Bellinger (2002) simply but effectively defined a system as a whole which maintains its existence through the mutual interaction of its parts. A system is a set of relationships and interactions which are in turn responsible for the characteristics emerging from that system. To put it another way, a system is a set of parts and their interlinked relationships which make up a complete unit (Heylighen, 2003). The principle of emergence creates a situation whereby systems have properties not necessarily shared by their individual parts, or properties which may not occur with other types of interactions. The behavior patterns of systems are among these properties. The core parts of the definition of a system, therefore, are its interactions, and these are thus its most important characteristics. According to this approach, also called the cybernetic approach, the whole is described not only in terms of its parts, but also and mainly in terms of the arrangements and configurations of its links and relationships (Heylighen, 2003).
Systems are made up of subsystems and are in turn subsystems of one or more other systems. All systems share certain common characteristics, are subject to the systems principle and to be understood must be studied in terms of their complete nature, not simply any one of their parts (Bellinger, 2002). The same author indicates that in the systems context, a model is a simplification of reality intended to promote understanding and knowledge. For this reason, a model leaves out certain details, and may be very simple (or very complex if many details are left in). A model is a good model if it helps to develop understanding and knowledge of the thing we are trying know. The simple and most basic model shows the relationship between cause and effect, but this is actually a very limited way of understanding how systems really operate. According to Bellinger, to conceptualize and to express a relationship one must indicate that a relationship is not necessarily “linear”, and the concept should include the characteristics of the relationship, and the interactions which are dynamic in nature. An entity may be an effect or factor external to the system and be in turn part of another system.
In systems analysis, we need to understand the relationships or links between entities, which in turn may or may not affect other relationships with other entities, and even the actual nature of each entity. There may be circuit links, in which interactions are such that an entity or action is added to another entity or action, producing a result which in turn promotes more than the original action or entity (reinforcing circuits). Alternatively, there are interactions in which an action promotes the solution of a problem or the achievement of an objective, so as to reach equilibrium between two entities or actions (balancing circuit). It must be remembered that there can be “hidden” circuits or relationships, that there are time lapses between events, and that the effects of interactions may be cumulative (Bellinger, 2002). Some enzyme systems behave like this, as do some social systems.
One way of representing systems (see Figure 1) is through the absorption of inputs in order to achieve “something” or to transform, process, and thus produce outputs (products) which may be desired objectives, proposals, things or situations (Sauter, 2000), or even measures of performance (Dixon, personal communication, 2004).
According to this approach, five elements must be considered in defining systems (Heylighen, 1998; Sauter, 2000): inputs (what comes into the system from outside it), outputs (what leaves the system and goes outside it), the process (transformations occurring within the system), boundaries (which define the difference between the system and its setting), and the environment (context, medium, scenario, ambit, setting, surroundings), which is that part of the world that can be ignored in systems analysis, except where it interacts with the system. These may include elements such as people, technology, capital, materials, data, regulations, and so on. Also considered further essential elements of systems theory are system hierarchy, system state, information and the orientation toward a global purpose. If the nature of the processes (what happens inside the system) is not known, than the so-called black box concept is applied (the box in Figure 1 would simply be painted full black). Processes or interrelationships are not known or understood, nor, often, are the components of the system. A typical example of this is when fuel consumption in an agricultural chain and the production of CO2 (inputs and outputs) are known, but what is not known, or is ignored, is the pattern of consumption, the internal flow and the consumers (components and relationships). Another example, starting to relate the systems approach to food quality and safety, is when policy makers request from food industries the delivery of high quality products (outputs) without paying attention neither to the inputs (raw materials, services, etc.) nor to what is going on in the industry-business itself (processes).
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FIGURE 1
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The interacting components of a system may be subsystems of this same system, and may be related and interacting in different ways. One simple way of representing this is shown in Figure 2, which illustrates both the difference between the so-called “white box”, or, better, the “transparent box”, with subsystems interacting within the “dynamic” boundary of the larger system, as opposed to the black box concept. Note that the arrows linking the ellipse-shaped subsystems represent the interaction or interactions between them, which are dynamic in nature and therefore not represented as straight solid lines (Heylighen, 1998). The full line representing the boundary in a given moment or set of circumstances, evolves dynamically to another boundary (the dotted line) for a different moment or set of circumstances, as a result of the principles governing systems. Lastly, all the above concepts lead to the consideration that systems have hierarchical structures with different levels. From the top level one has an overall view but ignores the smallest parts, whereas at the bottom level one looks at many small interacting parts, without taking in the structure as a whole at its other levels. The systems structure is the set of complex relationships among its components and subsystems which in the long run determines the outcome and common purpose of the system as a whole. These are generally considered open systems. It should be pointed out that complex systems have a set of characteristics and properties that lie beyond the scope of discussion of this paper. In any case, as mentioned, models are needed to simplify the reality, and to know about and understand a given system or subsystem.
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FIGURE 2
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The advantage of the application of systems analysis, which is derived from systems theory, is that the principles apply to any type of system, as to any type of organization. Organizations, being systems, are subject to their governing principles for aspects such as decision-making, pinpointing problems, and maximizing control (if at all possible) and operation of the system (Heylighen and Joslyn, 1992; Bellinger, 2003). The systems approach, which is a way of thinking or mental stance focused on understanding how things work, behave, interrelate and are structured (in a word, how systems operate), is essential for those trying to device strategies and execute actions in order to increase competitiveness in the food industry. Logically, we also need to understand the basic systems concepts for effective and efficient application to an understanding of the complex nature of food systems. In the real world, such as in a farm, an agroindustry or a food retail business, the systems approach is essential, understanding that the principles of systems apply to them. Once this is understood, we can develop interventions to bring about the desired changes, and ensure that these changes persist (Bellinger, 2003). This can be perceived as real control over the system. It basically consists of choosing the inputs and knowing the effects, parameters, and influences on the behavior of the system which can change its state or outputs as desired (Heylinghen, 2003). From the engineering viewpoint, this would consist of distinctively identifying the independent variables and transforming them into dependent variables, for a given set of parameters, boundaries and restrictions. However, there may be systems which are composed of coordinated networks with no overall control (Dixon, personal communication, 2004). The physical world offers many examples of such systems.
