Planning for Product Integrity and Quality Agribusiness Management - ZAB 101

Introduction

As well as the financial and business operational planning we talked about last week, the other key areas in which agribusiness managers need to focus their planning efforts is in the area of product integrity and quality.

Product ‘integrity’ encompasses various considerations. These include, that the ‘product’:

We don’t have the time within this Unit to delve deeply into this significant area of management. What we want to do, however, is highlight to you:

We will discuss product integrity from two perspectives:

1) Product quality; and introducing the concept of ‘total quality management’ or TQM.

2) Product integrity, from a value-chain perspective and particularly in terms of traceability.

But let’s start with defining ‘quality’.

‘Quality’ is a rather subjective term – different people perceive the quality of a product using different benchmarks and diverse socio-cultural lenses. Some people are quite happy with a Korean-made car and are more than happy with the quality of its construction and performance; others want the German quality of a Mercedes or BMW.

But when your customers are purchasing your product – whether that be a primary product like a lamb carcass or potato crop, or a value-added product like a potato chip – it is critical that they know that what they are getting meets their needs and expectations and is consistent.

‘Quality’ is therefore a relative term and the key thing to remember is that it’s the customer who sets the expectations of quality, or defines what quality means to them.

Quality can also be expressed in terms of the product’s reliability and longevity. These attributes are less subjective, because they can be measured in absolute terms (e.g. years in service; hours of service; number of repetitive cycles of performance etc.); but they are also relative measures. For example, what benchmark performance measure are you assessing quality against?

Quality can also be thought of as the output of a process – a production and/or manufacturing process. Therefore, quality can be thought of as a way of working; a culture. It is in this context that the ‘total quality management’ approach to business management has emerged.

Total quality management is the overall approach to ensuring that the critical components and/or production processes take into account the quality of the end product and enable problems in the supply/manufacturing process to be identified and solved.

Watch this video for an overview of a general quality management system and what it does:

Quality Management | 7 mins

Why plan for product integrity?

Apart from our moral duty to ensure that our products are safe and authentic, there are 4 key reasons to consider product integrity.

1. Legal/Statutory requirements

There are myriad legislative requirements to ensure product integrity, particularly in the food industry. The key one to know about is the Food Standards Code, which we will look into further a little later.

2. Market access:

Many businesses require a quality assurance system in order to supply a business. For example, the major supermarkets require conformity with their quality assurance programs. Processors require their inputs to meet quality assurance schemes, for example the Livestock Production Assurance Program (LPA), which we will discuss later. As a supplier into a value chain, you are an integral part of someone else’s ‘total quality management’ system; your input is what contributes to the quality of their product, so you have to conform to their quality requirements.

3. Continuous improvement and product refinement

Monitoring, evaluating and refining your production systems can help identify savings in the costs of labour and direct input costs. More importantly from a product integrity perspective, continuous improvement in production systems and processes can help identify critical control points where loss of product integrity or quality can occur, enabling those problems to be fixed and thereby ensuring an overall increase in product quality.

4. Business reputation and sustainability

You won’t be in business for long if you produce a bad product. Conversely, if you’re known for your product integrity, you are more likely to thrive and survive well into the future. Attention to product authenticity and integrity helps ensure the sustainability of your business.

Let’s look at some videos that illustrates why product integrity, traceability and quality assurance programs are so important.

Australian case-study of Homebush cakes implementation of GS1 | 3:13 mins

Overview of the Australian National Livestock Identification System, illustrated in the cattle industry (Queensland Government video). Note that NLIS applies also to sheep and goats and pigs have a similar system called ‘PigPass’ | 1:34 mins

On the Canadian system called ‘Ontrace’, and provides an excellent overview of a product traceability system that has been implemented across various crops and products) | 12 mins

We are now going to look briefly at some examples of the Australian legislation around product integrity, particularly in the food sector, particularly around food traceability.

The National Livestock Identification system, whilst not a QA system in itself, is a legislated system that is supported by and integrates with various QMS’s. Cattle, sheep and goats cannot be sold into the food supply chain without being tagged with a registered NLIS identifier, which is tracked back to the property upon which the animal was born. It is a critical tool that facilitates the traceability of livestock, enabling outbreaks of disease to be contained in a timely manner. The NLIS is one of the key tools that enables our livestock producers to have access to international markets, because it enables us to support our claims about the safety and quality of our products.

