By: Udo Paneka
As a child, I dreamed of becoming a champion triathlete. I spent hours each day biking and swimming, working hard to make my dream a reality. At 15, I got my chance; I knew I was ready.
Race day came, the starting gun cracked, and I dove into the water; I emerged in first place. Then I jumped on my bike, racing far ahead of the others; I remained in first place. I thought I had the race already won. Then came running, my weakest event. I moved slowly through the 6.2-mile run as if I was stuck in mud, watching as athlete after athlete passed me. By the time I reached the finish line, I was in 241st place. The dream had become a nightmare. I was devastated.
What happened?
I was content with my strengths and didn’t focus on developing my muscles that were weak.
My struggles as a young athlete feel strikingly similar to the struggles of the packaging industry. My dream for the industry is for it to become more technologically advanced, to see more consumer packaged goods companies implement active and intelligent packaging. It’s a worthwhile dream. Active packaging protects products, extending their value and shelf life. Intelligent packaging opens a world of new possibilities, allowing consumers to interact with products through their smartphones and giving companies an ineffable number of options for customer interaction, including better data, anti-tampering tools and augmented reality experiences.
But a McKinsey study shows that the Consumer Packaged Goods (CPG) industry is finishing last in the race toward digitization. We are the least digitized industry, the study finds, operating with mostly analog, manual processes. Just like I fell behind during one leg of the triathlon, our industry is struggling with digitization, and it’s slowing us down overall.
Here are some hard truths: it takes our industry an average of 198 days to execute a package refresh. How far is this number from our expectations? According to a recent study from the CMO Council, Chief marketers expect a packaging refresh finished in 30 days. Consumers? One day. Add to this the fact that our industry is failing at the most basic requirements of packaging. Color is still challenging, and sometimes there are mistakes in content.
I know that our industry can improve, just as I knew I could improve after my 241st place finish. Back then, my dream felt almost unattainable, but I never lost hope: I built muscle and trained harder. Eventually, I became a top 10 triathlete in Germany.
The packaging value chain can build this muscle too.
How can our organizations make the same progress? First, we must focus on what matters to management and consumers. To do this, we should visualize how high-quality work could help eliminate the need for so many quality checks, how we can reduce wasted cycles by getting our content right the first time, how consistency in packaging can reinforce brand equity, how automation can make our lead times shorter and how we can adapt to ever-advancing technologies.
Then, we need to exercise our organizations in preparation for a digital future. To do this, we:
Digitize everything we do, ending analog work processes. Digitization must come first; it’s where we’ll see our greatest benefit.
Automate repetitive tasks. Let the machines do routine work, such as automated proofreading, auto-detection of quality problems and color conversions. Machines can catch problems the human eye will surely miss, thereby improving quality and saving time and money.
Connect our systems. This step should come last, but we should always be mindful of connection as we digitize and automate. Our industry will gain value by increasing the quality of handoffs and shortening the time it takes for the next stakeholder to pick up work.
Some may look at the current state of the packaging industry and say we’ll never improve, but I see through the eyes of someone who failed, built muscle and succeeded. We all want a better packaging industry, one that’s closer to the warp-speed vision of executive management and consumers, but a better industry starts with us. If we want predictability and organization, we must work to change our world of disorder and fragmentation.
We have vast potential, most of it untapped. Our improvements will take time, hard work and tenacity, but they’re within reach. We must build our speed, quality and consistency muscles. Digitize, automate, connect – or expect your packaging to remain in 241st place.
Udo Paneka
Udo Paneka became President in January 2015 after joining Esko in August 2014 as SVP Sales, Marketing and Service. Since joining Danaher (Esko’s parent company) in 2008, he has held a number of senior management positions. Udo has a BA degree in Management from Berufsakademie Heidenheim, Germany.
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