The FAO concept of food security says that food security is a situation that exists when all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food that meets their dietary needs and food preferences (that is, that satisfies people’s quality and cultural preferences) for an active and healthy life on a continued and sustainable basis (FAO, 2000c). Within the agroindustrial sector, rural and urban food industries are major actors in agrifood systems, and can therefore have a positive impact on food security, provided they have the capacity to offer safe, high-quality food to consumers on a sustainable basis, and to help boost the incomes of processors and producers. Agri-food enterprises range by scale from those narrowly linked to the immediate post-harvest stages of primary production to the most highly developed, largest-scale enterprises. Processing micro enterprises comprise a link between the two extremes (Figuerola, 1995). The food industries are also one economic sector where men and women alike are active participants in the production process.
Social and economic progress in the rural sectors of developing and transition countries is closely bound up with innovation and competitiveness in the agrifood sector in both domestic and international economies and markets. Competitive advantage is largely dependant on a series of factors, including conditions of demand such as meeting local market requirements, and the pressure they exert on the demand for safe, quality products (Castro and Gavarrete, 2000). Correspondingly, competitive strategies reside in the development of managerial systems that permit compliance with consumer standards, regulations and expectations for product quality and safety, all under favorable economic conditions. Where agrofood industries are competitive, they clearly make a decisive contribution in terms of increasing food availability by delivering high quality, nutritious, wholesome and safe food products, and thus enhancing food security.
However, food purchasing power, food distribution and physical access to food also need to be improved, as do living conditions, particularly for people living in rural areas. This calls for integrated, multisectorial approaches based on complete agrofood systems and subsystems (including the economic, social and environmental aspects) as the basis for strategies, policies and decision-making.
Looking at the above analytical concepts for the agrofood sector or system from the systems standpoint, we can see that the social purpose of the system is food security, whereas normally the global economic purpose is wealth creation and profit. We may look at the various participating actors and their technical, social and economic relationships and interdependencies in the various geographical areas within a given country or group of countries. Analysis may focus on a sector, a sub sector, or various interlinked sectors, at the micro or macro level, or combinations of both. We need to identify and characterize relationships and hierarchies. In this approach, the boundaries of the system are defined by a given set of food sectors or products and by groups of actors, including enterprises, as well as those enterprises supplying goods, services and capital inputs. We also need to consider how institutions, socioeconomic, and political forces interact, in addition to the environmental characteristics that serve as a backdrop to the system. Its nucleus must include the pre- and post-production chains (and their ramifications) within which the agroindustries operate. Presented below are examples of the various analytical degrees and horizons of agricultural systems, from the national macroeconomic setting, to the microeconomic community environment, to the internal environment of a food processing enterprise. The emphasis is on the food chain and on processing,
Figure 3 shows one example of the effort to model a historical analysis of the global factors governing food security which produce a given state of food and nutrition. This is a simple, general model of sequential relations. Obviously, there are a great many possibilities and proposals for models representing factors, relationships and causalities with reference to food security. The example presented here is cited solely to illustrate the type of analysis which is possible, and the type of model which can be constructed.
The big box in the centre defines the boundaries of the food network subsystem which contains the food chain subsystem, represented using a model based on the consecutive-stage type of flow diagram. As systems, all food chains are subject to systems principles. It should be noted that in reality the food chain is immersed in a network, that is, is composed of, and related to other subsystems, and the conformation is not necessarily linear or simple. The need to approach food chains, in particular, from a holistic and systems-oriented standpoint has been identified on numerous occasions. Various approaches and methodologies have been used, and various orders of magnitude and environments (see Castro and Gutman, 2003; Bell et al., 1999; Ranaweera et al., 1998; McConell and Dillon, 1997; Bockel et al., 1994; La Gra, 1993; FAO, 1990; Seepersad et al., 1990). Hennessy et al. (2003) also postulated that many food safety problems are systemic, and they trace the nature of these systemic failures in the following four causes: system interconnectivity, communications, information and technology. This is why prescribed policy and analyses need to be systems-oriented, applying existing tools to model the main aspects of systems interactions. These various papers illustrate a range of detail and excellence in the application of the principles of systems analysis, from the simple use of the relevant terminology to genuine systems approaches to agriculture. Thecritical aspect of the system approach to the agrifood sector, compared to static and linear chain approaches, is that it embraces all subsystems from production to consumption, it internalizes and analyses the cross-linkages and relationships between chains, or better, between subsystems, and moves from description into identification of key components and relationships for which interventions might be needed (Dixon, personal communication, 2004).
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FIGURE 3
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In addition to the systems approach to the food chain as a set of interrelated and sequential steps from field to consumers, there are other variants such as supply chains, link analyses (analyse de filière), commodity systems, productive chains, and value chains. In any case, it has been established that these chains have highly-evolved forms of coordination and integration, and rules of participation (Vorley, 2001), which are properties of systems, as can be seen. As an example, the value chain concept has been developed as related to Canada, where a supply chain is the entire vertical chain of activities from production on the farm through handling, processing distribution and retailing to the consumer, that is, the entire spectrum from gate to plate. However, little attention is given to how it is organized or how it functions. On the other hand, the value chain refers to a vertical alliance or strategic network between a number of independent business organizations within a supply chain. The primary focus is value and quality, with demand-type of pull, and interdependent organizational structure. Through a systems approach it was established that vertical coordination, organization of industry stakeholders, feedback mechanisms, and quality and safety assurance tools as part of the 3-C (coordination, cooperation and communication) are key to the success of value chains (Hobbs et al., 2000).
Figure 4, continuing the descent into lower levels of systems analysis, shows a more detailed model at a lower level than the system represented in Figure 3. This diagram is comparable to the “inputs-process-outputs” diagram, where inputs and outputs are both physical and socio-economic. This systems model purports to summarize the internal scenario of processing, with its major inputs and outputs. In essence, it shows that the general objective of the food industry as a subsystem is to receive materials, process them and deliver high quality and safe food products that satisfy consumers and provides revenues to the company and keeps healthy business. As can be seen in Figure 4, three possible boundaries have been drawn, which in turn define three distinct and interrelated subsystems. Subsystem 1 is basically the food industry. Subsystem 2 may be also part of 1, depending on the perspective and purpose of the analysis, and on the properties of the subsystems themselves. Process 1 is the processing plant itself. The box called “Inputs 1” can be very useful for determining the diverse factors that can affect the result of Process 1, from a broader position as compared to the most common and simple, but equally illustrative, model that processing is simply “raw materials ® process ® products”, as there are usually many inputs for any given process. Notice that in that systems model we may already identify inputs that belong to the categories of methods, manpower, materials and machinery, also called the 4-M.
