EQMS Coexistence

in an Enterprise
Environment
Best Practices to Managing Quality Processes
1 2 3 4 5
Quality Benefits
IT System
Introduction System of EQMS Resources
Challenges
Processes Implementation
Introduction
Organizations have increased their global presence by entering new markets, outsourcing
to global suppliers and contract manufacturers, and through mergers and acquisitions. This
offers competitive advantages but also increases risk due to the lack of visibility of quality
processes across the value chain.

As a result, industries have seen considerable increases in product recalls, which has increased
regulatory attention and requirements. Increases in rework, disposals and scrap attributed
to poor quality also increased cost and reduced profitability for companies in an already
struggling economy.

While companies in the life sciences industry have leveraged Enterprise Quality Management
Systems (EQMS) for the last 20 years, 80% of quality managers in consumer products (i.e. food,
beverage, personal care, cosmetics, baby products and tobacco) and chemical companies are
still managing quality processes using spreadsheet and paper-based systems.*

Companies have spent years trying to find ways to use existing enterprise IT systems to
manage quality processes, with a big assumption that their ERP system can be extended to
handle it.

This eBook will highlight trends in both the Enterprise Resource Planning (ERP) and quality
management systems, as well as discuss key issues that should be considered by those
looking to better manage quality across the enterprise..

*Transforming Quality Management through Automation, Quality Digest. January 23, 2012
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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
IT System Challenges
ERP System Deployment
A number of trends have surfaced to change ERP deployments over recent years. With a
history of lessons learned during deployments and an understanding of capabilities and
gaps in performance, organizations can now better identify needs going forward.

The success of an ERP system deployment depends on the commitment of senior

management to adapt to changes in business processes to support best practices.
Although an ERP is known for standardizing and centralizing business processes, it does not
provide the flexibility to easily adapt to an individual organizations process requirements.
There has been a history within organizations of extensively customizing ERP installations to
extend their use into more traditional, transactional supply chain uses. A recent survey study
found that 25 percent of respondents implemented ERP systems with significant, extreme
or complete customizations. * The consequence of making extensive customized changes is
the difficulty in upgrading these systems, which can end up requiring a full implementation
effort to utilize functionality in a new release of the ERP application.

The total cost of ownership becomes extremely high due to the cost of each upgrade
which includes the redesign of custom objects and almost a full revalidation of the system.
While that seems like a positive for ERP vendors from a license and professional services
revenue standpoint, but it actually ends up putting incumbent vendors in a full competitive
evaluation process during each upgrade. More frequently, this trend and refocused
perspective are driving organizations away from the view that ERP platforms are a one-size-
fits-all solution.
1 Avons Failed SAP Implementation Reflects Rise of Usability, The Wall
*Panorama Consulting Solutions, 2014 ERP Report. Street Journal, January 24, 2014
2 Identifying Critical Issues in Enterprise Resource Planning (ERP)
Implementation Elsevier. May 2005.
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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
IT System Challenges
Impact of Mergers and Acquisitions (M&A)
Due to challenges in the economy as well as industry trends, we have seen a significant
number of merger and acquisition (M&A) activities. The net effect of these changes has
been a high level of redundancy of IT systems within these organizations, resulting in
multiple ERP, MES and CRM systems. This leads to an even greater amount of disparate The Real Cost of an ERP
data and lack of visibility within their newly combined organizations.
Reimplementation?
During the M&A process, organizations often make a decision to select the preferred Although costs vary based on the size of the
application and rip and replace redundant applications in order to consolidate data into
company, a large food manufacturer disclosed
one harmonized system. But when it comes to ERP systems, this harmonization is usually
performed at a high cost and a substantial disruption to the business. Users are often that the cost to upgrade their ERP system
frustrated with the functionality, and the extensive number of transaction codes they was expected to cost $70 million, in addition
needed to do their job.
to capital investments. During 2010, the
Alternatively, many companies are taking the approach of leaving multiple preexisting company incurred approximately $9 million
ERP systems alone until a more suitable solution can be achieved. However, that results in consulting costs associated with their ERP
in siloed data across multiple facilities within the enterprise. Some companies are using
SOA-based middleware applications to communicate between different legacy systems,
reimplementation.*
but that still doesnt provide the visibility needed to ensure compliance and consistency
across business processes especially as it relates to managing quality processes.

