As outlined by the United Nations, the water-food-energy nexus lies at the core of any sustainable development efforts. And, with food accounting for 26% of global greenhouse gas emissions, it is not hard to see why the pressure is on food producers and processors to boost their sustainability credentials. There is a real need for firms to turn this challenge into an opportunity, making sure products are appealing to increasing customer expectations regarding sustainability and social responsibility, while ensuring compliance with a steady increase in relevant legislative requirements. In product development in particular, food businesses are having to work smarter and harder to optimise product sustainability.
Customer-led change
The combination of a rise in social media influencers and more media coverage given over to sustainable and responsible consumption means that more customers want visibility over and real connections with the things they are buying every day, including food products. And it is not just the products themselves that they are concerned about, but how they are packaged and how they are transported too.
Sustainability legislation is undoubtedly on the rise too for food producers, with packaging standards already in place in some countries. For example, requirements for food packaging in Australia are outlined by the Food Safety Code, which specifies packaging materials fit for contamination prevention. As labelling requirements for nutritional values and allergens are now standard, it is likely there will be an increase in regulations for issues such as carbon emissions and water usage over the next few years, As such, businesses will strive for compliance not only for the sake of compliance but to boost their appeal to an increasingly discerning customer base.
While robust sustainability credentials are not yet the ‘licence to operate’ that they will inevitably become, more food businesses are setting themselves apart from the crowd through sustainability. But, and it is a big but, what are the boxes that need to be ticked for a product to be ‘sustainable’? It is here that food businesses are facing perhaps their biggest challenge, particularly when it comes to developing new, ‘sustainable’ products.
The scope of sustainability
The most straightforward and somewhat basic approach is to determine the environmental impact of owned or controlled sources, so all those factors within the confines of the food producer. Take it one step further and include the environmental impact of any electricity, steam, heating, cooling processes consumed by the business. But the standard approach should be to expand the scope further still and take into account the environmental impact of every step of the supply chain, so to use that well-worn phrase, from farm-to-fork. And, if the industry is really serious about sustainability, it needs to go beyond the fork, looking at closing the loop of the circular economy, analysing waste and recycling options as well. But, there are currently no guidelines as to what represents robust sustainability reporting and this is where clarity is needed.
The lack of cohesion and commonality when it comes to product labelling does not help the situation, with consumers seeking clarity about multiple eco-labels from an industry which itself is not always in a position to explain. Where does sustainability begin and end? For example, there is a growing interest in regenerative agriculture, advocating farming practices which encourage soil fertility, and more suppliers are trying to use less water in production processes too. At the same time, sustainability can include the improvement of social and economic inclusion for farmers and suppliers.
So, where do the sustainability parameters lie? Ultimately, at the moment, it is down to producers and processors to define which are the multiple factors to be considered when determining just how sustainable a product is. This includes meeting customer demand for transparency of sustainability and putting in place the processes that will be able to cope with the introduction of concrete legislative requirements which should create a more level playing field.
Data overload
When it comes to bringing a new, sustainable product to market, the main challenge for food businesses is how to deal with the massive amounts of data from right across the supply chain (not to mention making sure that the date being received from supply chain partners is accurate). It is not static data either, but dynamic data without fixed product characteristics dependent on the country of origin of an ingredient, for example, or method of transportation, or how it needs to be packaged. With an increasing number of factors to be considered to determine sustainability, so the complexity of product lifecycle management (PLM) and product development grows at an astounding rate. This means it is no longer just about product formulation but about streamlining and automating the product development process, getting relevant, appealing products to market as quickly as possible.
This is where spreadsheets are no longer good enough when it comes to PLM, unable to deal quickly and effectively with the huge volumes of dynamic data that need to be taken into account. Spreadsheets are not only error-prone, but time-consuming as they are passed from department to department in an effort to amalgamate the actions and activities of all involved parties. With the right PLM tool in place, businesses can capture ideas, qualify them in structured stage gate processes, bringing a new transparency to not only decision criteria and accountability, but sustainability credentials too.
A collaborative process
The right tool facilitates input from every part of the business, providing a central repository of all relevant information. Activities are allocated to various departments and people, scheduled in parallel and requiring digital sign-off before any further actions can be taken, speeding up the entire product development process and making it less error-prone and more efficient. All too often new products are late to market due to an oversight in one or more areas of the product development process. So interlinked and codependent are all the stages involved in bringing the right products to market in a timely fashion, that the simplest of mistakes in a seemingly inconsequential part of the process, can ultimately lead to failure.
A continuous journey
The product lifecycle doesn’t begin and end with product development but continues long after launch. The ability to re-calculate sustainability factors when switching suppliers, changing ingredients, or responding to new legislation, for example, is crucial and something that is simply too complex and time-consuming to be left to spreadsheets. The right PLM solutions can manage this entire process, changing the spec of a particular product and then telling you how formulations will need to change to optimise not only specs and costs, but sustainability too.
Taking this one step further and the management of the end-of-product stage must be considered too. So, PLM going beyond formulation-to-fork and looking towards recyclability of packaging and perhaps even responsible food waste management options, steps which represent additional efforts to boost the sustainability credentials of a particular product or food business.
As more food businesses strive to achieve truly sustainable products, the capability to bring such products to market quickly is crucial, helping to build a real competitive advantage in an increasingly challenging and competitive marketplace. Technology is the key to optimising sustainability, enabling a food business to adapt to changing demands and legislation while still delivering appealing products to consumers. With the right technology in place, food businesses can streamline the entire product development process, and putting the infrastructure in place for an ongoing commitment to delivering the highest sustainability standards.
By Jarrod Kinchington, Infor ANZ
This article was first published by Food & Drink Business magazine