Figure 4 also invites the consideration that the outputs (or products) of a process can be the supply which feeds another process, and that these outputs can in turn be varied in nature, even with reference to broader settings than that of the economic environment. We need to remember that the food chain subsystem is not static, and that its products or total results are not just the simple sum of the contributions of its parts. Because it is a system, the food chain has properties such as self-stabilization, feedback, propagation, interconnectivity and evolution. For this reason, segmented and isolated analyses and interventions are not always effective. Figure 4 therefore defines the domain of the agrofood industry as a system.
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FIGURE 4
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The processing stage as a component of the food chain is represented in graphic form in Figure 5. The big box contains the industrial plant and services, as an example of components of the “processing plant” subsystem. The other three components also make up part of the so-called 4-M of industrially oriented production. In this diagram, we can define or characterize either inputs (e.g., raw materials, personnel) or outputs (products) in terms of quality, quantity, suitability, uses, characteristics and costs.
Additionally, the scientific and technical literature contains numerous examples of analyses and models of processes belonging to the agrifood industry, at various orders of magnitude. As an example, Cuevas et al. (1985) present flowsheets specific to industrial maize processing of precooked flour for the preparation of Venezuelan “arepas”. The process is broken down into its consecutive, interrelated operations, with the raw material as the first input and the product as the final output. This type of diagram, called a process flowsheet, is described and utilized in food engineering texts and, in general, in chemical and food engineering books and publications. Figure 6 shows part of the process for the production of precooked maize flour, as it was performed in Venezuela in the 1980s. There is first a process that takes maize and produces maize grits, maize germ and by products. From maize grits the precooked flour is produced, as shown in the process flowsheet in Figure 6. Industrial inputs such as steam, hot or cool air and electricity are not included for the sake of simplifying the figure.
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FIGURE 5
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Cuevas et al. (1985) also present an additional way of analyzing systems relationships in a subsystem like that of an industrial maize processing plant, using a materials balance diagram, as shown in Figure 7 (which does not explicitly show all losses). Similar diagrams can be prepared for energy balance and cost analyses, all based on primary specialized information obtained directly from the detailed study of manufacturing processes.
An equivalent approach can be utilized for the logistics, marketing and trade aspects, for instance in order to identify participants in the marketing chain and to define the cost/price percentages absorbed by the various actors in said chain, which becomes their economic interrelationship.
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FIGURE 6
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Adapted from Cuevas et al., 1985.
In summary, it is important to depart from the linear static and descriptive approaches to describing the agroindustry and the agricultural sector, to a more comprehensive, realistic, integrated systemic view considering that food is produced and delivered to consumers in complex and interrelated networks (or subsystems) which in turn are part of larger and more complex systems, with components, behavior, and interrelations governed by the principles of systems. In modern marketing terms, it would be said that the food industry and in general food systems have as an essential objective to deliver high quality and safe food products to consumers. The term “consumer” is used here in the broad sense, not only as “clients” buying goods from a seller, but as “users” of the products coming out from a given system. In a food system, consumers buy or acquire food products. It is well known that a food product is not really “food” until it provides nutrients to a person (see Figure 3). To do this, the food product has to be eaten, that is, consumed, the nutrients absorbed and utilized biologically by the person. Hence, in this paper “consumer” is a comprehensive term not only implying the a person who buys something, but also and mainly a person who eats -consumes a food product, with the hope to get nutrients, components good for health, satisfaction, better body condition, and good value for the money. Therefore, for any food industry and hence for a given food network to be successful, the needs and expectations of consumers have to be understood and fully satisfied, so that they get foods that are of value to them. This seems to be all that food industries, small and large, should be trying to do.
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FIGURE 7
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Adapted from Cuevas et al., 1985.
We have seen in these different models how the systems approach can be applied from the macroeconomic to the microeconomic, or enterprise, level. Systems analysis is normally applied to economic or informational aspects. But it is also used in engineering aspects, especially industrial engineering, and traditionally in agriculture, but primarily in terms of economic relations. For the small food industry sector, the next step would be to understand how the components interact. This might be a technological and/or some other type of systemic interaction (not only economic), with a negative or positive impact on competitiveness.
For Porter (2003), productivity is the true measure of a nation’s competitiveness in the long run, and depends on the value of goods and services, measured as prices obtainable in open markets, and how efficiently the former can be produced. In other words, efficiency and performance are the criteria (Castro and Gutman, 2003). On the other hand, competitiveness can be seen as the condition whereby the structure and strategic conduct of a productive entity such as a small food processing industry can have a positive impact on performance, ensuring the enterprise achieves the market position and participation needed to make it profitable and sustainable. Competitiveness in this sense depends on critical or “steering” factors which may or may not be subject to control (Da Silva and Batalha, 1999).
The potential for agroindustrial development in developing countries has been associated with the relative abundance of agricultural raw materials and a low-cost workforce. The traditional consideration is that the right industries for such settings are those making intensive use of raw materials and human resources, using by comparison relatively fewer of the less common resources, such as capital and skilled labour (Porter, 2003). Many industries that make abundant use of agricultural raw materials have features that make them particularly apt for prevailing developing country circumstances. Provided these materials can be obtained at reasonable cost, the advantage can partially offset the lack of infrastructure and skilled labour (FAO, 1997).
Some recent studies have shown, however, that this view of things may well set self-limiting conditions. This is because over reliance on "abundant natural resources", as opposed to their efficient and effective use, has quite possibly complicated the development of a successful agroindustrial sector and national economies in general. Economic development is difficult to achieve where policy and technical assistance are based on the extraction of natural resources, abundant, cheap labour, and raw materials and primary assembly-based trade (or, at most, simple, artisan processing). The control of value chains consists in control of the means of coordination, not the means of production. It is also based on strategic alliances and organizations, the value-added chain approach, and competition-oriented policies (Vorley, 2001). To put it another way, the traditional vision tends to be excessively localized, limited and even noncompetitive, focusing on primary production and based on promoting the export of raw materials from a country which will then have to import processed goods, losing value addition. An alternative approach is to support initiatives that favor microeconomic development, where, according to Porter (2003), is where wealth is created. One example would be processing food at a slightly larger scale than that of the usual family kitchen. Home cooking-based efforts have the merit of solving immediate problems at the household and local level, but such initiatives can hardly be expected to promote sustainable community processes unless they involve the necessary social, technical, entrepreneurial, commercial and environmental considerations, and are seen as part of the wider web of agrofood systems.
