Supporting Explosive Growth with Rootstock Cloud ERP

Tilray (formerly Aphria) implemented Rootstock ERP and ComplianceQuest in four and a half months.

Aphria Inc. (Aphria) is one of the largest and fastest growing cannabis companies in the world. Since Canada’s federal Cannabis Act went into effect the company has been continuing their mission to produce high-quality products using state-of-the-art facilities and operations.

Aphria was founded in 2013 and has since grown from producing a few medical cannabis plants to managing a few million plants as they serve both the medical and adult-use markets. Across several brands, the company is on track to hit 225,000 kilograms of annual production capacity when all facilities are fully operational. With FY2019 revenues of nearly CAD 240 million—a 542% increase over the previous year— Aphria is now the premier global cannabis company. and one of the few public cannabusinesses, listed on both the Toronto and New York Stock Exchanges.

But that level of growth, and the pressure from markets and investors to continue the steep trajectory, also brought about growing pains. Good thing Cloud ERP is now there to help.

Growing Effects, Both Good and Bad

To support strong growth and supply emerging cannabis markets, Aphria had to increase production capacity and manage it as optimally as possible. Additional complexity came from their worldwide footprint, with offices spread across the globe from the Caribbean to Australia, Africa to South America, encompassing more than 22 locations.

The company isn’t slowing down, however. Their existing production facility, Aphria One, was expanded in 2019 to a total of more than 500,000 plants managed by a “sophisticated, proprietary automation technology”, according to their annual report. In addition, the company just received approval to start production at Aphria Diamond, a newly constructed, 1.3 million square foot production facility located in Leamington, Ontario.

Global sales continue to expand as well, with the company opening medical distribution channels across Argentina, Australia, and more. In Germany alone, Aphria has access to more than 13,000 pharmacies to serve the country’s $1.6 billion market, and Canadian partnerships give them access to 99.8% of the country’s 38 million residents.

To call Aphria’s growth explosive is an understatement.

But with that growth comes tension, constraints, and the obvious operational, logistical, and regional issues. And, with cannabis being a highly regulated product regardless of use, plus the regulatory and compliance requirements of producing products for medical use, Aphria was faced with a daunting need for efficiency, productivity, and control.

Exacerbating the situation was their lack of modern, enterprise-ready technology.

“When I joined the company, the initial technology that was in place was very fatigued,” said Tim Purdie, Chief Information Officer & Chief Information Security Officer of Aphria Inc. in a recent interview with Enterprise Times. “Those early investment decisions were sound when the company was sub-300 people. We’re about 1,200 people today and as that scale changes dramatically, you get a more sophisticated workforce that has expectations about tools and enablement. My job was to make sure that we’re matching the growth trajectory of the company in a global way, in an enterprise way, of bringing those services to bear at Aphria.”

The company needed more control, but also technology that could support their compliance demands.

Solving for Both Operations and Compliance

A large and growing global operation, especially in a highly regulated industry, is going to have a long list of ERP requirements. For a cannabusiness, regulatory issues become an enormous burden because the industry spans both agriculture and pharma. That adds significant complexity because the product is seen both as a food and a medicine.

Aphria started by implementing Salesforce as the main platform, but then quickly looked to address their seed-to-sale operational demands. Lucky for them, Purdie’s background consisted of more than a dozen ERP implementations at various companies. Those experiences led him to see cloud-based ERP as the best option.

“Cloud first is super important to our flexibility to respond to changes in any of our market conditions,” explained Purdie.

Aphria chose to simultaneously implement Rootstock Cloud ERP to optimize production, manage inventory, improve profitability, and more, and ComplianceQuest’s Enterprise Quality Management System (EQMS) to support quality management processes.

“Rootstock transformed our processes related to operations, inventory and production overnight,” said Purdie. “Rootstock ERP will help facilitate precise production, inventory, and supply chain management, enabling our company to be highly responsive to market needs.”

Increasing Operational Control

Aphria chose Rootstock’s Cloud ERP for many reasons, including that Cloud ERP meets the stringent requirements of the cannabis industry. The tight integration to their Salesforce platform was also important.

“I understand the Salesforce platform very well,” explained Purdie. “The question was whether or not Rootstock was sound, and it was very much so. It’s proven out to be so.”

