Natalie Novak 

Ladies and gentlemen, please welcome to the stage our keeping supply chains resilient panel

 
Emma Cosgrove 

Good morning. How's everyone doing? Thanks for coming. We've got a really exciting panel of supply chain experts today. And we're very aware that our presence at CES is a bit of an anomaly. So we wanted to pull the audience real quick to figure out why you guys are all here at the supply chain of panels. So our first question is, please raise your hand if you work in a supply chain function.

 
Emma Cosgrove 

Okay, for the live stream, it's about half maybe a little more. Now raise your hand if you work for a company that has a physical supply chain in a non supply chain function. 20%? Live stream has no idea how bad I am at math. And raise your hand if your business has ever been affected by a disaster. So that could be a hurricane or a cyber attack. Anything you'd call a disaster. 20%. Okay. Some of you are probably in denial about that. And raise your hand if you feel like you could explain blockchain to a relative in less than two minutes. 10% Okay, great.
 

Emma Cosgrove 

We'll see how that is at the end. I don't think we'll have time for a poll. But I want everyone to think about that. Those questions at the end of the panel. Okay, so my name is Emma Cosgrove. I'm a supply chain reporter. I cover freight logistics, operations and procurement for supply chain dive calm. that touches everything we're going to discuss today and a whole lot more. And I'm super excited to have Kathy Fulton and Robin Hensley here with me and they're going to introduce themselves and then give us a quick presentation.

 
Robin Hensley 

I lead a team of engineers and IT professionals that basically deliver our smartly to six network.

 
Kathy Fulton 

Give it a second. There it is. Hey, my name is Kathy Fulton, and I'm the executive director of the American logistics aid network. And we help nonprofits and other organizations with their logistics and supply chain activities during disaster. So, yeah, thank you.

 
Emma Cosgrove 

Okay, so we'll have 15 minutes from Robin and Kathy on disaster preparedness.

 
Kathy Fulton 

All right. So just we asked about who has experienced a disaster before. I'm also curious about resilience within your supply chain. Would you consider your supply chain resilient? Just show of hands, a show of hands, maybe five, maybe 5%. So what does that even mean? What is what is running Resilience from a disaster mean, so just kind of putting that down, it's really about being able to bounce back, right and being able to recover. You know, there are organizations that talk about the whitespace and their ability to ship products or get products to their customers during you after a disruption in limiting that white space. So there's really no disruption proof supply chain, but you can make your supply chain more resilient. So ALAN, is we do some work within the resilience arena, helping businesses understand what's happening within the the environment after disaster, helping them to look at not just their supply chains, but the supply chain writ large. The ecosystem of what's happening, what government activities are taking place, what roads are closed. I mean, very practically, you know what roads are closed so that ups can can move their trucks around. All of that helps ensure this continuity of supply chain operations. Okay. Um, so that's just a quick primer on on us. But let's look at the the problem of supply chain resilience. We've kind of talked about that ability to bounce back. There's some things about the nature of today's supply chains that really can affect our resilience is supply chains. And so I'm not going to read through all of these with the complexity, right? We all know that a supply chains are not just point A to point B. It's not just one or two suppliers. There's a network out there. I know we're going to we're going to spend some time talking about that. A technology or CES, right? So technology is wonderful. It's a wonderful enabler to help us do our jobs. But during a disaster, though, that same technology relies on power and communications that they themselves can be disrupted. So this underpinning items, you can look at the OECD statistics on the number of disasters and the impact of those disasters, then there's this global trend of concentrating our populations in, in cities. And it just want to read a statistic to you that 54% of today's population lives in urban areas. And that's compared to about 30% 1960. And expected to be almost 70% in the next 30 years. So all of these things can both enable us to do supply chain better, but at the same time, that can make us more fragile when a disruption occurs. And then you can add in the problem of humanitarian response, right. So if you are, if you are a business who suddenly needs to assist and take care of your employees, you're going to you're going to spend a lot of your business time that you would be serving your customers, making sure that your employees have everything that they need. There's a great statistic out there that was produced by (inaudible) that 80% of humanitarian spending actually goes towards logistics and supply chain activities. And we've heard from our nonprofit partners that 40% of that is waste. And I'm not talking about malicious or intentional waste, but really the waste that comes from having to do supply chain differently during a disaster activity. And so, what does all of that mean? Those bad supply chain activities can also lead to what we call the second disaster in humanitarian response, meaning that stuff that really should never make it into a disaster area gets shipped there. And so how do you how do you use technology to prevent problems like this? It really become a waste disaster. How do you sense and respond and use good data? To help support that, but there are some good news. Okay. So the good news around around this is we have a lot of data, we have a lot of information that can help us prepare better up front, they can help us make better decisions about what's happening during, before a disaster what's happening within our supply chains.