What we should be doing, instead, is seeking solutions to problems of scant capital, poor or inadequate infrastructure and scarce trained human resources, so as to promote the formation of efficient enterprises and build on the strengths of the agrifood industries (even at the small-scale level) based on entrepreneurial concepts and the proper application of ad hoc technologies. Strategies based on the argument that there are no (or not enough) markets in today’s globalized context or that promoting sustainable conditions for subsistence is a sufficient goal, are perhaps not very helpful. We also need to remember that educational development at the country level could be made a top priority of development plans and a condition of sector progress. We need to identify the factors which can promote growth and diversification for markets, the necessary investments, improvements in local and provincial conditions for business, and the variables which will allow enterprises to improve, flourish and triumph in that business environment. By tackling these problems from a holistic, systems-oriented stance the agroindustrial sector can help rural communities and societies move forward in their development.
Porter (2003) holds that wealth and prosperity are created at the microeconomic level by economic actors, particularly the enterprises and other productive bodies. Moreover, the same author postulates that the determinants of enhanced productivity can be grouped under two major factors: the quality of the microeconomic trade environment, and the degree of development of enterprise operations and strategies. Lowincome countries, which usually have economies based on comparative advantages such as cheap labour and abundant local natural resources, need to improve their competitiveness determinants. They need to stop relying on their comparative advantages only and develop their competitive advantages in terms of their own unique products and processes (Porter, 2003). That is, the private sector actors should improve or change the way they compete to achieve economic development. For this they need better-qualified personnel, better information, better infrastructure, better suppliers and better relationships (Porter, 2003). Dirven (2001), for example, shows that small and medium enterprises are subject to and sidelined by factors such as economies of scale, access to international capital markets, perhaps limited local technical capacity, growing pressure from supermarkets, and the new developments in trade conditions. Figure 8 is an attempt to summarize Porter’s postulates (2003). The sub factors determining the business environment have been conceived by Porter as four interrelated areas, represented by what he calls “the diamond of competitiveness”, listed in the lower lefthand box of Figure 8.
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FIGURE 8
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Adapted from Porter, 2003
One way of improving the trade environment is by the formation of productive groups or complexes (“clusters” according to Porter, 2003) in a specific economic field, which intervene in the production of a given set of goods. These conglomerates may be geographically close (or not), interconnected, companies, suppliers, service providers, trade associations, and associated public and private institutions of all types, linked by common and complementary elements (ECLAC, 2001). These conglomerates and their relations and processes enable the increased productivity of the principal enterprises, boost innovative capacity, and stimulate the formation of new businesses which in turn sustain innovation and expansion in the conglomerate.
Studies of competitiveness have utilized competitiveness indicators to determine the national potential for competition and growth. One indicator is the Global Competitiveness Index, based on quantitative and qualitative information, which breaks down competitiveness into eight factors or subindexes, including technology and management. Generally speaking, the technology factor measures the general level and quality of technology, including the ability of economic actors to absorb new technologies and engage in research and development. The management factor measures the quality of both managerial resources and competitive strategies, as well as the development of goods and control systems, including quality, human resources and marketing (Castro and Gavarrete, 2000).
Porter in turn has proposed a Microeconomic Competitiveness Index, based on a survey of almost 5 000 enterprises in 80 countries. It covers sub factors determining the quality of the microeconomic trade environment, and the degree of development of enterprise operations and strategies. This index shows that microeconomic factors have a major impact on variations in per capita gross domestic product. Table 3 shows selected data on the Global Competitiveness Index (GCI), and the Microeconomic Competitiveness Index (MCI) by country, for selected countries.
TABLE 3
Competitiveness Indexes
|
Country |
MCI Rank (2002) |
MCI Rank (2001) |
GCI position (1999) |
|
Chile |
31 |
29 |
18 |
|
Mexico |
55 |
52 |
31 |
|
Costa Rica |
39 |
48 |
34 |
|
El Salvador |
63 |
64 |
44 |
|
Guatemala |
73 |
69 |
50 |
|
Honduras |
78 |
74 |
55 |
|
Nicaragua |
75 |
71 |
56 |
Source: Porter (2003), and Castro and Gavarrete (2000)
The definition of quality is usually open for discussion. Kramer and Twigg (1970) defined quality as product excellence measured in terms of a set of specifications to be met within set tolerance levels. These specifications, one might add, are framed in terms of what the market requires, at reasonable (ideally, minimal) cost to those involved. In a broader context, Juran (1988) defines quality as two interlinked components: product performance leading to consumer satisfaction, and the property of being free of defects and thus avoiding customer dissatisfaction. Potter and Hotchkiss (1995) in the classic book on food science suggested defining food quality as the measure of product excellence, including such aspects as taste, appearance and nutritional content, and comprising those characteristics relevant to determining consumer acceptance.
According to Satin (undated), quality refers to the combination of characteristics critical to establishing consumer product acceptance. For the food industry this is a mix of purity, taste, texture, color, appearance and manufacture. This author indicates that quality is associated with consumer perception of the value of a product in terms of what he/she is prepared to pay for it, which may well be subjective. In any case, once a standard is defined, product quality consists of meeting this standard. Fellows et al. (1995) see quality as meeting the specifications, expectations and criteria for a given product as agreed with or established by the consumer. The quality principle is seen as quality products satisfying the needs, solving the problems and meeting the expectations of users.
