organizations that want to leverage investments in their SAP systems are recognizing that labeling plays a critical role in the production and distribution of their products as well. Barcode labeling solutions, which today entail much more than just the printing of barcodes, can be fully integrated with key SAP processes to effectively and efficiently manage labeling across the supply chain, and throughout the product lifecycle. Done correctly, labeling plays a big part in helping an organization meet customer and regulatory requirements, increasing time to market and cutting costs.

The best way to manage labeling in today's complex supply chain and SAP environment is to integrate with an Enterprise Labeling Solution. This allows companies to leverage existing business processes and vital data sources. It allows them to standardize and offer consistency throughout their operations, while maximizing existing investments and eliminating the need to retrain users. The approach, which triggers labeling directly from SAP, replaces multiple, disparate, locally controlled data sources with data from SAP. This prevents data replication to other sources and eliminates labeling errors. It also removes the need for countless permutations of label templates.

There are many benefits that SAP-based organizations realize when integrating with an Enterprise Labeling Solution. Those organizations are able to leverage the value of their SAP deployment more fully to meet the requirements of a global enterprise while drawing on SAP as a source of truth. Ultimately, integrating labeling with SAP allows these companies to standardize labeling for accuracy and consistency, enabling them to respond quickly and efficiently to customer and regulatory requirements while also dramatically cutting costs, simplifying maintenance and improving time to market.

Also, in the decades since SAP began helping supply chains run more efficiently, there have been numerous trends that have had a profound and direct impact on global supply chains. Overall, supply chains have increased in complexity. There are more suppliers to connect and collaborate with throughout the supply chain. Outsourced manufacturers are often part of the overall mix. With more nodes within the supply chain network, organizations require greater visibility and transparency into what's happening at what location. They need access to more systems, and to more consistent sources of data.

Additionally, globalization has made a significant impact. Today's supply chains are worldwide, which means meeting a host of customer and regulatory requirements. There also are many language requirements, which makes a significant impact on labeling and worldwide business processes. Additionally, each region may maintain different production processes and each border crossing may mean a different set of regulations for compliance. Adhering to regulations that define how products are developed, marketed, shipped, and disposed is essential to avoid fines, retain customers, enter new markets, and in some cases, stay in business.

Across the globe, these regulations are continually evolving, and may be sprung on suppliers with short notice. Industry-specific regulations are also growing in importance, and they are often directly related to labeling. Some of the pressing regulations impacting businesses today include:

  • The UN's Globally Harmonized System of Classification and Labeling of Chemicals (GHS)
  • The FDA's Unique Device Identification (UDI) system impacting medical device suppliers
  • The FDA's Drug Supply Chain Security Act (DSCSA) requirements affecting the pharmaceutical industry
  • The Global Transport Label Standard (GTL), which was designed for the automotive industry.
  • The European Union's EU1169, which stipulates a variety of areas where mandatory information must be present on food package labeling
  • The Restriction of Hazardous Substances or (RoHS) compliance for electrical or electronic products

Globalization and the increasing volume of regulations and standards across industries are not the only trend effecting supply chains. With heightened competition and the entry of ever-lower-cost competitors, price pressures are tremendous. Customers are demanding a higher level of responsiveness and accelerated delivery times that enable them to keep up with markets that can change in a moment's notice. Many customers are ordering smaller (and often more customized) lots, and are more focused on being supplied on a “just-in-time” basis. The days of carrying large inventories are gone, and organizations look to reduce inventory buffers. In competitively charged markets, customers maintain significant influence and they want to work with suppliers that can address their specific needs on a timely basis. 

Throughout the supply chain, greater efficiencies, more flexible support for a wider range of variability, and higher quality are being demanded. This is where Enterprise Labeling helps manage the pressure. When it comes to achieving greater efficiencies, more flexibility and higher quality, labeling plays an essential role. It results in improved traceability, the elimination of mislabeling, fewer issues encountered by customs, and fewer fines for non-compliance. However, when done correctly to begin with and integrated with SAP business processes, accurate labeling reduces the need for time-consuming and costly relabeling. 

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