 
Kathy Fulton 

Technology advances are allowing us to simulate those activities. So I know of organizations who use digital twins to map their entire networks, they use the data to simulate an impact of taking out one of those locations during a disaster. I'm not going to go wrong with thunder, but she's going to talk about dynamic network adjustments and then disaggregation to distribute risk. You know, the, the nature of our supply chains has been that we concentrate in areas to gain efficient scale. I'm thinking of the bioman region in Puerto Rico, they had a terrible earthquake there yesterday, Bayamon is in San Juan, northeast part of the island, they are relatively unscathed. But there is a significant concentration of the distribution activity is right in that corridor. So if they do have a significant disruption you know, it's going to affect a larger population. And then the the technology and we're I know we're here to talk about technology. So I'm actually going to pass this along to to Robin here very shortly. I would be remiss if I didn't talk about just the consumer technology that is allowing those who are disrupted by disaster to have access to information to know what's going on to know where they can go and get assistance and even just thinking of the simple things like within the US a lot of cities are moving to text 911 you know, community disruptions. Phones often don't work after disaster phone calls, but texting typically does. So I think with that I've just brain dumped a lot to you, which we're going to, we're going to talk about a little bit more. But I'm going to pass it to Robin to talk about the fun stuff.

 
Robin Hensley 

Thank you, Kathy. So I hope this is fun stuff. So as we know that disasters affect many parts of the supply chain. It's quite complicated when you think of everything from pickup, to warehouse scene to packaging, to delivery, to customs. So I'll give you a couple of examples with UPS. I would say resiliency of the supply chain is a journey. And we're constantly on this journey. We're constantly learning, but I'll give you a couple of examples. In UPS, we have we can do pop up centers, to actually do sorting in alternate locations. And we're using technologies how I mentioned one of them, we call DSI dynamic sordin struction. And you wear a ring scanner, and you can scan packages. And using bluetooth, it'll tell you in your earpiece, where to sort this package. So basically, you don't have to have any experience at all. You don't need to know anything about the postal codes, anything about the area that you're supporting. We do this by the way, during our peak season, we just do it during the holidays. So we practice these pop ups all the time, but we can use them during disasters. Another example is customs. So making sure that everything's secure for customs, we can use canine dogs for security screening. And we always do drills we are constantly doing disaster drills, different types of drills, at UPS, I'll tell you it's a it's a great practice. Every time we do them, we learned something and we're documenting alternate ways of getting things done. So I highly recommend that. In addition, we have over 34,000, what we call access points. So these are alternate locations to pick up or deliver packages. And I'll give an example hurricane...I think it was Tropical Storm Harvey, that was in the Houston area. And areas were flooded for weeks at a time. And people could not pick up their packages. But using an alternative location like a UPS Store, a Michaels, CVS, different kinds of stores that we have that are available, you can go to a safe location that's near either where you work where you live, and pick up or to, you know, send off your packages. So extremely useful to the teams and to all of our people. And by the way, use MyChoice. It's a free application on ups to change the delivery of your package. In addition, we're doing projects that provide relief, working with different groups like the Salvation Army. Making sure that we are using technology so that we can distribute it to refugee camps to make sure that they're getting their relief and their medication in an equitable way. So making sure that everybody gets what they need all the way through the system. And they were using handheld handwritten cards, and we moved it just to a barcode. So it doesn't seem like very high tech. But it makes a really big difference when you're delivering the materials directly to those that are impacted in this in this case, it was 20,000 individuals to make sure that they actually got the relief that we were looking for. And we're also testing with the United Nations a technology called Relief Link. In the same way, we can track all the relief from the origin, all the way to the destination and the destination being humans, which is very important that everybody gets what you expect them to get at the right time. Now, of course, I need to talk about the role of drones. So drones play a big part in supply chain facilities. And we've talked about the last mile, but ups now is a has a drone airline. We are a certified drone airline from the FAA, were the first certified drone airline. And were able to deliver supplies, I would say medicine and samples on very large medical campuses. So imagine a very large campus, and it could take a half an hour to drive across this campus. And you can make these deliveries very quickly, which is very important. If the sample happens to be you want to do something for cancer test, you need something turned around very quickly, or a blood product that needs to be sent or you know, some sort of human tissue. So we're doing those on campus but in addition, we have tested with partnering with CVS, to do a delivery of medicine to a person. So basically, we're looking at both the business areas for drones as also what we can do with residential. So imagine this airline just like our regular airline with airplanes. We have very large airplanes, Boeing said, go across the ocean. We also have very small airplanes that are regional airplanes. The same thing with drones. So we're partnering with a number of different drone makers to that have very different types of drones for different types of use cases. So it's a big growing area for us. And as I move on to our conversation, I really my last thing I want to say in summary, is that this is a very complex environment. It's also very personal the supply chain is very personal. It's very people intensive. I know that CES we're talking a lot about technology, which is so exciting, and UPS We have over 480,000 people. And these include people that are creating this technology that are delivering the technology. So we have our IT professionals, we have our engineers, we have our pilots. And now we have our new drone operators. So there are many new types of jobs that are being created through this. And again, personal people related, you know, making sure that we're getting everything to the right person at the right time.

