traceability

1. Making profit with traceability and improved Quality
Management in agro-food chains along the Dutch German
Border
Gereon Schulze Althoff,
GIQS e.V. c/o University of Bonn, IPBH, Katzenburgweg 7-9, 53115 Bonn, Germany, galthoff@uni-
bonn.de
Abstract:
Effective quality management in the agro-food industry depends on traceability to enable knowledge-
and information exchange between the various links of a production chain. It improves productivity,
leads to better consumer care and reduces risks. Practical solutions for its support within food chains
leave ample room for improvement. Analysis of the supply chains in the food industry shows that even
today the boundaries of businesses, production stages and geographical borders still arbitrarily
separate quality management activities that are - logically speaking - interdependent on each other.
The international association GIQS develops a tool box of IT systems that support chain oriented
quality- and health management in the pig sector of Germany and the Netherlands. After a pilot testing
phase the tools will also be available for other food chains who want to set up or improve their
integrated quality assurance system.
Key Words:
Quality Management, Traceability, Supply Chain Management, Data warehouse, Management
Information System
The Challenge – Chain wide Quality Management
Specialisation in the agro food sector has led to an immense growth of productivity. However, it has
also led to an increase of customer-supplier relationships throughout production chains. Economic
interest of such specialised organisations often diverges diametrically. Short term economic thinking
and the absence of price instruments lead the individual link to avoid preventive and corrective
measures in case of quality and animal health problems, often invisible for the next production stage.
This results in an excessive increase of product controls, although the subsequent links in a chain only
have minimal options to compensate for prior emerged problems, at higher cost.
In recent years producers and consumers have become more and more aware, that quality of
agricultural products depends on the performance of individual links within the complete production
process. (Nuessel, 1997). Each link has its role in assuring process- and product quality as well as the
productivity of the entire chain as through the maintenance of an optimal health status of the animals.
In contrast, quality management efforts of the various organisations of a supply chain are separated
rather arbitrarily. Various borders exist between:
• Organisations – quality management activities are carried out separately by the specific members
of a supply chain
• Production stages – diverse organisational cultures exist at the different levels of production
• Nations – different languages, different production methods and quality and information
standards, differences in executing EU legislation
Following the big food scandals legislative actors have induced new framework conditions on
agricultural production: The newly established EU General food law demands a “stable to table“-
approach throughout agricultural production while governmental Food Safety Inspection is currently
under reorganisation towards a „control of control“. Of special importance within the meat sector is
the EC proposal on risk based meat inspection, currently undergoing the legislative process (European
Commission, 2002).

2. Product liability law has been extended to the primary sector. National programmes for safeguarding
baseline quality have been implemented (IKB (NL), QS (D), QSG (DK)). The retail sector works on
standardisation and harmonisation of norms and regulations on food safety (BRC, IFS, GFSI,
Eurepgap).
A netchain has been defined as a set of networks comprised of horizontal ties between firms within a
particular industry or group, such as these networks (or layers) are sequentially arranged based on the
vertical ties between firms and different layers (Lazzarini et al., 2001). In the Agro-Food Sector, a
variety of network (i.e. farmers cooperatives, public authorities, veterinary organisations) and supply
chain structures exist, forming a broad diversity of netchains.
A quality and health management system encompassing the horizontal and vertical dimension of a
netchain is an important instrument to steer the complexities of a supply chain in the agro-food sector
(Petersen and Schmitz, 2001, Amelung et al., 2002). Driving force is the recognition that each member
of a netchain can enhance its performance and the product quality by integrating its goals and
activities with other organisations to optimise the results of the entire netchain. If the performance of
the total netchain increases, the individual links will benefit more than in case of one individual link
being optimised (Van der Vorst, 2000).
EN IS0 9000:2000 has been widely accepted as a framework for implementation and certification of
quality management systems and demands amongst others for the principles of
• Process approach
• Continual improvement
• Mutually beneficial supplier relationships
thus formulating the cornerstones for a chain wide cooperation and coordination of quality
management activities.
The concept: Communication - the key to chain oriented Quality Management
Information technology is the prerequisite to support communication of customers and suppliers and a
process based quality management. It enables documentation and identification of products and
processes throughout the whole production chain.
At present, individual links of a food production chain already capture details on products and
processes for their own use. Reports of consultants and auditors are available in paper form and so far
only of little assistance for long term analysis and early warning activities. Information exchange
between two links of a chain is more and more established, but often paper based and point-to-point.

3. A point-to-point information exchange is not enough to support chain wide quality management. In
fact, it is essential to exchange information by electronic documents via a central hub in order to
enable traceability, chain management and consumer oriented quality politics (Luttighuis, 2000).
Effectively implemented and supported by innovative information technology chain wide quality
management can assist to improve productivity, raise consumer confidence and result in higher profits.
(e.g. Clemons and Row, 1992; Lazzarini et al. 2001, Amelung et al., 2002, Petersen, et al. 2002).
On Line Data warehouse for an effective information management
Following Devlins (1997) definition of a data warehouse, relevant quality information is selected and
obtained from a variety of sources along the whole production chain (e.g. local herd management
systems, enterprise resource planning systems, production databases, identification databases) and
structured for decision support purposes. Similar to a backbone in the body, a central hub and
database serves as support and integration tool for quality information along the whole production
process. Through specific access rights and internet based interfaces the information is then made
available to various end users, that they can use it in their business context (Devlin, 1997).
The information system serves as a central data warehouse that contains the relevant information of
the participants in the chain including data on the converging and diverging product flows. It enables
point to point information exchange and centralised information management. Another major
advantage of de-coupling information from the product, while preserving a link to detailed product
properties though identification systems, is that exchanging parties prevent an information overload, as
detailed data are not exchanged, while these data still remain accessible by means of identification
(Trienekens and Beulens, 2001).
The different companies gain access via an Internet portal to ensure the availability of data and
information at any place and anytime. It is only accessible for organizations which are authorized
within a particular chain. The system enables forwards and backwards information exchange of
product related quality information between supplier and customer. The set of information accessible
for each individual link is adjustable to their specific needs.
Through its long term availability of relevant data, the food chain information system is an important
source to be used for quality planning, control and analysis of individual links and the chain as a
whole. Specifically adjusted reporting tools enable “easy to use” analysis through combination of
valuable information from the different chain links (i.e. producers, veterinarians, public inspection