Other authors (e.g. Okazaki, 2002) view the term ‘quality’ as implying more than just one concept where some food products are concerned, and perhaps implying some ambiguity. Food quality can be divided into two concepts. One has to do with hygiene quality and the other with the non-hygiene aspects. The first, safety-linked concept, according to Okazaki can in turn be divided into three categories: absence of biohazards, chemical hazards and physical hazards. The second concept can be divided into four categories: sensory quality, nutritional quality, physiological quality (how the food acts to promote human health) and the quality requirements for processing (or use). This author believes that the safety aspects tend to be overemphasized, and that the others are also very important in considering the value of a product as food. From the public health standpoint, including the issues of marketing and export, safety is a front-ranking component of food quality in any case. In the context of national sanitary control regulations, for example, quality has been defined as the inherent set of product properties and characteristics which allow it to be assessed as like, better or worse than the other units and the reference unit of its kind. In this context, a food’s property of being safe (neither endangering nor constituting a risk to health) is inherent in quality (Secretariat of Health, Mexico). All this may lead to recurrent discussions on whether or not “quality and safety” of food is redundant and that one may need only talk of quality as safety is implicit, or that safety has such implications that deserves to be mentioned explicitly.
In commercial areas, the term “quality” is considered in its broader sense, including all those attributes which make a consumer prefer one food product over another. In addition to the safety issues, this covers whether a product is healthful, nourishing and fresh, plus such characteristics as taste, integrity, authenticity and origin, besides any cultural or ethical value (OECD, 1999). Recent studies addressed quality management in leading companies in the industrialized countries (as an example, Gomiero et al., 2003). These companies were found to view the so-called physical attributes of products as key measures of quality, and included the sensory or organoleptic parameters such as color, aroma, consistency and texture, plus appearance (size, weight, packaging condition, conditions of use, and hygiene). Enterprise quality may be seen as including all factors not attributable to the product, but which contribute to consumer satisfaction and customer perceptions with respect to the enterprise and its products, and future decisions to buy. These factors in turn serve to identify enterprise strengths and weaknesses (Gomiero et al, 2003). Therefore, several aspects may be included in a definition of quality, such as “satisfying changing consumer demand”, “ability to meet the highest nutritional and public health standards”, “optimum safety”, “guarantee on the origin and nature”, and other economic, cultural, economic, social and scientific dimensions (Inter-ministerial Food and Agriculture Committee, 2004). On the other hand, Formal definitions are given by standardization and regulatory bodies, such as ISO 9000:2000 Quality management systems - Fundamentals and vocabulary. Recently, a joint FAO/WHO publication established that “The terms food safety and food quality can sometimes be confusing. Food safety refers to all those hazards, whether chronic or acute, that may make food injurious to the health of the consumer. It is not negotiable. Quality includes all other attributes that influence a product’s value to the consumer. This includes negative attributes such as spoilage, contamination with filth, discoloration, off-odors and positive attributes such as the origin, color, flavor, texture and processing method of the food. This distinction between safety and quality has implications for public policy and influences the nature and content of the food control system most suited to meet predetermined national objectives” (FAO/WHO, 2003a).
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FIGURE 9
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Figure 9 suggests that quality, for products as for the enterprise and its resources, is an essential element in enterprise development and strategy. Quality can therefore be seen as a multifaceted concept with various components and aspects, and at least three dimensions that need to be analysed. These are product quality, enterprise quality (all factors excluding those to do with the product), and the relevant economic component. Meeting commercial standards and regulations on product quality, product safety, and product nature or identity, for example, imposes restrictions on the agroindustries which affect decisions as to compliance or non-compliance and the possible implications of each. To compete efficiently in domestic and export markets, companies need to identify the critical factors that compliance with these standards will require, in terms of making the necessary changes, and their costs. As for the three quality dimensions, product quality can be enhanced, but without enhancing enterprise quality, or vice versa, and the final outcome will be a situation of poor competitiveness. Boosting competitiveness will depend on enhancing the first two dimensions while lowering the relevant economic component. Alternatively, an enterprise may decide to produce at a pre-determined cost due to internal or external factors, and thus achieve minimum quality standards which will nonetheless allow some sort of return (OECD, 1999). The challenge is to identify the set of enterprise circumstances and trade environments (i.e. systems factors and properties) leading to maximum enterprise quality at minimum cost (or cost and quality level ensuring sustainable and enhanced competitiveness). There is no question that quality, including safety aspects, affects processing costs and cost-benefit ratios (Antle, 2000).
In the above figure, the four boxes in the graph show four different possible situations with respect to quality. Enterprises with excellent product and enterprise quality appear in the upper right-hand box. Poor product and enterprise quality are shown in the lower left-hand box. Good enterprise quality but poor product quality is shown in the lower right-hand box and good product quality but poor enterprise quality in the upper left-hand box. The lines a, b, c and d correspond to hypothetical (linear) functions of the cost parameter, in which the relationship cost a < cost b < cost c < cost d applies, for the sake of illustrating the possible effect of this dimension. These lines suggest that enhancing product quality for a fixed enterprise quality (vertical arrow) will increase cost. Likewise, enhancing enterprise quality for a fixed product quality (horizontal arrow) will also increase cost. The big diagonal arrow shows the direction in which both product and enterprise qualities rise (as do costs). The linear functions are hypothetical, of course, in that each specific case will have its corresponding cost function for different conditions of quality. In any case, the enterprise will have to move in the direction of the conditions found in the excellence box, but at the same time keep costs to a minimum, all in accordance with the prevailing business climate. Some small food industries in Latin America and the Caribbean seem to be facing problems when trying to optimize their performance in this domain, or simply are not able to identify and devise possible and feasible solutions to their priority problems.
When a more in-depth systems analysis of the interior of an enterprise is done, one may realize that the technological aspects cited in the discussion regarding Figure 8 are in turn based on other specific components which can be grouped into systems-linked subgroups. These families of components, affecting competitiveness and quality from the very conception of a given industry, are summarized in Table 4.
TABLE 4
Selected technological and management factors
affecting industrial competitiveness and quality
|
Infrastructure: |
Equipment: |
|
· Sanitary construction and design |
· Sanitary design and construction |
|
Process technology: |
Location: |
|
· Type of process |
· Market access |
|
Markets: |
Costs: |
|
· Product uses and types |
· Fixed |
|
Services: |
Management and economics: |
|
· Steam |
· Processes |
Adapted from Peters and Timmerhaus (1980) and with contributions from the author.
