How To Create A Resilient Food Supply Chain

How to create a resilient food supply chain

Authority Magazine interviews TMX North America President Jeff Bornino.

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Authority Magazine

Published

27 December 2023

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CLEVELAND, OH

The cascading logistical problems caused by the pandemic and the war in Eastern Europe have made securing a reliable supply chain a national imperative. What must agriculture companies and policymakers do to ensure secure and resilient food supply chains? In this interview series, we are talking to business leaders who can share insights from their experiences about how we can address these challenges. As a part of this series, I had the pleasure of interviewing Jeff Bornino.

Jeff Bornino is the President of North America at TMX Transform, where he is responsible for driving the supply chain consultancy’s expansion into the U.S. market. Well-known and respected within the retail industry, Bornino has over 20 years of supply chain experience, most of which was spent at Kroger, the world’s largest grocer. In addition, Bornino has served on numerous industry boards and committees, including the GS1 Trade Partner Performance Management Committee and the University of Pittsburgh Supply Chain Management Corporate Advisory Board.

Thank you so much for joining us in this interview series! Before we dig in, our readers would like to get to know you. Can you tell us a bit about how you grew up?

I was born and raised in Cleveland, Ohio, and to this day, I maintain a strong connection to the city. However, for most of my career, I lived in Cincinnati, working for Kroger, the world’s largest grocer. During my 14-year tenure at Kroger, I held the position of Vice President of Corporate Supply Chain and Inventory and replenishment. In my role, I oversaw the procurement and inventory management of its goods, along with supply chain strategy analytics, international logistics, and process improvement for the company. I then moved to Giant Eagle, which allowed me to return to Cleveland. In my role as Vice President of Supply Chain Strategy and Transformation, I led supply chain strategy and transformation.

Currently, I serve as the President of North America for TMX Transform, an end-to-end supply chain consultancy dedicated to propelling companies to the next level by optimizing their supply chains. Guided by former industry practitioners and specialists with deep expertise across retail, manufacturing, consumer packaged goods, food and beverage, e-commerce, and more, TMX Transform delivers practical and efficient solutions that drive transformation and tangible improvements for our clients.

Can you share the most interesting story that happened to you since you began your career?

It’s interesting reflecting upon my career that I’ve had the same thing happen three times when starting new roles. When I joined Kroger, I did not have deep supply chain experience. I had worked for supply chain providers and studied supply chain in school, but my experience was limited. Yet, Kroger took a chance on me because of my eagerness and willingness to learn.

Seven years later, I was appointed as the Director of Grocery Procurement despite having no procurement experience. On paper, the other candidates were more qualified, but I had fresh perspectives and an eagerness to change.

Fast forward many years to TMX Transform, where I’m experiencing the same phenomenon. I never envisioned myself as a consultant or building a business in a new market from scratch. It’s about your attitude and approach, not what you already know.

You are a successful leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
  • Humility. There are two aspects to humility in leadership. I believe that ego has no place in successful leadership and is probably the single most damaging human attribute. One day, while driving from the office, I saw a construction worker struggling to retrieve materials that had fallen from his truck. I hopped out in my work clothes and began helping him. As it turned out, many team members saw me doing this from the office windows and commented the next day. The lesson here is simple: no one is better than anyone else, and you should always do what you can to help others. The second part of humility in leadership means focusing on your team. The collective efforts of the team will yield superior results than the results of a single individual. Throughout my career, I’ve made a conscious effort to surround myself with diverse and incredibly knowledgeable individuals and I simply allow them to grow and be their best. I neither claim nor aspire to be the smartest person in the room. If you examine the teams I’ve led, you’ll notice this recurring theme.

Curiosity. This principle underscores the importance of continuous learning, exploration, and pushing one’s boundaries to foster personal growth. Leaders must embrace new challenges and facilitate positive change. The three anecdotes I shared earlier about making unconventional career choices serve as good illustrations of this concept.

Jeff Bornino
  • Genuine care for people and loyalty. Recognizing and understanding that everyone has their own story and experiences is a fundamental aspect of effective leadership. Taking the time to engage in one-on-one meetings with every team member, not out of obligation but genuine interest, is a powerful practice. These meetings delve beyond career aspirations, encompassing personal backgrounds, such as family, travel, pets, hobbies, and interests. This effort fosters a deep, lasting connection based on genuine connection. Maintaining these bonds over the years is a source of pride, and the loyalty and camaraderie endure. And nothing beats handwritten notes and personalized Christmas cards!
Are you working on any exciting new projects now? How do you think that will help people?

