DC Velocity - May 2011

thoughtleaders STEPHEN CAHILL

AWe are involved in a number of initiatives, from local and regional procurement, to rainfall-based insurance in Ethiopia. WFP purchases more than 2 million metric tons of food every year. At least three-quarters of it comes from developing countries. This is because it is WFP’s policy, whenever possible, to buy locally produced food. It’s close to where we want the cargo, and it provides the local economy with much-needed funding.

IT is essential for us. We operate in more than 70 countries, many of which have poor infrastructures and communication systems. We are always looking for better ways to gather and distribute information on our supply chain.

Cloud technology certainly seems to me to be the way forward.

QIn 2009, WFP began using a cloud- based global visibility system from GT Nexus to monitor your network and match supplies with need. How effective has it been, and what do you see as IT’s role in supporting your work?

AWe saw that the platform could offer us a much better insight into our pipeline, and by having that insight, we could adapt our supply chain quickly to the ever-changing environment we work in. An example would be the recent events in Libya, which we use as a corridor to Chad when the corridor through Cameroon is not reliable due to the rainy season. We needed to be able to quickly divert cargo to alternative ports; GT Nexus gives us the visibility to do that.

QWould it be accurate to say that, due to climate change, political unrest, and other factors, nations or regions that were once self-sufficient in food must now import their foodstuffs? If that is true, what additional pressure does this place on the supply chain?

AClimate change is forecast to have a dramatic effect on rain-irrigated crops. And it’s not only about lack of rain, it is also changes in rainy season patterns. Piracy is also affecting our supply chain, We are prepared to work in politically unstable and underdeveloped countries, and our supply chains are designed accordingly. Climate change and food price instability will stress them, but to what extent is difficult to predict.

QThe U.S. Food Safety Modernization Act signed into law in January imposes new requirements on the food supply chain and gives the Food and Drug Administration more powers to develop a system that will minimize the risk of food-borne illnesses. Do you see, over time, similar programs being implemented globally, and how does this complicate your life?

AAs someone involved in food aid, I do not see this as an issue. That said, though, recipient countries have become stricter in the cargo certification process. In some countries, we have to run up to six tests, everything from radiation to bacteriological screening.

QIf you look at global food needs five years out, what do you expect will be the biggest problem facing the supply chain?

AI look more toward opportunity at the moment. I think cloud technology will have a major influence on the supply chain by improving visibility and highlighting actionable bottlenecks. Of course, there will be challenges, most obviously as it concerns the price of oil and petroleum products. In addition, elevated food prices, in and of themselves, have political and commercial consequences. The recent events in Egypt highlight this; the effects on the worldwide food supply chain were negligible. However, had the Suez Canal been closed, the situation would have changed dramatically.