[Cover Story] Total Quality Management

Every food plant has unique brand identity, manufacturing methods and business practices that individualize it, but touring a food plant, meeting the employees and watching the processes in action also reveal the unique personality, priorities and processes of a plant.

At Berner Foods, a private-label cheese-product processor in Dakota, Ill.: 

• the personality is its seeming contradiction as a “big” small company. “We’re a small company with the ability to be a big company and the resources to take on just about anything,” said Vice President of Quality Assurance Gary Gold.
• the priorities are its people and its electronic quality systems, which are helping Berner drive its growth from small company to major cheese-food processor. 
• the process through which all this is achieved is the strategic standardization of systems.

From the elimination of changeover and unnecessary steps through the flip-of-a-switch process conversion to the integration of Six Sigma, Lean Manufacturing, ISO, a quality management system (QMS) and real-time performance management (RPM) into everything from warehousing to product delivery, Berner Foods is using systems and technology in strategic standardization for food safety, quality and continued growth.

Why Six Sigma and Lean and ISO and QMS and RPM? “Each one is a tool,” Gold said. “In a business you certainly want a toolbox, and in that toolbox you want the right tool for the occasion.” And it is the integration of all these tools that has helped Berner increase accountability, compliance, productivity and responsiveness, and decrease costs. “If you do it right the first time, then you don’t have scrap, you don’t have waste, you don’t have to do it a second time. It costs you less to produce a quality product,” Gold said.

THE SYSTEMS. Six Sigma enables a business to ascertain and implement the right processes; Lean makes the processes more efficient; ISO creates a system of consistency, particularly in quality documentation and reporting; QMS manages that quality; and RPM integrates it all into real-time data, enabling immediate response and assessment and vastly reduced recall time.

Berner Foods systems implementation for quality improvement was begun in 2002 by President Steve Kneubuehl. “Steve had the foresight to know that ISO within a company would be beneficial,” said Gold, a consultant at the time who was hired by Berner to lead its quality charge. “I saw they had great opportunity. They had a beginning — they knew where they wanted to go; they knew where they wanted to end up at a certain point.” They just didn’t have a program in place to get them there.

SETTING THE FOUNDATION. It took about six months to get a framework in place. Though it was just a start, it put Berner well ahead of most small plants — and many large ones — and gave them the impetus to keep going, Gold said, explaining the thought: “Since we’re this far out in front, let’s just keep going.”

After that start, Berner Foods has come to understand the importance of systems, and the programs have continued to expand and contribute to Berner’s annual double-digit growth. “We’re creating a foundation that will enable us to continue to grow at the rate we’re growing, which is about 18 to 24 percent yearly,” Gold said.

“If you build quality into your system, your production efficiencies will come,” he said. At Berner, an integral key to setting the foundation is the integration of electronic systems across the plant, so all areas — warehousing, inventory, production, scheduling, sales — are interconnected enabling whole-plant tracking and assessment.

Berner’s system is based on CDC Software’s Ross and MVI business systems. With its Enterprise Resource Planning providing the critical record-keeping step, “Ross is our system of record. You can have ISO, Six Sigma, and all the programs you want, but you need records and to be able to retrieve those records when you need them,” Gold said.

The real-time performance management solution through MVI was particularly helpful with the plant’s HACCP and its additional QCCPs. For example, the quality module allows the production personnel to make adjustments on a real-time basis and Berner incorporated X-ray to strengthen its quality controls. “We have a lot of production and quality checks we perform that aren’t CCPs,” Gold explained. With capabilities for measurements, tolerance setting and product tracking, “MVI allows us to set parameters. If they don’t match up, it will give you a failure. The main objective is to continually drive out variation within your process and products,” Gold said.

