{"id":12077,"date":"2016-11-04T16:41:59","date_gmt":"2016-11-04T20:41:59","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/how-climate-change-is-impacting-an-american-icon-heinz-ketchup\/"},"modified":"2016-11-04T16:41:59","modified_gmt":"2016-11-04T20:41:59","slug":"how-climate-change-is-impacting-an-american-icon-heinz-ketchup","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/how-climate-change-is-impacting-an-american-icon-heinz-ketchup\/","title":{"rendered":"How Climate Change Is Impacting An American Icon: Heinz Ketchup"},"content":{"rendered":"<p><strong>Climate Change &amp; Kraft Heinz:<\/strong><\/p>\n<p>Kraft Heinz, and other companies that rely on agricultural inputs, will be directly impacted by greenhouse gas emission driven climate change. While rising temperatures extend the length of growing seasons and crop yields in the short term, longer growing seasons increase demand on water as this resource becomes more constrained.<a href=\"#_edn1\" name=\"_ednref1\">[1]<\/a> Over the long term, higher temperatures, the resulting increased pest, weed, and parasite issues, and extreme weather conditions are expected to decrease crop yields.<a href=\"#_edn2\" name=\"_ednref2\">[2]<\/a> <a href=\"#_edn3\" name=\"_ednref3\">[3]<\/a>\u00a0A <em>Climactic Change <\/em>study modeling the impact of low and medium to high emission rates suggests by the end of the century a variety of crops ranging from cotton to tomato will experience notably decreased yields.<a href=\"#_edn4\" name=\"_ednref4\">[4]<\/a><\/p>\n<p>Figure 1: Crop Yield Decline<\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/crop-yields-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-12030\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/crop-yields-1-256x300.jpg\" alt=\"crop-yields\" width=\"490\" height=\"573\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/crop-yields-1-256x300.jpg 256w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/crop-yields-1-512x600.jpg 512w\" sizes=\"auto, (max-width: 490px) 100vw, 490px\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Heinz will fall victim to climate change\u2019s impact on the key input for their signature ketchup production, tomatoes. Beyond concerns of crop shortages and resulting increased costs for tomatoes and other agricultural inputs<a href=\"#_edn5\" name=\"_ednref5\">[5]<\/a>, decreased water availability will put pressure on manufacturing at Heinz.<\/p>\n<p>&nbsp;<\/p>\n<p><strong>Sustainability Efforts: <\/strong><\/p>\n<p>Acknowledging their ability to play a role in bettering our world\u2019s environmental positon, Heinz set forth a number of sustainability goals, touting that \u201csustainability is not only better for the planet, but smart business.\u201d<a href=\"#_edn6\" name=\"_ednref6\">[6]<\/a> <a href=\"#_edn7\" name=\"_ednref7\">[7]<\/a>\u00a0 These goals ranged from reducing greenhouse gas\u00a0emissions by 20% (which they surpassed, achieving ~23.8% reduction), to reducing solid waste sent to landfill by 20% (also surpassed, achieving ~51.2% reduction).<a href=\"#_edn8\" name=\"_ednref8\">[8]<\/a> <a href=\"#_edn9\" name=\"_ednref9\">[9]<\/a> Additionally, reducing energy consumption, and increasing use of renewable energy serves a dual purpose of minimizing greenhouse gas\u00a0emissions and minimizing the financial impact of rising energy costs.<a href=\"#_edn10\" name=\"_ednref10\">[10]<\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Figure 2: Heinz Sustainability\u00a0Achievements<\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-12072\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability-300x72.jpg\" alt=\"heinz-sustainability\" width=\"684\" height=\"164\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability-300x72.jpg 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability-768x184.jpg 768w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability-1024x245.jpg 1024w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/heinz-sustainability-600x144.jpg 600w\" sizes=\"auto, (max-width: 684px) 100vw, 684px\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Heinz has also made strides in agricultural sustainability. Heinz reduced water consumption by 23% using hybrid tomato seeds requiring less water and drip irrigation minimizing water waste.