Addressing Supply Chain Sustainability in a VUCA World: A Case Study of Kellogg Company
Technology Category
- Analytics & Modeling - Computer Vision Software
Applicable Industries
- Food & Beverage
- National Security & Defense
Applicable Functions
- Logistics & Transportation
Use Cases
- Supply Chain Visibility
- Tamper Detection
About The Customer
Kellogg Company is a multinational food manufacturing company headquartered in Battle Creek, Michigan, USA. The company produces cereals and convenience foods, including cookies, crackers, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles, and vegetarian foods. The company's brands include Corn Flakes, Frosted Flakes, Rice Krispies, Special K, Pringles, and many more. With a history spanning over a century, Kellogg Company operates in over 180 countries across the globe. The company's SVP of Global Supply Chains, Alistair Hirst, has been working in supply chain for Kellogg Company for 32 years, across four different continents.
The Challenge
Kellogg Company, a global leader in the food industry, was facing significant challenges in managing its supply chain sustainability in a VUCA (volatile, uncertain, complex, and ambiguous) world. The company's SVP of Global Supply Chains, Alistair Hirst, identified four key challenges that were impacting the stability, risk, and sustainability of their global supply chains. These included political instability, climate change, food security, and urbanization. Political instability, such as wars and socio-economic imbalances, was affecting the company's sourcing and sustainability at a high level. Climate change was altering the world's growing regions, posing a threat to the company's food production. Food security was a major concern, especially in developing markets where the company hoped to expand its business. Lastly, urbanization was expected to increase the world's population to nine billion by 2050, with 70% living in urban areas, thereby increasing the demand for food while the resources remained limited.
The Solution
To address these challenges, Kellogg Company collaborated with the Institute of the Future, based in California, to develop a strategy for managing in a VUCA world. The strategy involved having a clear vision of the company's direction, understanding the path to get there, clarity of purpose, and agility to handle long- or short-term supply shocks. To tackle political instability, the company had to develop robust policies and programs. To combat the effects of climate change, the company aimed to create resilience in its supply chain and predict changes in growing regions. To ensure food security, the company planned to step in commercially and transition people from subsistence farming to commercial cash crops. To address urbanization, the company aimed to improve food security for those left on the land and enhance productivity through a strong sustainability agenda.
Operational Impact
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