Industry Brief

Adapting to the
Next-Generation Food
and Beverage Industry
 Industry Brief

Introduction
The COVID-19 pandemic effectively disrupted many aspects of our lives. Through
most of 2020, people navigated uncharted approaches to working and socializing,
while organizations scrambled to revise business strategies and processes to
remain operational. Overall, the focus of dealing with a worldwide health situation
drew attention away from other events impacting many industries across the
globe. In particular, before the pandemic, the food and beverage industry was
already experiencing a transformation that is reimagining the way the industry will
function going forward.

Currently, the food and beverage industry is largely influenced by consumer

trends, evolving food safety initiatives and regulations, globalization of supply
chains, and advancing technologies to name a few. Pursuing innovation and
remaining relevant in the market are core elements of a company’s business
model. It’s a given that to be competitive, organizations need to be agile to keep up
with the evolving marketplace. This is becoming more challenging as companies
are facing more variables and disruptors in their respective focus areas.

This industry brief examines current challenges impacting the food and beverage
industry and addresses how organizations are implementing digital technologies
to overcome the challenges, maintain a competitive edge, and ensure long-term
relevance.

Evolving Consumer Demands

Before masks, hand sanitizer, and social distancing became a way of life, people
were already reexamining their lifestyles. Efforts to maintain a healthy body and
mind by staying physically fit were growing in popularity. This pursuit of improving
health and wellness naturally included a transformation in the way people shop
for and consume food products. In a nutshell, food consumers are demanding
better quality, more variety, and more information.

Adapting to the Next-Generation Food and Beverage Industry 1


Research from
compostable packaging
company Tipa cites that
48% of British shoppers
would like to see clearer
labelling on products with
plastic-free packaging.3
“Greater technical
literacy and awareness
of food safety issues are
increasing consumer
expectations that
companies should use
technology to improve
standards, traceability,
and transparency.”5
Adapting to the Next-Generation Food and Beverage Industry
Industry Brief
Dietary Preferences
Beyond nutrition and sustenance, consumers are looking at food products as
more of a catalyst for improving physical and mental health. This shift in the
consumables paradigm is manifest in emerging dietary trends, including:
• Gluten free.
• Foods without genetically modified organisms (GMO).
• Plant-based protein.
• Foods that promote relaxation and improve sleep.
• Immunity-boosting foods.
Data from an Innova Market Insights 2020 Consumer Survey revealed:2
54% 60% 64%
Claimed to have spent time Are increasingly looking for Have found more ways to
educating themselves on food that could boost their tailor their life and products
ingredients. immune health. to their individual style,
beliefs, and needs.
These trends have compelled food and beverage companies to develop healthier
ingredients and food products and establish more product transparency.
Label Literacy
More consumers are examining food product labels. That said, there is a push for
more consumer-oriented packaging. COVID-19 escalated concerns with hygiene
and contamination, leading to a growing preference for single-use and tamper-
proof packaging. Also, informed consumers make better decisions regarding food
usage and disposal, which contributes to a significant reduction in waste.
One of the ways consumers can educate themselves on food products is through
the SmartLabel™ digital transparency initiative launched by the Consumer Brands
Association (formerly the Grocery Manufacturers Association) and the Food
Marketing Institute. Using digital technologies in product labeling, consumers
can use their smart phone to scan a quick response (QR) code, which accesses a
webpage or app that provides in-depth information about the product, such as the
brand’s sustainability record and where the food originated.4
Food Quality and Safety
The U.S. Food and Drug Administration (FDA) introduced the Food Safety
Modernization Act (FSMA) at the beginning of 2011. By design, the FSMA shifted
the agency’s approach to food safety by turning its focus toward preventing
contamination of the food supply rather than responding to outbreaks of
foodborne illnesses. The FDA divided the law into five key areas:6
2

