Managing Food Safety Risk in a Foreign Supplier Verification Program
By Dr. John W. Raede
My introduction to a foreign supplier verification program (FSVP) was in 2013 by way of a coworker, Tim Jackson, Ph.D., who said, “Hey, Raede, your world is about to get more interesting” as he chuckled and walked away. At the time, I was working in a global supply chain quality management capacity. I did quite a bit of international travel to perform focused risk assessments, creating business relationships, building trust, and eliminating process variation. My worldview was all about walking the factory floor, watching processes, collecting data, analyzing, identifying issues, creating collaborative corrective actions, implementing them, and validating if they accomplished what we intended. Boom—done. Little did I know how prophetic Tim’s words would be 5 years later when an opportunity presented itself that I knew I had to pursue.
I had been searching for a challenging, faster-paced environment that required my experience and process knowledge in an expanded role. In March of 2018, I came to an agreement with an importer of record (IOR) that supplies an array of imported and domestic food ingredients for the U.S. industrial market. I had the pleasure of working with this family firm for 15 years in my previous role because they were one of my suppliers. Switching from a corporate-based “silo” structure to a “many hats” format was tough enough, and add to that the challenge of working from a remote location with a 3-hour time difference. The FSVP was in the forefront of this position, and I had to jump in and gain an understanding immediately. Fortunately for me, the program was set up by a very competent and capable individual, Breanna Neff. She was a recent graduate of the Cornell University Food Science Department and had to start from scratch to build the program.
Importance of the Document Exchange Process
Document management was not in my circle of responsibility in my previous role. I really had no idea of the volume of documents that were required at the time and what the future regulatory requirements would eventually generate. Once in, I began to realize quickly how providing documentation in a timely manner is a critical component of the customer service capability for this type of organization. Especially in a new ingredient/product introduction that is on a tight implementation schedule. You do not want to be the reason a potential piece of business is lost in any-size organization.
The technical folks need the backup documents to begin the process, and if they are not received in a timely manner, the process comes to a halt. The goal should be to keep that process running smoothly and be considered as the best IOR to work with. The challenge is how to keep the updated version of the documents that have expiration dates (most are annual) available when requested.
Document management services are becoming popular; there are two main choices in the marketplace to my knowledge. I’ll let you do your own research to determine which is the best fit for your operation. If you are supplying to a large-scale operation, you are already engaged in the process with a supplier portal and receive the barrage of notification emails regarding expired and/or new document requests. There are least-cost options available that require a database-to-database transfer from your supplier to your customer, or the often more expensive “pass through” option.
Caution: Although a web-based system is an efficient method to control the document management portion of the FSVP, you must be careful not to lose the personal side of this operation. Numerous times, I receive document requests, turn them around quickly, and receive a sincere note back thanking me for the speed of the response. You cannot ignore the importance of that interaction. Remember, business is personal: It is all about relationships based on trust through verification.
Supplier Risk Assessments
I’ve always believed that the way we conduct ourselves in our professional life is basically how we are in our personal lives. If you like to travel, learn about different cultures, learn different languages, eat different foods, sleep in airports, continuously request documents, and send documents, you too can be an FSVP professional!
One of my favorite phrases is: “Everything I’ve experienced in my life has prepared me for the challenges I am facing today.” It is a guiding principle that allows me to have the mental fortitude to walk into a situation with confidence, prepared to handle whatever will be encountered and be prepared for the next challenge.
I remember 25 years ago how I kept repeating that mantra the first time I disembarked the Boeing 747 in a country that required a business visa and generated personal safety warning documents from our in-house travel agents. Didn’t know the language, culture, the airport, or even if our contact had arranged transportation. After receiving scrutinizing stares through the maze of customs agents, I received the stamps of approval on my passport and stepped into the cacophony of awaiting loved ones, vocal tour guides, and taxi services. Much to my delight, a gentleman was holding a piece of paper with my name on it, and after an awkward hug (from me to him), off we went.
The assessment went better than expected, the factory programs exceeded my expectations, and the translation challenge was minimal. The important factor that was recognized by all the parties involved was the development of a rapport. We dined together for lunch and dinner. We spoke of our families and shared similar experiences that narrowed the cultural differences. When I left, I knew I had connected with the managers, and they understood why I asked the questions I did, pushed for verification, and left them with a list of items to mitigate risk for our customers.