ON THE LINE. Beyond the obvious computer monitors, you would probably not notice the implementation of the various systems by walking the Berner line, but a pointed finger here and a clarification there quickly bring evidence of the systems at work:

• Lean Manufacturing — As Berner has grown, it has expanded its product line, and although its primary line is still cheese products, there is variety even within this. To implement Lean — increasing process efficiencies — the plant customized its line to enable the changeovers from jars to bowls and back to jars with just the flip of a switch, eliminating unnecessary steps.
• Customized Equipment/Processes — “Everything we do, we try to engineer or re-engineer to make it better for our use,” Gold said. Much of the equipment in the plant was created specifically for Berner or customized for quality or efficiency.
• MVI — Every line in the Berner plant is set on the MVI tracking system, ensuring that a constant stream of data tells what’s in, what’s out, what was produced or rejected and how the process is running. 
• QCCPs — The plant incorporates a number of Quality Critical Control Points above and beyond required CCPs that help increase shelf life and decrease variability within products. 
• Automation — While there are people on the line at Berner Foods who are critical to the operation, automation is the basis of Berner’s processes, not only providing consistency, but enabling the electronic data compilation and assessment by which the food quality, safety and the processes themselves are managed.
• Standardized Variation — In and of itself cheese is “a huge variation,” Gold said. Like wine, there are a variety of types and ages of cheese, and while it gets better as it ages, it can also break down over time. Because of these variations, Berner has set up a standard program based on cheese. That is, each cheese is profiled and the characteristics of each type loaded into the company’s system. From these profiles, the cheese products are created blending the proper amounts and types based on specificity of characteristics of the cheeses being used. “We are able to offer a better product based on that,” Gold said.
• Real-Time — This data is not only automatically compiled, it is provided in real-time, ensuring that any decisions that need to be made can be made immediately and based on current, accurate data.
• Warehousing — Using the tracking system in the warehouse enforces First-In/First-Out compliance. As soon as an item is received in, it is recorded and assigned a bin location according to date, thus ensuring FIFO. “It only allows you to take product that isn’t already staged,” Gold said. 
• Hold — Using the tracking system, if an item is placed on hold for any reason, it is logged as product on hold and quarantined. When the product is put into this status, the information allowing it to be staged for use is “hidden” from view as an option, and the system will not allow use of the product until it is investigated and released. Once the item is released, this information is added back into the database and the product can be used if deemed an acceptable product for use. 

PRIVATE LABEL. Being a contract, private-label supplier adds additional challenges to Berner’s operations. Private labelers are not only entrusting their product to a third-party manufacturer, they are entrusting their brand. “To be private-brand labelers, you have to be above and beyond the norm,” Gold said. “Our customers have to trust us; and in order for them to trust us, they have to know how good we are.” This trust generally comes from high scores on customer, USDA, FDA, FPA and ISO audits.
 
RECALLS. With the constant concerns about bioterrorism, recall preparation and readiness is extremely critical, Gold said. Thus regular mock recalls should be a part of every plant’s processes and, are, in fact required by many customers.

Through the improvement of its systems, Berner has been able to reduce its recall time from nearly a day to just more than a half hour. “The FDA would like for you to be able to do it in a minimum of four hours, and they’re really pressing for two,” Gold said. “We can do it in 36 minutes.” And he would like to see continued reduction of even this timeframe. Although FDA accepts a several-hour time of recall, “in that time, how many people might pick up that product and eat it?” Gold asks. “That’s why it’s important. Our product deals with a million people a day, so minutes count.”

How does Berner efficaciously recall and continually reduce the minutes? “You map it,” Gold said. Specifically delineate each step of the recall process, document it, train on it, and ensure that every employee understands it. “If you have this type of system in place, anybody can do it.” And Berner’s system has enabled the firm to do mock, or, if necessary, an actual recall very quickly.

While Berner’s recall process could fill a book, Gold highlighted some of the key steps for systematizing a recall process:
1.) Know what you shipped, to whom and how much. “That’s the easy part,” Gold said.
2.) “Now bring that back,” he added. That is, say you had 8,000 cases of product go down your line, making up 24,000 pounds of product, in which a variety of ingredients were combined for the formulation. Knowing this, you have to trace down a single ingredient. How do you do that?

