{"id":24508,"date":"2017-11-15T17:46:11","date_gmt":"2017-11-15T22:46:11","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/which-cow-provided-the-milk-for-my-hersheys-chocolate-bar\/"},"modified":"2017-11-15T17:49:16","modified_gmt":"2017-11-15T22:49:16","slug":"which-cow-provided-the-milk-for-my-hersheys-chocolate-bar","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/which-cow-provided-the-milk-for-my-hersheys-chocolate-bar\/","title":{"rendered":"Which cow provided the milk for my Hershey\u2019s chocolate bar?"},"content":{"rendered":"

It\u2019s no secret that consumers have become savvier about reading nutrition labels before purchasing packaged food products, but the demand for information has not stopped there. The question around labeling for genetically modified organisms (GMO) has become a political hot-topic, and the sustainability impacts of ingredient sourcing have also become newsworthy. Those are only two examples out of many questions consumers have begun asking about their food as they look to become \u201cmore socially, environmentally, and nutritionally conscious of their purchases.\u201d [1]<\/p>\n

This challenge will require unprecedented transparency from big food companies, like Hershey, to earn back the trust of skeptical consumers. These companies are finding that they cannot combat this mistrust with marketing campaigns alone; rather, they need to open up about their supply chains more publicly than ever before. [2] In fact, research has shown that honesty is the most important quality consumers demand from large brands and thus a key factor driving buying behavior. [1] Enter: SmartLabel, a platform developed and launched in 2015 by Hershey in partnership with the Grocery Manufacturers Association. [4] It is the first major step towards digitalization of the food supply chain, putting nutrition, ingredient, allergen, and third-party certifications at consumers\u2019 fingertips through the simple scan of a QR code or online search (example<\/a>). [3] Hershey has committed to provide SmartLabel information for its entire portfolio by the end of 2017 and add the physical QR code to all packaging by the end of 2018. [4]<\/p>\n

Although a good first step, simply adding more detailed information about the ingredient deck and GMO disclosure is not enough to satisfy customers\u2019 desires to understand where their food is coming from. Again, Hershey is at the forefront of introducing new technology. It recently announced a pilot with Sourcemap, an interactive tool that allows people to trace an ingredient\u2019s sourcing journey from the farm and learn about sustainability projects currently underway. Although only two products are currently available on Sourcemap (example<\/a>), Hershey plans to utilize customer feedback on this pilot to roll-out the concept to other brands in their portfolio in the coming years \u2013 particularly with other non-chocolate confections to create differentiation between the maps. [5]<\/p>\n

This improved transparency of the entire upstream portion of the supply chain will require more careful management of suppliers. As Hershey continues to pull back the curtain on its sourcing, it needs to ensure it is only partnering with suppliers whose practices it can defend. Hershey needs to focus not only on the technology that enables transparency, but also on the supplier relationship management required to maintain a network it is proud to be so open about.<\/p>\n

Sourcemap gets the consumer one step closer to understanding the origins of her chocolate bar, but it is still only generalized information. Is it possible to track what went into the exact chocolate bar in her hand? IBM has recently announced a partnership with several large food companies (not Hershey) and retailers to begin tackling this question through blockchain technology. [6] It would enable all members of the supply chain \u2013 from grower to producer, distributor, retailer, and ultimately consumer \u2013 to trace the specific inputs of a product all the way from farm to shelf [7] and create a reliable source that contains all this information in one place. This type of solution is still in development and will likely not greatly impact the food supply chain in the near term, but the potential for enabling radical transparency is huge. [6] For that reason, I believe that Hershey, as a champion for the advancement of traceability in this industry, should find a way to be involved in the learning and development process and join this partnership with IBM.<\/p>\n

Incorporating blockchain technology into the food supply chain would result in more benefits than consumer transparency. Perhaps the most impactful change would be on food safety and the ability to accurately and quickly trace the source of food contamination during a recall. A tracing process that currently takes weeks could be done in seconds and result in less food waste and a smaller economic impact compared to the overly-conservative recalls we currently see due to lack of accurate information. The broad participation in blockchain development for food also indicates that stakeholders throughout the supply chain see this as a shared responsibility \u2013 to collaborate to improve food safety \u2013 not as a competitive advantage. [6]<\/p>\n

All this change in the digital traceability of the food supply chain still leaves big questions unanswered:<\/p>\n

How can a brand leverage industry-wide technology, such as Sourcemap or blockchain, in a way that creates competitive advantage?<\/p>\n

How does this type of technology change the balance of power between Big Food and smaller start-ups who currently have the advantage of consumers\u2019 trust? Does this transparency \u201clevel the playing field\u201d or are there still other major barriers to consumer trust needing to be broken down?<\/p>\n

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[1] Source: Wilkinson, Dan, \u201cHow SmartLabel Delivers Product Transparency To Build Consumer Trust,\u201d Food Manufacturing, 2 October 2017, ABI\/INFORM via ProQuest, accessed November 2017.<\/p>\n

[2] Source: Charles, Dan, \u201cCan Big Food Win Friends By Revealing Its Secrets?,\u201d NPR: All Things Considered, 25 December 2015, via Factiva, accessed November 2017.<\/p>\n

[3] Source: Driggs, Joan, \u201cSmartLabel brings transparency to CPGs,\u201d Retail Leader, 20 January 2016, via Factiva, accessed November 2017.<\/p>\n

[4] Source: \u201cNew Hershey Commitments Expand Efforts to Help Consumers Make Informed and Smart Snack Choices,\u201d Food Manufacturing, 24 April 2017, ABI\/INFORM via ProQuest, accessed November 2017.<\/p>\n

[5] Source: Turcsik, Richard, \u201cStraight from the Sourcemap.(Trade\/talk),\u201d Grocery Headquarters, 1 July 2017, via Factiva, accessed November 2017.<\/p>\n

[6] Source: \u201cIBM Announces Major Blockchain Collaboration with Dole, Driscoll’s, Golden State Foods, Kroger, McCormick and Company, McLane Company, Nestl\u00e9, Tyson Foods, Unilever and Walmart to Address Food Safety Worldwide,\u201d PR Newswire Europe Including UK Disclose, 22 August 2017, ABI\/INFORM via ProQuest, accessed November 2017.<\/p>\n

[7] Source: O\u2019Marah, Kevin, \u201cBlockchain: Enormous Potential Demands Your Attention,\u201d Supply Chain Digital, 14 March 2017, via Factiva, accessed November 2017.<\/p>\n","protected":false},"excerpt":{"rendered":"

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