 
Emma Cosgrove 

Wonderful. Okay, great. I have a ton to chew on that. It's exciting. We are going to talk about the concept of a network and what that means. I can't believe the word visibility hasn't come up yet, but it will in a second. But first I kind of wanted to bring it into focus for anyone in the audience who's not used to hearing about warehouses and trucking. I'm stealing this from a writer at supply chain.com that's not me, but one of our writers described receiving a parcel as managing a personal supply chain only you don't know the origin of the package, of the parcel, right retailers keep that from you for pretty much as long as they can. And and that way you don't know how many stops your parcel is making you don't know who actually has custody of it at any given moment until it reaches UPS. And then you do, and then you have visibility. So I wanted to just give that example before we start talking about networks because that level of visibility is not unheard of in the supply chain world at all. It's it's, it's depending on the size of the business or the amount of attention they've paid to technology. A lot of times that beginning part of the supply chain is opaque. And you can imagine that if you if there is a hurricane, thousands of miles away from you that affects a part of a supply chain, you're not used to seeing your own meaning a supplier you're exactly the same as you are sending your apartment just needing that parcel and having no idea where it is and really no one to call about how to get it. So in light of that, let's talk about networks. You mentioned digital twins Kathy and I I really love that conversation because if you're not in supply chains every day, it seems like a no brainer. Of course, you would have a digital map of your supply chain. One, just define what a digital twin is for me. And then tell me what it looks like if you don't have one.

 
Kathy Fulton 

Yeah. So digital twin is basically what it sounds like you take your physical infrastructure, and you did make it, you know, make it an electronic copy of it so that you can look at those nodes geographically across time, whatever that that may be. And I'm probably not giving there's probably someone in here who can give a much better real description of digital twins, but that's the basics taking the physical world and making it digital. And then your follow up is if you if you don't have that, or what is the benefit. So, you know, think about these large scale disasters that we have in my background is really, you know, disaster and crisis. Think about those impacts and think about being able to understand what's going to happen within your network to roleplay that right without actually doing the physical damage to your network. You know, if you have that capability, then you suddenly can can plan for scenarios. That may seem really wild, right? There's Black Swan events, the unknown unknowns that General rums, Rumsfeld talked about those those things that are so beyond the pale so beyond our comprehension that you can you can play with that and you can say, Okay, if we lose a supplier because we have this earthquake, tsunami, and nuclear meltdown, if we lose a supplier because of that, what are the impacts to our supply chain? Oh, maybe we could have known that it's going to mean that we're going to have to shutter one plant in Shreveport, Louisiana for a short amount of time. Yeah. And when I'm sort of fascinated by is does it talking about disasters, This is kind of a sexy way of talking about things that can happen every day, like one of your suppliers has a worker strike. Yeah. And all of a sudden that facility is down. There wasn't a hurricane, but the facility is still down. Right. So talk to me about what the connection between just plain old good supply chain management and disaster preparedness, are they linked? Do they generally come together? Yes. And so, so I love this question. Because sometimes it's actually the opposite. The things that we do to make ourselves efficient with our supply chains just in time, make us more fragile, we have less inventory on the shelves, because we've optimized defined just in time, it meaning that things are produced and shipped and arrive just as the consumer, meaning you don't have tons of inventory. You don't hurry, you don't have things sitting on a shelf, right? And so as our supply chains have leaned out, that's put us at risk when significant disruptions occur. And I'll just give a quick example. I know I'm kind of skipping your your question here, but I'll get back to it. Puerto Rico, and the saline manufacturing in Puerto Rico was disrupted for months because of power. That actually we didn't have large stocks of saline. And we were actually at a point where we were kind of reduced on stocks and saline bags. Leading up to that, that disruption from Hurricane Maria in 2017 actually prompted hospitals to stop doing some elective surgeries because of the saline shortage, right? Um, so that's a real tangible example. So are is good supply chain management linked with, with resilience? Yes. Okay. But it can also disrupt and just just one more thing. And the really good, the folks who are doing supply chain really well are thinking about, like you said, not just disruptions based on cause, but regardless of what happens they're looking they're looking at how do we how do we fill? How do we keep that supply chain moving? I'll stop there

 
Emma Cosgrove 

Yep. Robin, I'm wondering if you could answer that question as well, from your experience at UPS is getting better at what you do. Does that make you more prepared for when you need to know exactly which roads are shut down and how to send your where I'm assuming like 408,000 workers, you're moving people when there's a hurricane to make sure they're in the right place, too. So those two things go hand in hand for you.

 
Robin Hensley 

They're absolutely hand in hand. And it's a journey. It's an everyday because I would say I almost feel like there's a disaster every day. It's called weather. And when you're moving things around the world, it can get pretty crazy. And we talked about the digital twin for us as a package. So pack- package is a physical thing, but it does have a digital twin, and that is actually scanned. So we have really could almost be 10s to hundreds of scan events for a package as it moves through the supply chain. And we're tracking that and giving you visibility and to that package, at the same time, it causes some time a little concern, you might see a package that you think should go direct, you think it should go direct to you, you see it, sometimes moving to hubs, sometimes you see it moving backwards. And you're like, what is happening with this package. And it's called analytics. So we are doing a massive amount of analytics with this data, because on a normal day, we're moving 20 million packages. And during peak, that's over 30 million packages per day, so that you can imagine the number of scans and the number of events that are happening. So we're using analytics to provide the best route and how to get these packages to where they need to be, and at the same time, give you visibility to those packages.

