• Source: CSB System.
    Source: CSB System.
  • Source: CSB System.
    Source: CSB System.
  • Source: CSB System.
    Source: CSB System.

Those who want to cut the costs in meat production need to address the biggest cost items: raw materials and products. Smallgoods manufacturer Courage Production has demonstrated how precise measures help you to control the performance in all divisions and to take action where required. Its key to success is the coherent data capture throughout the entire production process, as well as detailed analyses and planning in the ERP system.

“What if we were able to know which smoke house provides the best results for specific product groups?” This is just one of the questions Rob Engelhart, COO of Courage Production, has been asking.

The company located in Fairfield, California, is a specialist for hot dogs, beef jerky and delicatessen products. The company is known for its innovation when addressing challenges by using new technologies. In 2009, Courage implemented the ERP software by CSB-System to better support the government regulations and the increasing documentation requirements of the expanding business.

By doing so, the company has laid the foundation for a comprehensive optimisation program which, to date, has produced many great results.

“We spent a good two years alone investigating how we could improve the production process. In the past, everything was rather complicated,” said Engelhart.

“Every day, some 50 pages of paper were passed on to production, such as orders, bills of materials, recipes and work instructions. We have now digitised and streamlined this to a great extent. At the same time, we have really intensified our data capturing.”

Which products should go into which smoker and to which position?

Digital data capture at all key points in the processing chain has many benefits for the meat processor. Firstly, working with scanners and keyboards is much faster and significantly less prone to errors than using paper: by entering origin information, production times, quality data, lot numbers, and other relevant data electronically in the ERP system right on the spot, there is no need to write down the information by hand and then to transfer it later on.

In addition, data capture at the shop floor is an essential precondition for in-depth analyses from which appropriate action can be derived. The example from the smoke house demonstrates which major efficiency gains could be achieved here.

Courage produces about 350 different items. Every single item, at some stage, will go into one of the four smoking chambers, where it will lose part of its weight. But how much is it exactly, and why do the losses in the smoke house differ? Where can correlations between product and smoke house be identified? Where can yield potentials be located? These simple, but essential things matter and are important in today's meat production.

“It has been important for us to minimise the losses in the ovens. When we started capturing and analysing the weights digitally in the pilot project, we had already anticipated some improvement. Yet, the actual results significantly exceeded our assumptions,” said Engelhart.

During the project, every smoking cart was weighed before and after smoking, at PC racks that were specifically set up for this. The weights were then transmitted online into the ERP system. The aggregated data provided a precise overview so that the managers could determine the respective weight losses. As a result, they were able to identify in which smoking chamber the specific products had the lowest loss.

This in turn allowed optimal economic planning and distribution of the raw materials to the different positions in the chambers. The outcome was that numerous so-called “marginal gains” – including a two per cent increase in hot dog yields, and one per cent less water loss for beef jerky - ultimately added up to a major cost saving.

“The experience we gained from the project has now been transformed into a new standard process. It allows us to optimise the yields of every item in every smoke house, and to reduce our losses to an absolute minimum,” Engelhart said.

Simulated recall under one hour

Source: CSB System.

For every batch, labels with the serial numbers and other important details are printed at the CSB stations. The Serial Shipping Container Code (SSCC) finally allows Courage to quickly trace the entire processing path – for a simulated recall, the company needs less than hour.

The positive effect also shows in the traceability of the products. Data capture starts in receiving, where every raw material is scanned to register it in the system, and follows every step of the process on to the spice department, batch processing, filling, smoking chambers, packing, warehouse, and picking.

For every batch, labels with the serial numbers and other important details are printed at the CSB stations. The Serial Shipping Container Code (SSCC) finally allows Courage to quickly trace the entire processing path – for a simulated recall, the company needs less than hour.  

Minimize the downtimes at the production lines 

While the digital optimisations have led to a high level of efficiency now, the management now focuses on the metrics-based planning and control of the meat processing facility. With five production lines and several hundred items, production planning is especially a complex task, where more and more individual requirements of the customers, and short lead times from order to delivery, constitute additional difficulties. Consequently, predictive machine allocation plans become increasingly important to ensure the best possible utilisation of the production line capacities, while retaining maximum flexibility for short-notice orders. With Advanced Planning and Scheduling (APS), both are possible for Courage, as the module takes the five most important factors into account for planning:

  •        Product group;
  •        Label;
  •        Wrapping films;
  •        Allergens; and
  •        Set-up changes.

The system provides an optimised planning proposal, which can be adjusted dynamically and in detail by the managers. 

“First, we establish a weekly sales forecast, then a production forecast. We check our stock on hand and run the material requirement planning against it before we plan the production for each line,” said Engelhart. 

In the future, simulations should indicate exactly whether the line, shift and staff capacities are utilised in an optimal manner. Capacity bottlenecks and downtimes to the exact minute due to product changes and allergen contamination are visualized as well, including necessary cleaning procedures.

Courage aims for continued growth with the ERP system

A series of several optimisation measures that Courage recently initiated should bring even more transparency.  The aim is to make the ERP system and its data on purchase orders, order entries, invoices, batch calculations, production orders, picking processes and inventories, the “workhorse for all business decisions”. 

In the stock on hand, there is huge potential just waiting to be exploited. With greater precision in the entries and documentation of stock movements, the managers want to obtain a permanent overview of the exact values available at any given time. In order to make the work easier for the production staff, and to further standardise the products, the bills of materials should be supplemented with technical procedure instructions. 

Recently, the implementation of the EDI module (Electronic Data Interchange) has been completed to facilitate the collaboration with trade customers like Costco, Trader Joe’s, Whole Foods (Amazon), Safeway and Vons. The automated data exchange, which is required by many key accounts, is an important building block for the growth of the company. 

“Our goal in the next five years is to double production and to expand products throughout the United States,” Engelhart said.

For further case studies from CSB-System, visit the websiteYouTube or LinkedIn.

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