Quality and safety
encompass multiple
dimensions across
the food and beverage
industry. According to
Deloitte’s 2020 food
consumer survey,
85% emphasized the
importance of safety
for self, others, and the
workers who produce food
as well as safety in terms
of packaging to prevent
contamination.⁷
Adapting to the Next-Generation Food and Beverage Industry
Industry Brief
• Preventive controls – Comprehensive, prevention-based controls enforced
across the food supply.
• Inspection and compliance – Specifies how often the FDA should inspect
food producers.
• Imported food safety – Importers must verify that their foreign suppliers
have adequate preventive controls in place to ensure safety. The FSMA also
mandates that the FDA can authorize qualified third-party auditors to certify
that foreign food facilities are in compliance with U.S. food safety standards.
• Response – The FDA has full authority to recall all food products.
• Enhanced partnerships – Strengthens the existing collaboration among all
food safety organizations to achieve the agency’s public health goals. This
includes improving training for U.S. federal, state, local, territorial, and tribal
as well as foreign food safety officials.
Using Technology to Achieve Product Quality and Safety
In food products, quality and safety are non-negotiable priorities. Too often,
quality issues and product recalls are a result of companies not integrating a
quality focus into all parts of their business. Even though quality management is a
regulatory requirement, it is often tacked on at the end of production. This makes
it an added process, which means it’s an added business expense. Quality issues
discovered late in the production process will result in delays, wasted resources,
and ultimately a loss of revenue.
For example, a common challenge in quality management is identifying the root
causes of deviations and nonconformances because they involve many variables.
Consider equipment, materials, personnel, procedures, design, training, and
external factors. When different people are responsible for each aspect of an
investigation, the data each person collects and uses is likely in different formats
(paper, electronic, hybrid) and scattered across various locations.
This siloed approach to problem resolution is inefficient. Discovering a quality
issue during manufacturing or after a product is on the market could lead to
a costly, time-consuming resolution or even a recall. This can undermine your
product release time frame, revenue goals, and market position.
The ability to capture all structured and unstructured data, including the data’s
history, from multiple stakeholders in a single repository gives organizations
a more in-depth view of the issues. This is critical for distinguishing between
observed symptoms and the root cause of the problem. Digitized data
management leads to faster resolutions and helps ensure that a fix in one area
doesn’t create problems in other areas.
MasterControl Development Excellence™ helps you automate the entire product
development process, providing integrated solutions that not only follow industry
best practices, but also allow you to collaborate across multiple sites while
maintaining visibility and quality at each step of product design, development, and
manufacturing. Allow teams to shave considerable amounts of time off product
introductions with faster changes, approvals, notifications, and transfers.
3
 Industry Brief

Global Supply Chain

More food products are traversing international borders as more businesses

are going global with operations and market reach. Consequently, the food and
beverage supply chain — farm to fork — is becoming more expansive and complex.
The risks are also increasing. Therefore, more stringent food safety regulations
with stricter policies in terms of quality standards, supervision, and sanctions are
being adopted by governments committed to protecting their citizens.

In particular, as part of its FSMA, the FDA has a mandate to hold everyone at
each segment of the supply chain accountable for adopting preventive controls to
decrease the likelihood of food safety problems, raising the compliance bar for all
global food companies operating in and exporting items into the U.S.⁹

Traceability
Over the past two decades, the food and beverage industry has faced difficult
challenges. Global events such as bovine disease and honey scandals frequently
“Has deployment
made headlines. These issues highlighted supply chain weaknesses, such as
of advanced safety the ability to transparently document traceability records, leading regulators,
technology or process producers, and consumers to demand better traceability options.
capabilities provided
improvement in These scandals pushed the international community and organizations, such as
financial or operational the FDA and the European Union (EU), to come together and agree to a set of
standards that aim to improve the global traceability issue.
performance?”
Respondents
Still, despite having these standards in place, companies should not become
overwhelmingly said complacent. Consumers are constantly demanding improved traceability,
yes, with 75% reporting particularly as they become more conscious and conscientious of where their food
operational improvements is sourced. At the same time, manufacturers are now beginning to understand that
and 60% claiming financial robust traceability systems are cost-reduction and revenue-growth opportunities
improvements.”8 that can help them stay competitive.10

– LNS Research Maintaining oversight over the supply chain while meeting multi-country
regulations is challenging. Government agencies require food to be tracked
through all stages of production, processing, and distribution. The aim is
to fully visualize the supply chain and enable quick and effective corrective
action/preventive action (CAPA) to keep contaminated products from reaching
consumers.

