What is it worth to have visibility in a supply chain? When the consequence of screw ups can be catastrophic and deadly (think pharmaceuticals), it is worth tracking everything from raw materials through to consumption. So why are agricultural products any different? If anything, contaminated spinach or eggs can affect more people than any one prescription drug problem. Why then not trace produce and farm products the same way drug makers follow their products?
The Los Angeles Times reports that a number of tech firms are working with large growers to make such detailed tracking possible (Amid mounting safety concerns, technology helps track food from farm to table, Oct 3).
In general, such trace-back systems work in a way that’s similar to how Federal Express tracks its packages. On the farm, animals and crop sections are given a “smart” label with a unique identifying number. The label is then attached to a bin, crate or container used for transport. Workers then can use a hand-held computer or smart phone to scan the labels and record key information, such as date and time, location, workplace temperature and which truck hauled the food away. The information is usually uploaded to a central online database, where it is stored and can be accessed via the Web. Each time the food moves or is handled by someone new, the data can be updated and recorded.
The results of this are pretty impressive. Dole — a big producer to prepared greens — can trace a head of lettuce down to 100 feet from where it was picked and has not had any contamination problems leading to recalls and resulting bad press since they installed the system. Concerns over contamination and recalls have been a driving force behind these systems to date but some firms have used the system as a marketing ploy. California Olive Ranch allows customers to look up on the Web where the olives in their bottle of oil were grown and crushed. Others have seen operational advantages.
[Jamie] Strachan [of Growers Express in Salinas, a leading produce growing and packing company] said he discovered some unexpected benefits. The production process worked more smoothly. Warehouse managers were able to go online and figure out how much produce was coming out of a particular field, with little hassle.
So just how wide-spread will this technology become? There are a couple of barriers. First, is cost. Some of this is being done with RFID chips, which cost a quarter or so per pop. That sounds cheap until you think of slapping one on every carton of a dozen eggs in America. There is also the question of agreeing on standards:
An apple can make five stops before a consumer takes a bite. The fruit is picked from a grove, trucked to a sorting center, boxed at a packing company, sent to a distribution warehouse, and finally unloaded and placed on display counters at a grocery store. Each location would have a different method for recording and storing data.
So we need all the players in the apple supply chain to agree on a standard which might well be different from what those in the corn or green bean supply chain think is best. Thus coordination across the entire agricultural market could be very challenging. Legislation would be one answer but such attempts have been hung up in Congress. The real answer might be public pressure working back from retailers. A number of grocery chains (notably Food Lion) have stated that they won’t do business with suppliers that don’t conform to traceability by 2012.
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Marty,
For such an important industry their ability to track and trace is quite poor as you’ve described. I’ve witnessed it first hand for over 20 years. Government and customer compliance issues will continue to improve the quality and traceability of our food supply.
However, standardization will kill any progress or at least slow it to a decades long transformation. Each segment in the supply chain has their own business systems. They were not made to be flexible; they were made to consolidate. Getting these systems to comply with a track and trace “standard” will impede the ability of track and trace to exist/improve.
Instead of requiring integration, which is the act of welding two systems together in a “standard” way, companies can simply enhance their existing process. No ERP system was tracking the “harvest” of food so this is an opportunity to enhance the process without any impact on the ERP. This is, and I apologize, the low hanging fruit.
But as the product moves through the supply chain network it touches many “systems” and companies. This is where it gets tough. Each, effectively proprietary, system does not have the data, process or technology in place to meet a “standard”. Now mulitple this complexity by the number of total players in the market at the producer, packagers, wholesalers, delivery and retail operations and you can see why standards are the wrong play.
Each of the existing systems “broadcast” a message about their own controls. As an example, each system defines what data is collected at the time of receiving. This common function is unique to each company. It is safe to say that no systems (save those pilots you refered to) captures the data or the process that a solid track and trace would require. Instead they just track what is important to the software as designed many years ago.
There is a new generation of Enterprise software that protects the existing investments of IT systems (no integration, no replacement and no modifications), avoids disruption to the business, and can be deployed and measured in one day. These applications require no change to the “host” application, are extensible to add new data, process and technology, and are deployed in an iterative/agile process. Customers can measure the results before they commit to a roll out. Adjustments to business are incremental, proven and non-disruptive. The “secret sauce” of your company can now be leveraged to meet your business needs instead of being hampered/handcuffed by your IT systems.
Marty,
I wrote a quick blog on the responsiveness of recalls to consumption. Once the situation has been detected, how long does it take to react. Also, the lack of track and trace requires that recalls be broadcast to a larger audience than may have been required: i.e. you could generate less bad press about the quality of your product – priceless as the commercial says. Here is the link:
http://operationsnation.babblewareinc.com/?p=96
[...] move through the process. What is driving this is new regulations that mandate traceability. (We posted on this back in the fall.) The twist here is that the information is put into the end [...]