Processing Companies Still Unsure of FSMA Implications

By Sudhakar Kaup, Contributing Editor

Most businesses, particularly those in heavily regulated industries, argue that its not regulation per se that makes it harder to do business; its the uncertainty that regulations breed that causes problems. 

Case in point: the Food Safety Modernization Act (FSMA).

Signed into law by President Barack Obama on the second day of the 122th Congress, January 4, 2011, the laws included in FSMA finally came into full force this January.

And while the measured phasing in of the new rules was meant to allow organizations time to prepare, it has instead caused confusion and hand wringing.

In fact, iRely found in a study conducted in March that the majority of process manufacturers are unaware or uncertain of how the stricter regulations will affect their production processes.

Of the survey respondents, 71 percent agreed the new FSMA regulations would directly affect their operations, but when asked which one requirement would affect them most, the most common answer was unsure" (47 percent). In addition, respondents listed uncertain or unclear implementations" (44 percent) as their biggest concern about new FSMA regulations.

The survey data confirms that while food and beverage manufacturing leaders are mostly aware there are new requirements, they are still getting up to speed on how those requirements will be the impetus for operational changes. The results also show that a number of manufacturers are still either unaware or unconcerned with the new regulations tied directly to the quality and safety of end products.

The FDA has confirmed most plants will need to increase capital expenditures in order to upgrade their technology and meet new guidelines. Yet, when asked if the FSMA regulations have affected their ability to plan/budget, 45 percent of respondents answered no, they have not addressed the FSMA guidelines.

In fact, most did not plan on increasing resources at all. A total of 76 percent of respondents answered that they were not looking to increase their number of employees or resources to address FSMA requirements.

One particularly new stipulation of the FSMA is that mock recalls be carried out more frequently. In most organizations, a mock recall can take days or even weeks to complete and normally require the involvement of staff from multiple departments.

Based on that fact alone, an increase in resources would seem to be needed to be prepared for these additional mock recalls. The new regulation gives the FDA new power to levy fines and access fees. This new power, along with the new authority to mandate a recall and, under certain conditions, suspend a companys registration without a court order, should be a wake-up call for food manufacturers.

The FDA has already shown it can and will use this new authority. Case in point: the summary shutdown of Sunland Inc.s New Mexico plant last November. Companies using new adaptable manufacturing systems would not only be covered from these immediate threats, but also be proactively prepared to tackle additional FDA regulations down the line.

The reticence to upgrade plant-tracking technology may be a lingering effect of the uneven economic recovery. Companies have generally held more cash as economic indicators, such as unemployment, have fluctuated wildly. Any investments being made today are directly related to cost-cutting or revenue-improvement.

Another main factor that could be holding plants back is the current technology in place. Many companies still rely on basic ERP systems, or even spreadsheets, to track and manage the production process. The FSMA regulations clearly define the need for improvement in electronic recordkeeping and auditing, which would require more advanced technology to properly report all the necessary items.

Survey responses supported this trend. While 76 percent of respondents did say they currently use a quality-control management system, nearly 45 percent of respondents reported using spreadsheets or other manual processes to manage traceability, quality and inventory issues.

One final reason companies are not planning for FSMA-related improvements is skepticism the rules will actually be enforced. However, plant owners should be aware that the Congressional Budget Office has budgeted around $280 million per year for enforcement of these new rules.

When asked if they would start using an automated system now that FSMA regulations are in play, 76 percent of respondents said "no," because their system is already compliant.

This reveals a startling disconnect between the FDAs claim that most facilities would need to be updated to meet new regulations and managements claim that they do not plan to improve upon their current system.

The answer may lie somewhere in between, but the survey indicates a strong need for the FDA and government to better educate and enforce the regulations of the FSMA. Facilities managers also hold the burden of better tracking and tracing technology, allowing them to both meet and pass potential FDA audits or recalls, as well as ensure customers their food and/or beverages have no contamination or quality issues throughout production.

Finally, one of the most compelling reasons for compliance may be that, when rules and guidelines are loosely defined, the chance of winning a court case against a manufacturer is pretty hard. But once rules and regulations are more clearly defined, as they have been with the release of FSMA guidelines, litigation is more attractive because then lawyers can attack all of the little nuances of the regulations and look for any small mistake or incorrect interpretation a manufacturer may have made.

As Benjamin Franklin said: An ounce of prevention is worth a pound of cure".

Sudhakar Kaup, CPIM, is chief technology officer at iRely, LLC, a provider of process manufacturing and commodities software. He has more than 18 years of experience in designing and implementing solutions for the manufacturing industry. iRely currently employs over 250 people and services more than 400 customers in more than 10 countries around the world.