As a comprehensive ERP solution, Rootstock Cloud ERP includes order processing, production management, supply chain management, lot and serial number trackability and traceability, compliance reporting, costing, and financial management. Since Rootstock is built on the Salesforce platform, the combination gives manufacturing, distribution, and supply chain organizations a single platform on which to grow and manage their businesses. This inherently eliminates any gaps between ERP and CRM so companies can be both more agile and more customer-centric.

“We were thrilled when the company first selected our Cloud ERP,” said Pat Garrehy, CEO of Rootstock Software. “Our Cloud ERP helps enable a digital transformation to automate processes, meet growing demand, facilitate a superior customer experience, and optimize revenue and profitability. Our ERP is highly flexible and scalable to meet Aphria’s needs now and into the future, especially as market needs and regulations continue to evolve.”

Ensuring Compliance

In addition to Rootstock Cloud ERP, Aphria deployed ComplianceQuest’s EQMS software to support quality management processes. ComplianceQuest is also built and deployed on the Salesforce Platform and focuses on quality and risk management across Aphria’s business platforms, from sourcing to manufacturing to supply chain management, and further supports compliance with Good Manufacturing Practices (GMP) and Good Production Practices (GPP).

“The legacy applications that were inside our company as far as compliance go felt like the 1800’s,” said Purdie. “We were using only paper because there was not an appetite for a gigantic on-premise application that would take workers away from actually growing the plants. So, we just did it through paper. That certainly does not work for audit traceability and real time awareness of what’s happening.”

Purdie looked to his internal compliance teams to help him navigate the vendor marketplace. But, having worked with the top vendors in the past, they expressed their disappointment with what was available. The inherent complexity was their justification for staying with a paper-based compliance process. But after Purdie’s Salesforce account executive pointed him to Rootstock, ComplianceQuest became the obvious next step.

“We had an engagement call (with ComplianceQuest) and the demo literally brought my quality head to tears,” recalled Purdie. “Real tears. I’ve never seen in my entire career someone be so excited to see an application that solves such an acute business problem without being concerned it was going to be overly complex, too difficult to implement, or was missing key features.”

With Aphria looking to capitalize on cannabis opportunities across dozens of different markets and regions, quality assurance becomes a daunting challenge. Every market has different requirements, which creates a tangled web of records and audit trails. ComplianceQuest EQMS now helps Aphria manage standards and compliance throughout their operation, from ensuring raw materials and active ingredients meet set standards, to documenting purity of ingredients and verifying that certificates of analysis match their claims. In addition, EQMS helps Aphria manage documents, training, changes, inspections, nonconformance, corrective actions (CAPA), and customer complaints. The combination and tight integration of Cloud ERP and EQMS has enhanced Aphria’s overall enterprise quality management and track and trace capabilities, which is critical to the cannabis industry.

“These tools are the best and I don’t say that lightly,” added Purdie. “I’m a pretty jaded guy working in IT as long as I have, and I am just bowled over by how great the actual platform is, how well thought out the architecture decisions are in these wrapped apps, and how professional their teams are.”

A Quick Deployment for a Fast-Moving Industry

The cannabis industry is growing quickly, creating enormous opportunity for those who can move first to recognize openings and fill gaps. The forecasts for future growth are also increasing, creating even more potential opportunity and more incentive for companies like Aphria to quickly deploy platforms that can handle the growth. Waiting a year or more for a traditional ERP to be up and running isn’t acceptable.

“We implemented Rootstock and ComplianceQuest in four and a half months, not three years like you would do with something like SAP or Oracle,” said Purdie. “Even if you’re on a fast track of 10 months in an ERP, that’s considered very challenging to do. It’s a huge testament to the engineering horsepower that’s on the platform of both applications.”

It’s challenging to adequately prepare for such extreme growth but doing so in a very dynamic regulatory and regional environment adds even more stress to an enterprise system. Aphria obviously couldn’t continue their trajectory given their manual processes and paper-based systems they previously relied on.

“The biggest risk was doing nothing, staying exactly the same, having the scale of the business ramp a hundred times up, and not have the ability to respond,” said Purdie. “(Going with Rootstock and ComplianceQuest) was really the smartest investment I think we’ve made on a technology.”

Creating a Modern, Appealing Workplace

Today’s connected workers expect the systems they use at work to have the same engaging user interfaces, mobile access, and social communication tools they use in their personal lives. Rootstock’s lack of complexity helped Aphria jump to a modern application that was also intuitive and easy for their teams to use, no matter their technical skills.

