IBM Supply Chain Intelligence Suite Food Trust

Unapproved enhancement involves the addition of unknown or undeclared chemicals to artificially enhance the quality of the product or percentage of other attributes. A high-profile case occurred in China in 2008 when it was discovered that melamine was added to milk and infant formula to increase the nitrogen content of diluted milk. It gave the appearance of higher protein content and helped “chemical” milk pass quality control testing. Contaminated infant formula consumption took the lives of six infants and made more than 300,000 babies sick. Many Chinese parents still don’t trust local brands and prefer to buy expensive foreign formulas.

The system creates a running invoice that evolves in real time as costs accrue. For these reasons, Walmart decided to go with a private network built on Hyperledger Fabric, an open-source platform. The initiative started when one of us and his Walmart Canada team began thinking about new ways to solve the problem.

  • For example, Walmart may offer financial incentives for suppliers such as preferential payment terms to adopt these changes to their own production processes.
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  • The Walmart team was only concerned about compatibility with other blockchain-based tracking systems, and later the Hyperledger team announced a partnership with Ethereum.

We create tools, assets, and ecosystems to seamlessly merge real-life and digital worlds within your Metaverse projects.It could be a multi-layer virtual space or a unique artwork item. Walmart is also using AI to analyze policies and variables that affect the supply chain and predict retail patterns. Walmart even applies technology to forecast Open-source software Wikipedia traffic on the roads, and in this way speeds up the delivery process as well. Mislabeling means that the product is labeled or marketed incorrectly for economic gain. It is usually related to organic food which in reality contains non-organic ingredients. Re-labeling dates on expired products also belongs to this type of food fraud.

Pathways to Just Digital Future

Walmart noted in its letter that food safety is also a shared responsibility, and one way to achieve this goal is through close collaboration with suppliers. 4 To combat these challenges, Walmart uses blockchain technology to keep the record of temperature in the transportation unit during the transit of foods. This way, it allows the track of food provenance just in minutes compared to days of paperwork-based methods. Blockchain is a revolutionary technology for supply chain management for businesses that are eager to downsize human-error-related problems. According to IBM, more than 70% of supply chain leaders reported that there is a compelling advancement in speed, data quality, integrity, and visibility when human intervention is removed through the use of emerging technologies such as blockchain. It is still not 100% clear to me how could the block chain have such a tremendous effect as in the example of mangoes mentioned above unless the previous process was really precarious.

walmart blockchain supply chain

For example, the carrier’s information about miles traveled and fuel consumed is automatically compared with Internet of Things data reported from independent devices on the trucks and any discrepancy is immediately highlighted. “It’s stressful,” Jim Kras, chief executive of Walmart leafy-green supplier Edible Garden, said of creating its own digital-inventory software system. But TradeLens could only work with the collaboration of a host of companies and nations—which never fell into place. Probably the biggest food recalls that happened in 2019 in the US were connected with poultry products. Due to possible foreign matter contamination, 11,760,424 pounds of chicken strip products sold under the Tyson brand were recalled. Chang’s Home Menu chicken pad thai and chicken fried rice products were misbranding and undeclared allergens.

Also, it uses smart contracts to compare whether the temperature of the product on the verge of delivery is compliant with legal requirements. If not, it also reports the deviation both to the sender and to the receiver. I especially appreciate this article because it also helps me to think further about the cases we learned in the supply chain module. The carrier’s sprawling delivery network will be at risk unless a deal is reached by July 31.

Playing a part in food traceability

Frank Yiannas once noted that their customers deserved a more transparent supply chain, adding that the one-step-up and one-step-back model of food traceability was outdated for the 21st century. The food industry is closely tied in with all stages of the supply chain, from the picking of raw materials all the way through to the consumer’s shopping bag. Tracking the route, authentication, and safety confirmation of each product is a challenging task, but blockchain technology can offer a solution. Blockchain is not only used in food supply and cross-border logistics, but also in diamond business.

” Wal-Mart collaborated with IBM and others to set up IBM Food Trust, involving prominent players in the food industry, like Nestle and Unilever. Hyperledger Fabric is a blockchain framework implementation and one of the Hyperledger projects hosted by The Linux Foundation. Intended as a foundation for developing applications or solutions with a modular architecture, Hyperledger Fabric allows components, such as consensus and membership services, to be plug-and-play.

Walmart works in collaboration with IBM to secure the health of its food supply, which consists of a complex and hard-to-follow web of the supply chain. With such a big supply chain, keeping track of the food condition is challenging. Contaminations can occur if the temperature is not managed during the supply process. Agriculture is one of the least digitized sectors where farmers still use paperwork records to keep data of, for example, the pharmaceuticals used on animals.

At least 51 people died after consuming poisoned alcohol, and many suffered irreversible health damage. The company has constantly developed and innovated its supply chain, enabling workflow optimization. This has helped them reduce prices, cut costs and attract more customers. Walmart still does everything to maintain its status as a market leader and tries to respond to challenges in a timely manner. Although this case is based on piloting and trial period, ZIM, a container shipping company, initiated the use of blockchain in digitizing the bill of lading. This bill is an essential document for shipping in which information like destination, quantity, product description and billing information are stored.

