The Future of Food Supply Chain - Coursework Example

 The Future of Food Supply Chain Introduction The global food supply chain is undergoing a major transformation in the recent years. The food supply chain is identified as an element having enormous potential to benefit the ecological system and the livelihood of people throughout the globe. Agriculture and food supply chain are the major drivers of environmental sustainability, food safety and security and creation of economic opportunity.The food supply chain industry is a critical industry in the global environment as it deals with the social commodities, essential goods and services that are used to increase industrialization and global economic development. With the concern moving to the scarcity of resources, the world is facing a new challenge of producing more with lesser resources. The food supply chain industry is dominated by features like increasing demands, increasing volatility risks and limitation of resources. Discussion There are various factors that are likely to shape the future of the global food supply chain industry. The factors arising from the suppliers’ side are: increased competition for expenditures by the consumers, major changes in the operating environment, improvement of the quality of the commodities, high differentiation level of food products, cost-effective and flexible modes of logistics. The factors arising from the viewpoint of the customers are nutritional qualities of the food products, health benefits, sensitivity of the customers towards safety and quality of food, ways of production, place of production, environmental and social concerns and welfare of the community. The most important elements for consideration in the designing of the food supply chains are on-shelf availability and cost efficiency for the businesses. But in the light of the emerging environmental concerns other factors like greenhouse gas emissions, energy conservation, increasing traffic congestions and transportation costs are also gaining importance. Challenges The future of global food supply chain focuses on the following critical dimensions: The global food supply chain industry is feeling the necessity of a paradigm shift in the processes as the future of the industry is considered to be highly different from the past trends in the industry. The need for adopting the latest technologies and innovations by the supply chain like the adaptation of the green supply chain is critical to comply with the raising environmental concerns all across the globe. The challenges arising in the global market which will influence operational changes in the major companies involved in the food supply chain industry. The food supply chain industry has identified the need to implement a new business model to deal with critical issues like taking up new business opportunities and achieving sustainability in the industry. The increasing demand and the scarcity of resources is a major issue faced by the global food supply chain industry (McKinsey & Company 7). The population of the world is increasing in manifolds and so is the necessity to provide food and nutrition to the global population. According to the latest statistics, more than 850 billion people throughout the globe do not have proper access to food commodities and are more sensitive to price increases and nutritional concerns. The global food supplies need a boost by a considerable increase in the production of environmentally sustainable food commodities. But reaching stabilization is difficult due to the complexity of the food supply chains and the various factors diversely affecting its operations. Internal forces driving change The major changes in the food supply chain industry that will influence the changes in the supply chains are the flow of information, consumer behavior and the movement of goods (McKinsey & Company 12). Since these are internal changes occurring within the industry, the industry would have some control over reshaping these factors. Information flow: The proper flow of information would be highly dependent on maintaining transparency and managing complexity along all the levels of the supply chain. The food supply chains are expected to become more complex in the future. Thus, the businesses will have to effectively fill the gap between demand and supply. The trend of open sharing of information would be a critical factor in increasing the performance of the whole food supply chain industry. The industry has to respond suitably to the changing consumer demands. Consumer behavior: The consumers are expected to be more demanding in future. They would also have more options to choose from as competition in the industry will increase over time. Thus, the consumers will be more empowered making it essential for the industry to be more equipped to provide high value and dynamic solutions to the customers (Poulakis 62). In the recent future, the consumers are expected to become active influencers of the food supply chain driving new solutions and strategies in the supply chain.The consumers would be more focused towards environmental concerns and brand reputation. Movement of goods: The new challenges evolving in the industry would create the necessity for better infrastructures and transportation modes. The transportation domain will be largely impacted by the government regulations and the increasing costs of fuel. The congestion in the urban areas will be one major challenge for the global food supply chain industry. The industry will have to devise and implement new strategies for their distribution processes. External forces driving change Unlike the internal factors, the external