As part of their implementation process, Aphria invited 15 operations workers to join their IT team and help guide the rollout. While a few initially weren’t thrilled with the idea, they quickly overcame those objections as they discovered how Cloud ERP would make their jobs both more rewarding and more enjoyable. Now, every Aphria worker is becoming a knowledge worker because of the insights available to them. As Purdie explained, workers are no longer just workers; they’re offering increased value to the company because they’ve elevated the impact of their contributions.

“Anyone that’s working with the Salesforce platform, anyone that’s working with Rootstock and ComplianceQuest, the more they can learn, the deeper rich experience they have in the contemplation of how they can take that skill and expand it,” said Purdie. “I want to keep them inside the company. I don’t want them to leave.”

That attitude is making Aphria even more appealing to current and prospective workers. Given their growth trajectory, attracting and retaining workers will likely be critical to their future success. More and more, the brightest workers seek opportunities to learn and develop professionally, not to be held back by older technologies.

“Manufacturers of all types are trying to make their workplaces more attractive,” added Tom Brennan, Chief Operating Officer at Rootstock Software. “If you don’t have the right technology in place, if you have a 25-year-old ERP system, or lots of on premise tools, managing server stacks and all that, it’s not attractive to a young person coming into the workforce.”

Aphria Leverages Benefits of Cannabusiness ERP

With the Rootstock Cloud ERP solution, Aphria is already advancing their cutting-edge operations. The application touches teams across production, inventory, and supply chain management, and will enable the company to become more agile and able to respond more quickly to emerging and changing markets.

Aphria is using Cloud ERP to:

• Optimize production based on demand forecasts, production capacity and supplier constraints.
• Leverage “track and trace” capabilities for lot control and serial number tracking, including comprehensive audit trails from seed to sale.
• Manage inventory and costing across multiple locations by items, lots and serial numbers.
• Maintain compliance with Good Manufacturing Practices (GMP) and Good Production Practices (GPP).
• Benefit from single-cloud-platform interoperability with ComplianceQuest, which supports enterprise-wide control and predictable quality so regulatory and product safety requirements are fully met.
• Reduce the cost of compliance while fully meeting industry expectations and regulatory agency (such as FDA and Health Canada) requirements.
• Improve profitability by reducing variability, eliminating waste, adhering to schedules and commitments and reducing cycle times.
• Leverage a worry-free infrastructure with data and document access anywhere, anytime and from any device.

Being built on the Salesforce platform also enables Rootstock Cloud ERP to give a true 360-degree view of customers. A common platform helps remove the traditional silos between operations, sales, compliance, and customer data. The result is a single, shared view of product details and customer interactions that can enable personalized customer experiences, compress cycle times and new product releases, and enable faster reactions to changing market conditions.

“Aphria is setting the standard as a worldwide leader in the cannabis industry through a diversified approach to innovation, corporate citizenship, strategic partnerships and global expansion,” said Purdie. “With these system implementations, we’re now technologically equipped to take our competitive advantage to new levels of market leadership.”

Growing a Cannabusiness Powerhouse

The cannabis industry has experienced explosive growth over the past few years, moving from a handful of small growers to a diverse collection of companies of all sizes and footprints. But that fast growth has also strained companies who’ve relied on manual processes and ill-equipped systems to manage and improve their operations. While markets quickly opened, their ability to scale was hampered by their inability to manage growing inventories and expanding operations.

Industry frontrunners, however, quickly realized their need for modern ERP capabilities and process automation. Today, progressive cannabusinesses like Aphria are leveraging the power of industrial-strength, cloud-based ERP systems. Their rapid growth, fueled by new markets, creates challenges to manage inventories, optimize production, and keep up with compliance needs and expanding customer service requirements. Only the most robust ERP systems, with extensive flexibility and industry-specific functionality, can help them keep their eyes forward towards growth instead of backwards toward infrastructure deficiencies.

Rootstock Cloud ERP is the best choice.

“We’re honored to be working with a company of Aphria’s caliber and standing in the cannabis industry,” added Pat Garrehy, CEO of Rootstock Software. “We’re looking forward to seeing what they’ll be able to accomplish with the full benefits of our system in place.”

Download the Case Study

Click here to download the Rootstock Software Case Study “Aphria – Supporting Explosive Growth with Rootstock Cloud ERP.”