Digitalisation in the Food Industry – Case Studies on the Effects of IT and Technological Development on Companies

Judit NagyZsófia JámborAnna Freund

DOI 10.7160/aol.2020.120406
No 4/2020, December
pp. 77-92

Nagy, J., Jámbor, Z. and Freund, A. (2020) “Digitalisation in the Food Industry – Case Studies on the Effects of IT and Technological Development on Companies", AGRIS on-line Papers in Economics and Informatics, Vol. 12, No. 4, pp. 77-92. ISSN 1804-1930. DOI 10.7160/aol.2020.120406.

Abstract

In recent decades as a result of the development of information and communication technologies (ICT) and the Internet, we have witnessed major changes in companies. The ICT support of the processes is becoming more and more extensive and comprehensive, which enables the realization of digitalisation. The interconnection of processes, machines, people in a single network makes another level of optimisation available. The changes turned up by digitalisation are not only technological, but they also have an impact on the company's organisation and strategy. Our study aims to create an analytical framework and map the opportunities that digitalisation promises in the food industry and the organisational changes that ICT and technological development bring, with special emphasis on the impact on strategy, employees, and corporate culture. Our results show that companies are not consciously engaged in digitalisation yet, but they exploit their opportunities and make improvements in this sense. Adaptation of digital solutions is often forced by the labour shortage, the pressure to achieve higher efficiency and thus to remain competitive and to service the growth strategy.

Keywords

Digitalisation, ICT development, food industry, strategy, interviews.