We were a company with one emerging brand that had a robust internal prevention program, and we needed to implement those risk-mitigation strategies in our supply chain. My boss at the time, Dale R. Rice (who is now Dale R. Rice, D.V.M.), coined a phrase, “Realistic specifications, rigidly enforced.” He encouraged me to audit to the specification for each ingredient at the supplier locations. A thorough ingredient specification will cover the quality and food safety attributes important to the customer.
My previous experiences with implementing a supplier management program for a single brand and multiple product variations grew into multiple brands and select ingredient categories via an acquisition by a global corporation. I spent the subsequent years managing domestic and foreign supplier performance. This advancement over a period of 25 years increased supplier knowledge into currently implementing an FSVP for an IOR with approximately 70 products from an international supplier base.
An FSVP is not about performing multiple desk audits. While document and procedure review are crucial to a baseline understanding, the real learnings are derived from walking out to that factory floor and seeing it for yourself. You need to meet the line managers, line workers, maintenance technicians, and sanitation crew. They need to see what their customers look like and think about. Make it personal.
Business is about relationships, and relationships are personal. Your suppliers need to know you, understand what your concerns are, and what you can do to help them. In my current role, we are focused on traveling to our suppliers’ locations, having discussions with the factory professionals about practices and procedures, walking the factory floor, concluding the assessment with a closing discussion, and then enjoying a meal together while sharing our professional and personal experiences. Again, the personal side of business is important. I want my suppliers to care about our company, customers, and our customers’ consumers.
The key to understanding any process is to deconstruct it and look at the parts individually while keeping in mind how they will all fit back together and function. Below is a list of the requirements of an FSVP and a summary of how I recommend addressing each one:
Use a qualified individual to develop an FSVP and perform FSVP activities: At a minimum, your designate should successfully complete FSVP training. Ms. Neff successfully completed a Preventive Controls-Qualified Individual (PCQI) training and an FSVP prior to setting up the structure, and I successfully completed the PCQI, PCQI Instructor, and FSVP courses.
Perform a Hazard Analysis that includes identifying known or reasonably foreseeable hazards associated with each type of food and determining whether they require a control: The intent of this item in the final rule is to ensure the IOR understands the risks associated with the ingredient they are bringing into the country. We prioritized the Hazard Analysis by product volume and lethality step control (supplier or customer), and performed an annual risk assessment focusing on preventive controls for biological, chemical, and physical hazards at our high-volume/high-risk suppliers.
Evaluate risks posed by the food and the performance of the foreign supplier: This requirement is ingredient-shipment specific. To quote President Ronald Reagan: “Trust but verify.” Ask for supporting documents, go to the supplier’s location, ask pointed questions, and gain a detailed understanding of your supplier’s processes and procedures. We evaluate the process flowchart, Hazard Analysis document for the ingredient(s), validation studies for the lethality steps (if identified as a Critical Control Point), food safety plan, certificates of analysis per shipment, and supporting documents such as pesticide residue lab results.
Conduct appropriate supplier verification activities to provide assurance that the hazards requiring a control in the food you import have been significantly minimized or prevented: This step is also focused on the validation of procedures and verification that the procedures are followed. Low-risk supplier verification activities may include reviewing updated third-party audits, conducting supplier meetings at trade shows, and reviewing corrective actions identified in the third-party audit and/or corrective actions for issues identified by our customers. Spending extra time on corrective actions is very important because it provides an insight into the management commitment of the supplier. I will address this further later.
Reevaluate the food and foreign supplier every 3 years: No matter the size and/or budget of your operation, you must request an updated Hazard Analysis and Critical Control Points (HACCP)/Hazard Analysis and Risk-Based Preventive Controls (HARPC) plan and risk assessment from your supply chain. We perform annual risk assessments at our high-volume suppliers. The benefits are twofold: First, we gain a visual perspective of process improvements from the previous year. Second, we strengthen the business-personal relationships with the management team by sharing meals and conversation. Document management systems come in handy when requesting the updated HACCP/HARPC risk assessments on a 3-year schedule.
Keys to Evaluating a Potential Supplier
A significant number of further processors retain their own in-house auditors or contract with third-party certification bodies. A recommendation is to conduct a targeted risk assessment for your customers to determine whether they want to invest the resources to move forward with the new ingredient on-boarding process. The purchasing, R&D, regulatory compliance, and food safety folks appreciate a heads-up, so to speak. Nobody wants to waste the substantial cost of sending an auditor to a location that will fail because of major deficiencies in their food safety plan.
