I have had the chance to meet and discuss with many supply chain and sustainability managers across multiple industries and geographies. I often realise that there is confusion on traceability and traceability systems. Some people think that they trace their raw materials by subscribing to a digital solution or by complying with a certification scheme, but they don’t.
Some clarifications would certainly be useful to understand what is happening and make the right decision when investing in a traceability solution.
The International Organisation of Standardisation (ISO) defines food traceability as the ‘ability to follow the movement of a feed or food through specified stage(s) of production, processing and distribution’, and a traceability system as ‘the totality of data and operations that is capable of maintaining desired information about a product and its components through all or part of its production and utilisation chain’.
If we replace feed and food with raw materials to cover all supply chains, it is obvious that ISO is referring to physical traceability: tracing in space and time the raw materials as they change their status to become ingredients or components of a final product. We can even go beyond this to how the final product is terminated and recycled. There is no reference to a ‘one step back, one step forward’ approach, which so many organisations seem to limit traceability to. A proper system should trace all the way through a supply chain and consider all the tiers.
So, if the system you use doesn’t physically trace raw materials, ingredients, components and products, you should not claim that you’re performing traceability. Is it possible to say your supply chain is overall 10% traced because you know your suppliers three tiers down? In my opinion, no. But you could say, if you can prove it, that 10% of your procurements and products are 100% traceable!
Most of the standards certifying products use a mass-balance approach, where certified raw materials, such as cocoa, coffee, tea, palm oil, cotton, are mixed with non-certified ones. Is this traceability? Absolutely not. These standards don’t even ask the organisations selling certified products to indicate on the wrapping what the ratio is of certified and non-certified raw material in a specific consumer product.
Sometimes certification standards use the segregation or identity preservation model. This only results in proper traceability if the raw material is physically separated from non-certified products at each stage along the supply chain and if the final output (the consumer product) can be linked with the initial input (the raw material). This is rarely the case in the certification world.
Another method that we often hear about is administrative traceability or a chain of custody approach (following the paper trail). Again, this is not traceability as you track product movement and transactions with volumes and quantities but not the product as such. You can record in a system that a consignment as moved from point A to B and changed ownership but can you confirm without any doubt that no product substitution or contamination happened?
Let’s now look at digital supply chain mapping and supplier risk assessment systems. We found many providers offering this type of solution and some of them insert ‘traceability’ in the description of their system. Sorry but mapping all the tiers of your supply chain and assessing the risks for each supplier doesn’t result in traceability.
However, if you put in place a traceability system and you start tracing the raw materials throughout all the tiers to your own facilities (end to end traceability), you’ll obtain a detailed map of your supply chain, updated for each consignment you’re receiving; thus, killing two birds with one stone.
Some digital systems will put the emphasis on product compliance and give you the tools to verify it. For example, you could document at different tiers of your supply chain if the cold chain requirements are respected, regulations are observed and your product specs are applied. Again, this information is certainly highly valuable and useful but this is not traceability.
At this point, you might want to ask is there a solution on the market that could perform traceability, risk assessments and compliance assurance at once? To my knowledge no, but if you know of one please let me know.
Why is this? Each of these systems is inherently complex and when applied to large logistical and manufacturing operations the level of complexity only increases. If you need to pursue the three objectives, you’d do better with three different systems that, and this is very important, could interoperate with each other (pull and push data from system to system).
If you ask your IT provider if their system can interoperate with others and if they use APIs, and they look at you as a deer does at night on the road in the car’s lights, walk away!
At GeoTraceability, we’ve deliberately developed a traceability system adapted to the raw material produced by smallholders. For us, traceability starts at the production site - the field, the forest - or at the extraction site - the mine, the sea.
The main originality of our solution is the ability to combine geo data with traceability data. Not only do you know the origin of the raw material but you also know who produced it, how, and what could be the human and environmental impacts. This upstream information will follow the raw material throughout your supply chain and enrich as other relevant data is added.
Do not hesitate to contact me if you wish to discuss further traceability and supply chains matters. It will be my pleasure to exchange with you.
The biggest threat to your brand and reputation happens when performance does not meet expectation. So, please don’t claim that you perform end-to-end traceability when you don’t.