With regulated products, there is little to no margin of error with your target
level of quality. Digitization transforms quality management and reduces the cost
and effort to meet your quality goals and achieve compliance. MasterControl
Supplier™ maintains all supplier quality data and documentation in one place.
It automatically tracks and stores audit findings and other supplier information.
This significantly simplifies your supplier qualification, traceability, and supplier
corrective action request (SCAR) processes.

Adapting to the Next-Generation Food and Beverage Industry 4

 Industry Brief

Managing Risks in the Supply Chain

The COVID-19 pandemic contributed to an already elevating risk factor across

the food and beverage industry. It’s evident that risk management is no longer
an afterthought to check a box on the compliance to-do list — it needs to involve
more than a one-time risk assessment.

More disparate entities (internal and external) are involved in the development and
distribution of food products. All too often, defects or functionality discrepancies
go undiscovered until later in the production process or after products are
on the market. Risk management needs to start earlier and be performed in
greater detail at every stage of the product’s life cycle. Staff involved in product
development, manufacturing, supply chain, etc. must participate in risk control
and mitigation.

Risk management is a continuous iterative process. It involves employing a

systematic, data-driven approach to monitoring trends and identifying and
mitigating risks before they result in costly delays, rework, or product recalls.
That said, risk management is not a quality-only responsibility, it needs to be
integrated into all areas of the company by effectively aligning people, processes,
and technology — infusing risk-based thinking into the organizational culture.

MasterControl Risk™ unifies all risk-related activities and documents for efficient
and consistent risk management. You can gain a complete view of your enterprise
risk landscape, including all product lines, business units, procedures, quality
management, document control, and more.

Case Study: How the FDA Advocates Advanced Technology for More Precision Risk Management

The FDA is using advanced technology to accurately screen imported foods. In the spring of 2019, the agency
launched a pilot program to learn the added benefits of using artificial intelligence (AI), specifically machine
learning (ML), in import-screening processes. “ML uses algorithms to rapidly analyze data, automatically identifying
connections and patterns in data that people or even our current rules-based screening system cannot see,” said
former FDA Commissioner Stephen Hahn.

The first phase of this pilot was a “proof of concept” to validate the agency’s food screening approach. The FDA
decided to test this approach on imported seafood to assess the utility of using AI/ML to better target seafood at the
border that may be unsafe.

“Why seafood? Because the U.S. imports so much of it. Upwards of 94% of the seafood Americans consume each
year is imported,” said Hahn.

The proof of concept demonstrated that AI/ML could almost triple the likelihood that we will identify a shipment
containing products of public health concern and further strengthen protections for consumers.¹¹

Adapting to the Next-Generation Food and Beverage Industry 5

 Industry Brief

Digitization Is Key to Long-Term Success

Near the beginning of the pandemic lockdown, outbreaks at food and meat
manufacturing plants regularly made the news. As a result, more consumers are
taking a closer look at where their food comes from and who makes it. Experts
suggest that this level of scrutiny will continue, and technology will have a larger
role in keeping food and workers safe.¹²

The circumstances surrounding the global health crisis highlighted the need for
reliable connectivity and integration. That said, to remain competitive, companies
need to adopt new technologies in order to keep up with the changing trends and
advances in the marketplace.

Leading food and beverage manufacturers are investing in digital technologies to

address the challenges facing them today and to gain a competitive advantage
going into the next generation of consumable product development. Companies
are taking advantage of the latest developments in automation and platform-
based technology to increase productivity, maintain compliance, and strengthen
their economic status and market position.