 
Emma Cosgrove 

Okay, perfect. So you mentioned dynamic network, that phrase in your, in your slides, could you just break down what that means to ups to have a dynamic network? Maybe a tech stack as well, like, give me a list, a tech

 
Robin Hensley 

A tech stack. There are so many technologies that are involved in this. But when you think about dynamic again, I'll go back to the data that we look at. We have a lot of data, but data without insights, we think of that as trivia. It's meaningless. So we're really using the analytics to come up with information and insights, using the data to say what is the best route? Again, what is the most efficient route, you know, for these packages, and you mentioned like moving people and moving equipment. We're definitely able with the dynamic network, we have something called our new automated hubs. And Atlanta, we call it the Smart Hub. And these hubs are very highly automated. A package will go into them and and actually, even though they're larger than nine football fields, the package would spend less than seven minutes inside of it. But at the same time, remember hubs all around the world, they know how to move the packages in that particular area with those zip codes. With the automated centers, you can turn them into any type of hub. And for example we had with Hurricane Michael, we had in Florida, we were not able to access the Jacksonville hub that have had to be shut down because the hurricane was coming. We could move those packages to another automated hub like Atlanta, and turn that into pretend to be the Jacksonville hub. And then it would actually support all those packages, we do a special sort, put them into bags for those zip codes, and then send them along their way. So that's dynamic. Now you have centers that can be dynamically changed to another center.

 
Kathy Fulton 

The scale of that is, it's really hard to imagine. I love thinking about it, but it's the same thing with any physical supply chain. If you've got a hurricane coming toward one of your factories, I was talking to PNG about a hurricane coming toward one of their laundry detergent factories, if you have the agility to twin that factory somewhere else, that the preparation that goes into that the technology that goes into that, to know when to pull that trigger as well is just immense. It's unfathomable. I mean, I'm assuming that your decisions when you're deciding to shut whether to shut down a facility are enabled by technology, but at the end of the day, that's a human pulling the trigger

 
Robin Hensley 

At the end, it's a human. And at the end, it's also you know, with all of our agencies telling us that we are now going to shut down this area and we need to evacuate. And we want to take care of our people as well as all everybody else. So we are evacuating and we are also moving equipment. We have plans to move equipment, we do it all the time. We can pick up those servers and move them with the people to make sure that they're safe and we'll move them back. And you also mentioned about sometimes you run out of certain things. And of course we have 3d printing and we are doing 3d printing with certain areas and certain types of commodities.

 
Emma Cosgrove 

Yeah, yeah. Okay, so I wanted to get back to the saline. So that's perfect.

 
Emma Cosgrove 

We can't 3d print saline. And we I was just thinking since this is a Consumer Electronics Show, everyone I mean, everyone in the supply chain is also a consumer. So, Robin, can you Robin or Kathy, can you help us understand how to make sure that if we're giving money to a disaster, which is pretty much the only thing we can do unless we want to volunteer? How do we make sure that we're purchasing that saline or enabling that saline and not enabling the 10,000th case of bottled water that is not needed or another box of diapers that's not not in the right place? How do we make sure that we're actually supporting smart disaster relief?

 
Kathy Fulton 

Yeah, we've we've had lots of conversations about this. So there are vetted organizations vetted nonprofits. In here within the US they all typically participate in an organization called the National voluntary organizations active in disaster national voted, but they are the ones who are looking across the need. They're they're doing pull based rather than push based. So to put in supply chain financially, yeah, so to put in supply chain terms, they're sensing what is needed on the ground, and they're reacting to a demand signal from the ground, rather than just pushing what they think someone might need or taking orders. They're taking orders basically, and it has to happen very quickly. But with and I don't have my phone with me but with you know, the technology that we all carry around in our pockets. And we tweet about hey, you know, this this, this shelter is in need of water, their shelters in need of those can be very quickly quickly vetted because of technology and organizations who are doing that are the type of organizations that you want to support.

 
Emma Cosgrove 

Gotcha. Robin, could you go into I'm just in our last minute or two, how UPS thinks about aiding in disaster relief. I can imagine I mean without people like Kathy It'd be a pretty daunting task to just wait into a hurricane.

 
Robin Hensley 

It's very important to ups we have a UPS Foundation, which ALAN is, of course, part of the UPS Foundation, it has a number of different partners with it. And that's what we rely on, I would say that we rely on that pole to tell us exactly what's needed exactly where it's needed. We have a very large network. And we also have a large network of volunteers, that people UPS serves around the world to volunteer their time and their money to bring the right the right materials to the right place at the right time. And we maybe more than others recognize that very well. If you need water, you're going to get water if you don't need water. And you know, we're not going to send you water, we're going to send you exactly what you need at exactly the right time.

 
Kathy Fulton 

Yeah, and I'll just take a point of personal privilege to make a PSA. A really good way to donate smartly in a disaster is to donate to the logistics services like ALAN, because that's the only thing that's absolutely needed. And never excess is a movement of goods,

 
Kathy Fulton 

Goods, and we're doing that betting as well. We're making sure that the partners who are on the ground are the ones who are in the they're shipping the things that they need to, because of the relationships we have. I'll just add one tiny thing. I know we're out of time here. But it, we have to say this that the success of a disaster of a disaster response recovery is entirely about supply chain. It's about the information about it's about the movement of goods. Disaster Response relief recovery does not happen without supply chain.

 
Emma Cosgrove 

Yeah. Wonderful. Everyone join me in thanking Robin and Kathy.

 
Kathy Fulton 

Thank you.

 
Emma Cosgrove 

And we'll switch over our panel real quick and talk about an entirely different kind of disaster. very personal one.

 
Emma Cosgrove 

Nigel, Bob, welcome.