*Source: Kellogg, 2010 10K Report, page 17.

IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Quality System Processes
Quality Systems Deployment Trends
In the mid-to-late 1990s, life science organizations implemented quality
management systems (QMS) as a point solution within a facility to meet
specific compliance requirements. As operational and cost efficiencies began
to be recognized, pharmaceutical and medical device companies rolled out
their QMS across all quality processes and global facilities.

These systems not only span the broad spectrum of highly interrelated quality
systems processes, but also involve the participation of cross-functional
groups within the organization. The evolution of these systems has also
resulted in expansion well beyond manufacturing quality systems processes,
and in many cases these systems are now extensively used by regulatory
affairs groups, lab operations, clinical operations and even, increasingly,
environmental health and safety staff.

In recent years, companies in the food, beverage, personal care, cosmetic,

baby products, tobacco and chemical industries are starting to see an
increase in regulatory and compliance requirements, and are looking
to leverage the best practices from their life sciences counterparts.
Standardizing quality processes across all facilities using an EQMS enables
organizations to maintain standard operating procedures (SOPs) and
compliance requirements effectively. It also enables information to be
integrated and shared across existing IT systems so issues can be identified
earlier and product can be quarantined in the facility. This reduces the need
for costly product recalls that impact brand reputation, recalls costs and
consumer health and safety.
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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
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Quality System Processes
Quality Systems Deployment Trends
Certain elements of a quality management system are thought to be logical extensions of an ERPs functionality. Several ERP platforms offer functions that are
positioned as quality modules, or add-ons, for managing quality related processes. However, this functionality is typically designed to manage just an isolated
process within the overall quality system previously mentioned.

During the manufacturing process, there are a variety of deviations that can occur against a particular batch or lot number within the ERP system. However,
these systems typically work in a batch-centric fashion, where a deviation is associated with a specific batch. So, when the total quality process, such as an
incidents, is reviewed, business users can see that upto 90% of the quality process is done manually outside the ERP system.

This is different than a typical quality management system, which manages business processes via an incident-centric fashion. So, significant customization of
an ERP system is normally required to permit a single deviation to be associated with multiple batches or products, unlike a quality management system that is a
purpose-built solution.

For those that choose not to engage in customization, resource-intensive manual processes susceptible to errors are developed instead.

The implementation model for these systems is consistent with the approach taken in a broad range of ERP-related deployments. These are typically large-scale
professional services engagements involving significant customization to enable the ERP to conform to the customer-specific product and quality process
requirements. Even for a mid-tier company, this isolated component of the overall quality systems landscape can cost several million dollars, easily equaling or
exceeding the price of implementation of a complete, best-of-breed quality management system.

IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Benefits of EQMS Implementation
What does an EQMS Provide? Accelerated quality
outcomes* that result from
an EQMS implementa:on:
As regulations increased and the complexity of multiple systems across the supply chain expands, the idea of automating
quality workflow processes becomes more of a necessity rather than a option. These highly interrelated processes within Supplier
Improvements
the quality systems area span a number of functional groups, including supplier quality, manufacturing operations, 39% reduc*on in
product management, regulatory affairs, multiple auditing groups and even complaint handling. supplier quality
management .
cycle *me
With the focus on increasing a companys global footprint, an effective supplier quality management program has 39%

*2010 survey of Sparta Systems 30 customers using TrackWise

become even more critical. This discipline includes a holistic, end-to-end processfrom a request for a new supplier,
through the qualification process and ongoing monitoring through structured, risk-based auditing programs.

