The What, Why, and How of Barcoding

Barcode

Barcodes have only been around since the 1960s, yet it would be hard to imagine a world without them. Over the past several decades, barcodes have become an everyday part of life. Everyone is familiar with the little black and white bars that are stamped on seemingly everything—and with the advent of smartphone apps that can scan and read them, barcodes have taken on a new life for consumers who wish to instantly compare product prices, find suppliers, or locate additional product information.

The fact that they’re so familiar, however, makes it easy to overlook—or take for granted—the enormous impact they can have on businesses that still use paper systems, or other outmoded forms of data management, to track assets and inventory.

Together with the right CMMS/EAM solution, barcoding systems can revolutionize a business. But first, it’s vital to understand the different configurations available, and to have the knowledge necessary to persuade key stakeholders that implementing a barcoding system will generate high ROI.

Here’s a breakdown of the “what,” “why,” and “how” of barcoding systems.

+ What. There are number of barcode “symbologies,” which are sets of rules and conventions that govern bar code design—they are, in effect, different languages, and which one is used depends on the application. For instance, the U.S. Postal Service uses its own barcode symbology. Universal Product Codes or UPCs are among the most recognizable because they appear on most packaged consumer goods.

Scanners are available in different varieties, but they all basically function the same way: a laser is passed over the barcode, and the scanner reads the light that is reflected back by the white spaces between the black bars. This light is converted into a unique digital signal that is associated with a numeric or alphanumeric code. These codes are then used to query a database and retrieve specific information pertaining to that code.

Scanners are further categorized according to how they interface with computers or terminals. Fixed scanners remain connected to a computer or terminal at all times, transferring scanned data instantly. A portable batch scanner typically comes equipped with an LCD screen and a basic keypad, and stores scanned data until it is uploaded in batches via a “dock” that is connected to a computer. Other wireless scanners exist that transmit data the instant it is scanned, providing up-to-date, real-time information.

Finding the right scanner and symbology configuration depends on how a business is organized and which industry or industries it serves. There are many case studies and guides available online for help getting started.

+ Why. Time wasted searching for assets can add up quickly. According to one estimate, 10 minutes per day searching for assets can add up to an entire week of wasted time over the course of a year.

This is a common problem. Fully 64% of participating companies in one survey reported that such searches are an everyday occurrence; 47% percent admitted that they often waste up to an hour per day searching for needed assets.

According to the same analysis, a company that loses an asset as small as a $60 drill could wind up having to make $690.30 in profit to replace it, when all the time spent searching and procuring a replacement are factored in.  

These numbers only scratch the surface of barcoding ROI. One company reports that its clients routinely achieve 99.9% data accuracy across the board after implementing barcoding systems. According to their analysis, handling time was typically cut in half, and many businesses have seen worker productivity increase by as much as 30%.

A cost-benefit analysis of barcoding by the American Society of Health System Pharmacists (ASHP) drew similarly striking conclusions. According to their analysis, the typical hospital could reduce administrative errors by some 87% by utilizing barcoding systems. This includes “harmful errors,” or those severe enough to incur legal expenses that can reach upwards of $10M for the typical hospital.

Every company is different, of course, but these figures serve to illustrate the impact that barcoding systems can have on operational efficiency. Any company looking to implement these systems should be sure to incorporate both “hard costs” (those that are easily quantifiable), and “soft costs” (impact on morale, client perceptions, etc.) into their analysis. It’s not unusual for either type of cost to be sufficient on its own to justify implementing a barcoding system, but it’s important to paint a complete picture of the potential impact such a move might have on every aspect of a company’s operations.

+ How. In order to reap maximum benefits from a barcoding system, it’s extremely important to give equal or greater consideration to the software platform with which it will interface. It does a company little good in net terms for data to be entered accurately upfront if it’s only going to be corrupted later when employees get into the system and begin making changes.

For businesses in asset-intensive industries, software platforms must allow a lot of users to use the program for their specific needs, without dramatically increasing the occurrence of errors in the system. With this in mind, managers considering these solutions should pay careful attention to whether the software they’re looking at enables them to control user access through permissions and security features.

But even permissions/security features alone can be insufficient to prevent errors from accumulating in a database. For this reason, leading CMMS providers offer implementation and training services to ensure that data is configured correctly upfront. The conventions and procedures set up during the initial implementation phase of CMMS roll-out are a major determinant in whether the software is ultimately successful.

Compatibility is another key issue: ManagerPlus features a dedicated barcoding module, making it easy to integrate barcoding processes.

+ Conclusion. Barcodes are nearly ubiquitous for a reason: they can dramatically reduce administrative costs, data entry errors, and operational turnaround time. But whether they succeed in the long term has a lot to do with the quality of the software on the user side. Software platforms that are poorly designed, or that lack robust security and configuration features, can easily undermine any gains from switching to barcoding systems. Given the upfront costs of barcoding systems, it is therefore important to consider them as part of a complete system in which software plays a key role.

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