<a href=\"#_edn11\" name=\"_ednref11\">[11]<\/a> By increasing yields Heinz is able to use less land, translating to less fertilizer, water, and pesticide use.<a href=\"#_edn12\" name=\"_ednref12\">[12]<\/a> Every step of the growing process has been thoroughly evaluated and adjusted to decrease negative impact on the planet, and in turn increase efficiency and eliminate costs for the company.<\/p>\n<p>&nbsp;<\/p>\n<p>Video 1: Heinz Sustainable Agriculture<\/p>\n<p><iframe loading=\"lazy\" title=\"Heinz: Sustainable Agriculture\" src=\"https:\/\/player.vimeo.com\/video\/94432797?dnt=1&amp;app_id=122963\" width=\"640\" height=\"360\" frameborder=\"0\" allow=\"autoplay; fullscreen; picture-in-picture; clipboard-write\"><\/iframe><\/p>\n<p>&nbsp;<\/p>\n<p><strong>Sustainability Programs Though M&amp;A:<\/strong><\/p>\n<p>The Kraft Heinz merger presents a great opportunity for Kraft Heinz to leverage learnings from each company\u2019s efforts in sustainability (and long term profitability), to make their joint effort even more powerful than the two parts alone. However, we must be wary of the potential for a drop in focus on sustainability as the joint company seeks quick wins through cost cutting, perhaps overlooking the long term value of sustainability efforts.<\/p>\n<p><strong>\u00a0<\/strong><\/p>\n<p><strong>Steps Towards Increased Sustainability:<\/strong><\/p>\n<p>There are many ways for Kraft Heinz to expand their efforts in reducing environmental impact. Taking Walmart\u2019s lead, they should consider SKU consolidation, to limit excess packaging required for frequent shorter production runs.<a href=\"#_edn13\" name=\"_ednref13\">[13]<\/a> Transportation also stands out as a key area to target given Heinz has not been successful in its goal of reducing transportation, instead increasing transportation by around 2.5%.<a href=\"#_edn14\" name=\"_ednref14\">[14]<\/a> \u00a0One route could be leveraging the increased number of\u00a0production facilities (from the merger), and performing processing and manufacturing of raw materials as close to the source as possible, thus decreasing fuel use and greenhouse gas\u00a0emissions. Another route could be optimizing the use of truck space, perhaps moving trucks fewer times total with more stocked cabins in each run. \u00a0As has been successful in Heinz Netherlands<a href=\"#_edn15\" name=\"_ednref15\">[15]<\/a>, the company could consider additional opportunities to shift from truck to ship transportation to reduce carbon dioxide\u00a0emissions.<\/p>\n<p>Beyond incremental efficiencies in their processes, which are indeed a great step in the right direction, Kraft Heinz, as a key player in the food industry, should be completely rethinking their growing and manufacturing processes for Ketchup, and other products, to make more radical changes in ensuring sustainability for the future.<\/p>\n<p><strong>\u00a0<\/strong><\/p>\n<p>Word Count: 622<\/p>\n<p>&nbsp;<\/p>\n<p><a href=\"#_ednref1\" name=\"_edn1\">[1]<\/a> The California Climate &amp; Agriculture Network, \u201cClimate Change Impacts on Agriculture,\u201d <a href=\"http:\/\/calclimateag.org\/wp-content\/uploads\/2011\/09\/Impacts-fact-sheet.pdf\">http:\/\/calclimateag.org\/wp-content\/uploads\/2011\/09\/Impacts-fact-sheet.pdf<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref2\" name=\"_edn2\">[2]<\/a> Lee, Juhwan, Steven De Gryze, and Johan Six, &#8220;Effect of Climate Change on Field Crop Production in California&#8217;s Central Valley,&#8221;\u00a0<em>Climatic Change<\/em>\u00a0109 (2011): 335-353. <a href=\"http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/913318655?accountid=11311\">http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/913318655?accountid=11311<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref3\" name=\"_edn3\">[3]<\/a> The California Climate &amp; Agriculture Network, \u201cClimate Change Impacts on Agriculture,\u201d <a href=\"http:\/\/calclimateag.org\/wp-content\/uploads\/2011\/09\/Impacts-fact-sheet.pdf\">http:\/\/calclimateag.org\/wp-content\/uploads\/2011\/09\/Impacts-fact-sheet.pdf<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref4\" name=\"_edn4\">[4]<\/a> Ibid.