Monday, 8 February 2010

The Food Supply Chain

Cor Groenveld, LRQA's leading global food safety expert and chairman of the Foundation for Food Safety Certification, gave a presentation at the Global Food Safety Conference in Washington, D.C. His Food Supply Chain Presentation was one of the highlights of an outstanding conference, with organisations from across the food supply chain coming together to discuss the most relevant food sector issues.

Click here to listen to Cor's presentation

Please send me an email at and I will email you Cor's PowerPoint presentation.

Below is the transcript of Cor's presentation

Global Food Supply Chain, Cor Groenveld
I have been doing this work for a very long time, and what I want to do, I want to share some of our client experiences, as well as our experience in working with risk-based management systems. It’s not only food safety, I think when you look in food supply chain, we have more risks and we have more worries and I like to share the things we see, the great things companies have achieved in controlling those risks.
This is the things I’d like to talk about, most important I think, what are the issues we have in a food supply chain? And then the question, of course, can it happen to you? I’m afraid it can.
How can a management systems support a food company and how can audits and verification services support you? We are an audit company, we are member of Lloyd’s Register, this year we celebrate our 250th year of existence, that’s unbelievable, we started 250 years ago as a marine classification society, and we still do that, that’s an important part of our business. LRQA is the organisation doing certification and audits in all kinds of sectors, not only the food industry but also in other sectors. But food is very important for us, we have 450 food auditors and at the moment, we have more than 5,000 certificates in the food industry. This is a short list, I will just show it, these are the different services, we do in the food supply chain, and you can read it later in a handout.
The question is of course, is our food reliable enough? When you do a bit of googling, I think, you can find very interesting facts and figures, this was from the centre of disease controlling convention here in America and it says that 76 million Americans are estimated to be sick every year, that’s an interesting number, I think. And also when look at, the WHO, there are 2.2 million people who have health problems at the moment, 1.9 million are children, so I think it’s not a discussion, food is very important. This was an interview here in the United States by the by a market research company, and they found out that 57% of the people are very worried about food safety, and 39% a little bit. So, the facts are very clear. But, I think we have more concerns, when you think about sustainability and you think about food security, there are also big issues in the food supply chain. Talking about this, for instance the global livestock industry emits more greenhouse gas than all forms of transport. Well, that’s quite interesting I think, talking about global warming, well right now global warming is quite cold, but the economic impact of a problem with anthrax, I think when you look at these figures it shows how important food security is. Also, talk about children who do not have enough to eat, and then about labour conditions, and child labour, they say that 250 million people under the age of 12 are working for a salary, so there are quite a lot of concerns next to food safety. So, you could ask yourself, what do consumers expect? Of course, they want to have safe and good quality, that’s one of the most important things, but they also expect sustainability, social responsibility, food security, protection against bio terrorism, healthy food, fair trade and on and on, so there are more expectations than only safe food.
Today, JP Suarez (Chairman of the Global Food Safety Initiative) asked, “Should we think about extending the scope of GFSI?” And that’s an interesting discussion, of course food safety is non-competitive, and it’s the most important thing of GFSI, but when you look at food companies they will absolutely address these issues. Of course, we have to make sure that we have sustainable food supply chains.
And where are you? Are you here? Lying, very comfortable, in control, compliant, sustainable, or is it more like this? The world is changing, interacting, and we are depending on each other in the food supply chain, I think it’s more like this, but you can make your own choice. So, what we see in practice, how to deal with those different risk areas, we see three important things. One is when you want to control risks, you have to go through the whole supply chain, most of the food scares, they start in the beginning of the supply chain, you all know that as experts. So we have to make sure that we have a system throughout the supply chain. It should involve animal feed, it has to include packaging materials, so we have to make sure that there are systems in place that go through the whole supply chain. I think the working group of GFSI, working on supply chains is looking at that, and they are now looking if we can have other areas of the food supply chain included in the benchmarking process, and that’s very interesting, and I think it’s very good. The system has to be risk based, it’s absolutely important that we have systems based on risks, on risk assessment and not only for food, you can do risk assessment also for other risk area, and we have to cover all the concerns. Throughout the supply chain, you have the supply chain, I even think the word is wrong, I think it’s not a nice chain, it’s a network, it’s a very complex network, and I think one of the most complex networks in the entire industry. It starts with pesticides, fertilisers, animals feeds, and then we have all kinds of activities and if you look for instance to the pizza, I think the pizza can have more than 100 ingredients, and probably the producer of the pizza has more than one supplier for a number of these ingredients, and that shows how complex it is.
