Lack of Visibility + Product Recall = Perfect Disaster

The rising number of large-scale food recalls in recent years is not going unnoticed. Incidents such as the recent beef recall from Huntington Meat Packing and the January 2009 peanut butter Salmonella outbreak are all stacking up, adding to the lack of consumer confidence, growing scrutiny from regulators, unprecedented demand for food from emerging nations, and increased demands for brand-protection assurance.

The impact of food recalls alone, in both human and financial terms, can be quite staggering. The financial costs associated with the recall of peanuts from Peanut Corporation of America are believed to have topped $1 billion.  The human cost was even more profound: Nine people died and hundreds became sick from eating contaminated peanut products. In response to widespread incidents of food contamination like this, the Institute of Food Technologists (IFT) issued a new study recommending guidelines for the U.S. Food and Drug Administration (FDA) to establish a comprehensive product system to track the movement of food products effectively from farm to table.

Food processors are also doing their part to address this complex challenge by leveraging enterprise software to automate and integrate traceability across all steps in their supply chains. Just as accounting systems act as financial systems of record, these enterprise resource planning (ERP) systems create an operational system of record.

Newer, more powerful ERP systems also contain product lot-tracing capabilities that allow a business to trace the source of all ingredients, and project the distribution of all food products made and sold within just a few minutes, if not seconds. The increased confidence provided by this level of tracking enables food processors to establish a competitive advantage and save thousands of dollars. With proof of “in-control status” for customers, auditors, and regulatory inspectors, such systems can also help prevent the potentially catastrophic consequences of a failed safety audit or comprehensive recall of all lots (and potentially products) on store shelves or consumers’ pantries.

Considering the ever-growing regulatory pressures worldwide, greater consumer awareness, and the increased safety risks inherent in the extended global supply chain, having the right technology in place is no longer a luxury.  It’s a strategic differentiator that is imperative for surviving and thriving today and in the years ahead.

Jack PayneJack Payne
Director of Solutions Consulting
CDC Software

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