Smithfield Foods Research Articles

Teaching case “IT outsourcing at Smithfield Foods: From on-premises data center to a cloud-based ERP system”

In August 2015, Julia Anderson, the Global CIO at Smithfield Foods, the biggest pork manufacturer in the US, was faced with a problem on how to structure the company’s ERP system. The company operated its own data center in the early 2000s. Eventually management of hardware and software was outsourced to an Infrastructure Management Service (IMS) provider. The system was running on servers hosted by an IMS provider, but lately a series of major problems had Julia contemplating whether or not to continue the company’s relationship with the provider. Furthermore, SAP AG, the company’s ERP vendor, released a new version of the system, SAP HANA. As Anderson pulled into the company’s parking lot on Monday morning, she had three difficult decisions to make. Should Smithfield stay with its ISM provider or switch to a cloud service, which was becoming an increasingly popular choice? Should the company convert its current SAP system onto SAP HANA platform, or implement and deploy a new system from scratch? Finally, should the company take a big risk and do both changes simultaneously?

107 Raised Without Antibiotics, Lessons Learned

Abstract Smithfield Foods has initiated Raised Without Antibiotics (RWA) programs into its vertical integration model in the past. This opportunity to drive change to meet a growing demand provides an unique ability to analyze approaches to raising swine in a setting where multiple entities are tied to the success of a program and maintaining a focus of animal welfare, traceability and financial responsibilities are a must. There is a wide range of housing and resources used for industry RWA programs across those that implement such practices. Smithfield Foods program was performed in conjunction with its company-owned sow farms weaning to contracted grower bases in conventional wean-to-finish barn settings within the Midwest making it a multi-entity managed approach. Therefore, a full-package view is mandatory for the success of a RWA program and takes into account many current industry research approaches as well as fulfilling basic husbandry parameters. A focus too heavily on one will alter the ability to achieve program goals. The focus in the most recent success of the RWA program provided by Smithfield Foods included beginning with high health pig sources sourcing robust offspring, utilizing strategic vaccines and timing to combat potential obstructive issues, specific biosecurity plans, optimal environment uniformity, nutrition and water quality focuses and individual pig awareness throughout the entirety of the pig’s time in the program. Over 400,000 pigs were placed into Smithfield Foods RWA Program. The outcome of implementing the multi-faceted approach of securing the basic animal husbandry, along with newer industry knowledge and research, led to only 1.53% individual pigs needing to be taken off of the program due to requiring an antibiotic treatment and the remaining pigs within the program having high success in financial returns with competitive company growth performances.

Sustainable Swine Manure Management: A Tale of Two Agreements

Intensification and concentration of swine farming has provided economic benefit to rural communities but also negative environmental and human health impacts, particularly from the use of the lagoon-sprayfield system for manure management. Although cost effective, this system is susceptible to poor management, unpleasant odor and other emissions, and inundation during extreme weather events. Competition for manure-spreading acres with other livestock or encroaching development can also pose a problem. This study examines two agreements between industry and government designed to develop and implement improved manure management technologies for swine farms: a voluntary agreement between the attorney general of North Carolina and Smithfield Foods and a consent judgment between the State of Missouri and Premium Standard Farms. Individuals involved in executing these agreements were interviewed to gain insight from their perspective on those processes and lessons they learned from their experience. Common themes among participant responses to support transition processes included the need to involve multiple stakeholder groups, clearly define goals, understand the system, allow time for incremental change, and provide adequate “protected space” for technology development and implementation. Viewing these themes through the lens of multi-level perspective theory identifies leverage points throughout the system to support transitioning farms to a more sustainable path of manure management.

Smithfield Foods commits $500,000 to boost minority leaders in ag industry

Smithfield Foods commits $500,000 to boost minority leaders in ag industry

Exploring the Liability of Origin: Lessons from Smithfield Foods and Meat Processing in the US During COVID-19

The Liability of Origin (LOR) refers to disadvantages faced abroad by firms sharing common national origins. We examine the country of origin effect on Smithfield Foods (owned by a Chinese parent), one of the largest meat companies in the US, before and during the COVID-19 outbreak. We find evidence that Smithfield experienced legitimacy challenges associated with its Chinese ownership. We conclude that animosity between a multinational enterprise’s home and host countries is an important source of LOR and discuss three strategies (distancing and localization, stakeholder, and social media) that might help companies overcome these challenges.

