The Kellogg Company (Kellogg's) is an American multinational food-manufacturing company headquartered in Battle Creek, Michigan, United States. Kellogg's produces cereal and convenience foods and markets its products under several well-known brand names including Corn Flakes, Keebler, and Cheez-It.
Students to research, review and discuss course material as it relates to the Project. All reports should include a properly formatted cover page listing the report title, course name and section, instructor name, student name & student number.
Report submissions should be a MAXIMUM of ten (10) pages in length (excluding cover page, appendices and exhibits), single sided, 1-inch margin, 12-point Arial font. Reports may also contain an additional five (5) pages of relevant appendices and supporting exhibits as required
Consider yourself as a management consultant, specializing in supply chain projects, hired by the executive leadership team of Kellogg’s. The scope of your consulting engagement is to research and analyze the company’s current problem, and supply chain abilities, and provide recommendations on how the company could better align their reverse logistics capabilities going forward with their stated company mission, and their perceived approach to strategic competitive advantage.
In order to ensure your report focuses on key issues, the executive leadership team has provided you with the following eight (8) specific questions to answer.
1. a) Describe the recall situation in this example. (2 points)
b) Who are the stakeholders involved and what are their objectives? (3 points)
c) How was the information communicated to stakeholders? (2 points)
d) Could Kellogg’s have communicated the information to other stakeholders more effectively? (3 points)
2. a) Where were the contaminated cereal products produced? (2 points)
b) Where were they shipped? (2 points)
c) What are Kellogg’s shipping terms of sale? (2 points)
d) In what order sizes (e.g. conveyance) might the contaminated products have been shipped to customers? (2 points)
e) If an Incoterm was used for any customer locations, what might it have been and why? (2 points)
3. a) Describe how Kellogg’s’ procurement team could have mitigated the risks associated with outsourcing production to a contract manufacturer in this situation. (3 points)
b) Describe the ethical risks associated with contract manufacturing in this situation. (3 points)
c) Based on the strategic importance of contract manufacturing, which Supplier Interaction Model best describes the relationship that exists between Kellogg’s and Kerry Inc. What should it be? Why? (4 points)
4. Identify and explain the Processing Stages that Kellogg’s might have followed in conducting the recall. (10 points)
5. Kellogg’s use this recall as an example in conducting a self-assessment of its ability to transition to a circular economy model. After completing the assessment, they ask you to take a lead on this transformation project. (10 points)
· List the project objectives
· List the main activities
· List the project milestones, such as required progress reports or the completion of major tasks
6. a) Which mode of transport, conveyance, and equipment would Kellogg’s likely have used to ship products to the countries involved in the recall of “Honey Smacks” cereal? (5 points)
b) What legal considerations would Kellogg’s have to be aware of when selecting carriers for domestic and international shipments of products involved in this recall? (5 points)
7. Consider the following scenario: Kellogg’s distribution of cereal products to customers in Guatemala is coordinated through Crowley Maritime Corporation, a U.S.-owned and operated third-party logistics company (3PL) with a distribution centre in Guatemala City, Guatemala.
Orders for the Latin America region were consolidated, and aggregate orders were placed with Kerry Inc. in Gridley, Il. Kerry Inc. shipped consolidated orders, palletized and labelled by distributor, by intermodal to Mexico City, at which point trailers with orders for distributors in countries south of Mexico were moved over the road.
Crowley’s general manager in Guatemala City advised Kellogg’s head office personnel in Battle Creek, Michigan that they had identified approximately 140 pallets of salmonella-contaminated cereal products still in wholesale inventory in Guatemala.
Unfortunately, despite FDA recommendations for disposal, government officials in Guatemala, upon learning of the recall through their government Facebook account, had contacted Crowley and insisted that no contaminated food products be disposed of in Guatemala. Furthermore, since the contaminated products had been shipped from the United States, Guatemalan authorities insisted that the contaminated products be returned to the U.S. for disposal.
Kellogg’s Supply Chain Manager had already spoken with their freight forwarder and customs broker regarding arrangements to return the contaminated products to the U.S. Mexican authorities would not allow the contaminated products to transit through Mexico, which left marine transport as the only economically viable option to ship the contaminated products from Guatemala to the U.S. Kellogg’s customs broker had placed a call to US Customs and Border Protection (CBP) for advice since the returning goods would be labelled “CONTAMINATED – Not for Resale – Goods returned for disposal only”. Since the returning shipment would not be subjected to the same level of scrutiny as a commercial shipment, CBP expressed concerns that someone might target the shipment for smuggling or terrorism reasons. As a result, CBP stated they would only allow the shipment to enter the US if the origin port was compliant with the International Ship and Port Facility Security Code (ISPS) and the Container Security Initiative (CSI).