References

  1. Bibi, F., Guillaume, C., Gontard, N. and Sorli, B. (2017) “A review: RFID technology having sensing aptitudes for food industry and their contribution to tracking and monitoring of food products”, Trends in Food Science & Technology, Vol. 62, pp. 91-103. ISSN 0924-2244. DOI 10.1016/j.tifs.2017.01.013.
  2. Bottani, E. and Rizzi, A. (2008) “Economical assessment of the impact of RFID technology and EPC system on the fast-moving consumer goods supply chain”, International Journal of Production Economics, Vol. 112, No. 2, pp. 548-569. ISSN 0925-5273. DOI 10.1016/j.ijpe.2007.05.007.
  3. Brettel, M., Friederichsen, N., Keller, M. and Rosenberg, M. (2014) “How virtualization, decentralization and network building change the manufacturing landscape: An Industry 4.0 Perspective”, International Journal of Mechanical, Industrial Science and Engineering, Vol. 8, No. 1, pp. 37-44. ISSN 0020-7403.
  4. Carlozo, L. (2017) “What is blockchain?”, Journal of Accountancy, Vol. 224, No. 1, p. 29. ISSN 1945-0729.
  5. Marsh Report, Marsh and McLennan Companies, United Kingdom [Online]. Available: https://www.marsh.com/uk/insights/research/food-manufacturing-are-you-ready-for-industry.html [Accessed: 5 June 2019].
  6. Chaime, J. (2020) “World population: 2020 overview”. [Online]. Available: https://yaleglobal.yale.edu/content/world-population-2020-overview [Accessed: 29 April 2020].
  7. Dalenogare, L. S., Benitez, G. B., Ayala, N. F. and Frank, A. G. (2018) “The expected contribution of Industry 4.0 technologies for industrial performance”, International Journal of Production Economics, Vol. 204, pp. 383-394. ISSN 0925-5273. DOI 10.1016/j.ijpe.2018.08.019.
  8. Deloitte (2015) “Industry 4.0 – An introduction”, Deloitte, Hollandia [Online]. Available: https://www2.deloitte.com/content/dam/Deloitte/be/Documents/Operations/2015_Industry%204%200%20Report%20vFinal.pdf [Accessed: 20 April 2019].
  9. Demartini, M., Pinna, C., Tonelli, F., Terzi, S., Sansone, C. and Testa, C. (2018) “Food industry digitalization: from challenges and trends to opportunities and solutions”, IFAC-PapersOnLine, Vol. 51, No. 11, pp. 1371-1378. ISSN 2405-8963. DOI 10.1016/j.ifacol.2018.08.337.
  10. Demeter, K., Losonci, D. and Nagy, J. (2020) “Road to digital manufacturing – A longitudinal case-based analysis”, Journal of Manufacturing Technology Management, ISSN 1741-038X. DOI 10.1108/JMTM-06-2019-0226.
  11. Denzin, N. K. and Lincoln, Y. S. (Eds) (2011) “The SAGE Handbook of Qualitative Research”, Sage, Thousand Oaks, USA. ISBN 978-1-4129-7417-2.
  12. Dworschak, B. and Zaiser, H. (2014) “Competences for cyber-physical systems in manufacturing–first findings and scenarios”, Procedia CIRP, Vol. 25, pp. 345-350. ISSN 2212-8271. DOI 10.1016/j.procir.2014.10.048.
  13. Fettig, K., Gačić, T., Köskal, A., Kühn, A. and Stuber, F. (2018) “Impact of Industry 4.0 on Organisational Structures”, In 2018 IEEE International Conference on Engineering, Technology and Innovation (ICE/ITMC), pp. 1-8. DOI 10.1109/ICE.2018.8436284.
  14. Frey, C. B. and Osborne, M. A. (2017) “The future of employment: how susceptible are jobs to computerisation?”, Technological Forecasting and Social Change, Vol. 114, pp. 254-280. ISSN 0040-1625. DOI 10.1016/j.techfore.2016.08.019.
  15. Gauger, C., Gehres, B., Quinn, M., Schmieg, F. and Xu, G. (2017) “Building the digital car company of the future”, The Boston Consulting Group, USA, April.
  16. Geissbauer, R., Vedso, J. and Schrauf, S. (2016) “Industry 4.0: Building the digital enterprise”.[Online]. Available: https://www.pwc.com/gx/en/industries/industries-4.0/landing-page/industry-4.0-building-your-digital-enterprise-april-2016.pdf [Accessed: 20 April 2019].
  17. Gill, M. and VanBoskirk, S. (2016) “The digital maturity model 4.0. Benchmarks: Digital Transformation Playbook”.
  18. Gracel, J. and Łebkowski, P. (2018) “The Concept of Industry 4.0-Related Manufacturing Technology Maturity Model (ManuTech Maturity Model–MTMM)”, Decision Making in Manufacturing and Services, Vol. 12, No. 1-2, pp. 17-31. ISSN 2300-7087. DOI 10.7494/dmms.2018.12.1-2.17.
  19. Hermann, M., Pentek, T., and Otto, B. (2016) “Design principles for industrie 4.0 scenarios”, In 2016 49th Hawaii international conference on system sciences (HICSS), pp. 3928-3937. E-ISBN 978-0-7695-5670-3. ISSN 1530-1605. DOI 10.1109/HICSS.2016.488.