 
 
Thank you. Thank you
 
Emma Cosgrove 

Just give a quick little introduction of yourselves and then we'll get your presentation.

 
Nigel Gopie 

Sure. So I'm Nigel, I'm Director of IBM blockchain. I help clients along their blockchain journey, whether they're just beginning or they're on there and they need help accelerating where the ability to extract business value

 
Bob Wolpert 

Bob Wolpert Chief Strategy and Innovation Officer of a private company called Golden State foods, very large supplier primarily in the quick serve restaurant industry. And we were started a journey three years ago with IBM and we believe we're the first in the world to combine blockchain, IoT and AI and a supply chain application. So we'll talk a little bit about that.

 
Emma Cosgrove 

This is exciting. Okay, and then pull the audience again, I apologize. Who has heard about the application of blockchain in food? Okay, less than half. This is really exciting. Because I've been hearing about it for years. So I'm very excited for an update about what's really happening. Go ahead, guys.

 
Nigel Gopie 

Okay, great. So I'll kick us off. So first of all, Happy New Year everyone. Holidays really have this ability to bring us all together with our loved ones or friends, families. And so I just got back from vacation a couple days ago. And it's actually in Trinidad and Tobago, and what I really think brings us together and connects us even more than just the holidays is food. Food brings us to the table allows us to have conversations with each other, listen to funny or not so funny jokes from our relatives, and allows us to connect in ways that were not able to. And so I had the great fortune of going to a local market to get produce, speaking with the farmers who actually created and produced the food we're about to eat and also had the opportunity to go to a local grocery store. And I was able to purchase because of our modern food system, foods from across the world able to produce food that was out of season locally, I was able to produce foods that just was not produced locally across the world. And grocery stores today now have about large ones 50 to 75,000 skews on their shelves. And so the modern food system is pretty extraordinary. We're very fortunate. However, because of the complex supply chain, there are some friction points associated with it. So we know that about one in four consumers really trust the food ecosystem today. And in in this room here, 1 in 10 people will get sick from a foodborne illness. Now when you think about the societal impact of that it's pretty pretty large, because there are going to be some deaths as well. But they're also business implications to think about the brand as well and how that impacts particular brands. It takes about $10 million or so for each recall. And not only is it for pulling out the impacted good, you also have to worry about your your brand as well. Food waste, so about third of all food produced is wasted. But 40-50% is thrown out in our homes and our kitchens. But the rest is really not optimized across our supply chain. Then we have things like food fraud. We have food items that do we actually know whether the strawberries were about to eat is organic or pesticide free. I'm from New York. And I know that recent study showed that 43% of fish in New York City is mislabeled. So can we be confident knowing that what we're purchasing is is is the item that we were meant to buy? So the root to these issues and many others. It's really bad this lack of trust and transparency and the reason for that is the complex web of our supply chain and food. So it looks like spaghetti mess on the book on your plate. And you have different participants connected in different ways to share information to share the food from growers all the way to restaurants or grocery stores to reach our plates. So if you think about businesses and networks, it's very much siloed a lot of people and Emma, you did polls, I'm going to do one right now.

 
Nigel Gopie 

How many of you think so if you think about the world's data, what percentage do you think is searchable? So you can just find that data do you think it's like 40%? Raise your hand. You think it's more like 50% or 80%? Okay, there's a couple of folks there. So So, basically, a high proportion you think is searchable. The truth is only 20% of the world's data searchable 80% locked within silos within organizational silos. And so you're not able to access that data very efficiently. Because Different people have different record keeping mechanisms or different technologies that they use to share that information. And so if any problems occur in your supply chain, you have to go through and and sort the different pieces. It's like a puzzle going back to the source. And so it's very complex, time consuming, and costly. And so here's where different technologies come into play, and then one that we've been using for the food system and helping transform it. And Bob's going to talk more about this is blockchain. And I'm going to talk about just three quick things about blockchain that really helps with food. One is digital. Second is it's distributed in that it's shared across so you have data shared across numerous computers. And the third is that the data is immutable, meaning that the data that you see there is the data you can trust because you can't change the data. And so it's when these three properties come together and that really can have an important set of benefits for us. So we have, when you have digital transactions and it's shared, you now have efficiency. You can share information quicker, faster when things are distributed or shared, and you can trust the data because it's not it, the data sources immutable or not changed, you can get the trust. And then when you have digital transactions with data, that's not changed, you have that transparency. So it's the efficiency, trust and transparency from blockchain that really allows us to transform the food ecosystem. And so instead of that spaghetti (inaudible) I showed you before, we now have a system that's a little more streamline and efficient, where information can be shared across those silos in a way that you can trust that secure and you can select the information that you want to share. So you don't have to share everything along across your food ecosystem. And so Bob's going to actually pull this and bring this to life by showing you some real world examples.

 
Bob Wolpert 

Thanks, Nigel. First, let me just add to the comment about blockchain and applicability to supply chain. So think of the physical movement of goods step a step B, step C, it's a chain. It's it's a natural analogy to then say, Can I put those chain events on the chain on the blockchain and add value to it, and that's what we're really talking about today is how to add value and then how to use that data both for day to day business purposes, but then also for resiliency. And the number one message for me for anybody that cares about resiliency, is it's an insurance policy and it's hard to pay for an insurance policy. The way you pay for insurance policy is to have ROI in your day to day operations that drive the type of infrastructure and data you need for also for resiliency and you get the best of both worlds. I'm going to give you some fun facts now. Just off of these graphics. So on the far left, a lettuce field in China, Golden State foods owns 1000 acres of produce production capability and far and then post processing in China.

