GTP:Supply chain view

From TraceFood

Contents 1 INTRODUCTION-THE SUPPLY CHAIN 1.1 The supply chain and traceability 2 OPINIONS/FACTS 2.1 What information to receive from food suppliers for traceability purposes? 2.2 What can I use traceability for? 2.3 Advantages in the supply chain with respect to traceability 2.4 Case 1. Preliminary verification of traceability information as part of request quote. 2.5 Case 2. Push information (report) as part of Delivery, e.g. part of ASN or Packing list. 2.6 Case 3. Request traceability information. 2.7 Case 4. Submit to electronic commodity market/commodity exchange. 3 WHAT OTHER PEOPLE THINK 4 FURTHER READING AND TRAINING MATERIAL 4.1 Presentations 4.2 Web resources 4.3 Supply chain references

INTRODUCTION-THE SUPPLY CHAIN

For an interactive demonstration see foodtraceability.eu

This view is dedicated to those who are interested in how traceability can improve supply chain management both related to the flow of physical goods as well as the related information.

The supply chain and traceability

Food supply chains are often extensive in number of suppliers and efficient supply chain operations include many different operations. CSCMP (Council of Supply Chain Management Professionals) defines a number of standard processes as shown in Figure 1.

Figure 1: Standard business processes and information flow in a supply chain (adapted from Senneset et al. 2007)

Both supply chain management and chain traceability have a focus on the interface between the processes Source and Deliver between two companies in the supply chain. This interface consists of a set of sub-processes with corresponding messages between the companies (CSCMP, 2004).

Examples of sub processes are:

• Supplier management
• Purchasing
• Order management
• Warehousing/Fulfilment
• Transport
• In-bound material management

Examples of messages are:

• Request for quote (RFQ)
• Purchase order (PO)
• Order confirmation
• Advanced shipping notice (ASN)
• Proof of delivery/In-Transit Visibility
• Invoice
• Payment

The supply chain view is directed at people who deal with such processes and message handling.

OPINIONS/FACTS

What information to receive from food suppliers for traceability purposes?

To enable traceability of food products through the supply chain, traceability information must be transmitted and recorded by all involved companies as shown in Figure 2. The principles of data capture of chain traceability and internal traceability information are shown in Figure 2. The figure shows the same CSCMP standard processes as defined above.

As a basis for chain traceability, the identities for traceable units must be recorded at reception and shipping (see top vertical arrows in Figure 2). Internally in each link in the chain, the same type of recording should be made at merging and splitting of materials/items.

Figure 2: Data capture points of traceability information. From Senneset et al. 2007

Information that is fundamental and necessary to identify and physically trace the products is defined in, e.g., the TraceFish standards (CWA14660 2003) as “Shall” information and should be made available by the supplier.

• Food business/actor or traceability actor ID (Identification of supplier)
• Logistic Unit ID (Identification of sold product, e.g., pallets, containers) on traceable unit
• Trade Unit ID (Identification of sold product, e.g., boxes, bins, cases) on traceable unit
• Date and time (dispatch of logistic or trade unit)
• Related created trade unit ID’s (documenting transformations between received and sold product that are related to the traceable unit in focus). This may be information that is should be considered as part of the privacy vs transparency discussion
• Type of unit (Description of created unit)
• Net weight (Net weight of traceable unit)

What can I use traceability for?

This section describes the most relevant processes to create exchange, and use traceability information in a supply chain. The different actors and processes are presented in UML use cases. A Norwegian fish chain is used as an example.

The following use cases for transfer of traceability information are specified and described:

• Request traceability information related to the Source process
• Push traceability information (report) as part of Delivery, e.g., part of ASN/Despatch advice or Packing list
• Request traceability information independently of business messages (e.g. recalls)
• Submit traceability information to a commodity market

Advantages in the supply chain with respect to traceability

Good traceability systems should be able to aid food supply chains in a similar way to 'Just In Time' which in the car industry (most notably Toyota) has led to the benefits listed under;

• Traceability can be used to improve stock control.
• Traceability can be used to monitor the effect the quality the suppliers goods have on your finished goods.
• Traceability can be used to optimize both internal and external logistics with respect to timeliness, transport distance, storage time, etc.

Case 1. Preliminary verification of traceability information as part of request quote.

A Russian importer of fish (Buyer) considers multiple batches of fish from a number of exporters (suppliers) as potential purchase objects. The importer sends request quotes for price, freight method, quality, estimated time of arrival, and additional information about the traceability history of each batch. The Norwegian exporters respond by sending response quotes including traceability information.

Figure 3: Use case 1 describing preliminary verification of traceability information

Case 2. Push information (report) as part of Delivery, e.g. part of ASN or Packing list.

When an exporter (Supplier) has sold a batch of fish, the exported may send an advanced shipping notice (ASN) and/or packing list to the buyer or consignee. This shipping notice may also include traceability information for all relevant traceable units.

In cases where the fish is shipped directly from the fish processor (Consignor) to a buyer or consignee, the consignor may also send the same type of information. In some cases supplier and consignor can be the same food business operator. The same applies to buyer and consignee.

Figure 4: Use case 2 describes reporting traceability information as part of delivery

Case 3. Request traceability information.

A prerequisite to be able to track and trace trough the chain is the ability to send and request corresponding reports of traceability information between all the actors in a supply chain (Figure 5). A possible case is described below.

Figure 5: Case 3: Request traceability information

To document the legality of a catch of fish, the governmental body requests traceability information and information about quota etc. from the fishermen and the fish processors. After receiving sufficient information, a proof of legality, e.g., an electronic certificate may be issued by an authority and sent to the chain actors responsible for landing (subsequent chain actor in Figure 5).