In most cases, a certification body has audited the potential site, and a good idea is to carefully review the report. Another key component is a pre-site assessment, what some refer to as a desk audit. The HACCP flowchart for a review prior to each product is a standard item to have in hand when you are performing a desk audit and during the walk-through at the supplier location. It is your guide to what preventive controls have been identified as potential hazards by the factory management.
I have found that internal audits provide an insight into how a supplier manages their business. The internal audit identifies issues in the factory, and the corrective action completion data indicate the management commitment. Internal audits are a key component to an organization’s ability to identify potential hazards, conditions that can cause disruptions in throughput, and situations that can create employee safety risk. A supplier that has a robust internal auditing program can prevent issues that may contribute to a system failure. The critical component to an internal auditing program is implementing an effective corrective action and then verifying the corrective action solved the issue.
Document requests are an integral part of the FSVP. In my experience, our customers keep track of their own document requirements via document control programs. I recommend you perform your own due diligence if you employ a system to manage the volume of requests your business generates.
One of the key items I look for is management commitment. This is one of the few things that may indicate whether you will have a successful relationship with the supplier. If the resources are not provided to pay for and train capable employees, provide them with the equipment and tools they need. In my experience, resources are required to pay/train/develop/retain competent managerial staff, and when the resources are not provided, the opportunities for failure increase significantly.
Management commitment is a leading indicator of the overall sustainability of the business. Capable managers do not stay with an organization that cannot support their initiatives. Factory managers require competent support staff to fulfill the goals and objectives of the business. If there is a solid team in place, there is normally an experienced, cordial, capable factory manager, general manager, and/or owner. A supplier with a capable and competent factory manager is less likely to have significant failures that cause food safety issues. An exceptional factory manager will conduct him- or herself the same with their staff, family, friends, vendors, and even waitstaff at restaurants. In my opinion, you can learn a substantial amount about someone from the manner in which they address people that are paid to provide a service. Have you ever had to disembark an airplane because of a mechanical issue? Personally, I am happy the leading indicators worked (found before disaster) and not the lagging indicators (reason for the disaster). More than once, I have stood in line after we have walked off the aircraft and the person in front of me is yelling at the gate agent, who did not ground the plane. To me, the person yelling is not an exceptional manager.
An FSVP requires international travel, bottom line. If you don’t like to travel, then you should pick another occupation.
Personally, I really enjoy traveling. It is in my DNA. My aunt managed a traveling circus tent show. I would join them during the summer months, work in the concession stand, help with setup/takedown, and travel a portion of the country for 2 months. We had a set schedule of towns we would visit and set up for 2 days, perform six shows (three each day), take the tent down after the third show on the second day, and drive all night to the next town. It could be hectic when the weather didn’t cooperate, the trucks broke down, or some of the crew would disappear on the way to the next location. The mantra was “The show must go on.” The idea being, the folks paid their money and we must fulfill our obligation to provide the product, no matter the hardship.
Business travel to me isn’t really that different from the circus days. Most of my assessments are scheduled by continent and require extensive scheduling. There are challenges to overcome, and unless I am completely incapacitated, I am going to show up. For example, while writing this article, I just completed the second week of a 5-week European trip performing risk assessments at 10 supplier manufacturing sites, involving nine hotels, six flights, and countless hours in a car or train.
In my opinion, to develop a successful FSVP, you must have a firm understanding of the products, process, people, and procedures. The more you are informed about the entire operation, the easier it becomes to speak or write cogently. Business is about personal relationships, and the stronger the relationship, the better the business. That means you must walk the factory floor. In the words of my good friend Chuck Regan: “If you’re going to buy meat, you better have bloody boots, and if you’re going to buy fish, you better stink.”
Our customers require the current third-party audit certificate and the portion of the report that details the corrective actions. As an added component to the corrective action list, we request the status of the corrective actions and the validation study of the corrective actions’ effectiveness. It’s good to have corrective actions; however, they are not so good if they don’t solve the issue. I highly recommend augmenting your suppliers’ third-party audits with an additional annual visit to their manufacturing location(s) to perform a targeted risk assessment based on your customers’ product specification(s).