 
Bob Wolpert 

A head of lettuce as a consumer and take this home and talk about it at home, a head of lettuce that is transported at 34 degrees has twice the shelf life of a head of lettuce that's transport that's held or transported at 38 or 39 degrees. So imagine the amount of quality that comes with the controlling the temperature and tracking the temperature. So IoT one input is temperature. The other variable here is thermal cycling if the cellular wall of lettuce expands and contracts a lot of water inside. So if you go up and down, up and down, you're going to get less crunchy lettuce. So what does this mean for the food supply chain? It means that if we're going to reduce less have more immediately available and extend the shelf life we need to use data to drive those events. In the middle picture of a hamburger manufacturing facility, we make $5 million 5 million hamburger patties a day at one facility. And different chains have different standards for the shelf life. But in our case, that's 14 days from the time the hamburger stamped to the time it can be used in the back of a restaurant as the maximum. If you double that if you decrease the variability in the in the temperature, you could extend that shelf life to 20/21 days. So there's a lot of science and data that can drive the quality of the food you eat the safety of the food you eat. And you go back to the lettuce what farm did it come from what's traceable? Where can you prove that that lettuce was an from a safe farming practices. And lastly scallops on the right. Same thing. You You cut temperature, travel time and temperature in half and you're going to double the shelf life. So a lot of use cases that then are applicable when we we drove some pilots around this the aha was in blockchain you have a lot of real time visibility across multiple ERP systems data that you can tell we were running this particular pilot for hamburgers which is now in production and the hurricane in Florida hit and the supply chain professionals were amazed that they could see all of the data points of where the supply chain come to the quantities were off site storage things that would be a latent demand signals that were as to where the supply was. We we joined food trust as a way to build this, this capability because today the ecosystem approach is going to help all all boats rise as the rise as the tide rises all All boats get to a better place. Walmart started the journey and said we want people to get on board we we helped join that effort three years ago. And the belief is that by improving the accuracy and the data that comes with food, not only is the day to day production going to be better, but then when a food borne illness outbreak occurs, will have access to data much more quickly and be able to contain much more quickly. The IBM food Trust has a core set of capabilities for those of you that might be in development in the in the audience, the it's it's deeply encouraged to be interested in adding modules and capabilities and offering of his third party applications on top of the blockchain platform. So we get to get you connected IBM to talk about that if you're interested. We have a number of use cases that are pretty exciting. Just go left to right real quick, Carrefour, largest retail food retailer in Europe has right now over 20 items where you can scan the QR code on the package on your cell phone app you can see the travel of that contents of that package from the in this case chicken where the farm that chicken was raised at, where what processing facility at went through, and the journey to the to the store the time and date stamp, lift and sales. So you've got supply chain applications that drive the performance of the supply chain and you have applications that drive increases sales. Those are the two categories that people are trying to get ROI from that then make their supply chain more resilient and able to adapt to disasters more quickly. The next example is it was talked about in some of the press yesterday. Farmer Connect is able to tip a farmer or extend the scan the QR code on your cup of coffee or your package of coffee and and tip back to the farm or the co-op. And this right now the nonprofit in the area that could help the school systems or water quality that eventually when the farmer has a digital identity you can actually it'll actually go to the farm.

 
Bob Wolpert 

Walmart all leafy greens in North America and in the US or North America's overreaching, but in the US are now on the food trust blockchain, a full traceability real time Golden State Foods. So we combined the temperature data, we actually put RFID tags on every single case. We do that today for 15,000 cases a day. And you're able to trace that through the supply chain and you're able to see case level information. We're using artificial intelligence to to bridge the gap between our missing RFID reads what's the most probabilistic event that that case most likely would have occurred to a missing case with was it was it lost damaged, etc and decrease the variation in the supply chain. And then visibility, persona based visibility, there's there are a lot of software applications out there that say you can have a control center for the whole supply chain. But if each participant's not able to use the data in some way the data gets out of sync the data gets old, it's not trusted and then the system starts to degrade in terms of reliability. So you need you need to the beauty of blockchain is if it's implemented properly is you you provide tools that everybody uses, and then the quality of the inputs increases in the validation of the data. This is a daily occurrence. Seafood is is their number of applications onboard Ecuadorian shrimp, the scallops from outside of Boston going to Santa Monica seafood and to a restaurant chain with a QR code on the on the on the menu. So a lot of availability around visibility. And visibility, encourages trust and then reduces waste. Couple more slides just to two more here and then we'll get to q&a. The food, the basic food trust platforms in production. Everybody thinks of blockchain as a early adopter game, baby but these early adopters are in production and using this for over 17,000 products every day. And in on top of it sits a governance body that I'm chairing at the moment along with nine other company members and we're providing guidance on the your data is your data. There's no ability for the FDA or for somebody at IBM to look at your data. There's it's a private permissioned ecosystem, and we need to build trust in the data and the trust in the people use the system so that we get the bigger adoption and the bigger play. So with that, I'll open it up for a question.

