Leaders ripping apart the black box

By Virpi Varjonen

- Last updated on GMT

'Change is already happening. Sooner or later the change will reach you too, so why not get on-board today?' © iStock
'Change is already happening. Sooner or later the change will reach you too, so why not get on-board today?' © iStock
It’s hard to care when you don’t know the real supply chain picture, argues Scandinavia-based analyst Virpi Varjonen in this guest article.

What most people don’t know is how complex the value chains within food and nutrition are. Everything is squeezed into a black box, where no one can see inside. The only thing the consumer sees is the end product she buys. The ingredient list might indicate what raw materials are used – but that’s all! We in the food and nutrition businesses don’t have to operate within the black box to run a profitable business.

The current black box model keeps consumers engaged with enjoyable products, great promises and fancy marketing. These are important, of course. But if consumers could see inside the black box, they wouldn’t be too happy: adulterated raw materials, unlabelled ingredients, unethical and unsustainable production methods, secret formulations to hide the origin, intentionally unhealthy products… So far the public has only seen the tip of the iceberg.

The black box excuses are endless

The black box has its purpose: to optimise the margins as much as possible, to get big outputs with small inputs. Short-term focus on higher profits is guiding actions, and all participants in the value chain easily justify why the black box exists. The first excuse is the consumer – “they are driven by price”.

“Cheaping”​ is trendy. Of course, competition is so fierce that it is simply not possible to pay raw material producers and suppliers well. “Production can only be done with the cheapest possible workforce”.​ The king of all excuses is that “we would be more transparent and ethical, if all others would be too”.

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© iStock

Companies don’t have a conscience and empathy - people do. However, every company is run by people. The black box has just created an elusive world, where people can do things behind the scenes. Things that their conscience wouldn’t normally let them do, if they didn’t have this protective hidden space. The black box makes it easy to avoid taking responsibility.

Seeing the opportunities beyond

A better future is calling us to take responsibility. The black box shouldn’t even exist. We can choose make value chains better and take responsibility for our environment, social welfare and consumer health – right around the globe. Before you think this is unrealistic, it is good to emphasize that the purpose of the businesses is to make profit.

Embracing an opportunity mindset makes all the difference. There are thousands of ways to do good business – ethically. If you look around, you’ll see the forerunners are already there. Because that’s where consumers are going. Modern consumers want to follow companies who take the responsibility in a transparent and honest way. And responsibility doesn’t mean higher prices for consumers, it means they gain a greater feel-good factor, which gives them a reason to commit. To be loyal. And that loyalty creates steadier revenue.

Leaders of today, heroes of the future

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© iStock

Everyone can be a leader of this change and start breaking down the black box. The moment you decide this is important is the moment you start to lead. Leadership is not a position, it is the desire make change. Our world urgently needs leaders who create safer, smarter and greener businesses.

Leaders, who are good guys, authentic, stick to ethics and morals.

Leaders, who understand the true calling of People Planet Profit and creating better business.

Leaders who genuinely care about customers and employees.

Leaders who understand that what we do to others and to our planet, we do to ourselves.

Change is already happening. Sooner or later the change will reach you too, so why not get on-board today?

 

Virpi Varjonen is a strategist at Invenire and a judge at the Nutraingredients Awards​ 2016 to be held on May 11 at Vitafoods Europe​.

Related topics: Markets and Trends

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