4. services). More advanced OLAP (Online Analytical Processing) applications serve chain managers,
analysts and others for in depth quality planning, control and analysis of individual links and the chain
as a whole. Consequently it increases product and process quality as well as profitability (See Table
1.).
Table 1. Various benefits for the key actors of a pork production chain based on a food
chain information system
Aspect User group
Processor/ Chain Consulting Public
Producer Abattoir
Retail Coordinator service Inspection
Real time exchange of quality information Tool for
Information
(forward and backward) between chain links improved
Exchange
cooperation
between
Risk minimisation through transparent product-
different
and process information from all chain links
consulting
agencies
Multilingual system for use in international food
chains
Smarter, faster decision-making through Means for
Analysis
better
Collaborative Business Intelligence, matching
supply and demand customer
specific
Analysis to discover failures and its underlying advisory
reasons improving productivity and efficiency service
Condensing quality information to meaningful
quality reports for trend analysis and
prognostic activities
Structured supplier assessment
Compliance with chain wide traceability and
Quality
documentation requirements
Management
Information Source of condensed information for
source for an effective quality chain
producers' management
own quality Decision support and connection
management to off line analysis and process
optimisation methods (e.g. FMEA,
HACCP)
Improved
Legal Coherence with EU General Food Law (coming
into effect in 2005) requirements of a “stable to
requirements “control of
table”- management and a functioning traceability the control”
system
Practical solution to Decision
adhere to the new risk support tool
for the new
based meat inspection
risk based
meat
inspection
Integration of existing IT infrastructure
IT aspects
Reducing redundancy of information storage
Reducing extra workload for users
Cost sharing through ASP solution

5. This food chain quality information system serves mainly three functions:
• Improved Traceability based on existing product and process information
• Improved transparency on product and process information for the whole chain
• Improved reporting and analyses for better process and quality management
Off line analytical toolkit and process support
In addition to the on line product information system, described above, tools for an effective chain
oriented quality planning and management are needed to support the quality and health management
of a production chain. These tools optimise the use of available information to lead the continuous
improvement process at individual links and along the chain as a whole. Like a conductor, responsible
persons in a chain can use information structurally stored in the documents, audits and measures
management system to initiate specific actions for prevention and coping with quality hazards.
The project: Support to the pig sector along the Dutch German border
The pork sector plays a central economical role in the region along the Dutch German border and is
one of the most important centres for pork production in Europe. 30,000 farmers annually produce 16
million pigs. More than 80 small and medium enterprises as well as big multinationals have
specialised on slaughtering and meat processing. Trade relations exist at all stages of the pork
production chain.
Relevant quality information is frequently missing when products cross the border, but even national
chains do not have organised a proper information exchange between members of a supply chain.
Companies at all stages of the chain have so far been hesitant to invest in chain wide and trans-border
innovations in quality management.
Therefore the Dutch-German non-profit-organisation Grenzüberschreitende Integrierte
Qualitätssicherung (GIQS) (German for Integrated Trans Border Quality Assurance) could convince
a group of public donors to support research and development activities in this field. Since March
2002, GIQS together with 11 partner organisations from both countries is implementing a three-year
project. It is co financed under the EC Interreg IIIA Programme of the Euregio Rhine Waal, by the
European Commission, the Dutch Agro Ministry and the Ministries of Economy from Lower Saxony
and North Rhine Westphalia.
Tool box of IT systems for different types of production chains
GIQS together with its partners develops a tool box of IT systems which support chain oriented
Quality- and Health Management in the pig sector of Germany and the Netherlands. Six separate
modules are currently being customized for the need of pork production chains. The module based set
up will allow the chain to choose a specific set of tools according to its needs and organisational
structure.
On Line – Data Warehouse:
Three tools for a product based information system support accumulation, condensation and exchange
of quality information along the production chain:
1. Module Tracking and Tracing
2. Module Food Chain Information System
3. Module Animal Health Management
Off line – Management Tools:
Three tools to support quality planning, control and management in production chains form a
knowledge database. They are made available to end-users through a group ware application.
Based on the information gathered in the above described data warehouse and other sources,
“conductors” of food chains use the tools to manage the continuous improvement process.
4. Module Preventive Risk Management
5. Module Documents Management
6. Module Audit and Measure – Management

6. Conclusion
Offensive chain wide cooperation efforts can help improving quality and maximising profits. Chain
wide Information exchange and management improves predictability and supports preventive decision
making Effective Traceability Standards render information more useful for the entire chain. The
international non profit organisation GIQS develops a tool box of systems that support effective
information exchange and can manage the continuous improvement process in a chain. Borders not
only between two countries will be crossed.
Remark:
The GIQS project is co financed under the EC Interreg IIIa Programme of the Euregio Rhine Waal, by
the European Commission, the Dutch Agro ministry and the Ministries of economy from Lower
Saxony and North Rhine Westphalia
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