The determinants of location, for example, are highly complex, as can be deduced from this table. For agro industries in rural and other areas in developing countries, transport is a major factor. Transport results in both physical and economic losses in most cases. This is exactly why many agro industries are established in the first place. Removing moisture from raw materials is usually a major objective. Food transport, therefore, is a key element of supply chains, food marketing and national development. Recent studies carried by FAO in the Latin America and the Caribbean region have demonstrated that in order to improve rural living conditions, increase income, and get communities and countries updated with social development, cost-effective actions through integrated, coordinated and multisector interventions are needed, directed to optimize this key element related both upstream and downstream to the food industry (De León et al., 2004).
The other factors listed interact and affect the decision on where to locate. Energy and manpower availability are also vital, as are public services and, of course, proximity to the raw material production area. At the other end of the chain, however, market proximity is also a prime factor, entailing lower distribution costs for the finished product. In competitive terms, a country faces the challenge of enhancing the quality of the business microenvironment (Figure 8), through efforts to improve infrastructure, heighten the educational and other capacities of the workforce, and generally foster a favorable climate for the agroindustrial activity (Porter, 2003).
Another important element in process engineering and technology is energy requirements. As seen in Table 4, the energy factor affects the productivity of and return from processing activities. Energy is a key factor in successful operations, and arguably a direct processing input or requirement for ensuring the availability of a given service. Industrial services, after all, also require energy to pump water, for instance, or to operate hydraulic machinery. Every process, in line with its degree of development, normally requires more and more diverse services, with the corresponding impact on costs and returns. The percentage of energy required by type also varies from one industry to the next, depending on whether the source is natural gas, electricity, petroleum products, coal (Singh and Heldman, 1993) or biofuels. Table 5 illustrates the requirements of selected services in the food industry.
TABLE 5
Approximate comparative use of processing
inputs
|
Type of industry |
Input |
||
|
Water |
Steam |
Electrical power |
|
|
Maize starch production |
2.5 |
1.7 |
0.121 |
|
Oil hydrogenation |
5.0 |
0.5 |
- |
|
Oil extraction |
21.7 |
2.0 |
0.022 |
|
Sugar refining |
50.0 |
1.8 |
0.035 |
|
Lactose production |
833.7 |
70.0 |
0.396 |
Adapted from Shreve (1967)
Better access to and use of energy services, especially the agricultural and agroindustrial support services, can help reduce poverty. All postproduction operations in the food chain require the efficient provision of energy inputs, efficiency here being a sine qua non for sector development. Indeed, energy in the food industry is a variable affecting product quality and safety, productivity, market share, and, lastly, economic and enterprise success. It is widely known, for example, that the correct choice of fuel can affect the processing costs profile and also the characteristics of processing operations and their output, merely by the varying calorific content (and, of course, the price) of each fuel, as Table 6 shows. One other factor, so vital and important for enterprise performance that it alone demonstrates the suitability of the systems approach, is raw material quality (Cuevas, 1992). Agricultural raw material quality is affected by production aspects, including such factors as seed selection, fertilizer application, weed control, pest and disease control, cleaning and selection (FAO, 1997). The same can be said of raw materials of animal origin. The efficient, cost effective and appropriate application of Good Agricultural Practices as intended to improve quality and safety of agricultural products will have an enormous effect on the quality of the final processed product, since no food industry can transform in a high quality and safe food product a lousy and bad quality raw material without deceiving the consumer. Issues such as crop production and protection, animal production, health and welfare, harvesting and on-farm processing and storage, energy management, and human health, welfare and safety, are among the recommendations for GAP implementation. As part of any effort to assure quality and safety of food, the formulation and implementation of good agricultural practices of a holistic and multidisciplinary nature for crop and livestock production through to the horizontal and vertical integration of markets has been recommended (FAO, 2003).
TABLE 6
Calorific value of selected fuels used in the
agroindustries
|
Fuel |
Calorific content, |
|
Liquid propane |
50.00 |
|
Fuel oil |
46.05 |
|
Charcoal |
30.80 |
|
Coal |
30.18 |
|
Ethanol |
27.67 |
|
Methanol |
20.90 |
|
Maize cobs |
19.30 |
|
Coconut and coffee husks |
16.70 |
|
Fuelwood |
13.80 |
|
Sugar cane bagasse |
8.40 |
Source: Data from FAO (2000a) and Perry (1984)
From the food industry point of view, one type of processing often requires a specific type of raw material, and, in turn, a specific type of raw material will be particularly apt for a specific type of processing. Many quality factors depend on aspects belonging to other systems, e.g., varieties, crop rotation, use of agrochemicals, in the farming system determine the type of material that becomes an input to the food processing plant. For fruits and vegetables, for example, a set of physiological pre-harvest factors demonstrably affects the post-harvest stages. Environmental factors such as temperature, luminosity, irrigation practices, soil type and winds are important, for example. Farm practices such as mineral nutrition and growth regulators have an impact on the following citrus quality factors (adapted from Duarte, 1992):
Taste
Weight
Ripeness
Rind thickness and texture
Soluble and total solids
Acidity
Ascorbic acid
Volume of juice
Color
Shape
Size
Pulp texture
With respect to processing technology, listed below are some of the more important physicochemical properties of processing materials and products in terms of food engineering activities regarding the design and control of processing lines. There have a bearing on quality and therefore on competitiveness:
Melting point
Boiling point
Vapor pressure
Density
Composition
Enthalpy and specific heat
Thermal conductivity
Viscosity
pH
Getting even deeper into the engineering and technology aspects in a food industry, it has to be borne in mind that processing variables are those central factors of the processing subsystem that determine product characteristics. They are in turn dependent on equipment design, technology, manufacturing practices, human resource capacity, and the managerial approach of enterprise strategy. Processing variables can therefore be directly linked to the items listed in the bottom part of Figure 8. For entrepreneurs, and especially for engineers and technicians, these variables afford the opportunity for upgrading enterprise operations and strategies. Processing equipment and its performance is and unquestionably will be decisive in the quality of the end product. This is illustrated by the selected performance variables of processing equipment listed in Table 7.
Familiarity with the engineering aspects of operating equipment is obviously important for successful control of the key variables. This requires much more than a simple definition of the desired limits of these variables. The following steps in processing control are given for industrial processing, for example.
