<strong>MSU</strong> SUPPLY CHAIN FACULTY FOCUS ON FOOD SECURITY By David J. Closs The food chain involves all the processes and activities to deliver food from the farm to the fork. To secure this chain, the U.S. Dept. of Homeland Security (DHS) sought a team of researchers with both technical knowledge about food safety and business knowledge about organizationing and managing the process to move food from the farm to the consumer. They found that kind of expertise at <strong>MSU</strong>. A team of <strong>MSU</strong> researchers had already been investigating ways for firms to enhance the security of their supply chains. This includes the food consumer in the home as well as in restaurants and institutions, as well as transportation companies, government institutions, and port operators. Even though Americans consume mainly domestically-grown food, an increasing percentage is imported to allow for “out-of-season” fresh produce. This <strong>MSU</strong> team included faculty from marketing and supply chain management in the Broad College of Business, the School of Criminal Justice, Computer Science, Diagnostics, Engineering, the Food Safety and Toxicology Laboratory, and the School of Packaging. In November 2003, they hosted a workshop and generated a special report titled “Enhancing Security Throughout the Supply Chain” published by the IBM Center for the Business of Government. It’s clear that <strong>MSU</strong> faculty were uniquely poised to investigate supply chain security in general and food security in particular. The Criminal Justice and Supply Chain Management team have begun their efforts to examine such supply chain activities as material procurement, manufacturing, warehousing, transportation, inventory management, and customer service, which amount to 30-50 percent of the retail cost of food products. The objective of these activities is to provide food for U.S. consumers when and where they want it at the lowest possible cost. While there has always been concern regarding food security and safety, previous efforts have focused on accidental contamination. Since September 11, the focus expanded to include intentional contamination, either via bio-chemical agents or by tinkering with the vehicles and containers hauling the food. Historically, the food supply chain has not focused major resources on improving security because of the low probability of such events and the trust between supply chain partners. Since September 11, however, it has become clear that a terrorist incident could have not only severe health implications for thousands of people, but also severe financial repercussions for the firm and the overall economy. For example, last year’s relatively small incident involving the import of an animal with “Mad Cow” disease from Canada reduced farm prices, or even eliminated the ability for Canadian beef farmers to sell product in the U.S., reduced employment at processing plants and distributors, and reduced availability and/or increased price of beef to U.S. consumers. An intentional event could well produce an even more significant impact. Food firms have already increased their interest in food supply chain security initiatives, ensuring vigilance when the product is on the road or ocean 24/7 even with limited personnel. These initiatives include physical security of buildings and processes, increased inspections of equipment and processes, certification of domestic and international partners and carriers, application of technology to track and trace product movement and responsibility. Increased inspections help ensure that processes have not been compromised and that transportation equipment has not been compromised with contraband. Formal and informal certification and auditing processes help verify the integrity of other supply chain partners. Finally, new technologies such as Global Positioning Systems (GPS) and Radio Frequency Identification (RFID) help to track the movement and location of vehicles and shipping containers. We also need to minimize the cost of these initiatives so they do not mean higher food prices for the consumer. We need to determine which processes and technologies provide the best return on the security investment. We need to consider trade-offs. We can rely on both interviews with managers involved in enhancing food supply chain security and in statistical analysis. <strong>MSU</strong>’s research team will try to identify the best use of resources to provide us with a safe, secure, constant, and economic food chain. David Closs is <strong>MSU</strong>’s John H. McConnell Chaired Professor of Business Administration. CLICK RIGHT THROUGH FOR <strong>MSU</strong> msualum.com PAGE 37
PAGE 38 FALL <strong>2004</strong> <strong>MSU</strong> ALUMNI MAGAZINE
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