Transparency and traceability are major models that are behind the advancement of operational strategies in a food supply chain. It is important of companies to understand the significance of traceability and transparency in food supply chain management system. Without the aspect of transparency, it is difficult to implement the aspect of traceability. Successful administration of a food supply chain necessitates that traceability is developed based on transparency.
Task 1: Three Challenges the Retailer Faces for Food Traceability and Transparency
Walmart Inc. is an American international retailing company that operates a chain of repositories, discount departmental outlets, as well as grocery supplies. Walmart, the realm’s major vendor, is accountable for almost a quarter of every grocery item retailed in the United States. According to Pham (2018), however, the firm’s existing structures fail to ascertain the information integrity or the comprehensibility required to guarantee food safety and quality. This has resulted to several significant challenges associated with traceability and transparency. The challenges faced involved the absence of transparency in the firm, demand by consumers for traceability, and regulatory compliance.
Demand by Consumers for traceability
According to Chen, Yan, Tan, Liu, & Li (2019), traceability is not a request by clients but is considered as a demand. The clients’ interest in the safety of food products and quality has necessitated an emphasis on traceability and assurance on quality, which includes retail labelling of produce, source and production methods. A research based on transparency revealed that clients require information ranging from the overall breakdown of ingredients to information on sourcing. Another study conducted on Walmart’s clients revealed that clients in nations like China and the United States are concerned about the aspect of food fraud. The constant upsurge in the falsification of food has resulted in substantial financial loss and wore down the trust of clients. According to Smith and Crawford (2006), Wal-Mart reimbursed funds to its clients that purchased contaminated donkey products that contained fox meat. The outrage was viewed as an aspect that may harm the company’s operations in China’s ever-growing food and grocery industry. Walmart was faced with a difficult challenge of convincing their potential clients of meat quality and the freshness of the food. The clients were cautious of current humiliations that involved contaminated products such as the tainted meat and contaminated milk. Consequently, the Chinese clients associate Walmart’s normal low price strategy as being substandard and not secure. Brand protection, demand forecasting, and consumer loyalty all become possible for early adopters who show themselves to be taking practical steps to guarantee the authenticity of their products.
Lack of Transparency within the Supply Chain.
According to Dabbene Gay and Tortia (2014), measurement of transparency can be done in two dimensions. Foremost is the supply chain’s scope, which entails the intricacy of communication within the firm, and indicators on the alleyway to comprehensive transparency. One of Walmart’s massive challenges regarding the traceability of the products is the disjointed aspect within the supply chain. When handling simple foodstuffs, there may be a substantial number of individuals involved around the globe, and with slightly or no information on the actions of another individual (Introini et al., 2018). For example, locating a product from the farm to the point of packaging may include tracing the ingredients to the point of growth, or tracing meat products to the cattle, and some barriers in logistics. Various interested parties in the food supply chain fail to prioritize the aspect of communication with the traders, either by failing to implement traceability resolutions, or the obligation to only engage with trustworthy providers. According to Wang Han and Beynon-Davies (2019), dependence has changed institutions’ aspects to a distributed structure. In such an intricate structure, it is important to contemplate on how the food supply management can start drifting away from traditional consolidated dependence approaches. Moreover, trust-based institutions are not intended for the ordinal period due to the rise of new technologies.
Another key challenge involves compliance with certain regulations regarding the safety of food items. According to Sander Semeijn and Mahr (2018), there entails a concept at a higher level, frequently referred to as the “one up, one down,” that mandates each retailer to possess the capability of effectively tracing their products. This should be done instantaneously prior and subsequently in the supply chain in case of a retraction. Therefore, key stakeholders in the supply chain ought to implement at least elementary traceability structures. However, in most instances, the structures may just be based on paper, hence proving to be a challenge as no digital record is available externally. Plans have been put in place in legislating regulations that allow for effective prevention of food security occurrences. There is a challenge in assessing the aspects of food fraud as a separate entity from Walmart’s perspective. Legislature concerning labeling is still lenient as only products such as olive oil, beef, and fresh or frozen poultry products not from Europe, wine, vegetables, and eggs may be labeled (Stevens, 2019). This proves to be a challenging aspect in most Walmart’s outlets as information on meat products such as sausages and ham, kitchen commodities such as pasta, sugar, and oil as well as ready meals. Stringent legislations need to be enacted for punitive measures to be taken against those engaging in fraudulent activities. This would prove to be a critical catalyst guaranteeing that food in Walmart’s food supply chain is greatly safeguarded.