TMX Transform is engaged in several compelling projects. Among these endeavors, we’re working closely with prominent global brands to overhaul their supply chain networks and create new distribution facilities. The approach involves the utilization of TMX Transform’s proprietary simulation solutions and the implementation of state-of-the-art automation recommendations. The anticipation is high for these projects, as they will yield significant results and improved outcomes for the respective companies’ customers.

Ok super. Thank you for all that. Let’s now shift to the main focus of our interview. To ensure that we are all on the same page let’s begin with some simple definitions. What does the term “supply chain” encompass?

“Supply chain” refers to the entire process from the production of goods to their delivery into the hands of the consumer. This process involves not only the physical movement of products, but also the technology and systems needed to plan, manage, and execute the efficient flow of goods from manufacturers to consumers. In today’s complex business environment, supply chain management has become a critical aspect of ensuring product availability, reducing costs, and meeting customer expectations. It is often complex work, which makes it interesting.

Can you help articulate the weaknesses in our current food supply chain systems?

Three major weaknesses in our food supply chain systems are the volatility of customer demand, labor constraints, and a lack of supplier redundancy. Traditional supply chains are often designed to handle stable, predictable demand patterns. However, the rise of e-commerce and changing consumer behaviors has increased demand volatility, resulting in challenges for many retailers in inventory management, order fulfillment, and adapting to sudden shifts in demand. To address this, supply chains need to become more flexible and agile, using technologies like demand forecasting algorithms and real-time data analytics to anticipate and respond to changing customer demands.

Labor shortages and consistency, particularly in specialized areas like the cold chain, are another weakness in our current food supply chains. This is exacerbated by the physical demands and conditions in some parts of the food supply chain. Automation technologies, such as robotics and AI-powered machinery, can help mitigate these labor constraints by handling repetitive or physically intensive tasks. Investing in workforce development and training programs can also attract and retain skilled workers.

The third weakness in our current food supply chain systems is a lack of supplier redundancy. In the middle of the pandemic, there were many examples of retailers that struggled because they had a single source for critical supplies or ingredients that experienced significant shortages. Retailers and manufacturers need to build redundancy in the case of supply disruptions and have a backup plan to serve customers.

Here’s where technology and automation can play a pivotal role. Embracing digital transformation, adopting smart manufacturing practices, and leveraging data analytics can help make supply chains more resilient and responsive to changing conditions. Furthermore, collaboration across the supply chain ecosystem, including suppliers and logistics partners, can enhance the overall resilience of the food supply chain. This includes sharing accurate forecasts and communicating any potential shortages as soon as they are known.

Can you help define what a nationally secure and resilient food supply chain would look like?

We should regard every supply chain as a strategic enabler for delivering exceptional customer satisfaction. We must move away from the outdated notion that supply chains are merely cost centers with the sole purpose of expediting product flow.

Jeff Bornino

While efficiency remains crucial, the cost savings derived from these operations should be reinvested to enhance the customer experience. For example: bolstering investments in stores, offering improved pricing, or delivering higher-quality products. Ensuring the integrity of the cold chain is paramount for preserving sensitive items like chocolate, ice cream, meat, and produce, guaranteeing they reach the customer in optimal condition. Each hour that a strawberry spends outside refrigeration diminishes its shelf life significantly, and temperature fluctuations can manifest in crystallized ice cream or waxy film on chocolates.

Retailers and manufacturers should prioritize investments in technology and solutions that not only generate savings but also elevate the overall customer experience. This encompasses areas such as automation, infrastructure optimization, and network evaluation to identify optimal supply chain nodes and minimize costs. However, these efforts should not focus on saving money but rather on channeling these savings toward enhancing the customer experience.

Can you share with our readers a few of the things that your organization is doing to help create a more secure food supply chain?

TMX Transform collaborates with diverse global companies to address their various supply chain challenges and opportunities. As a comprehensive end-to-end supply chain consultancy, we offer a portfolio of services, capable of assisting various complexities including, optimizing supply chain design for maximum efficiency, establishing a more dependable flow of goods within the distribution center, or leading a major automation implementation. By creating a more cost-effective and reliable supply chain, we help our customers to improve their customer’s experience.

We’re knowledgeable in automation solutions, but we remain agnostic in terms of a “preferred” provider. Rather than implementing automation for its own sake, we take the time to understand our client’s specific requirements, identify their most pressing challenges, and detect the pain points within their supply chains. This allows us to determine the ideal automation solution that will be most effective for them.

