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voice of the industry
Blockchain Ushers In
New Age Of Crisis Visibility
BAe you ready for the big reveal? Old school product traceability systems are giving way to emerging blockchain technology, introducing almost immediate transparency and accountabil- ity into the food chain. While most of the discussion in the produce industry surrounds logistical issues, blockchain is also about to re- de ne the blame game during a crisis.
Whether by consumer demand, retail re- quirement or FSMA (Food Safety Modernization Act) at, it looks like blockchain will become the accepted traceability standard for food products. With good reason. Results from the IBM/Walmart mango blockchain test reduced product tracking from grocer to growing elds from 6 days, 18 hours and 2.6 minutes to just 2.2 seconds.1
Under blockchain, two key factors have been accelerated: source identi cation and track- ing time. The ability to determine the source of product contamination within a matter of seconds represents an operational and public relations sea change for the produce industry. Growers, packers, distributors and retailers will be challenged to respond publicly to a crisis event faster than ever before.
Government agencies will be able to liter-
ally “name names” and assign responsibility
to a speci c company at warp speed. Further
exacerbating the fallout from these near-instan-
taneous discovery timetables will be increased
vigilance by regulatory agencies, driven by the requirements of FSMA.
For complex products such as salad mixes with proteins, if pro- duce is the culpable ingredient, the grower identity no longer will be masked by that of the branded marketer. Heightened visibility calls for a heightened communications response.
REPUTATIONAL TABLE STAKES
There appears to be almost no end to the consumer thirst for total transparency, particularly about food products, and blockchain de- livers on that criteria big time. It raises the reputational table stakes by requiring the release of a cogent media statement in a matter of minutes, even as the affected company is conducting its internal in- vestigation.
This virtually real-time traceability technology practically demands that produce companies have a crisis public relations plan in place that is every bit as robust as their operational crisis response plan.
SOCIAL MEDIA RULE BOOK
When preparing a social media strategy and messaging, keep two
Y LAUREL KENNEDY
words in mind: transparency and dialogue.
Transparency characterizes social media because every word written or spoken, every action taken, is recorded and disseminated, purposely or not. This informs corporate conduct throughout the cri- sis, from interactions with rst responders to formal communications. Assume everything is being recorded for popular consumption and
posterity — because it is.
Dialogue serves as another hallmark of social media, fueled by the expectations of wired generations raised on collective activi- ties such as crowd funding, work-sharing and open sourcing. These social media users ex- pect companies to solicit their points of view, respect their opinions and engage in mean- ingful dialogue throughout a crisis. The days of “behind closed doors” meetings are so over!
COST OF A CRISIS
Another major driver behind the need for rapid response is cost. There is a reason that executives in Deloitte’s global risk survey con- sistently place reputation management in the Top 3 ranking of risks “with the most impact on your business strategy”.2 Crises levy a heavy nancial, organizational and reputational bur- den on a company and an industry.
The annual cost of foodborne pathogens was estimated to be $55.5 billion in a 2015 Ohio State University study.3 As to organiza-
tional costs, another study of 100 crisis incidents across industries discovered that 32 percent of senior executive lost their jobs as a re- sult of the crisis and more than $200 billion of value was destroyed.4
Savvy companies can adopt and adapt to blockchain, crafting crisis public relations programming designed to bolster their reputation as good corporate citizens, while protecting their bottom line. pb
1 “Why Blockchain Won’t Fix Food Safety—Yet,” New Food Economy, February 4, 2018. https://newfoodeconomy.org/blockchain-food-traceability-walmart-ibm/
2 “Exploring Strategic Risk: A Global Survey,” Deloitte, 2013. https://www2.deloitte. com/us/en/pages/risk/articles/exploring-strategic-risk-survey-report.html
3 “Why Our Food Keeps Making Us Sick,” Fortune magazine, May 6, 2016 http://fortune.com/food-contamination/
4 “Communicating Through a Crisis: The Cost of Not Saying Sorry,” FTI Consulting, January 10, 2017. https://fticommunications.com/2017/01/communicating-crisis-cost-not-saying-sorry/
Laurel Kennedy is president of Blink OnDemand Crisis PR, a technolo- gy-based communications company offering the world’s rst crisis PR plan- ning and response software. A former executive at Edelman and Ketchum, she earned an MBA from the University of Chicago Booth School of Business.
What is
blockchain?
Blockchain is a shared, immutable ledger for recording the history of transactions. It fosters a new generation of trans- actional applications that establish trust, account- ability and transparency— from contracts to deeds
to payments. —IBM web site
190 / OCTOBER 2018 / PRODUCE BUSINESS