The 3’Cs of Food Production for CFO’s – Compliance, Competency & Cost

Chief Financial Officers in food production play a pivotal role in ensuring their companies thrive amidst stringent regulations, dynamic market demands, supply chain shifts and constant technological advancements. To navigate these complexities and drive performance, CFOs must push for a learning and development strategy that focuses on compliance, competency, and cost management across your production floors. Here’s a closer look at how focusing on these three pillars can lead to sustained success in the food production industry. 
 

1. Cost Management: Balancing Efficiency, Yield and Quality

Cost may sound like table stakes to most CFOs, because it is.  But the hidden costs of not investing in your front line workers are potentially costing you hundreds of thousands or even millions of dollars. Hidden costs are everywhere in your plants, in places seen and unseen including:  

• Turnover:  Employees leave when they feel under-appreciated, undervalued, unsafe, and do not see a path to advancement. Clear training pathways and career development can help you avoid the ongoing costs of rehiring. 

• Audits:  Audits are time sucks, production killers and open the business to sizeable risks. Audits should be clicks of a button to make your auditor clearly see you have a systematic process for tracking safety, training and compliance.  

• Big machines, little training:  You likely  invest hundreds of thousands of dollars in equipment to produce your product - but how much do you invest in training the workers tasked with it’s use and maintenance? 

• Death by PowerPoint:  How much time is your staff spending creating, maintaining and updating home-grown training?  Or even worse, is outdated training being pushed through your production floors? 

• Exposure:  Recalls increased 20% from 2020 to 2023 and every hour of down time can be $250K in loss.  Is your training doing everything it can to mitigate risk? 

2. Compliance: Mitigating risk across your operations

The food production industry is heavily regulated to ensure the safety and quality of products. The cost of a single mistake or negligence can be insurmountable to a brand and cause serious harm to your customers or employees.  Compliance must be driven by a culture of food safety and be consistent across facilities.    

Key components of a successful strategy to mitigate risk and monitor compliance include: 

• Regular Audits: Conduct  internal audits to identify and rectify potential compliance issues before they escalate or are found by an auditor. 

• Training Programs: Ensure all employees are well-versed in compliance requirements through continuous training, provided via e-learning micro modules in their native language. 

• Technology Integration: Leverage technology to monitor compliance in real-time, such as automated tracking systems for immediate access to training gaps.   
   

3. Competency: Building a Skilled Workforce

A skilled workforce is the backbone of any successful food production company. CFOs should prioritize investments in human capital to enhance competency across all levels of the organization. By focusing on compliance and competency together, you can deliver real bottom-line value.  This can be achieved through: 

• Upskilling: Offer opportunities for ongoing education and professional development to create a more nimble and skilled workforce. 

• Succession planning: Baby boomers are going to hit retirement at an alarming rate.  If you do not invest in formalized passing the torch, and documenting decades of experience, will you have the workforce to maintain production? 

• Leadership Development: Create programs to identify and nurture future leaders within the organization.   

Conclusion 

In the tight margin world of food production, CFOs must engage in a comprehensive training and development strategy centered on cost management and compliance to drive performance. This strategic approach ensures that the company is well-positioned to navigate challenges, seize opportunities, and maintain a competitive edge in the market.