Situations which hit the news headlines regarding the supply chain, such as the egg contamination of August 2017, not only send immediate supply chain responses in to overdrive, but they also provide a valuable opportunity for learning.
The egg contamination has highlighted issues in the supply chain which demonstrate how the problem could have been averted, or avoided, and how we can learn from this in the future.
The Egg Scandal – What Happened
The egg scandal was a situation which hit the UK recently in August 2017. The headlines made for worrying reading: 700,000 eggs had been sent to the UK market from Dutch egg farms which were thought to have possibly been contaminated with the insecticide fipronil.
Although the actual risk to human health was considered low from the outset, it highlighted the potential problem of the spread of contamination. 11 products which are sold through UK supermarkets, including the humble egg mayo sandwich, were thought to have potentially been infected.
The number of eggs infected was actually a tiny proportion of the total amount consumed by the UK each year, and the infected eggs indeed were mixed with other eggs diluting any contamination, but nonetheless it sent fear through consumers and retailers alike.
The Nature of the Food Supply Chain and Supply Chain Management
The question has to be asked whether there was some check or balance within the supply chain which should have prevented these eggs ever reaching the marketplace and thereby causing a wide-scale recall. If not, why not? What could, or should, happen to prevent these problems from arising?
Despite the increased interest in the provenance of food and its origins, the reality is that the global food supply chain is phenomenally huge and complex. There are a myriad of raw ingredients, and different stages of processing, originating from a vast range of suppliers all residing, and passing through, a huge number of countries. Tracing an item from ‘plot to plate’ is incredibly complex for the vast majority of food items – particularly for those sourced from outside the country of consumption. Add to this the fact that there is no consistent method of tracing and tracking, or consistently effective systems in place, and it makes it easy to see how scares such as the egg scandal might happen.
Progress to be made in Food Supply Chains
Therefore, there is a huge need, as Trade Interchange states, for “transparent and easily navigable systems” in the hope that these “will simplify the auditing process (and put) the responsibility on a supplier to provide companies with the information required and allow the data to be gathered straight from the source.” In other words – a better form of checks and balances needs putting in place, but essentially documented accountability.
This means that collaboration and communication need to be managed within a given framework which involves documentation and insight. This level of insight is possible through advances in technology. We can drill down within data, and utilise smart technology – we now need to make sure we use it in a way which would help in situations such as the egg scandal.
Reputation and Illegality
Fipronil – the insecticide which contaminated the eggs – is actually a banned substance in the European Union if used on animals which are ultimately destined for human consumption. Its risks to human health are known. Arrests were made. However, that doesn’t change the impact that the egg scandal had on the retailers themselves. The recall was essential, but the retailers faced problems knowing exactly which products to recall, and how to do it. This was combined with consumer fear. This situation could have been vastly alleviated if the retailers could quickly and easily trace the source of their raw components of processed food products more easily.
The fact is that this inability to accurately, and efficiently, trace food products isn’t a new problem. Periodically a new scare hits the headline and it is dubious whether wide scale supply chain management for the food industry has vastly improved. For example, we have to ask if lessons were learned and implemented following the horsemeat scandal when the Government promised greater insight into food traceability.
The horsemeat scandal was indeed far larger and wider reaching than the egg scandal, even though it didn’t carry with it the fear-factor of the risk to human health. It highlighted the problems within the food supply chain, and how traceability is a deeply pervading problem. However, inefficiencies and lack of insight still allow for potential problems to grow in to large scale crises.
The Lessons for Supply Chain Management
Therefore, the egg scandal serves as a poignant reminder that lessons from the horsemeat scandal are still to be implemented more consistently and more widely. Retailers and food service businesses at the point of sale need to step up and take responsibility for knowing exactly where ingredients and food products come from – at every step in the chain. They cannot simply accept supplier relationships without insisting on knowing how products are tracked and traceable.
This means that the lessons to be learned largely feed in to benefits to supply chain management anyway. It is in the interests of supply chain management to make sure, for bottom-line reasons alone, that collaboration is increased, along with the implementation of smart technologies and smart insight. Reputational damage is not something to take lightly, or which can be easily recovered from. However, if supply chain management implements changes which increase traceability, the business reputation is more greatly protected, whilst bolstering the profit margins anyway.
Monitoring, throughout the supply chain, shouldn’t be something supply chain management fears. Insight shouldn’t be feared for what it might show. Instead, insight should be seen as a valuable check in the system to prevent unscrupulous behaviour lower down the chain which can adversely impact the retailer at the point of sale. The egg scandal is another reminder to supply chain management to act.