Identifying and achieving ROI
Many companies may find a serialization solution to be yet one more cost of doing business. If implemented properly, however,
it actually helps improve the business operation and bottom line. In a July 2008 report from Forrester Research, analysts
outlined key benefits and gains of creating supply chain visibility (2). According to the report, the types of benefits will
vary depending on the level of tagging (i.e., pallet-, case-, and/or item-level tags) and supply-chain stage. The scale, timing,
and duration of these benefits can be estimated by considering one or more key metrics and the value of improving those metrics
over time. Benefits include reduction in recalls and returns, reduction in shipping errors, improved financial accuracy of
order terms, direct labor savings, reduction in inventory shrinkage, reduced losses due to expiration or spoilage, reduced
stock-outs, and inventory cost savings. A well-executed implementation, integrated with existing business and enterprise resource
planning systems, provides a real opportunity to further automate and improve distribution processes and realize a positive
return on investment.
California is one of the largest markets for pharmaceutical manufacturers. While other states have implemented similar, and
less extensive measures, California is likely to have a greater impact on the pharmaceutical supply chain at the national
level. The key to making the transition for manufacturing and information technology operations as seamless as possible is
not to wait for standards. Industry consensus on technology and data constructs is lacking. Thinking strategically as to how
serialization will affect the entire enterprise, while roping trading partners into this process, will help define future
business implications. It is important to be cautious, but even more important to act early to implement a system that not
only complies with state and future federal mandates, but also offers overall business value.
Andre Pino is the vice-president and chief marketing officer at Acsis, 3000 Lincoln Drive East, Marlton, NJ 08053, tel. 856.673.3000,
1. G.M. Gaul and M.P. Flaherty, "Lax system allows criminals to invade the supply chain," Wash. Post, Oct. 22, 2003.
2. R.C. Wildeman and P.M. Connaughton, "The ROI Of RFID For Supply Chain Visibility," Forrester Research, July 18, 2008.