 
Emma Cosgrove 

Me. Come on back, Bob. Okay, great. Before I was a supply chain reporter, I was an agriculture reporter have a lot of questions. The first one is kind of a tough one. But it's honestly coming straight from the heart. There are a ton, not a ton. There's a handful of food supply chain visibility applications out there in the marketplace. Those who believe not all of them use blockchain. In fact, I'd say blockchain based applications are the minority. Why does it got to be blockchain? Explain this to me. I really don't get it.

 
Bob Wolpert 

Okay.There's a it's really a, my title is Chief Strategy and Innovation Officer and the answer to the question has to lie in your vision around where where we'll be five years from now.

 
Bob Wolpert 

If you think of the garment industry, every garment these days is coming up with an RFID tag Nikes made a commitment to put RFID in every box issues, the garment industry is going to be dominated by a digital identity for every piece of garment that might come to food. But no matter what, what also is coming to food is our digital signals around quality and water quality at the field, transit it temperature information, how if for those of you who are technologists, how are you going to keep all of that in sync on a on a proprietary database that one company owns. So should Walmart own that database? And then or should have an application. I won't mention any names that's not blockchain worried on that. And then everybody participate and how you're going to keep all those digital signals in sync. So the last thing I'll say is, if you if you if you think of blockchain as a time, data stamp of this of encrypted information, what better place to put a time date stamp of encrypted information about the physical good, with a time date stamp of the data you need for water quality or temperature right in the chain. Now that might be a pointer to a reservoir of other data. But you'll immutably forever create that connection. I don't know any database in my many years of working around it that could keep that in sync for the scale of a global operation across multiple companies across multiple years. So that's my short answer.

 
Nigel Gopie 

Yeah. I'll add to that as well. So when you think of a blockchain blockchain democratizes information, and so common applications and databases are owned, like Bob mentioned, by a particular company, blockchain we're all are owners of this information. So each one of us are responsible for uploading that data. And Bob mentioned governance models as well. And so you have the ability for your ecosystem to dictate the terms of how you would use these data. So each person who uploads that or each organization is in control of that data. You can't sell someone else's data, for example. So you have one democratization of information, which means that a person's owner, and the other part of it is the immutability aspect. And so you can't change records. All a lot of the databases that we have today, records can be changed. Now even we, we work with many companies, and they don't even trust our internal databases, right? We all know that we all email Bob or other people's like is this thing of the right data? And so here we have a ability with blockchain to know that the data I'm seeing is the trusted and reliable source and you don't see that anywhere else. And you know, the horse meat scandal in the in the UK. Do you recall that?

 
Emma Cosgrove 

No, but

 
Nigel Gopie 

No, you don't? Okay, so this is where we had a horse meat being sold.

 
Emma Cosgrove 

Oh, yes, yes, yes. Everyone know the horsemeat scandal? People were buying horse meat when they thought they were buying burgers. That's right. Yeah.

 
Nigel Gopie 

And across major retailers in the UK to find the issue with what happened we had to go through back into databases. And guess what people change data. They started erasing things and getting rid of the evidence and blockchain, you can't do that.

 
Emma Cosgrove 

Yeah, that's funny. I feel like the discussion around immutability is often not as easy to understand because we don't want to admit how much funny business there is on the back end of our food businesses, but it's a big it's a big issue. I think suppliers have interests, buyers have interest, retailers have interest, everyone has interest and keeping that information. Bob, you really convinced me keeping it with high fidelity at scale at global scale is what's understandable, but I think it's probably I think it's reasonable of me to see if it's to the scale that we're at currently, and be like, Well, our existing solutions can handle that, but you're thinking bigger. That's what you're saying. Because you're quite an advocate for this Bob.

 
Bob Wolpert 

Yes. And we, we use some of those systems are referring to and so I know the their weaknesses, and they're nice in my humble opinion they're nice band aids to to meet a need today but they're not scalable and and that's just we have 30 warehouses in the US and or more but 30 that deliver to the back of quick serve restaurants Starbucks, Chick Fil A, Chipotle, McDonald's, etc. And we know what tracking systems people use. And I can tell you that the there when you have to add temperature just as one extra variable, right? You're going to run into challenges with those systems.

 
Emma Cosgrove 

Yeah. Okay. Another point of fascination for me that I'd like to hear from both of you on is the physical challenge of getting, creating. It's the same term but different meaning a digital twin blockchain for more bulk food items because you brought up fashion, which is a really great example because there's no supply chain in the world more complicated than fashion. most mature national, even US National fashion businesses have 12 tiers, meaning like their supply chain has a buyer of a buyer of a buyer at 12 times, which is more than most food businesses to be honest, but they're non perishable items that every single one of them gets packed in a poly bag and a tag. So explain to me how, let it heads of lettuce are getting tagged. You mentioned cases of meat, so maybe it's not the case level, but how do we actually get from the ground from the soil to the consumer? Sure, great question.

 
Bob Wolpert 

It varies by product and where you are in the journey. It's you can start with a lot number that all this lot. I mean, just think of romaine lettuce crisis. The when, when the romaine two rows recent romaine lettuce crisis hit, it took eight weeks to figure out where the road came from in that intervening period all romaine in the US was wiped off the shelves. Could you see a day where it was isolated to these three lot numbers and therefore only the Northeast had to wipe out and the rest of the containers? Okay, so I think lat number is is is the first and everybody in the business tracks lot number there are some brokers that it's hard to track through the broker where the numbers but that's shouldn't be the reason the system stops that you need to clean up the act of the broker, not

 
Emma Cosgrove 

numbers that survives through pack packing as well.