Risk based systems, management systems can help, but you have to know where your risks are, and that’s why we invented HACCP, I think that’s a very good example of harmonisation, when you look at Codex when they developed HACCP, we know it all over the world. With those risks based approach, it’s not only important for food safety you can have the same approach for other risk areas. You can do also, a risk analysis on your quality issues, or your environmental issues, or health and safety, and whatever. We see these kinds of management systems and they help suppliers to control all their risks. And then, of course, covering all the concerns, and what we see is that companies make a list of the most important concerns. And here you have a number of them, it can be the reliability of delivery, it can be quality, it can be environment, and every company can make its own risk analysis of their supply chain concerns. So, what tools can you use? We had to build a risk based management system for your concerns. First of all, and I was happy to see the numbers in China, where also ISO 22000 is used, I think ISO22000, is an example of a standard for food safety management systems that can be used in the whole supply chain. It is a generic standard, it’s not for one part of the supply chain, it is not sector specific, and it’s truly independent and international. So, an example of an international standard that can be used and is risk based is ISO22000, and you can build on it also for other risk areas and have the same risk approach. And you probably know, that there’s now FSSC 22000, here in America they call it F22K because FSSC22000, I had to practice also for a long time, but it’s not easy to say, so, we can also say F22K that is now using ISO22000, to be approved under GFSI. Also, the risk management approach is very important and there are tools for that too, and you can also have audits and verification, you can do them yourself of course, your supplier audits, or you can use external companies like LRQA.
Some facts about the standard, it’s already there for three or four years, and we see now that ISO is also developing the sector specific standards, that can be used together with ISO22000, So, we have now 22002, and it’s called 22002/1, and that’s for food manufacturing. So, that can be used in addition to 22000. Another interesting document, and I would advise you to read it, it’s not a document to be certified against, you cannot be certified against this document, but it’s the ISO 31000. It’s all about risk management, and not only risk management for food safety, this is the standard that can help you to build your risk based management system and it can be used for all the concerns that I showed in previous slides, so an interesting tool I think. And then, last but not least, assessments and verification. now of course it’s very important to do assessments and verification, to have a good Standard Assurance program, those who have a good system of auditing your own companies, because that helps you to find the continuous improvement possibilities, and also of course compliance with your requirements.
Our findings in the food supply chain, most of the important things that we find is the transparency, a lot of companies do not know where the raw materials come from, a lot of companies have problems to have transparency in their supply chain, and you need to have transparency to control the risk, that is important, also there’s more risk areas than food safety. Working together, we can improve a lot in working together with our suppliers, make sure we have a win-win situation with our suppliers that will be absolutely in favour of it. Food is global, we have ingredients from all over the world, I can eat strawberries in winter in Holland. So we have from food from all over the world, ingredients from all over the world, and that makes it complex, very complex. The technique you use for hazard analysis, we see a lot of different techniques, very good ones, but also sometimes, techniques that perhaps can be improved. The depth of hazard analysis, did you look at all the potential hazards?And, organisation of course and I think GFSI is an example where we tried to achieve that. The control has to be in the right place, where do you need to control pesticides? Do you want to take a lot of samples? When you have your raw materials coming in? Do you want to work together with your suppliers? What is the best place to control the hazards in the supply chain? It can even save you money if you find the right place. And then, of course the control of suppliers, and control of changes, a lot of things where there is a change, there can be a hazard, when things change, you have a hazard. So, when you have a good supply chain management system, you will achieve trust within the chain, you will make sure that you focus on risk areas, that you have a good technique for your hazard analysis, the control of the hazard in the right place, transparency in the supply chain. You can have an international recognised approval when you have a good system, and of course good improvement program, continuous improvement is absolutely important. And that for itself, through reduction of costs, and this is for the CEO’s. The CEO’s don’t want to see my presentation, they just want to see the last three statements; reduction of cost, increase in confidence, (they want to sleep well at night, they do not want to be worried,) and protection of their brand and image. Thank you very much.


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