Clarification: I am not saying that audits do not add value to the FSVP equation; however, as an FSVP practitioner, you must go to the location that produces the product you import and experience it for yourself.
Third-party audits play an important role in program and procedure verification. A skilled lead auditor can provide a valuable assessment of the overall effectiveness of the food safety plan, management commitment, and physical condition of the factory. I created a customized, risk-based assessment of each type of commodity we import, based on the customers’ specifications and the inherent risk associated with the commodity type.
Meeting Customer Requirements
If you want to meet your customer’s requirements, follow Dr. Rice’s rule: “Realistic specifications, rigidly enforced.” Let’s expand on this. Sound easy? It can be when you work with a supplier that understands its process capability. This is where the relationship based on trust is essential. In my experience, we are presented with two specifications: what the customer requires and what the supplier can offer. Frequently, a supplier will generate a specification based on the parameters they consistently meet, and then they widen the upper and lower control limits to build in excess process variation. Understandable, and in some cases, the range is within the customer’s specification. In some situations, the supplier may require assistance in understanding either how to achieve the customer’s specification or why the parameters are in place. As an example, I had been working with European suppliers about Listeria spp. specification differences between their market and the U.S. market. Progress was slow until the European market recalls for individually quick-frozen (IQF) vegetables hit, and then the conversation changed from why should they comply to how can they comply.
There is a component within a food industry business that is not discussed to the extent I believe it should be. Food safety professionals play a vital role in the development of new business and maintenance of existing business, and should be recognized for doing so. I am truly blessed to work for an organization that recognizes the importance of my contribution to the business, and I reciprocate by doing everything I can to mitigate risk and promote the programs that we need to execute. While discussing what my role in the organization would entail, I proposed that we needed to make a bold statement that food safety was at the forefront of the operation. That is why my official title is Chief Food Safety Officer. We wanted our customers and suppliers to know what our focus is and how we would act upon it.
The Importance of Preventive Controls Validation
Food safety requirements are not getting easier because regulatory compliance and product liability are driving the demand for tighter product specifications. Processes that were partially ignored previously are coming under scrutiny for their contribution to risk mitigation. As the demand for reductions in pathogenic organisms increases, we are challenged to utilize existing processes to perform a lethality step that we were not originally intended to.
As mentioned above, IQF frozen vegetables are in the forefront lately with a focus on validating the blanching process to achieve a 5-log reduction for Listeria monocytogenes. One segment of our customer base is focused solely on the blancher, and other customers will accept a combination of validated process steps to achieve a total 5-log reduction. We are still working through the details of the study. Understandably, our suppliers do not want to have studies performed that use product inoculated with L. monocytogenes in their facility and would rather use a surrogate organism. As the IOR, we have the responsibility to offer solutions that meet the customer specifications and are within the capability of the supplier. Not always the easiest move to execute; however, with a “quiver” of professional experts and associations from which to draw knowledge, we were able to offer salient solutions.
Some of our European suppliers did not want to blanch to a 5-log reduction because of the negative effects on the organoleptic characteristics that the increased time/temperature ratio has on the product. Our task was to help them understand the reasoning behind the requirement. In the U.S. market, the mindset is to “kill all of it!” We walked them through the validation study guidelines, certified laboratories that could perform the studies, and options that met their comfort levels.
Working with foreign suppliers to help them understand the U.S. domestic market can be a challenge. Creating a working relationship with the management team of the foreign supplier is a positive means to gain an understanding of each other’s concerns and build trust.
If you’ve made it this far into the article, I want to thank you by leaving you with a brief summation of what I believe to be the pillars of a successful program. 1. Evaluate your suppliers’ preventive controls thoroughly in their factory. Remember Chuck Regan’s quote: “If you’re going to buy meat, you better have bloody boots, and if you’re going to buy fish, you better stink.” 2. Your supplier must have the capability to manufacture to your customers’ specifications. Remember the quote from Dale Rice, D.V.M.: “Realistic specifications, rigidly enforced.” 3. Finally, you must challenge the validation studies of lethality steps and require pertinent process documentation. Remember the quote from Ronald Reagan: “Trust but verify.”
Dr. John W. Raede is the chief food safety officer for National Cortina, an importer of record for grass-fed beef, IQF vegetables, and edible oils. Dr. Raede specializes in food safety supply chain process improvement, risk mitigation, and foreign materials assessment and prevention.