In Berner’s warehouse every ingredient is barcoded and tracked from receipt to shipment as an ingredient in a finished product. Each time an ingredient is pulled from the warehouse, it is scanned and entered into the database, which tracks its use from production line through finished product, and the quantity of each. So working backward, you use the bar code to identify the lot number of the material, supplier, date, how much is still in inventory, how much has been used, and to whom it went. “You have to be 100 percent accountable,” he said.

3.) With this information in an electronic system, a plant can easily trace that ingredient even if the recall occurs six months down the road. “If this were manual,” Gold said, “imagine what that would entail. We do it electronically in 36 minutes.” 

EXTERNAL LEARNING & SHARING. While Berner has across-the-plant internal systems, it does not rely only on its internal checks to ensure that its customers are receiving a safe, quality product. Rather, as Gold said, “We welcome audits.” (During this visit, Gold was dividing his time between our tour and interviews and an ISO auditor who was finishing up from an audit begun the day before.)

“We’re OK with people coming in on audits,” Gold said. “That’s how we learn; that’s how we know if we’re doing right.” In addition, he said, the auditors can bring new information to Berner that can help them continually improve. “It allows us to become aware of any new ‘best practices’ out there because your auditors have to stay up on all the latest regulations, all the latest quality criteria and controls,” he said.

Berner also makes a practice of staying updated on new industry practices, processes and technologies, attending trade shows and conferences; surfing the Internet for information; and attending training. Berner also pays back by speaking at conferences, working with other industries and allowing businesses into its plant to observe the systems and discuss potential in their own operations.

Berner understands that having a competitive edge is important to the success of a business, but it also understands that food safety and quality have to come first. “It’s not about this company against that company. We have to have a safe food supply,” Gold said. “Business is business, but if you don’t have a good product and a safe product, you’re not going to be in business.” 

Lisa Lupo is staff editor of QA magazine.

About Berner Foods

With contract manufacturing in its blood, Berner Foods began as a family-owned business more than 60 years ago, producing Swiss cheese for companies like Alpine Lace throughout the mid-1900s. In 1988, realizing that there was a void in the processed cheese arena, Berner built its first processed cheese plant and began mass producing a private label cheddar cheese sauce similar to Kraft Foods’ Cheez Whiz. Today, and millions of pounds later, Berner is run by two father-son teams, and is a leading private-label manufacturer of premium process cheese sauces, spreads and toppings.

Berner Foods was begun in 1943 when Arnold Kneubuehl took over manufacturing for a small group of dairy farmers. “It was a very low-key, small corner cheese factory,” said son, Berner President and CEO Steve Kneubuehl, explaining it was indicative of the Wisconsin/Indiana/Illinois/Iowa area “where every couple miles was a small cheese factory or creamery serving 10 to 15 dairy farmers.”

In the 60 years since then, the factory has grown to be a $75 million, multi-product campus encompassing three buildings and producing a range of cheese sauces and dairy- and soy-based beverages, with their continued success a result of, at least in part, the family strategy. Though Steve and brother Ed grew up in the family business, the family has always made a point that its members get a business-based college degree, and then gain experience in the business world, before coming back to participate in the management of the family business.

Family management now includes:

• Steve Kneubuehl, president and CEO. The older son of the founder, he has an accounting degree and MBA/accounting from the University of Wisconsin. 
• Ed Kneubuehl, COO. The younger son of the founder, he holds a food technology degree from the University of Wisconsin College of Agriculture.
• Zachary, operations manager. Steve’s son, he holds a degree in international business from the University of Wisconsin.
• Jason Ulrich, IT manager. Ed’s stepson, he has a business degree from the Wharton School of Business.

