A significant benefit of this recommendation is that the upstream supply chain

A significant benefit of this recommendation is that

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A significant benefit of this recommendation is that the upstream supply chain activities associated with the sourcing of the local ingredients will be analyzed for in/out-sourcing and lean manufacturing opportunities. Specific problems this recommendation addresses are associated with inadequate supply and quality of the ingredients. As mentioned previously, CMG has problems with having an adequate supply of ingredients because of more stringent responsible farming requirements. To keep up with demand, CMG sources ingredients from industrial farms that are not local; sometimes the ingredients are from other countries like Australia [ CITATION Sha14 \l 1033 ]. The value chain analysis will look at the viability of the sourcing activities. A possible alternative course of action is to insource the responsible farming of the ingredients for CMG’s products. This would mean that CMG would bring the sourcing of local ingredients under its control by having dedicated farms when appropriate. Interestingly, the specific item that caused either of the food-borne illness outbreaks could not be identified and likely took longer to isolate because of lack of detailed ingredient source to destination tracking information [ CITATION Cen16 \l 1033 ]. CMG would have more control over its supply chain which would lower inadequate supply risks and food quality threats. Insourcing the farming activities would be a significant undertaking but could enable CMG to continue to exploit the “food with integrity” market differentiator; a market differentiator that has been a core company value since the beginning.
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The cost of labor for the employees is also a significant cost driver for CMG. The idea that CMG is a socially responsible company suggests that the wages paid to the employees has fiscal as well as social elements. The raising of the minimum wage to a “living wage” is a popular initiative that politicians and constituents have championed recently. However, the current compensation model of CMG is not perceived to be socially responsible. While the mission statements of CO. EXIST and CMG seem to align as both are promoting similar values, the perception is that CMG is not living up to their stated values. This fact is evidenced by an article by Jessica Leber, a CO. EXIST supporter who offers detailed criticism of CMG and their compensation policies (Leber, 2015). It is worth mentioning that the article may cites many statistics of from the industry but still may be considered biased. However, the fact that an organization with similar stated values as CMG is offering such criticism.
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  • Fall '18
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