The Challenges of a Global Marketplace
Avoiding Pitfalls - The planet is getting smaller as a result of the globalization of markets. Maintaining a dominant position in the market place has a lot to do with staying on top of product compliance regulations. CHEManager Europe spoke with Patrick J. Lavoie, President and CEO of Atrion International, about the challenges of compliance and the solutions available.
CHEManager Europe: With regulations such as GHS and REACh being brought to life, regulatory compliance is becoming a critical focus point for many companies. How can companies' best approach these topics?
P. Lavoie: With the advent of GHS and Reach, the days of the "home-grown" system or point-solutions disconnected from the overall business process are gone. These catalyst regulatory changes are forcing manufacturers to take a second look at how they manage the data flow in their supply chain. Developing a robust "master data management" (MDM) strategy is where manufacturers should begin. Reach and GHS require an unprecedented amount of supply chain communication and collaboration, and the right tools need to be in place to facilitate this process.
Once the MDM strategy has been developed, companies will need robust and flexible processes, solutions or a combination of both to address the continuing changes ahead. For example, the new Classification, Labeling and Packaging (CLP) regulations will force companies to analyze/update a large number of SDSs and Labels in a very short amount of time. Companies will also need to handle the duplicity in countries where there are transition periods and so on.
Finally, companies will need to ensure that they have the right level of EHS professional talent required to prepare and maintain SDSs/Labels for GHS and Reach registration documentation. So, initial costs for company-wide GHS training and on-going professional development and/or recruitment of staff responsible for GHS/Reach compliance will need to be budgeted.
In summary, as is often the case, the right blend of people, processes and technology are required to get the job done.
How does Atrion enable the transition toward GHS?
P. Lavoie: Atrion has 20 years of experience in monitoring changes in regulations pertaining to Hazard Communication. So when changes occur, we immediately analyze and integrate them into our libraries of Managed Regulatory Content (MRC).
Monitoring and maintenance of MRC is especially important with the shift to GHS. First, the transition from one legal scheme to another is a major change that will concern all countries and companies. More importantly, the GHS model regulation is a dynamic continuum that gets updated every two years. This is an important paradigm shift, compared to past static hazard communication laws.
Atrion looks at the complete compliance challenge. Our MRC consists of data, rules, forms and phrases that are all crafted by us and designed to work in synergy. Clients can trust a fully working system from a single vendor, and don't have to worry about connecting the dots themselves to get the full picture. Having a single compliance partner to deal with greatly facilitates change management.
Recently, we announced the release of our ACE platform, which is essentially a service oriented "technology encapsulation" of our MRC. ACE acts as a compliance hub enabling our software solutions (existing and new) as well as external business systems (ERP/PLM) to tap into our MRC via a secure request/response communication model. This provides our customers with the ability to better embed compliance right into their business processes.
It's also enabling us and our business partners to design solutions that can leverage our MRC to provide as much automation as possible. By automating compliance, our clients are able to respond to change - including those related to GHS - quickly and consistently, as they come up.
What does Atrion's Product compliance Solution offer and how does it differ from other compliance services?
P. Lavoie: Atrion's Product Compliance (APC) Solution is quite flexible and comprehensive. It provides consolidated product compliance across a single or mixed ERP environment, and by PLM stage, via either an on demand or on premise delivery option.
What distinguishes us from the crowd is our MRC, which is the hallmark of our APC Solution and our core activity at Atrion. Unlike most other solutions out there, our MRC is pre-packaged, automated, reliable, and gives you access to our compliance expertise.
Our solution provides the necessary comprehensive knowl- edge that a manufacturer (process or discrete) would need to aptly manage the complexity of shipping compliant products to multiple global markets.
Can you explain the MRC?
P. Lavoie: The foundation of our MRC is in the monitoring and collation of the regulations and guidelines, etc. So when you look at the chemical industry for example, there are two common components to a law: lists of chemicals which are classified, restricted, banned or reportable; and text giving indication of the scope and application of the law.
We interpret the list of chemicals to produce data mapping documents, defining how we will slice and dice the data so it can serve as input to our rules. We also add value to published data lists. For instance, many list entries are defined by groups such as Cadmium compounds. In these occurrences, we develop the group definitions to their individual CAS numbers.
We also interpret legislative text to produce specification documents describing, in computer terms, how we will implement the legislation. Additionally we develop multi-lingual phrases, pictograms and regulated forms as specified per country. All these elements are rejoined to produce what we call, the Managed Regulated Content, crafted by our regulatory analysts and software architects, working in tight collaboration.
I think it's fair to say that Atrion is recognized in the GRC market for providing the most comprehensive pre-packaged and integrated regulatory content when it comes to product compliance.
What can happen if a company fails to be GHS compliant?
P. Lavoie: We must remember that GHS is a model classification system put forth by the United Nations (UN). It is not, in itself, a regulation. It only becomes a regulation when it's adopted by a country or economic region and is implemented into the local legislation.
As such, GHS is an ongoing challenge for chemical companies operating in the multi-national marketplace. Companies need to be prepared to comply with multiple ‘flavors' of GHS, as no two countries are identical in their GHS implementation. They may have implemented different revisions of GHS, adopted varying building blocks, and included their own country-specific nuances. On the other hand, various agencies within a country may not adopt GHS at the same time, and existing legislation may not even be in play for some substances, while others are covered by GHS. So, each time a country implements GHS or makes changes to the existing legislation, your SDS's and Labels need to be analyzed to confirm compliance. Painful as this may be, the bottom line is that lack of compliance (improper classification, inadequate SDS or Label) can result in fines by customs, loss of market share, and loss of credibility with your customers.
What industries do you serve with regulatory compliance management tools?
P. Lavoie: Traditionally we have been focused on serving top tier companies in four worldwide verticals within the discrete and process manufacturing industry: Paints & Coatings, Organic & Petro Chemical, Plastics & Resins, and Flavors & Fragrances.
Recently we've expanded our reach into the mid-market with several significant additions to our client roster. What we're seeing is that product compliance is no longer a "nice to have" for just Tier 1 companies, it's now a "must have" for both Tier 1 and mid-market companies.
It's important to understand that while both these sectors will have identical product compliance needs, mid-market companies typically have considerably less operating budgets and IT/EH&S resources than their larger counter-parts. In effect, we're leveling the playing field for these companies and providing them with our Tier 1 expertise combined with solutions that address their specific needs. The other alternative for these companies are mid-tier EH&S solution providers that don't have Atrion's Tier 1 expertise. The feedback we're getting from this market is validating the value of our track record and experience.
How do you ensure that the regulatory information is comprehensive and always updated to the newest stand?
P. Lavoie: This really comes down to our vast network of experts in combination with our Managed Regulatory Data. Over the past 20 years, Atrion has worked hard at nurturing a cooperative relationship between industry individuals, groups, clients and other industry businesses. This has given way to the most effective product regulatory network.
We're also supported by world-class professionals such as Regulatory experts, Authors, Industrial hygienists, Toxicologists, Chemists, Transportation analysts, and Environmental consultants. In addition, our network includes language translators and validators consisting of EH&S field experts in countries around the world. These experts not only understand but also master the local interpretations and applications of regulations, and are involved in ensuring continuous compliance with dynamic regulations.
Finally, Atrion's Task Forces are open forums where our clients exchange information and best practices, while working together in order to gain consensus on legal interpretations for complex regulations. This is especially important in today's environment where most counties' regulations are going through heavy transformations with the advent of GHS and Reach.