  20. Hofmann, E. and Rüsch, M. (2017) “Industry 4.0 and the current status as well as future prospects on logistics”, Computers in Industry, Vol. 89, pp. 23-34. ISSN 0166-3615. DOI 10.1016/j.compind.2017.04.002.
  21. Horváth, D. and Szabó, R. Z. (2019) “Driving forces and barriers of Industry 4.0: Do multinational and small and medium-sized companies have equal opportunities?”, Technological Forecasting and Social Change, Vol. 146, pp. 119-132. ISSN 0040-1625. DOI 10.1016/j.techfore.2019.05.021.
  22. Ilie-Zudor, E., Kemény, Z., Van Blommestein, F., Monostori, L. and Van Der Meulen, A. (2011) “A survey of applications and requirements of unique identification systems and RFID techniques”, Computers in Industry, Vol. 62, No. 3, pp. 227-252. ISSN 0166-3615. DOI 10.1016/j.compind.2010.10.004.
  23. Kittipanya-ngam, P. and Tan, K. H. (2020) “A framework for food supply chain digitalization: lessons from Thailand”, Production Planning & Control, Vol. 31, No. 2-3, pp. 158-172. E-ISSN 1366-5871. ISSN 0953-7287. DOI 10.1080/09537287.2019.1631462.
  24. Kürthy, G., Dudás, G. and Felkai, B. O. (Eds.) (2016) “A magyarországi élelmiszeripar helyzete és jövőképe”(The current situation and the future of the Hungarian food industry), Agrárgazdasági Kutató Intézet, Budapest. ISBN 978-963-491-599-7. (in Hungarian)
  25. Lichtblau, K., Stich, V., Bertenrath, R., Blum, M., Bleider, M., Millack, A. and Schröter, M. (2015) “IMPULS-industrie 4.0-readiness”, Impuls-Stiftung des VDMA, Aachen-Köln.
  26. Nagy, J., Oláh, J., Erdei, E., Máté, D. and Popp, J. (2018) “The role and impact of industry 4.0 and the internet of things on the business strategy of the value chain— The case of Hungary”, Sustainability, Vol. 10, No. 10, p. 3491. ISSN 2071-1050. DOI 10.3390/su10103491.
  27. Pagani, M. and Pardo, C. (2017) “The impact of digital technology on relationships in a business network”, Industrial Marketing Management, Vol. 67, pp. 185-192. ISSN 0019-8501. DOI 10.1016/j.indmarman.2017.08.009.
  28. Santeramo, F. G., Carlucci, D., De Devitiis, B., Seccia, A., Stasi, A., Viscecchia, R. and Nardone, G. (2018) “Emerging trends in European food, diets and food industry”, Food Research International, Vol. 104, pp. 39-47. ISSN 0963-9969. DOI 10.1016/j.foodres.2017.10.039.
  29. Schuh, G., Anderl, R., Gausemeier, J., Ten Hompel, M. and Wahlster, W. (Eds.). (2017) "Industrie 4.0 Maturity Index - Managing the Digital Transformation of Companies”, Munich: Herbert Utz.
  30. Schumacher, A., Erol, S. and Sihn, W. (2016) “A maturity model for assessing Industry 4.0 readiness and maturity of manufacturing enterprises”, Procedia Cirp, Vol. 52, pp. 161-166. ISSN 2212-8271. DOI 10.1016/j.procir.2016.07.040.
  31. Sen, K., Durakbasa, N., Erdol, H., Berber, T., Bas, G. and Sevik, U. (2017) “Implementation of digitalization in food industry”, DAAAM International Scientific Book, pp. 91-104. ISSN 1726-9687. DOI 10.2507/daaam.scibook.2017.08.
  32. Simutech (2016) “Industry 4.0: How the food industry must adapt to survive”, Simutech Multimedia, White Paper, Kanada. [Online]. Available: https://www.simutechmultimedia.com/downloads/whitepapers/simutech-whitepaper-industry-4.0.pdf [Accessed: 5. June 2019].
  33. Tian, F. (2016) “An agri-food supply chain traceability system for China based on RFID & blockchain technology”, In 2016 13th international conference on service systems and service management (ICSSSM), pp. 1-6. E-ISSN 2161-1904. DOI 10.1109/ICSSSM.2016.7538424.
  34. Tse, D., Zhang, B., Yang, Y., Cheng, C. and Mu, H. (2017) “Blockchain application in food supply information security”, In 2017 IEEE International Conference on Industrial Engineering and Engineering Management (IEEM), pp. 1357-1361. E-ISSN 2157-362X. DOI 10.1109/IEEM.2017.8290114.
  35. World Economic Forum (2018) “The system initiative on shaping the future of food security and agriculture”. [Online]. Available: https://weforum.ent.box.com/v/FSA [Accessed: 26 Feb. 2019].
  36. Yin, R. K. (2011) “Applications of case study research”, Sage Publications, USA, pp. 4-6. ISBN 978-1-4129-8916-9.

Full paper

  Full paper (.pdf, 494 KB).