Task 2: Possible Solutions to Tackle the Challenges
According to Badia-Melis Mishra & Ruiz-García (2015), due to the trade globalization, food supply chains are becoming progressively intricate, and locating products by way of the intricate websites is turning out to be a challenging affair. Overpowering these difficulties is vital to ensure the effective usage of traceability in the preservation of food supply safety. To achieve this, Walmart can incorporate various mechanisms to overcome the obstacles. They include the incorporation of RFID tags, adoption of blockchain technology mechanisms, and virtualization of supply chain management.
Incorporation of RFID tags
There are numerous technological resolutions to utilize in the identification of products. According to Galvez, Mejuto, & Simal-Gandara (2018), however, radio frequency identification tags are considered as one of the most noteworthy elements that may be applicable in supply chain transparency and traceability. The consistency and efficiency of the food traceability system rely on the accuracy and efficiency level of the food classification and verification methods. With the integration of RFID tags, Walmart’s precision and steadfastness on the collection of data for the identification of products will be advanced as compared to other current approaches (Wamba, 2012). For instance, when Walmart distributes horticultural products, it enables horticultural producers and marketers to efficiently extract their own transacted products in the event of sanitary predicament.
In the occurrence of a food security situation, products believed to be defective may be instantly traced due to the feature of traceability (Blass, Elkhiyaoui, Molva, & Antipolis, 2011). Causes, locality, and staff deemed to be accountable can be tracked effortlessly, and losses and risks are largely diminished. Walmart’s integration allows consumers to use an identification tag reader to access information concerning the various challenges in the course of shipment. Thanks to the advancement, information produced by Walmart will be auditable, with the product’s details, simultaneously through inspection of the system of traceability.
Adoption of Blockchain Technology
The adoption of various forms of Blockchain technology can develop conviction through the elimination of impenetrability in Walmart’s food chain supply management. Blockchain technology will enable end-to-end tracking of products by incorporating a mutual technical language to the vendor (Charlebois, 2017). This can be done simultaneously by allowing clients to access information on the food labels through their handsets. In another instance, if a client becomes ill, it may take longer to acquire data on the product and the shipment. By incorporating blockchain technology, Walmart will easily acquire vital information, including contractors, the origin of product and process of growing, and individual that reviewed the product. Blockchain technology may help support the system of traceability (Dujak & Sajter, 2019). Blockchain technology can be beneficial as traceability systems through the detection and identification of products within a short period. Also, a similar outcome is achievable through a centralized system that functions properly. Expeditiousness is usually vital in aspects of food security. For instance, when identifying the source of contamination of a product during shipment. Instituting an operative traceability structure based on an integrated system necessitates guaranteeing the conveyance of information to all trading associates as one of the associates may be accountable for all the data (Doyle, 2014). Therefore, technology will aid retailers and consumers in the integration process to offer outstanding steadfastness, transparency, and safety.
Virtualization of Food Supply Management
The other solution is centred on the virtualization of food supply management. In this case, Internet technologies will allow Walmart to employ virtualizations in management operation processes dynamically. This will advance sustenance for Walmart in handling products believed to be perishable, impulsive variations in supplies, and strict food security and sustainability regulations. The aspect of virtualization will enable Walmart to remotely oversee, regulate, strategize, and optimize business processes simultaneously (Dabbene Gay & Tortia, 2014). This will be achieved through computer-generated objects as compared to on-site observations. While considering the Internet of things, the company’s physical entities may possess digital colleagues and virtual depictions; objects turn out to be context-aware (Tsang, Choy, Wu, Ho, & Lam, 2019). This enables communication and exchange of information. Moreover, the Internet may serve as a point of storage and communicating structure that retains a simulated illustration of items connecting pertinent data with the entity.
As such, virtual elements act as a central hub of objects’ data, constantly merges and modernizes information from several resources. Walmart can use virtual objects to synchronize and regulate the operations remotely (Verdouw et al., 2016). This also suggests that the course trailed by the foodstuffs from the point of sourcing to the endpoint does not depend on the associate’s location, therefore affecting regulation, and direction. The Virtualization of Walmart’s food supply chain has to engage with an extraordinary system, object, and procedure and regulate intricacy. The optimization of Walmart’s operations will improve the operations through the application of algorithms and support decisions on the founded on the information of operations (Beker et al., 2016). Furthermore, practical activities may be executed founded on models of optimization and prognostic analytics. For instance, through the recreation of a shelf-life mode to ascertain the outcomes of perceived changes in the quality when the product arrives.
The advancement of a universal supply chain such as Walmart may bring with various key challenges that may hamper the operations of the supply chain. There is increasing demand by the consumers for traceability by the consumers as a result of the rising cases of food falsification. The other challenges involve lack of transparency within the supply chain and lenient regulatory measures that fail to punish those involved in fraudulent activities. To overcome these challenges, the company may opt to integrate changes based on technology such as block chain technology, incorporation of radio frequency identification tags and virtualization of the supply chain.