What started as a good idea for inventory control in the grocery industry has evolved into a technology that is now critical to the movement and tracking of virtually everything, from consumer goods to military hardware to healthcare products and pharmaceuticals. Barcodes are the glue that holds together supply chains, security and access control systems, government issued identification cards and driver’s licenses, tool tracking in machine shops, medical practice document controls, airline boarding passes and luggage tags, event ticketing, and a host of other functionalities.
In supply chains, barcodes are the connective tissue that helps systems run properly, and yet they are the least expensive and most often overlooked component. Hard and soft technologies—sensors, scanner tunnels, conveyor systems, machine vision, automated picking systems and software—command most of the attention, but bad barcodes can break the supply chain. In retail, when barcodes fail, stores cannot track what they sold and cannot accurately replenish inventory. In other industries, barcodes drive enterprise resource planning (ERP) and just-in-time manufacturing systems, and bad barcodes can bring factories, industries and workforces to a stop.
For some sectors, this can amount to an inconvenience—albeit a potentially expensive one. But in others, like in the pharmaceutical and health care industries, disruption of manufacturing and product movement can have more dire consequences. Barcodes are used to track the source, batch and date of manufacture as well as validate the efficacy of pharmaceuticals. Barcodes are also used at the bedside to make sure a patient is administered the right drug and dosage in many hospitals, nursing homes and assisted living facilities. When barcodes in those situations don’t function properly, people can be sickened or even killed.
The expansion of barcoding into new applications has created significant risks for companies. At the low end of the risk spectrum are vendors to big box retailers that have been levied substantial six-figure fines for products marked with incorrect or poorly-performing barcodes. At the upper end are judgments and settlements for malpractice, wrongful death and damages that run into the millions of dollars.
Currently, the U.S. Congress is considering new FDA regulations that will add specifics to the use of barcodes to mandate how drugs are tracked and validated. New legislation will make barcodes even more essential and while that is a good thing, the downside is that incorrect, non-working or poorly-performing barcodes will become an even greater liability.
Many companies that rely on barcodes are oblivious to the risks. They often fail to address barcode quality and dictate minimum barcode requirements as part of their quality policies and procedures. This oversight can become a ticking time bomb for risk managers.
It is not difficult to verify barcode quality, however. GS1 Global, the American National Standards Institute and the International Standards Organization all publish specifications for barcode data structure and print-quality standards. Barcode testing equipment can easily be obtained and independent laboratories have been established to provide testing and consulting services to help identify and control barcode-related risk. Considering the potential financial, safety and regulatory issues at stake, it is a detail no business can afford to overlook.