This certificate is then sent together with the traceability information to the parties that require information about legality (Supplier and Consumer in Figure 5).

The retailer (Supplier) has in advance requested information from the upstream supply chain (Buyer and subsequent actors) about traceability information (case 2). The certificate ca then be accessed through the Enterprise Resource Planning (ERP) system or traceability system.

If a consumer is asking questions about the origin and legality of a certain type of fish the certificate may then be displayed if authorised.

In one of the most serious food scares in Norway, the E.-coli case in 2006, extensive information about process and products in addition to traceability information were required by the governmental bodies as reported by Nortura representatives. Some of this information was also exchanged electronically. This case should be regarded as an important example of the Governmental body role and the use of information in a food scare case where a withdrawal was necessary.

Case 4. Submit to electronic commodity market/commodity exchange.

A fourth use case is defined when traceability information is submitted and flows through electronic commodity markets. An example of this is the situation where fishing boats (Suppliers) transfer their catch information into Commodity market represented by a web-based auction system. Traceability information may be sent and presented at the same commodity marked and accessed by buyers and Governmental bodies.

Figure 6: Case 4: Submit to electronic commodity market/commodity exchange

WHAT OTHER PEOPLE THINK

What other people think
Consumers	The main concern of a consumer related to the supply chain, is their ability to provide food to the retail stores. There will be an expectation that the supply chain has not in any way contaminated nor mistreated the food they manage. Go to actor.
Operational	The operational part will need to have sufficient availability of food items to be used in production and processing. Thus, on time delivery and despatch will be important for the different operators. Shelf life and possible contamination will be concerns that create demands of an efficient and optimised supply chain. Go to actor.
Quality Assurance	The quality assurance actors expect that the goods received will have the promised quality and usability. This will be, e.g., minimal transport time, no exposure too environmental damages or deviations related to parameters like temperature, humidity, light, shock, etc. This needs to be documented through the supply chain. Go to actor.
Public Authority	The public authority expects that all partners in a supply chain have control of where their goods are. By law, every actor needs to document who their trading partners are. There are specific rules and laws related to management of living creatures. The authorities expect that the actors in the supply chain can provide sufficient documentation that the laws and requirements are met. Go to actor.
ICT	A supply chain is by nature a collection of heterogeneous actors, thus will have different systems and procedures related to information management. ICT systems thus need to meet requirements to manage heterogeneity. Standard information exchange and middleware will be typical tools to manage heterogenity. Thus, ICT will require and expect that the supply chain members are able to agree upon standards for information exchange and sharing. Go to actor.

FURTHER READING AND TRAINING MATERIAL

Presentations

• The TraceFish standard - A tool for integration of the fish value chain (2006) PDF
• Fish Chain Traceability and The Tracefish standards (2003) PDF1, PDF2
• Traceability drivers in the fish supply chain (2002) PDF

Web resources

• Tracefood GTP Chain traceability.
• mineral water sector.
• honey sector.
• chicken sector.

Supply chain references

• Bechini, A., Cimino, M.G.C.A., Marcelloni, F. and Tomasi, A. Patterns and technologies for enabling supply chain traceability through collaborative e-business. Information and Software Technology, 50 (4). 342-359.[doi]
• Cimino, M.G.C.A., Lazzerini, B., Marcelloni, F. and Tomasi, A. Cerere: an information system supporting traceability in the food supply chain. Seventh IEEE International Conference on E-Commerce Technology Workshops IEEE Computer Society Press, Munich, Germany, 2005, 90-98. [doi]
• Folinas, D., Manikas, I. and Manos, B. Traceability data management for food chains. British Food Journal, 108 (8). 622-633.
• Folinas, D., Vlachopoulou, M., Manthou, V. and Manos, B. A web-based integration of data and processes in the agrobusiness supply chain. EFITA 2003 Conference, Debrecen Hungary, 2003, 143-149.
• Füzesi, I. and Miklós, H. EDI - XML Standards and Technologies in the Agri-Food Industry. SUMMER UNIVERSITY ON IT IN AGRICULTURE AND RURAL DEVELOPMENT. Centre of Agricultural Sciences Faculty of Agricultural Economics and Rural Development Department of Business-and Agricultural Informatics, DEBRECEN, HUNGARY, 2007.
• Gartner Retail research report, Retail RFID stirs process change & improves product availability. Gartner, 2005.
• Hedgepeth, W.O. RFID metrics: decision making tools for today's supply chains. CRC, Boca Raton, Fla., 2007.
• Lo Bello, L., Mirabella, O. and Torrisi, N. Modelling and Evaluating traceability systems in food manufacturing chains. The 13th IEEE International Workshops on Enabling Technologies: Infrastructure for Collaborative Enterprises (WET ICE*04), 2004, 7.
• Manthou, V., Folinas, D. and Vlachopoulou, M. Establishing an integrated virtual logistic network. International Journal of Logistics Systems and Management, 1 (4). 354 - 356.
• Myerson, J.M. RFID in the supply chain: a guide to selection and implementation. Auerbach Publications, Boca Raton, Fla., 2007.
• Niederman, F., Mathieu, R.G., Morley, R. and Kwon, I.-W. Examining RFID applications in supply chain management. Commun. ACM, 2007, 92-101.
• Roussos, G. Enabling RFID in Retail. Computer, 2006, 25-30.
• Schuster, E.W., Allen, S.J. and Brock, D.L. Global RFID: the value of the EPCglobal network for supply chain management. Springer, Berlin, 2007.
• Senneset, G., Forås, E. and Fremme, K. Challenges regarding implementation of electronic chain traceability. British Food Journal, 109 (10). 805-818. [doi]
• Smith I.G. and A Furness (editors). Food Traceability Around the World.