If you want to do some more reading on the NLIS, click here:

In the diary industry and producers of ‘ready to eat’ food (like salad leaf vegetables etc) must conform to the Food Standards Code. The code is administered by Local Government Authorities and industry bodies. Conformity with the Food Standards Code is a pre-requisite to sell food at various stages along the food chain.

The Food Standards Code comprises four chapters, which encompass all facets of the food chain from primary production and processing through to packaging and labelling.

One of the key components of the Food Standards Code is the Food Safety Standards, which establish systems of management and documentation of processes to enable recalls to be made should a problem be detected in a product.

Readings

1. Food Standards Code – Traceability Requirements

2. Food Standards

As we heard in the first video, a Quality Management System is a systematic approach to focusing all business processes towards the quality of the outcome or end-product of that process. Whilst QMS is a general overarching approach to quality management, there is a plethora of specific schemes, standards and proprietary (paid) systems. You probably use one of these in your workplace, or would have experienced or seen one referenced in many of the things you buy.

We are going to have a closer look at two examples this week: HACCP (which can be applied in general or proprietary forms) and ISO9001.

HACCP

One of the key tools that agribusinesses, particularly food processors, use to implement the Food Standards Code and conform to other quality management systems is tool or methodology known broadly as HACCP. HACCP stands for:

The system originated in the 70’s in America and has been widely adopted and systematised around the world in general terms and as proprietary systems that specialist service companies sell as a package of services and tools to companies.

Food Safety Case Studies | 3:00 mins

HACCP can be followed as a general approach to managing hazards and risks in any food-related agribusiness. But the full benefits are really only realised if you are certified by an independent organisation. For example, HACCP Australia are specialists in the HACCP food safety methodology and offer a range of services to food (and non-food) businesses in implementing, auditing and certification. See their website:

Their ‘FAQ’ Page provides a good summary of what is required in implementing a HACCP program. Task: Read through all the FAQs (one page).

The International Standards Organisation

The ‘International Standards Organisation’ is an international independent organisation made up of 164 member-nation national standards bodies. It brings organisations together to develop agreed standards and specifications for products, processes and services with a focus on safe, quality, efficient and reliable outcomes.

As well as acting collaboratively to design and agree on standards, ISO sells standards covering private and government sectors across an array of products and services.

For an overview of ISO, click here

One of the most common Standards underpinning most quality management systems these days is the ISO9001.

MLA’s Livestock Production Assurance Program (LPA)

The MLA has developed and promotes a quality management system for meat producers. It is a voluntary program, but opens doors to supplying many of the larger processors and retailers.

It comprises 5 interrelated components:

Stand by what you sell | 4:26 mins

Portfolio Reflection, Week 5

Next time you bring your shopping home from the supermarket, have a look at the packaging and see what, if any, promotion is included about the quality management system utilised.

In your portfolio, reflect on these questions: Do food companies promote their quality management systems as part of their branding and marketing campaigns, or are they doing it to conform to legislative (e.g. Food Standards) or market access requirements?

For those products/companies that do promote their quality management system, what system do they use? Is it a HACCP-based system? You can search here for more information about the registration status of every manufacturer

Also reflect in your Portfolio on what you think about QMS, HACCP and ISO generally… Do you think it’s worthwhile? How would you go implementing a QMS in your workplace? Do you think it’s too onerous?

Credits:

Created with images by Daria-Yakovleva - "plum box fruit" • USDAgov - "20110715-RD-LSC-0001" • PublicDomainPictures - "tobacco smoker cigarette" • cocoparisienne - "egg chicken eggs white eggs" • ImageParty - "onion food vegetable" • Birmingham Public Library (AL) - "Dawn of Prosperity" • USDAgov - "AMS_5071" • Steve Bowbrick - "Lost book" • USDAgov - "20120106-OC-AMW-0074" • USDAgov - "Super_Bowl_Infographic_01-31-12"

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