1. Iowa Grain Quality Initiative Advisory Committee Meeting: 1/12/07 Chad Laux Industrial and Agricultural Technology Program Dr. Charles Hurburgh, Jr. Major Professor The Impact of an Auditable Quality Management System in a Grain Elevator Application

2. Outline Farmer’s Cooperative Results of QMS in Quality Control FDA Bioterror Act FC Mock Recall Results

3. Farmers Cooperative Company Northwest Iowa Company Over $400 million in sales Over $400 million in sales 50 locations and growing 50 locations and growing 350+ employees 350+ employees Departments: Grain, Agronomy, Feed, Seed, Admin., Accounting Departments: Grain, Agronomy, Feed, Seed, Admin., Accounting Source: FC, 2006

4. Problem Statement With the adoption of QMS, how has it impacted Farmer’s Cooperative operations? What measurements would provide evidence so FC may proceed with other location implementations? Inquiry focused on company processes which directly affect grain preservation and handling

5. Key Value-adding activities Information flow Continual improvement of the quality management system Interested parties Interested parties Requirements Satisfaction Management responsibility Measurement, analysis and improvement Resources management Product realization Input Product Output Source: ISO, 2000 Core processes and ISO 9000

6. Core Farmer’s Cooperative Co. Processes: ISO Defined Processes which transform the end product in ISO structure 8.3.1 Control of Nonconforming Grain 8.2.5 Final Inspection 8.2.4 In-process Inspections 7.5.5 Preservation of Grain-Bulk Grain Shipping 7.5.5 Preservation of Grain-Storage Areas 7.5.5 Preservation of Grain-Handling and Preservation 7.5.3 Identification and Tracking-Inspection and Grading 7.5.3 Identification and Tracking- Grain Identification and Tracking 7.5.1 Control of Operations-Release & Post Shipping 7.5.1 Control of Operations-Loading Order 7.4.3 Verification of Purchased Product 7.2.1 Order Processing for Gain Shipments Shipping Storage All 3 Shipping Receiving Shipping

7. Statistical Process Control - Grain Grading Farmers Coop has been grading the same grain samples that were also graded by an official inspector –Matching the precision of the official inspectors

8. Research Model & Hypothesis  Grain quality for shipment is improved when QMS procedures are adopted  FC/FGIS/customer comparisons of same sample:  Corn Moisture - Content Instrument Factor  Corn Damage - Visual Judgment Factor  Smaller Difference is Better!  Comparison of:  QMS locations vs. non-QMS locations  Locations before and after QMS implementation

9. Moisture Content Absolute Mean Difference All Locations w/ SEM’s shown n=15087 n=279n=218

10. Moisture Content Absolute Mean Difference – Location 1 Before and After AIB/QSE Adoption w/ SEM’s shown n=218n=2924

11. Moisture Content Absolute Mean Difference – Location 2 Before and After QMS Adoption w/ SEM’s shown N=279N=2864

12. Total Points % Damage Absolute Mean Difference All Locations w/ SEM’s shown n=79n=110n=5303

13. Total Points % Damage Absolute Mean Difference– Location 1 Before and After AIB/QSE Adoption w/ SEM’s shown n=79n=1197

14. Total Points % Damage Absolute Mean Difference – Location 2 Before and After QMS Adoption w/ SEM’s shown n=110n=1637

15. Conclusions QMS positively impacted FC operations through improved product quality of shipped grain. –Better resource management => Better quality control There was no difference in quality where the basis of determination was instrumentation. (moisture content) –Process control through calibration BPM is a suitable model of inquiry for research of ISO results in organizations

16. How to Meet the FDA Bioterrorism Act: An Elevator Case Study of Tracking Commodity Grain Using ISO 9000

17. Bioterrorism Act of 2002 FDA Mandate of ‘one up-one down’ traceability by 6/06 (sliding scale based on size) Protection of food supply Legislation –Registration – Section 305 –Recordkeeping & maintenance – Title III, Section 306 –FDA expects documentation to be mode of traceability Produce information upon official investigation Unfunded mandate Note: Traceability a requirement of ISO certification

18. Product Traceability Research Questions: Does a QMS facilitate traceability in commodity grain elevator operations? Does the traceability system meet FDA guidelines for traceability under the Bioterrorism Act?

19. Methodology Traceability/safety training conducted at 21 QMS/non-QMS locations Mock recalls conducted at locations to measure of training effectiveness (ISO requirement) Devin Mogler (QMS Intern) conducted recalls per FC ISO Procedure for Recalling Commodity Grain

20. Recall Summary Results

21. Distribution of Recall Duration

22. Discussion and Conclusions Audited FC results per FDA rules: –QMS traceability is adequate to meet FDA mandate –Wide variation in duration of recalls –Wide variation in precision i.e. lot size

23. Recommendations Trace from back to front in next round of recalls Follow through on multi-site recalls Improve internal communication – reduce lag time Use older scale tickets in recalls – will test system more thoroughly Collect all sources in bin, railcar assignments – indicator of precision (index) Use controlled documents for recalls – ‘traceable’ documents required Launch CAR’s on failed recalls – close the loop Decide on lot sizes – operations issue

24. Final Steps Impact of ISO on Quality and Quantity (Inventory mgmt.) on grain Key process with management measures on performance imbedded in QMS system: –8.2.4 – Monitoring and measurement of product –8.3 – Control of non-conforming product –8.5.2 – Corrective and preventive action Final Defense and graduate by Aug. 2007