As a family business, the company continues to follow the strategies passed down from Dad. “He was always looking for specific natural cheese products to make and niche markets,” said Steve Kneubuehl. “That’s the one thing we’ve looked to continue to do today.” Because Berner specializes in private-label products, he adds, it is not looking to make a wide variety of products, but rather to use its competencies in rotary-retort, pasteurized top-fill, shelf-stable, specialized products for retail shelves. “Whenever we can identify a new market that we foresee as fast growing and has good growth potential, that’s what we’re going to move into,” he said.

The quality needed for the private-label products, he said, is maintained through the high standards of the company, which are ISO certified and inspected by FDA, USDA, Illinois Public Health Department and customers. “We are scrutinized every day,” Kneubuehl said. “We want to be the best for our customers. We want to offer the best products.” And, he adds, “Audits help keep us at the level.”

Berner’s products now include a variety of cheese sauces — from American to sharp cheddar to jalapeño; an assortment of soy-based items; and continual expansion into new cheese and non-cheese products. The processor’s current product line includes pasteurized cheese spreads, sauces, and toppings; natural cheese; zero-cholesterol specialty natural cheese; and whole bean full-fiber soy liquids. Packaging includes glass jars, portion control cups, plastic bowls, bottles, cups, tubs and aerosol cans.

Berner is planning coffee latte as its next product endeavor. How does this fit in with cheese products? Besides the fact that they are both dairy, Corporate Vice President Gary Gold answered, “You gotta wash foods down with something!”

Cross-Plant Challenges

Technology can now link operations across an entire plant, making it imperative that management groups stay up to date not only on the evolving technologies relevant to their own department, but to the integration of these technologies across the plant and food chain. Integrated systems can increase food safety as well as business efficacy and profitability.

“There’s a growing challenge in our industry to formalize both product and process data … the order in which you do things and the quality with which you do it,” said Beth Berndt, director of product management and industry solutions for CDC Software, Atlanta. “Food processors have an unbelievable level of variables to address, so we need to provide that extra level of granularity of data. That is how we help our customers gain control.”

Berner Foods uses CDC’s Ross Enterprise as its electronic business system, combining plant planning, finances, and manufacturing and inventory processes into an integrated system. Berner also uses CDC’s MVI application for its real-time performance management applications. These systems integrate across plant operations to provide a consistency of repeatability and transferability that is imperative to managing the data gathering of today’s processing functions.

While completely automated systems have their benefits, Berndt sees the manual function of operator input as intrinsic to quality and predicts a trend in this direction. The real-time functions, integrated data and alerts are key, but integrating human checkpoints allows for managed decision-making opportunities and continued improvement. Automation is based on best practices set in the workflow, but does not always allow for changes or random variables or decision-making outside the set parameters.

Having a completely integrated plant system enabling trace back to what was done; monitoring compliance to specifications (and alerting non-compliance); and ensuring that every action is repeatable, scalable and transferable, dismisses disparity in the final product. “The variability going in isn’t allowed on the way out,” Berndt said. “So you get risk management, compliance and high-quality products every time.”

Quality Hints and Tips

In addition to its e-systems and processes, Berner Foods implements non-required QCCPs and other quality controls to increase food safety and efficiencies. Just a few of these are:

Safety and Sterility

• Keeping it sterile — Berner uses ionic air to blow cans clean. This prevents static electricity that could cause airborne fibers to be drawn into the “clean” can.
• Retort — This high-heat process of sterilization adds a second step of food safety to Berner products and has the additional benefit of extending shelf life.

Lean and Mean 

• Set up processes for different products or containers to be as similar as possible. Berner “flips a switch” for changeover from bowls to jars and back to bowls, eliminating unnecessary steps.
• Every area has a toolbox that looks exactly the same, drawers hold same tools; and everything is labeled and color coded for placement.
  No Racks
• “We don’t rack, we stack.” Because most of its stored items are stackable, Berner has found that a great deal of space is saved by eliminating racks and shelving and stacking items directly atop one another. With its electronic data system tracking, First In, First Out is the only option.  
• Currently the areas are identified by ceiling-suspended labels, but the next step is a bar-code floor tape, which can be read and managed with a scanner, and will duplicate the ceiling labels.