factors that will impact the food supply chain industry cannot be controlled by the industry. But the global food and agricultural companies should evaluate the impacts of these factors on the industry and implement effective business strategies to minimize their effects. Technological trends: The supply chain industry should integrate the latest technologies in their business practices. The use of new logistics and warehousing technologies should be used to keep up with the technologically advancing business environment. The adoption of new technologies like RFID and other information technologies is critical for the success of the food supply chain in the coming years. The industry also expects a substantial increase in the use of technology by the consumers and the suppliers. Regulatory trends: The industry will be dominated by government regulations and compliance factors. More emphasis would be on corporate social responsibility of the businesses with particular focus on sustainability issues. Environmental and social concerns will play a major role in the regulatory decisions (Giovannucci 31). Economic trends: The emergence of new markets is creating new opportunities and economic trends in the world business environment. The markets in India, China, Brazil, Korea and Russia are forecasted to become the major markets in the coming years. These markets are expected to evolve rapidly as attractive regions for expansion. The patterns of global and local sourcing are also likely to undergo a transformation in the coming few years. Ecological trends: The scarcity of the fast depleting natural resources will lead to an increased concern or sustainability. The industry should adhere to the environmental laws and operate in a manner which is environmentally responsible and beneficial for the ecological system of the planet. The conservation raw materials and natural resources like water will be a key concern for the food supply chins in the future (McKinsey & Company 8). Strategies The main strategies taken up by the food supply chain industry for the future sustainability and competitive advantages are: Improvement in the processes by monitoring the annual productivity levels so as to implement more commitment towards continuous enhancement of the business processes. The management of supply chains and collaborations are critical to gain sustainability through the facilitation of the delivery performances, provide greater flexibility, decrease the response time and increase the efficiency of the global food supply chain industry (Ruteri 73). The food supply chainshould focus more on innovations that benefit the customers as well as improve the dynamics of the industry. The adoption of a green supply chain system is vital to adhere to the environmental laws and increase the brand reputation. The food supply chain industry should implement waste reduction and recycling processes to create more value for the customers. The food supply chain can have a competitive edge by engaging global talents through partnerships and collaborations spread across the globe. In the future, the food supply chain systems must design their processes to improve the parameters like traffic congestion, emission of harmful gases and energy conservation. The impact of these factors on the global food supply chain is likely to increase substantially in the coming years. The strategies for the food supply chain industry should be designed and implemented to make the industry progressive and sustainable in the future. New practices should be adopted by all the stakeholders involved in the industry to bring about a major change in the processes. The supply chain innovation should focus on the areas of packaging recycling, reverse logistics, waste management, energy conservation, use of alternative energy sources, identification of efficient resources and green initiatives. Conclusion The food supply chain industry is likely to meet with new challenges and opportunities due to the changes in the global environment for this sector. The supply chain companies should therefore look beyond the traditional ways to increase the sustainability and competitive factors. The industry is likely to benefit from a strategic focus on aligning their business processes with the latest technologies and emerging issues of concern.The businesses should use strategic alliances and best use of resources to create quality and profitability from their business practices. The food firms throughout the world can establish an effective supply chain management system by entering into collaborations, implement corporate strategies in their supply chain activities, monitoring and evaluating the performance of the supply chain and adopting the best practices suitable for the evolving industrial environment. The food supply chains are deemed to have enormous potential to benefit the society, environment, the businesses as well as the individual consumers. Works cited Bourlakis, Michael. Food Supply Chain Management.New Jersey: Willy Blackwell, 2009. Print. Giovannucci, Danielle. Food and Agriculture:The future of sustainability. 2012. Web. 6 December. . McKinsey & Company. Achieving the New Visionfor Agriculture:New Models for Action.2012. Web. 6 December. . McKinsey & Company. Putting the New Vision for Agriculture into Action:A Transformation Is Happening. 2012. Web. 6 December. . McKinsey & Company. Realizing a New Vision for Agriculture:A roadmap for stakeholders. 2012. Web. 6 December. . Ruteri, Jeremy. Supply Chain Management and Challenges Facing the Food Industry Sector Industry. International Journal of Business and Management. Vol. 4(12). pp.72-75. 2009. Print. Read More