At the recent Traceability Inter-Operability conference hosted by the Traceability Institute in Denver, Colorado, a few weeks ago, there was a strong call for a single traceability standard. According to Will Pape, Executive VP & Founder of Trace Gains, “The main barrier to widespread traceability adoption by the food industry was the lack of a single traceability standard which could exchange traceability data seamlessly from one company to another throughout all their trading partners in a supply chain.”
Unfortunately, each speaker was talking only about the traceability standard that their company commercially offers, and their implicit message was “If only everyone would speak my language, all companies in the food supply chain would be able to communicate and this industry would begin to rapidly grow.” One could only conclude the presenters wanted all of the other solution providers in the audience to abandon their traceability solution and jump on the presenter’s bandwagon – “my way or the highway”.
Pape Sees Similarities between Traceability Today and Credit card processing of the 1980’s.
Pape shared: This argument and this conference took me back to the early 1980’s when I attended similar data interoperability conferences about how banks should be working together to begin electronically process credit cards. At that point in time, credit cards were handled manually rather than electronically. Many of you are old enough to remember the time when, at retail check-out, the store’s cashier would put your credit card in a flat-bed device, nicknamed a “click-clack” machine, then put a receipt form on top of the credit card, and finally slide the click-clack machine’s lever from one side to another, making an impression of the credit card and the merchant’s information on the two-part paper form. After signature, the top paper copy was given to the customer and the bottom, cardboard copy was retained by the merchant and processed by the banks the same way they processed their checks at some later date.
In the early 1980’s, the banks knew there were compelling reasons to process these transactions electronically in near real-time rather than wait many days to enter into their system, but they couldn’t agree how to process and exchange this information. So, they held a number of conferences where each solution provider or “wanna-be” central data switch presented the arguments about why their company should be the one and only company to provide this electronic data interchange service and why their data standard was the only one that would work.
Not only wasn’t a single standard adopted in the early 1980’s, but each time you use your credit card today, it is likely to route through many different networks, each with a different data standard, and still be able to provide an approval or decline in a matter of seconds. In fact, there are over 64,000 different data standards and hundreds of different networks in existence among the global banking industry but to almost all consumers it appears as a single system.
Flash forward to 2010 and the Traceability Inter-Operability conference. The messages at this recent conference were the same as those at the early banking conferences thirty years ago – “Adopt a single traceability provided by my company and everything will be perfect.”
Pape insists that this is a flawed perspective on at least four levels. Firstly, there is the assumption that the lack of a clear interoperability standard is retarding the growth of traceability within the food industry. Secondly, this assertion assumes that a single standard will result in the best solution. Thirdly, there is assumption that a single traceability company will win all the chips. And fourthly, that full transparency of all traceability information equally shared with all trading partners is a good thing.
Based upon our experience in the global credit card industry, we believe each of these assumptions is false.
Pape argued, “The growth of traceability companies is not being impeded by a lack of traceability interchange among companies because most companies haven’t even taken their internal traceability conversation to that level. They are only concerned about internal traceability within their four walls, and they think they have already solved this problem with their one-up supplier and their one-down customer so they don’t need the help of a third-party traceability supplier.”
No single standard will meet all of the needs of every member of a single supply chain much less all supply chains.
First, there has to be a realization that no single company and no single standard will capture the entire market. Just as with the credit card system, each company and supply chain will have its own unique objectives for a system, These objectives will be different even though there will be at least one common objective: being able to provide at the appropriate time and ePedigree for ownership of all the ingredients in a product. This pedigree must be traceable from the retailer all the way back through all upstream processors to the first mile producers of all raw products used in a specific finished good.
Pape believes that accomplishing this objective only requires that a few “standard” things be accomplished:
- Agree on a numbering standard or a small set of numbering standards.
- Agree on the minimum data elements that must be included by all players to create the ePedigree ownership traceback.
- Agree how ePedigree data about upstream suppliers beyond the immediate supplier must be kept confidential until these data are needed during a high-profile recall.
He concedes, “These are standards, but they are very minimalistic and skinny standards, and are the skeleton upon which many traceability solution vendors can hang added value services, and distinguish themselves among other traceability solution providers.”
When principals similar to these three were applied to the credit card industry in the early 1980’s, the electronic authorization and settlement of credit cards did begin to rapidly grow.
Complacent food companies that think they have already solved the traceability issue will quickly find when they become involved in a high profile food recall that their systems fall far short of the mark, and their company is badly damaged or even destroyed.
Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc, (www.trcutlerinc.com). Cutler is the founder of the Manufacturing Media Consortium of three thousand five hundred journalists and editors writing about trends in manufacturing. Cutler is a member of the Society of Professional Journalists, Online News Association, American Society of Business Publication Editors, Committee of Concerned Journalists, as well as author of more than 300 feature articles annually regarding the manufacturing sector. Cutler is also the developer of lean technology C.E.O (Continuous Experiential Optimization). Cutler can be contacted at
trcutler@trcutlerinc.com