 
Bob Wolpert 

It does well, you try. You can have transformation events. So let's say that you raise now we're going into a lot of detail but let's say you are you're you're bagging salad mix. You first wash the lettuce, you bring the lots of lettuce in in a controlled fashion. You know what field they came from. They go on and wash it into a washing a piece of equipment washing machine and let's say you have Three of those machines that then they feed nine bagging lines, you have to keep all of those in sync to know that this bag of lettuce work back up through the chain came from this lot. And up until I'd say two years ago, it was this went in for the day and this went out for the day. One of the things that blockchain is teaching companies to do is to loop process mapping and make sure that their traceability is to a more granular level. Now, do you need blockchain to do that? No. But you get the double benefit of process improvement and the immutable technology to get more granular tracking. So if others will track down to the case, there have been studies with mid pilots that have been done down to the individual rapper, where you could track the rapper of a pre made sandwich, for example. So there's different mindsets as to where it's most cost effective. And I can't say I'm under NDA for some things but there are new packaging techniques where some things we It in the packaging so that the cost of the system will be lower and they'll be coming over the next two or three years.

 
Emma Cosgrove 

I'll close up with a question about resilience. But it is fascinating to me that some of the most controversial food items that we consume like palm oil, for example are now soy is under the microscope to because of the amazon fires, those are sold in massive bulk like like they're almost sold theoretically, and they're stored in massive bulk quantities. I'm really excited to figure out how we get those on a blockchain.

 
Bob Wolpert 

So let me try so yeah, today. We get tanker cars in of oil. You can today do a spectral analysis was the product that was delivered what was what you contracted for to ship you don't compare? Those kind of tools weren't available three, five years ago and now you can attach those to the blockchain and say it is actually a IBM to their credit has a attachment to us to a cell phone You can do a spectral analysis on the product, they do it for all of the oil is one example. So I think the technology is coming very quickly to make sure that nobody's adding fraudulent product. And it's, you know, it's palm oil from, you know, in one definition, it's from this region, it's it's harvested this way versus another region. Those those fraudulent practices are going to get reduced as a result of data transparency.

 
Emma Cosgrove 

A spectral analysis is really interesting in the horsemeat scandal as well. One of the things that came out of that with DNA analysis of me and there's a company in Ireland that all they do is take tiny little samples of every single case of meat that you receive as a grocer. And they just DNA verify that it's, it's what it is, and that's the ROI is there. Apparently, they're doing great.

 
Nigel Gopie 

I agree. And I think the other aspect is not just within the walls of our organizations again, but it's what consumers are wanting.

 
Emma Cosgrove 

Yeah

 
Nigel Gopie 

They want. They want to have produce or to purchase things that are responsibly grown, that are sustainable, responsibly source. And so Now we have the supply chain information on bob reference, all digitized. But now the consumer kept access to it via their smartphone. They can scan QR codes understand and see the transparency of that product as well.

 
Emma Cosgrove 

Yeah. Okay. So in our last minute, take that to the nth degree, tell me 20 to 30 years from now, with the amount of supply chain resilience we can get from this kind of technology, this kind of visibility, are we going to be able to end foodborne illness that's not restaurant related in developed economies? Like talk to me about how you see each of you. That's the future 2030 years from now if this technology really gets going?

 
Bob Wolpert 

Want me to go first, all right. Well,

 
Bob Wolpert 

for those that have been around manufacturing and process businesses outside of food, which I spent most of my career in before the last six years, the name of the game is reducing variation. You if you want to put out a quality product, you reduce variation in every step of the process, so that you have less risk that something can go wrong. Well, it In our world of food, think of where we've come from thousands, hundreds of years of farming techniques of, of, of locally generated practices and very little data that says the process is getting better or getting worse. So as you 30 years from now as water quality sensors as antibiotic sensors as the quality indicators, type sensors, you can you can do spectral analysis is one there will be DNA, they'll be they'll be there's work being done. In fact, there's an announcement, but somebody the UK last week around E. coli identification, real time so I think this food, food will get safer as a result of technology. Which technology Do you want to bet on? I won't comment other than, I believe it needs that infrastructure to attach to

 
Emma Cosgrove 

But IoT, whether no matter what your infrastructure is, it's got to be IoT. It sounds like as well. Nigel, can you weigh in 2030 years?

 
Nigel Gopie 

Well, I see blockchain has been the platform where you have the converging technologies come into play. So this is where your IoT will come in to get additional data sources. Then once you have your data infrastructure, you then can get insights from it. And this is where you can do analytics on your blockchain, you can have AI artificial intelligence, get smarter and create and create value for you that you didn't have before because now you're capturing information across your value chain.

 
Emma Cosgrove 

Wonderful. Well, thank you both so much. And thanks to CES for talking about supply chain resilience. It's a pretty exciting topic. And as the corny folks at supply chain conferences, say, supply chain technology is consumer technology.

 
Bob Wolpert 

Great. We'll be around for a few minutes afterwards if anybody has any questions.

 
Emma Cosgrove 

Thanks, everyone.

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