CAPAs
Nonconformances and product complaints are increasingly cross-referenced to both materials and the suppliers that had 51% reduc*on
provided them, allowing true aggregation of all supplier-related quality information. in CAPA cycle *me

From a manufacturing perspective, there are a number of different product and operational incidents that must 51%
be captured. After the logging of these incidents, a thorough investigation must be conducted, followed by the
identification of root cause and the planning and execution of corrective and preventive actions (CAPAs). To allow
accurate closure, a disciplined process must be put in place to check the effectiveness of the remediation activities to Incidents &
Nonconformances
make sure the issue doesnt recur in the future. 72% reduc*on in
72 incident
% process
cycle *me

IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Benefits of EQMS Implementation
What does an EQMS Provide?
As the supply chain becomes increasingly global, complete change management processes have
received continued attention. Critical to change management processes is the assessment of
regulatory impact and the determination of the appropriate updates that must be submitted to
the relevant health authorities. This is often a parallel series of activities that are being managed
by regulatory affairs staff.
Less Risk
A thorough internal audit program spans a number of different areas, including manufacturing,
Our legacy Quality Systems were
quality assurance, operations, and environmental health and safety. Leading organizations that
disjointed and our data vulnerable.
are looking to clearly prioritize risk within their business are now centralizing all of their auditing
activities into their EQMS to ensure that they have a standard and consistent method for assessing With TrackWise, we were able to
risk and prioritizing proactive remediation activities. reduce risk and streamline processes.

Quality Manager,
The EQMS does not end at the manufacturing of the product. It extends post-market to the intake
and investigation of consumer product complaints. Issues identified in the field must follow the Hologic
same regimented investigation, root-cause analysis and CAPA process as the earlier-mentioned
pre-market incidents and deviations.

Although this provides some details on an EQMS, each individual organization will have scope
variations and business-process details unique to both their operations and the products they are
manufacturing. As the functionality and benefits of an EQMS are identified, it becomes clear that
they go beyond simply tracking a batch process as in a transactional ERP system.

IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Benefits of EQMS Implementation
Enterprise Application Integration
EQMS solutions are now becoming integrated with other enterprise applications used in ERP EDMS
Product/ material/ vendor Integrated change
manufacturing IT environments. The benefits of this increased level of integration include the information
Batch release
management workflow
Access to controlled
Return/repair processing documentation
reduction of error-prone manual steps and redundant data, leading to an increase in IT and
business efficiencies. CRM MES
Customer master data Automated initiation of
Automated complaint incidents and

ERP Integration
initiation nonconformances

Enterprise Bus
The most prevalent EQMS integration is the exposure of master data from the ERP. This data LIMS PLM
Automated initiation Engineering change order
typically includes material master information, product information and vendor information to of lab investigations Document access

support supplier quality management processes.

There are multiple integration strategies from a technology perspective, ranging from more Quality Management
System
legacy batch processes all the way to real-time web services.
Real-time data push: Product issues are logged and affected lots/batches are identified in
real-time, so the EQMS can trigger an alert to the ERP system to quarantine or flag appropriate products.

 n-demand data pull: When the data is needed, the ERP system performs an in-bound inquiry into the EQMS requesting to identify any open product issues
O
that should prevent product from being released.

E QMS-managed release: In environments with legacy or limited ERP deployments, the EQMS can manage release criteria and bridge together product-related
quality information.

With todays complex IT environments, an EQMS can provide a flexible integration capability that can successfully interconnect many legacy systems while
ensuring a consistent, transparent quality management process. In addition, web services and cloud-based capabilities allow multiple integration points to be
put in place in a diverse environment at manageable cost and effort.
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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Benefits of EQMS Implementation
What does an EQMS Provide?
CRM Integration
Since product quality complaint handling is a critical component of an EQMS, it becomes important to perform the appropriate integration where
Customer Relationship Management (CRM) systems are the point of entry for customer inquiries. In larger organizations, it is common for a CRM to be
utilized as the master record for customer information and serve as the point of intake for all customer-related inquiries. Out of the high volume of customer
inquiries, only a percentage of those are actually product-quality related. That portion can be automatically initiated within the EQMS via CRM integration
to start the product-quality complaint investigation. In addition, that integration can allow visibility of the customer information stored within the CRM,
avoiding duplication of data.