By implementing digital technology, you can be confident that risks, supply

chain bottlenecks, unexpected costs, and production delays will be minimal.
MasterControl’s integrated quality and manufacturing solutions fully support
your compliance efforts:

• Quality excellence: Transform quality management with the most complete,

connected, and intelligent QMS available today. Choose the proven platform
that empowers you to digitize and automate the management of quality
events, documents, and training across your entire product life cycle.
• Manufacturing excellence: Simplify manufacturing with the fastest path
to paperless, errorless, and frictionless production. Our easy-to-use digital
platform helps you implement electronic production records on every line,
enable review by exception, and get products out the door sooner.
• Connected platforms: Eliminate silos by harmonizing technology systems.
Improve real-time communication, collaboration, and data sharing across all
business units. Ensure seamless integration and connectivity.
• Full system integration: Embed quality into your organization’s culture while
streamlining the productivity of systems you already own.
• Bring intelligence to unstructured data: Automate text extraction from
unstructured documents (paper reports, spreadsheets, emails, etc.) and
contextualize relevant data into your quality management system for better
accuracy and efficiency.

Adapting to the Next-Generation Food and Beverage Industry 6

 Industry Brief

• Connect data throughout the product life cycle: Streamline workflow

creation and execution. Allow users to improve data integrity with connected
data sources, process steps, and systems.
• Real-time data analysis: Stay informed and up to date on your industry and
operational trends by gathering, processing, and analyzing complex data sets,
enabling more informed, data-driven decision-making.

Emerge as an Industry Leader

MasterControl has the ideal quality and manufacturing solutions to give you a
competitive advantage. Combining our proven digital process automation, quality
data management, and analytics gives you the tools to establish a culture of
quality and efficiency throughout your organization and achieve your time-to-
market objectives.

About MasterControl
MasterControl Inc. is a leading provider of cloud-based quality and compliance
software for life sciences and other regulated industries. Our mission is the same
as that of our customers – to bring life-changing products to more people sooner.
The MasterControl Platform helps organizations digitize, automate, and connect
quality and compliance processes across the regulated product development
life cycle. Over 1,000 companies worldwide rely on MasterControl solutions to
achieve new levels of operational excellence across product development, clinical
trials, regulatory affairs, quality management, supply chain, manufacturing, and
postmarket surveillance. For more information, visit www.mastercontrol.com.

References
1. “Top Food Trends to Accelerate Innovation in 2021,”
Innova Market Insights, Nov. 23. 2020.
2. “In Tune With Immune: Innova Market Insights Spotlights Immunity Offerings for
Beverages, Cereals, and Dairy,” Nutrition Insight, Dec. 10, 2020.
3. “British Consumers Call for Clearer Labelling on Plastic Packaging,”
Jules Scully, FoodBev Media, Feb. 25, 2019.
4. “The Global Outlook on Smart Labels,”
Miguel Campos, Food Industry Executive, Dec. 17, 2018.
5. “Food Trust: Giving Customers Confidence in Your Food,” Food Trust – PwC.
6. “Food Safety Modernization Act (FSMA),”
U.S. Food and Drug Administration, Jan. 4, 2021.
7. “The Future of Fresh: Patterns From the Pandemic,”
Barb Renner, et al, Deliotte Insights, Oct. 13, 2020.
8. “Safety and Risk Management in the Age of IIoT and Digital Transformation,”
Peter Bussey, LNS Research.
9. Supra note 5.
10. “Food & Beverage Traceability: Present and Future,”
Tatjana Milenovic, Food Manufacturing, Mar. 26,2020.
11. “Import Screening Pilot Unleashes the Power of Data and Leverages Artificial
Intelligence,” U.S. Food and Drug Administration, Aug. 31, 2020.
12. “5 Trends Fueling Food and Beverage Innovation in 2021,”
Lillianna Byington, Food Dive, Jan. 4, 2021.

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IBXXXUSENLT-06/21

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