Identify and list processing variables
Define the magnitude, source, timeframe and nature of changes in these variables
Select the key processing variables
Establish which key variables are subject to control
Select the primary variables for control and set acceptable limits
Establish the control protocol
Repeat the same analysis for the secondary variables
TABLE 7
Characterizing performance variables of selected
processing equipment
|
Equipment |
Variable for operational design |
Capacity variable |
|
Centrifugal pump |
Discharge head |
Flow rate |
|
Cyclone |
Particle size |
Flow rate |
|
Evaporator |
Latent heat of vaporization |
Flow rate |
|
Plate-and-frame filter |
Cake resistance |
Flow rate |
|
Tube-and-shell heat exchangers |
Temperatures |
Flow rate |
|
Mixers |
Mechanism of operating system |
Flow rate |
|
Hammer mills |
Size reduction |
Flow rate |
|
Continuous reactor |
Reaction rate |
Rate of flow |
|
Batch reactor |
Reaction rate |
Volume |
|
Screw conveyor |
Bulk density |
Flow rate |
Adapted from Peters and Timmerhaus (1980)
This procedure contains the basis of control theory and of the most classic elements in industrial processing control. These are in turn based on a systems approach, as Figure 10 (a classical) illustrates.
The human factor, moreover, has always been a major determinant of competitiveness and industry success (including the food industries), and always will. Table 8 shows the complexity of the human contribution and relationships as an essential systems component for efficiency and effectiveness, with a direct impact on quality and thus competitiveness.
TABLE 8
Personnel characteristics affecting efficiency
and effectiveness
|
Skills |
Know-how |
Type of work |
Attitude |
|
· Mechanical skills |
· Sufficient |
· Monotonous |
· Initiative |
TABLE 9
Human resource characteristics essential for
competitiveness
|
Technical |
Personal |
|
· Managerial skills |
· Creativity |
Adapted from Cuevas (1998)
|
FIGURE 10
|
Adapted from Perry et al., 1984.
The microeconomic competitiveness factors listed in Figure 8 suggest the kinds of professional management and highly skilled, trained personnel which global markets and economic conditions in the twenty-first century demand. This leads us to a definition of the human resource characteristics which will have to be sought and promoted, as shown in Table 9.
Further, systems analysis of the processing plant within the food chain subsystem can reveal factors bearing on product quality, and their interaction. One common way of showing this is by using cause-and-effect diagrams such as the fishtail diagram (Whiteley, 1994). Figure 11 gives an example of this for a bread bakery. In this diagram the 4-M (manpower, machinery, methods and materials) are represented along with their principal component sub factors as causes of the outcome expressed here (“poor-quality, burned bread”). In other cases “means” is substituted for machinery, a distinction is made between raw materials and in-process materials and management may be added (the latter as a fifth “M”), including marketing.
Primary sub factors such as “poor design” and “poor maintenance” affect the “machinery” subsystem, factor or system component. This then interacts with other factors such as “manpower”, composed by various primary sub factors such as “lack of motivation” to determine the quality of a specific batch of bread. In this diagram, we may imagine that the small horizontal arrows represent the contribution (effect) of each sub factor, whereas the diagonal arrows represent the relationships and interactions of the sub factors, which result in the contribution of each factor. The central horizontal arrow represents the relationships and interactions of all these factors, and produces the result in the box on the right. We have thus shown the primary elements determining product quality. They are not necessarily and solely attributable to the breadmaking process as such. Poor quality of materials, for example, may stretch as far back as poor wheat seed management and inappropriate farm practices. As for processing, some studies suggest that there perhaps ought to be a global factor, or “sixth M”, which would be “management”. With this analysis we have established the fact that quality can be looked at as having a systemic nature, and taken advantage of this to learn which factors determine quality. It is now obvious that the bread-making plant (or simply the small bakery) is a subsystem within another system, made up of suppliers, buyers, regulatory bodies, transport providers and other systems entities, as shown in Figures 3, 4 and 5, which may easily be applied here as to comprise the bread food chain. In turn, the bread food chain is a subsystem of the wheat chain, within the great agrifood system. As an example, a high positive correlation has been found between raw material quality and final product quality for different fishery species in Argentina, including favorable effects on labor productivity, productivity and operating costs (Zugarramurdi et al., 2004). Similar analyses can be constructed for the issue of food safety.
|
FIGURE 11
|
To summarize, we can see that quality and competitiveness can only be achieved and improved if the key elements affecting them and determining their outcome are identified and effective action taken to effect positive change. This must be done at the lowest levels of the agrifood hierarchy, i.e., the individual actors in the agrifood chain, through systems analysis of each productive entity in the enterprise and in the corresponding cluster, within the national agro alimentary context.
To analyse quality factors and design quality-enhancement strategies, we need to look at the concept of cost-effectiveness, which is the effect or impact produced per unit of cost. In the systems approach, effectiveness is the relationship between the system and its environment, or the impact of the system on this environment. Efficiency, on the other hand, refers to the relationship between the inputs and outputs of the system, such as achieving the greatest possible output for a given input (the maximization principle). Effectiveness usually indicates performance levels achieved with respect to the proposed objectives (Heylighen, 1998, 2003). Food product quality objectives are defined on the basis of market studies, norms and standards (such as the Codex Alimentarius, international trade standards and national regulations), of the express requirements of consumers and the mission and plans of the enterprise. It is important to establish the necessary cost control mechanisms, including the respective sensitivity and scenario analyses, in order to determine the cost-effectiveness of quality as illustrated in Figure 9.
The important thing where effectiveness is concerned is to realize that knowing the quality objectives, while essential, is not enough. In other words, having a standard or norm in hand or knowing what the market demands is not enough to produce a product of given quality that meets a given set of specifications. Proper technological as well as managerial capacity is essential in order to determine which factors interact at the various stages or parts of the subsystems and how. They can then be suitably and correctly modified to gain control of the system, and ensure that the desired outcome is produced at a cost level permitting a competitive position. In the “zero defects” concept, the goal is to do everything well from the outset, applying a preventive approach. This implies that it is better to design quality as inherent in the product and operations, instead of measuring the extent of compliance with respect to goals (specifications, methods, standards) via complicated and costly follow-up systems (Juran, 1988). In the past (and even in many companies today), “quality control” departments have traditionally understood “control” as “verification”, “inspection”, “survey”, or “observation”, rather than seizing on the term “control” in the sense of “mastery”, “power”, “command”, “domination”, “steering”, for application within a more integrated and at the same time more reasonable and effective context.