Tracking food for better safety

While many of the leading banks and FIs were skeptical of cryptocurrency when Bitcoin first emerged, they were also quick to point out the potential of the blockchain platform for solving other business use cases. The next year, Walmart began tracing over 25 different types of products using the technology provided by the IBM Food Trust. In September 2018, Walmart officially announced that all their suppliers of leafy green vegetables must upload their data to the blockchain within a year. Supply chains are essential for any business that sells any sort of product. Even if you are simply selling soap produced by your next-door neighbor, you will still have to engage in some basic supply chain management. The bigger your business and the longer the distances goods have to travel, the more complicated the supply chain.

walmart blockchain supply chain

They use QR codes on fish packages, which enables end consumers to track such information encoded via blockchain. 3The system enabled auditing and tracking of environmental conditions of the product from harvesting to storage and delivery. Factors such as temperature, humidity, light, etc. are controlled in real-time. A completely separate issue is what type of blockchain solution is implemented. Blockchains require some sort of proof, and it is possible that what may be a reasonable solution in a trial may not scale well in terms of resource requirements. The most prominent blockchain currency today, Bitcoin, already consumes more electricity than the majority of countries in the world, and that is with a marketcap under $200B.

Additionally, Walmart could complement this program with a marketing push where these “preferred suppliers” that enroll in the program are highlighted, both through in-store displays and paid advertising. Besides improving supplier relationships, this would attract additional consumers who find appeal in Walmart’s sustainability and transparency. Walmart thought that blockchain technology might be a good fit for the decentralized food supply ecosystem.

C-Suite Insights: Surveyed CEOs Aim for Growth Beyond Current Challenges

Blockchain reduces the time it takes to find the data on specific food items from 7 days to 2.2 seconds. Let’s take a look at some of the common issues present in the supply chain industry and how blockchain can be used if not to eliminate, then at least to lessen the negative effects these issues have on the entire food supply ecosystem. As it is, big name early adopters like Maersk and IBM are winding down their TradeLens system during the start of 2023. The ambition of TradeLens, which began in 2018, was to digitize global supply chains, reduce fragmentation, and share tracking and accounting information.

CIO Yael Cosset’s experience improving data access, democratizing insight, and leveraging AI has served him well at Kroger. His teams are making advances on all three fronts to deliver value for customers, employees, and suppliers. “It requires both technology and business model changes that I think make it more challenging to drive,” IBM’s CIO Kathryn Guarini told CIO Journal earlier this year. Overall, enterprise blockchain has been slower to bring about change than had been predicted, she added. The company said it intends to use blockchain to comply with a recently released Food & Drug Administration regulation on enhanced traceability for over a dozen food groups, including soft cheeses, eggs and melons.

One of the most notable contributions of Walmart as a global food safety initiative leader is – the Walmart Food Safety and Collaboration Center. It led to investing in food safety research via internal supplier networks as well as leveraging JD’s expertise in technologies such as artificial intelligence and big data. The team also found it important to work with an open-source, vendor-neutral blockchain. Since the food traceability system was meant to be used by many parties, including Walmart’s suppliers and even direct competitors, the technology ecosystem underlying it needed to be open.

In 2018 the Food Trust Group was formed, a cluster of some of the biggest food companies in the world – Walmart Inc., Nestlé SA, Dole Food Co., Golden State Foods, Kroger Co, Driscoll’s Inc., among others. The goal was to use blockchain to improve recalls, identify stubborn bottlenecks in real-time, and improve the overall customer experience. Likewise, the carriers had similar issues in their receivables departments as they reconciled payments received from Walmart to their original quotes and invoices. The systems in use by each were purpose-built for the needs of their enterprise and worked well in their respective ecosystems, but were not optimized to exchange data with external systems. A blockchain network would overcome the issues of incompatible systems by serving as a single source of truth for the invoicing, data collection, contract rules, and payments for both Walmart and their 70+ carriers. A few years ago, there was a huge food sector-related scandal that exposed some glaring problems in the supply chain industry.

Entrust us with your end-to-end mobile project — from ideation and engineering to app launch and integration.With business growth in mind, we’ll help you hit the market with a slick iOS, Android, or cross-platform app. Concerning mangoes, they were often susceptible to Listeria and Salmonella contamination, so Walmart was planning to trace these sliced fruits from South and Central America to the US and demonstrate cross-border transfer and accountability. Realizing both projects the American retailer was also hoping to increase public confidence in supply information.

There’s a clear time stamp attached to every new block on the blockchain. A block, or a data point, is only considered valid if all network participants verify its integrity. Blockchains are fully programmable and can be used to create decentralized applications, smart contracts, tokens, and so on.

It helps prevent corruption and significantly lowers the probability of food fraud. In the pork pilot project, everything started with recording the entire production process, with RFID and cameras at the slaughterhouse. Once the meat was ready to be transported, it was put into shipping trucks that had GPS systems along with temperature and humidity sensors. This system organization ensured that meat arrived in distribution centers under safe conditions. Purchasing managers there could track all the necessary product information remotely. Walmart also optimized its supply chain management by forging links with suppliers to improve material flow with less inventory.

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