Barcode Verifiers and Enterprise Risk Management
The tiny little town I live in is a crossroad with a gas station, a post office and a small diner which is a Saturday morning breakfast ritual for us and most of the town. Last spring an elderly gentleman was parking his pickup when his foot slipped from the brake to the gas pedal, and he crashed through the kitchen wall, injuring a cook and causing extensive damage to the building. Now, almost five months later, a crude sign in the window says “open soon.” How has the business survived 5 months of expense with no income? How have the waitresses survived, many of them young moms, some of them single and working several jobs? Insurance is only a partial answer, and only for the restaurant owner.
This is a powerful example of enterprise risk management or ERM. Fourteen years ago (2001) the Casualty Actuarial Society defined ERM as “…the process by which organizations in all industries assess, control, exploit, finance, and monitor risks from all sources for the purpose of increasing the organization’s short- and long-term value to its stakeholders.”
What you don’t know is bigger than what you know
I have spoken to many people over the years about barcode quality—brand owners, graphics designers, pre-press service bureaus, marketing people, printers and packaging professionals—many of whom have insisted they do not need to verify their barcodes “…because they have never had a problem.”
Without a barcode verifier, in fact they simply have no idea how close or how often they have been on the brink. They simply did not know what they did not know. The apparent trajectory from “…I’ve never had a problem…” to “…I will never have a problem…” is, in the adult world, called BS—Belief System. ERM challenges that.
There is also the belief that such systems bring additional cost. Barcode verifiers do seem to be expensive, but the apparent high cost is the result of an illogical comparison of a barcode verifier to a barcode scanner. Verifiers and scanners often look similar, and they appear to do what they do in a similar way, but that is like comparing water to soup: water is a necessary but insufficient ingredient in soup; scanning is a necessary but insufficient constituent of predicting barcode performance.
Not needing a barcode verifier is BS—a Belief System
A more accurate comparison is a barcode verifier to no barcode verifier. It is a comparison of the cost of the verifier compared to the cost of a bad barcode. Without a barcode verifier, a bad barcode would always cost more than an internally discovered bad barcode that never escaped to the outside world. A barcode verifier helps to “…monitor barcode performance risks, increasing the organizations short- and long-term value to its stakeholders…”, paraphrasing the Casualty Actuarial Society’s ERM definition.
From an ERM perspective, a barcode verifier provides a return on investment. Although the unrealized savings cannot be measured unless and until there is a barcode disaster, which scenario would you rather experience?