Application of the “zero defects” concept as well as the concept of control in the sense of mastering and directing operations and processes, using a preventive approach, gave rise to use of the systems approach par excellence. The goal was to ensure one of the major components of food quality: food safety. This concerned the concept of hazard analysis and the control of critical points (Hazard Analysis Critical Control Point System, HACCP). It was designed and widely applied by the food industry in the United States, which was working with the space programmes of the 1960s on reducing health risks from food hazards. The concept has been exhaustively described for the last three decades in the technical and scientific literature (Bauman, 1974; Ito, 1974; Troller, 1983; Cuevas et al., 1989; Cuevas et al., 1990; IAMFES, 1991; Bryan, 1992; Cuevas, 1993; FAO, 1998; Mejía et al., 1998). The broad HACCP concept is based on understanding all factors contributing to the rise of food-borne diseases, including the agricultural, ecological and biological characteristics, the processing and food management aspects, and the cultural aspects. In this particular systems approach, hazards are evaluated at all stages of the production, harvesting and management of raw materials and ingredients, processing, distribution, marketing, and food preparation and consumption, i.e., at every stage in the food chain. The principles that lay the foundations for ensuring food safety and the recommended HACCP approach are thoroughly described in a specialized CODEX document (FAO/WHO, 2003b).
The analysis of the manufacturing process is broken down into its operational components, which can be managed, analysed and controlled independently and individually, but which are also of such a nature as to make a definitive contribution to the final characteristics of the product and the overall outcome of the process. An analysis designed to identify potential hazards considers raw materials and ingredients, product handling and use. The critical points are simply the practices, procedures, operations or locations within a food system where loss of control can result in an unacceptable health risk. To put it another way, these are points where a preventive measure (or control measure) can be implemented to prevent a hazard to food product safety and hence to consumer health. As in any systems approach, the part of the analysis corresponding to the process is represented by a flow diagram showing the systems interrelatedness of operations, materials and flows. Presented below is an example of the application of this method in a hypothetical processing case.
It is obvious, in any case, that successful application of this method rests on the exact, efficient and cost-effective application of control methods at the critical control points, besides the scrupulous adherence to good manufacturing practices and standard operating procedures, as is required as a pre-requisite to HACCP implementation. However, one possible shortcoming in the application of this method concerns the assumption that control of the critical control points (once it has been established that control is necessary) is actually feasible. Without real control of the critical points, not even the best intentioned and designed HACCP with the best follow-up will function effectively. Control measures must be feasible and practical in technical and economic terms (Bryan, 1992). Control actions are in turn much more complex than the simple definition of critical limits (prescribed tolerances which must be met to ensure hazard control) or measurements required for follow-up, and much more than a simple practice, or mere handling of some part of the equipment such as a thermostat. Often, once an HACCP analysis has been prepared, the critical control point is simply identified as “scalding”, “freezing”, “pasteurization”, “heat treatment”, “toasting”, “drying”, or “fermentation”, for example, as illustrated in the many publications and books on the subject. These critical “points”, however, are actually operations, parts of a process comprising a subsystem within the processing plant subsystem. Each of these operations, which in food and chemical engineering are called “unit operations”, is in turn made up of a complex combination of and interactions with plant equipment, methods, manpower and materials (Figures 4, 5, 10 and 11). In these interactions, many dependent and independent variables, governed by physicochemical laws and acting in a physical and managerial environment, determine the result within a given timeframe under certain specific conditions.
TABLE 10
Simplified example of HACCP for processing
pulses
|
Operation |
Hazard |
Risk |
Control |
Follow-up |
Action |
Verification |
|
Reception |
Spores |
High |
GAP* |
Observe GAP |
|
|
|
Cold storage |
Microbial growth |
Med. |
Temperature |
Take measurements |
|
Observation |
|
Cooking |
Spores not inactivated |
High |
Time- temperature |
Measurements |
|
Observation |
|
Cooling |
Spore germination |
High |
Time- temperature |
Measurements |
|
Observation |
|
More.... |
... |
... |
... |
... |
... |
... |
* GAP = Good Agricultural Practices; GMP = Good Manufacturing Practices. The General Principles of Food Hygiene Practices are recommended by Codex (FAO/WHO, 2003).
Adapted from IAMFES (1991) and Bryan (1992).
As intimated in Tables 4, 7 and 8, and Figures 4, 5, 6, 7, 9, 10 and 11, because we are dealing here with systems, both control and corrective action may require complex analyses, calculations and specialized decisions from processing engineers, all with definite cost repercussions. Control therefore has an economic as well as a technological connotation. Using the correct time/temperature combination may well be more expensive, for example, that using a sub-optimal combination. This is why a correct, effective and viable HACCP application requires an indepth systems analysis, or rather an analysis of the food chain as a system based on multidisciplinary criteria, as opposed to a simple microbiological approach to processing. Achieving other product quality features can be conceived in similar terms. In technical terms, Good Agricultural Practices, Good Manufacturing Practices, Standard Operating Procedures, and General Principles of Hygiene are all interrelated quality and safety assurance tools, and not objectives themselves.
Lastly, there are acknowledged problems with how small or less developed businesses handle the implementation of HACCP with respect to the food safety issue, so special guides are needed for such businesses. Some barriers to implementation have been identified. They include lack of state commitment, the characteristics of demand in the trade environment, the lack of legal requirements, financial and personnel problems, lack of technical support, poor infrastructure and installations and poor communications. This being the case, it has been recommended that strategies be developed to facilitate the implementation of HACCP in such industries (WHO, 1999). Efforts have also been made to evaluate HACCP cost-benefit ratios by diverse means, as an example by surveys through federal inspection systems in Mexico (Maldonado et al., 2004), or using elaborate methods such as the application of the Bayesian theory of decision-making (Schimmelpfennig and Norton, 2003). We may add that one problem with the application of HACCP, in more developed as in less developed businesses, concerns the failure to consider that the steady, sustainable and effective design, implementation and utilization of HACCP depends on food handling and processing engineering technologies. These are part of a subsystem where technology, economics and management interface each other in the microeconomic business environment, requiring a multidisciplinary systems approach.