MES Integration
In organizations utilizing manufacturing execution systems (MES), product nonconformities can be identified in real time as a function of shop-floor auto-
mation. An element of efficiency will be achieved from the establishment of an automated inbound integration with the EQMS to allow product nonconfor-
mities to be automatically initiated, leading to immediate product containment, investigation and corrective activity.

LIMS Integration
Potential material or product issues can be identified through routine laboratory testing activities. The results from this lab testing are stored within
laboratory information management systems (LIMS) and nonconforming results are identified. At the point of identification, a LIMS application can
automatically initiate a lab investigation process within the EQMS, transferring the appropriate identifying information. The nonconforming lab result will be
investigated through a structured process resulting in a decision on the status of the product nonconformity and if corrective action is needed. Following
the conclusion of the investigation, the EQMS will perform an outbound communication to the LIMS so the results are clearly visible to those in the lab.

Additionally, comprehensive enterprise applications such as Product Lifecycle Management (PLM) and Document Management systems can be integrated
with an EQMS, creating enhanced visibility through out the quality workflows.
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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Conclusion

Organizations will achieve the most effective holistic quality system with the fastest time-to-value and time-to-productivity for their investment using an
EQMS with the appropriate integration with their other existing enterprise systems.

In summary:

Implementing an EQMS helps avoid costly and complex customization of ERP systems and other peripheral applications.

 anufacturing organizations can achieve powerful visibility and traceability with the highest level of efficiency across the broad scope of quality systems
M
processes are with an EQMS, avoiding the pitfalls of when functions are spread across multiple applications and/or across manual processes.

 n EQMS can serve as a powerful bridging point for quality management in organizations that have been engaged in mergers and acquisitions, effectively
A
interconnecting diverse and global enterprise application environments.

An EQMS is incident-centric and allows the appropriate impact and assessment tracking expected in a GxP and ISO environments.

 n EQMS provides a proven solution to managing regulatory and compliance requirements according to FDA, USDA, EU Directives and Asia and Latin
A
America requirements.

 rganizations can gain a faster return on investment and lower total cost of ownership will be gained by leveraging purpose-built EQMS solutions rather
O
than customized ERP-based solutions.

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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Resources

To learn more about strategies to implement a successful enterprise quality management

solution to address quality across the supply chain, check out these resources:

Whitepaper: Quality Management in the Complex

Manufacturing Environment

eBook: The Five Building Blocks of a CAPA Solution

eBook: Four Best Practices to Improve Quality in the Supply Chain

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IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources
Sparta Systems, an industry pioneer and global
leading provider of enterprise quality management
software (EQMS) solutions, enables businesses
to safely and efficiently deliver their products to
market. Its TrackWise EQMS, a trusted standard
among highly regulated industries, is used by
quality, manufacturing and regulatory affairs
professionals to manage compliance, reduce risk
and improve safety across the global enterprise.
Headquartered in New Jersey and with locations
across Europe and Asia, Sparta Systems maintains
an extensive install base in the pharmaceutical
and biotechnology, medical device, electronics
manufacturing and consumer products markets.

Global Headquarters
2000 Waterview Drive
Hamilton, NJ 08691
(609) 807-5100
(888) 261-5948
info@spartasystems.com

European Offices
Berlin | London | Tel Aviv | Vienna
europe-info@spartasystems.com

Asia Pacific Offices

Singapore
apac-info@spartasystems.com

www.spartasystems.com
http://blog.spartasystems.com

IT System Quality Benefits of EQMS

1 Introduction 2 Challenges 3 System Processes
4 Implementation
5 Resources