<\/p>\n<p><a href=\"#_ednref5\" name=\"_edn5\">[5]<\/a> Medell\u00edn-azuara, Josu\u00e9, Richard E. Howitt, Duncan J. Macewan, and Jay R. Lund, &#8220;Economic Impacts of Climate-Related Changes to California Agriculture,&#8221;\u00a0<em>Climatic Change<\/em>\u00a0109 (2011): 387-405. <a href=\"http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/913318714?accountid=11311\">http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/913318714?accountid=11311<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref6\" name=\"_edn6\">[6]<\/a> Manna, Dean R., Gayle Marco, Brittany Lynn Khalil, and Cara Esola, &#8220;Sustainable Markets: Case Study of Heinz,&#8221;\u00a0<em>Journal of Business Case Studies<\/em>\u00a07 (2011): 35-42. <a href=\"http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/893661721?accountid=11311\">http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/893661721?accountid=11311<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref7\" name=\"_edn7\">[7]<\/a> Heinz, \u201cSupply Chain,\u201d Vimeo, published May 7, 2014, <a href=\"https:\/\/vimeo.com\/94399859\">https:\/\/vimeo.com\/94399859<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref8\" name=\"_edn8\">[8]<\/a> Manna, Dean R., Gayle Marco, Brittany Lynn Khalil, and Cara Esola, &#8220;Sustainable Markets: Case Study of Heinz,&#8221;\u00a0<em>Journal of Business Case Studies<\/em>\u00a07 (2011): 35-42. <a href=\"http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/893661721?accountid=11311\">http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/893661721?accountid=11311<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref9\" name=\"_edn9\">[9]<\/a> Heinz, 2014 Social Responsibility Report. <a href=\"http:\/\/www.heinz.com\/data\/pdf\/hnz_CSR_pdf_report.pdf\">http:\/\/www.heinz.com\/data\/pdf\/hnz_CSR_pdf_report.pdf<\/a>.<\/p>\n<p><a href=\"#_ednref10\" name=\"_edn10\">[10]<\/a> Ibid.<\/p>\n<p><a href=\"#_ednref11\" name=\"_edn11\">[11]<\/a> Ibid.<\/p>\n<p><a href=\"#_ednref12\" name=\"_edn12\">[12]<\/a> Ibid.<\/p>\n<p><a href=\"#_ednref13\" name=\"_edn13\">[13]<\/a> Smorch, Patrick. &#8220;Nine Steps to Greater Profitability, Sustainability,&#8221; <em>Packaging Digest<\/em> 03 (2007), 46-48. <a href=\"http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/215275303?accountid=11311\">http:\/\/search.proquest.com.ezp-prod1.hul.harvard.edu\/docview\/215275303?accountid=11311<\/a>, accessed November 2, 2016.<\/p>\n<p><a href=\"#_ednref14\" name=\"_edn14\">[14]<\/a> Heinz, 2014 Social Responsibility Report. <a href=\"http:\/\/www.heinz.com\/data\/pdf\/hnz_CSR_pdf_report.pdf\">http:\/\/www.heinz.com\/data\/pdf\/hnz_CSR_pdf_report.pdf<\/a>.<\/p>\n<p><a href=\"#_ednref15\" name=\"_edn15\">[15]<\/a>\u00a0Ibid.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>When a company identifies sustainability as a way to both better our environment and drive profitability, how far will it go to achieve these goals? <\/p>\n","protected":false},"author":2281,"featured_media":12093,"comment_status":"open","ping_status":"closed","template":"","categories":[28,1403],"class_list":["post-12077","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-agriculture","category-sustainable-farming"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/climate-change-challenge-2016\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - 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