What are a few threats over the horizon that might disrupt our food supply chain that we should take action now to correct? Can you please explain?

Every retailer should conduct a comprehensive assessment of their SKU portfolio. Retailers need to evaluate the products occupying shelf space and identify those that don’t resonate with customers.

Jeff Bornino

For instance, having an extensive selection of mustard or olive oil variants, often numbering in the dozens, may not be necessary. Every item is competing for shelf space, which means less important SKUs are leading to out-of-stocks for top sellers.

Jeff Bornino

Retailers need to assess which products are most critical and create more shelf holding power for them by removing less popular and less profitable items. This will also help reduce shrink and improve store operational efficiencies.

There is often reluctance to reduce product variety, due to concerns that it might negatively impact customers. However, consistently delivering the items that matter most with a higher degree of reliability has a more significant impact on the overall customer experience. Retailers can still offer products they removed from physical shelves through online channels. For example, they can adopt a direct-to-ship model with suppliers or collaborate with separate distribution centers for products with longer lead times.

The trap many retailers fall into today is attempting to cater to every possible customer need. Instead, they must understand their customers, prioritize essential items, execute flawlessly on those products, and find alternative solutions for lower-priority items. Availability is king. And perhaps most interesting of all; studies have shown that customers prefer a simpler shopping experience and even perceive the retailer to have more variety when the mix is streamlined.

What are the “5 Things We Must Do to Create Nationally Secure and Resilient Food Supply Chains” and why?

1. Find the right automation for your supply chain. Retailers and manufacturers should never automate for its own sake. Instead, they should focus on identifying the most suitable solution to address their specific challenges. By doing so, they can enhance the resilience of their supply chain and, most importantly, deliver a higher-quality experience to their customers.

2. Create redundancy both in your supplier network and in internal operations. The pandemic exposed the vulnerability in relying on a single source for a particular item, as it led to shortages when that source was compromised. To mitigate such risks, retailers should introduce redundancies in their supplier base and internal networks. This means having backup plans to address customer demand in the event of a catastrophe or disruption, ensuring continuity of operations.

3. Make data-driven decisions. Retailers must leverage data to ascertain what their assortment should encompass to sustain high levels of in-stock availability and product freshness. Retailers should critically evaluate their SKUs, ensuring that the items they carry genuinely align with customer preferences. By streamlining both their supply chain and in-store product offerings, retailers can secure a consistent supply of products that hold significance to customers. This approach ensures that the right products remain in stock and meet customer expectations.

4. Assess your entire network design to guarantee the efficient and reliable flow of goods to customers. Retailers and manufacturers should adopt a holistic perspective, examining their entire network for potential bottlenecks or vulnerabilities in the accurate and reliable delivery of products to their customers. It’s imperative for companies to take proactive measures to address these challenges, particularly in anticipation of peak retail seasons. Developing a digital twin or utilizing dynamic simulation modeling is particularly helpful in this regard.

5. Maintain the integrity of the cold chain for temperature-sensitive products. The cold chain presents a highly intricate challenge in terms of sustaining the correct temperatures for sensitive items such as meat, produce, and dairy, among others. Retailers must guarantee the presence of suitable solutions to maintain consistent temperatures, ensure safety, and prevent any breaches in their cold chain. Every hour that a strawberry spends out of refrigeration has a significant impact on its shelf life.

Every hour that a strawberry spends out of refrigeration has a significant impact on its shelf life.

Jeff Bornino
Are there other ideas or considerations that should encourage us to reimagine our food supply chain?

Retailers can’t cater to every possible customer need. Success lies in gaining a deep understanding of your customer base and their specific preferences. For example, some retailers are rolling out same-day or even 30-minute delivery services, but the reality is that most customers may not need products that quickly. In their pursuit to meet the demands of every individual customer, retailers risk becoming distracted and inefficient.

Retailers should instead focus on identifying their core customer segments, understanding their unique needs, and tailoring their efforts to provide services that cater to those specific demands. Whether the focus is on speedy delivery, product assortment, pricing, or exceptional service, each company must grasp what their customers expect and concentrate their resources on solving those challenges to deliver the desired results. It’s about prioritizing and aligning with your target audiences needs rather than trying to be everything to everyone.

This was very inspiring and informative. Thank you so much for the time you spent with this interview!

This article was written by Martita Mestey and originally published by Authority Magazine on December 27, 2023.

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