ISO 22000: Traceability in Food Supply Chains /Theoretical Reviews of Traceability - III

Part III

ISO 22000 & Food Traceability

Theoretical Reviews of Traceability

Traceability in food manufacturing can range from in-house traceability in production plants to traceability in whole or part of the production chain from raw material to consumer, and descriptors of the product and its history can be few or many as decided. Well thought-out traceability systems are fundamental to achieving optimal benefits from quality control, production control and for fulfilling consumer demands as well as voluntary regulatory requirements such as ISO 22000, FSSC 22000, HACCP, etc. In order to facilitate the discussion of a traceability strategy in food industries these viewpoints outline the fundamental theoretical issues of traceability systems and present a more practical discussion of its extent. This will give you more to think before you start your traceability system to achieve ISO 22000 certification.

Traceability in Food Industry

In a literature review on traceability and supply chain, 70% of the literature found is related to the food industry. The research field of traceability in the food industry is relatively young and most authors of the literature found agree that food-related scandals and incidents during recent years have increasingly driven authorities, consumers and other stakeholders’ interest towards food safety. Full traceability or traceability throughout the entire supply chain is seen by many of the authors, e.g. Kelepouris et al. (2007), Morrison (2003), Van Dorp (2003) Viaene & Verbeke (1998) as essential for ensuring food safety and quality, and thus a way to regain or maintain consumer confidence. Although traceability itself cannot improve food safety or quality it can provide necessary information and keep track of products (Wang & Li, 2006). Consumers’ increased concerns have, according to Beulens et al. (2005), Lareke (2007), and Wang and Li (2006), led to an increased demand for information about food safety and other properties of the food they consume.

Different Perspectives of Traceability

Several different definitions of traceability are found in the literature studied. In a review of definitions Van Dorp (2002) confirms that there is no uniform understanding of the concept. According to the European Union regulation which concerns food safety explained as; “traceability means the ability to trace and follow a food, feed, food-producing animal or substance intended to be, or expected to be incorporated into a food or feed, through all stages of production, processing and distribution” (REGULATION (EC) No 178/2002 Article 3 §15). Two kinds of traceability are referred to in literature; local and chain (or internal and external). Chain traceability refers to the ability to trace a product/batch and its history throughout an entire supply chain. Local traceability refers to the ability to trace ingredients and raw material within one of the actors in a supply chain (Alklint & Göransson, 2004; Moe, 1998; Stadig et al., 2002). Van Dorp (2002) proposes four perspectives on traceability:

1. The enterprise perspective: Traceability viewed from within a manufacturing company.
2. The multi-site perspective: Views traceability issues related to the additional aspects emerging in companies with several manufacturing plants.
3. The supply chain perspective: Includes the entire supply chain with an integrative approach encompassing planning and control of material flow, and efficient and effective information management throughout the supply chain.
4. The external environment perspective: Refers to external requirements which affect traceability, from authorities, branch organizations and external stakeholders.

The supply chain and the external environment perspectives presented by Van Dorp (2002) will be in focus in this paper. The traceability definition selected indirectly demands a supply chain perspective since it requires all the actors in the food supply chains to be able to trace ingredients and products one step up and one step down in the supply chain. The supply chain perspective presented by Van Dorp (2002) is wider than the demands in the EC regulation since it also encompasses information management aspects, as previous studies confirm (Eken & Karlsson, 2006).

The Challenges of Supply Chain Traceability

Full traceability, end-to-end traceability, chain traceability and supply chain traceability are frequently used by authors in the field. However few authors define what they include in these concepts. Nevertheless, all these expressions can be regarded as traceability throughout an entire supply chain. Consequently, Kelepouris et al., (2007) state that: “achieving end-to-end traceability across the supply chain is currently quite a challenge

from a technical, a co-ordination and a cost perspective.” Co-operation throughout the supply chain is stated as being a main success factor for achieving supply chain traceability by Viaene and Verbeke, (1998). Wang and Li (2006) concur that collaboration is needed between supply chain actors and Kelepouris et al. (2007) state that, participation of all actors in the supply chain is needed. To reach supply chain traceability Viaene and Verbeke (1998) state that managing product and information flows effectively throughout the chain is a challenge. Lo Bello et al. (2005) state that: “For complete product traceability it is necessary to record not only all incoming and outgoing movements of the production lots, but also all the procedures and processing operations applied to them”. Companies need to exchange traceability data with other actors in the supply chain (lo Bello et al., 2005). Wang and Li (2006) highlight sharing of information along the supply chain and good communication between the different actors as important aspects for successfully achieving supply chain traceability. Kelepouris et al. (2007) agree that information on the total product’s lifecycle is needed in order to achieve supply chain traceability.

