If you wondered how blockchain technology could go beyond the realm of cryptocurrencies to help improve people’s lives, look no further than the shores of Lac Léman in Vevey, Switzerland, where Nestlé is accelerating its role in a pioneering partnership to use the emerging technology to increase food safety.
Nestlé is one of ten large companies, including Walmart and Unilever, that are working with IBM to apply blockchain technology to monitor the entire food supply chain. The initiative aims to improve and prevent the costly food recall efforts that are sometimes needed to stop the spread of food-borne illness.
After earlier trials with a single-ingredient food product, canned pumpkin, Nestlé is now adding data from some of its Gerber baby food products to the system to test how it works with multiple ingredients and cross-border transactions.
To protect people from unsafe food, you have to be fast and you have to be right – and blockchain technology offers a chance to improve speed, accuracy and trust levels as never before. The IBM Food Trust partnership, launched last year, uses IBM’s blockchain platform to help companies ensure traceability throughout the value chain. This helps gain consumer trust, says Benjamin Dubois, Digital Transformation Manager – Global Supply Chain at Nestlé.
“We are constantly exploring new technologies that improve the access to information and traceability throughout the end-to-end value chain with minimum complexity and cost, and blockchain is a promising technology for that application,” says Dubois.
Benefits of blockchain
Food traceability systems have been typically handled at a company level, which means important information can be stuck in silos, hindering critical food recalls, explains Brigid McDermott, vice president of blockchain business development at IBM.
“You’re treating the supply chain like a chain, a single chain that goes from one place to another,” she says. “In reality, the food ecosystem is a web.”
Blockchain allows for a trusted, immutable, secure system of record that makes it easy for companies to choose which information to share and whom to share it with, McDermott continues.
“What blockchain does is it provides trust inside of an ecosystem and allows participants to interact in ways that haven’t been possible before,” she says. “We’re creating a situation that allows trusted sharing for an entire ecosystem.”
This means data can be shared across many players in the supply chain, but it’s possible that only those directly involved have access to the information. It also means information about ingredients and products can be traced more quickly than with current systems, Dubois says.
“Using blockchain, we aim to provide better visibility across the supply chain, benefitting the whole value chain including customers and consumers,” he says.
Nestlé first entered the partnership with a “track and trace” test of a single product that came from a limited number of U.S. farms: canned pumpkin, Dubois says.
Now, it’s uploading data for some of its Gerber baby food products into the system. The goal is to test a product with multiple ingredients, some of which come from different countries, to see how Nestlé suppliers can participate in and grow the ecosystem, Dubois explains. As one example, Nestlé is tracking mango from Colombia, Dubois says.
“The main purpose is to illustrate how blockchain technology can work through a multi-steps and multi-ingredients product supply chain, progressively increasing the scale until we can fully understand and quantify the benefits of the solution versus our current systems,” he says.
The opportunities of this technology include its potential to scale within the food industry, provide interoperability, standardize data and increase value for consumers by allowing them to easily access information about their food and where it came from, Dubois says.
“This is an exciting new concept that may still have to prove where and how the benefit will be captured for Nestlé Gerber before potentially making available to other Nestlé businesses,” he says.
One issue facing food traceability efforts is ensuring the accuracy of the data.
IBM is planning a mobile app that would help make the system easier to use and add extra verification to the data by adding phone-based GPS and time information from the person entering the data, McDermott says.
The biggest challenge moving forward is creating a critical mass of data that provides the greatest amount of value to the system, McDermott explains.
“The way to solve that is in creating a blockchain solution that isn’t just, ‘hey, here’s a really cool technology,’ but here’s a solution that addresses the known needs and given reality of this particular ecosystem,” she says.
That requires an understanding that the business model, governance structures, standards and inter-operability matter just as much as the technology, McDermott concludes. Incorporating those five elements can create beneficial systems of collaboration and trust for the food industry, as well as other areas, she says.
“It’s about continuing to add value to the existing solutions that we have and to find solutions where a single trusted system of record creates new opportunities to solve problems that have not been solvable before.”