Wang and Li (2006) state that a properly designed traceability system is crucial to assure that data collection is managed effectively and that the right data are collected. They also state that integration of traceability systems with other enterprise systems is crucial in order to gain the most beneficial outputs from supply chain traceability. Lo Bello et al. (2005) feel that security and authentication in the communication between the actors through the systems is a problem to be tackled while Moe (1998) points out that limitations or particular aims of one actor in the supply chain set the demands or limits the traceability for the entire supply chain.

Different approaches and systems designed to achieve supply chain traceability appear in literature: they range from paper-based records to sophisticated computer-based information technology including biological technologies (Folinas et al., 2006; Wang & Li, 2006). Despite the different computer-based traceability systems proposed by researchers, most companies have adopted paper based traceability systems (lo Bello et al., 2005). Sioen et al. (2007) state that studies within seafood industry show a gradual change from paper-based traceability systems to computer based technology, however Roth et al. (2008) state that adoption is slow. Although technological solutions seem available there is a major challenge in economical feasibility for SMEs according to Sioen et al., (2007). Kelepouris et al. (2007) agreed that costs are especially critical for SME’s but state that labour cost for the required work effort to collect the information to support the traceability system is the critical cost, while, RFID technology and proper information infrastructure are affordable solutions for SMEs. Independent of how challenging the task is most authors agree that traceability must high on the agenda for companies within the food industry. In the process towards supply chain traceability there are also important actual and expected benefits (Kelepouris et al., 2007; Wang & Li, 2006).

Added Value through Supply Chain Traceability

In order to achieve more beneficial outputs and added value an integration of traceability systems with the supply chain management processes is suggested by Wang and Li (2006). “If the objective is only to meet regulatory requirements, these costs can be a significant burden with little perceived payback. In fact, traceability can provide substantial benefits beyond the traditional understanding of its value.” However not all beneficial outputs add value: improved core value of a product or service rate as value adding. It can be regarded as exceeding of customer expectations (Näslund et al., 2006). Besides, added value will be viewed in a supply chain perspective.

Efficient consumer response in Europe confirms that the best way to ensure food safety and supply chain traceability is through close collaboration between actors in the supply chain. It is through this collaboration that supply chain actors can find ways to “improve the efficiency of business processes and procedures, reduce waste and to do things in new ways in the supply chain” so that benefits can be shared (ECR 2004). Wang and Li (2006) agreed that waste can be reduced through traceability and stated that it can be done by an optimized use of raw material. They further stated that supply chain traceability enables high inventory visibility and optimized production planning which in turn can facilitate decreased inventory levels. Moe (1998) and Morrison (2003) stated that supply chain traceability can be used to improve process control. All of these add value in terms of increased efficiency.

Roth et al (2008) state that there are economic incentives for companies to invest in traceability and that it can “improve supply management, increase safety and quality control”. Providing safe food to customers and consumers is hardly considered a competitive advantage, rather a basic requirement according to Mentzer et al. (2001), however, the ability to accurately target the product lots in case of a recall can generate added value to the actors in the supply chain through cost savings. These are regarding lost sales, product disposal and damage to the company’s marketing profile (Kelepouris et al., 2007). Roth et al (2008) also stated that supply chain traceability can “reduce the likelihood of expensive and embarrassing recalls“. Wang and Li (2006) agreed that accurate traceability effectively reduces risk exposure by enabling supply chain actors to identify, isolate and correct the problem quickly and efficiently through the facilitation of follow-ups after disruptions.

It is expected that all supply chain actors will benefit from the information transparency (Van Dorp., 2003). A shared and holistic overview of the supply chain can be created through the efforts towards supply chain traceability (Lindh et al., 2008). According to Kelepouris et al. (2007), and Viaene and Verbeke (1998) advertised traceability can raise customer confidence in and loyalty to a company or brand and is thus a competitive advantage. Traceability beyond the legal requirements can generate benefits in meeting new and higher consumer expectations regarding quality and safety and increased value to the consumer while increasing efficiency and effectiveness in the supply chain (ECR 2004). Traceability also enables selling high margin products through product differentiation by providing special raw material or product properties (Moe, 1998; Roth et al., 2008; Wang & Li, 2006).

Document Courtesy:

TRACEABILITY IN FOOD SUPPLY CHAINS: TOWARDS THE SYNCHRONISED SUPPLY CHAIN

Helena Lindh, Christina Skjöldebrand* and Annika Olsson**

Department of Design Sciences, Division of Packaging Logistics, Lund University

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