Smithfield Foods: Activists and Acquisitions

This research-based case uses the circumstances surrounding Virginia-based Smithfield Foods' (Smithfield's) buyout offers from multiple foreign firms to examine the political and cultural constraints of a regionally rooted global firm in pursuing its strategic objectives. Smithfield's senior leadership receives offers from three firms, ShuangHui International (ShuangHui), JBS S.A. (JBS), and Charoen Pokphand Foods (CPF), based in China, Brazil, and Thailand, respectively, to acquire all of Smithfield's outstanding assets and liabilities. Smithfield's history was one of aggressive growth through acquisition, skirting government regulations, and truculence with respect to labor and environmental activists. However, as revenues plateaued, the firm faced increasing investor pressure to either trim costs or sell off portions of the company to improve shareholder value. Though the company's operations crossed continents, its identity and brand were tied to southeastern Virginia. Would it be best for the company or its shareholders to sell? If so, to whom? What risks would the firm face, politically and culturally, if it decided to do so? Because of its many details, the instructor teaching this case can approach the content from a number of strategic or leadership perspectives. Excerpt UVA-S-0308 Apr. 1, 2019 Smithfield Foods: Activists and Acquisitions C. Larry Pope, CEO of Smithfield Foods (Smithfield), and Joseph W. Luter III, chairman of Smithfield's board of directors, were in Williamsburg, Virginia, for a meeting with the company's board of directors on April 21, 2013. Joining Pope, Luter, and the board were advisers from Barclays Investment Bank and representatives from the international law firm of Simpson Thacher & Bartlett. Their purpose that day was to map the future direction of the company, then the largest pork production, processing, and packaging firm in the United States. Despite its size, Smithfield was anchored to a regional history and community. The company was founded in and had continued to operate out of the town of Smithfield, Virginia, since 1936. Although its population was less than 8,000, the town's name had been synonymous with cured hams in the South as early as the 1870s. Remarkably, among the possible futures to be discussed that day, none was more urgent than the question of whether Smithfield would continue to operate as a publicly traded US company or become a subsidiary of China-based meat processing firm ShuangHui International (ShuangHui), Brazil-based JBS S.A. (JBS), or Thailand-based Charoen Pokphand Foods (CPF). The events leading Smithfield to this decision had begun in early March, after the company released its third-quarter earnings. Continental Grains Company (Continental), one of Smithfield's largest institutional investors, had issued a letter on March 7 accusing the company's leadership of acting against shareholder interests by not splitting up the firm and selling its unprofitable fresh-pork division to another meat firm, while spinning off its more profitable meat packaging and international meats divisions. The letter noted the company's stock had declined 26% over the last seven years, paid no cash dividends, and had no clear strategy for growth. In contrast, Continental noted that Smithfield's competitors, Tyson's and Hormel's, stock returns were 70% and 131%, respectively, with $ 429 million and $ 729 million paid out in cash dividends during the same period. Pope and

Transpacific Maladies

This article centers on cultures of anxiety and threat across the Pacific. Threat is an especially useful category for writing about a “rising” China, which is often imagined both as a site of localized environmental ruination that prefigures imminent global collapse and as a source of contamination that easily crosses national borders. Particularly in the global North, China has become a focal point for ecoanxieties that are shadowed by longer histories of perceived racial and cultural threat. This article confronts the idea of China as threat by investigating representational cultures across the Pacific. It focuses on a series of recent events mediated through textual and visual forms that unfold as a contemporary ethical drama between species—the human and the pig: the 2009 swine flu pandemic, a 2013 episode in which thousands of pig carcasses were found floating in Shanghai’s Huangpu River, and the 2013 purchase of Smithfield Foods, one of America’s biggest pork producers, by the Chinese conglomerate Shuanghui. To understand the movement between the representation of threat and the violent responses that flare up in its wake, one must pay attention not only to quantifiable risks but also to the cultural forms that characterize anxiety in the Anthropocene. Ultimately, what is at stake is not just geopolitical relations or public health but also the lives and deaths of the animals that are so often slaughtered to protect humans.

Smithfield Foods awards over $3 million in cash product

Smithfield Foods awards over $3 million in cash product

News Briefs

Merck Foundation awards nearly $2 million for cancer treatment. Hershey launches new program aimed at teen isolation. Walmart, Sam's Club increase commitment to disaster relief. Smithfield Foods donates 41,000 pounds of protein to Virginia food bank. United Way selects new president of U.S. operations. Study shows foundations maintained giving levels despite investment losses. Google commits over $1 billion to address housing crunch. Takeda Pharmaceutical pledges $9 million to Global Fund.

Balanced, Higher Protein at Meals in the Context of Obesity Intervention: A Diet Feasibility Study (P21-003-19)

ObjectivesObesity is a major health concern in mid and later life; ≥40% of those ≥60 years are obese. However, the optimal approach for obesity reduction during the latter half of life has not been identified. Consuming balanced, liberal amounts of high quality protein at each meal is recommended for older adults and could help preserve lean mass and physical function. This study examined the feasibility and efficacy of this approach in the context of a weight reduction intervention for obese middle-aged and older adults. MethodsThis analysis combines findings on calorie and protein intakes of obese participants (mean BMI = 37.4 kg/m2; 88.7% female) aged ≥ 45 yrs (mean = 64.8 yrs) from two RCTs with similar protocols. Participants were randomized to hypo-caloric diets with either RDA level protein (0.8 g/kg bw; C-WL) or higher protein (1.2 g/kg bw; HP-WL) for 6 months. The HP-WL group was counseled to consume 30 g high quality protein/meal and provided lean beef or pork for 2 of 3 meals daily. Both groups had weekly group counseling and weigh-ins. Diet records (3-day) collected at 0, 3 and 6 months were analyzed (Food Processor; ESHA Research) for daily intakes of kcals and macronutrients. ResultsBoth C-WL (n = 30) and HP-WL (n = 59) reduced their kcal intake and successfully reduced their body mass. At 6 months, weight loss was 5.8% and 7.0% for C-WL and HP-WL, respectively. Diet record analysis confirmed HP-WL participants achieved intakes of 30 g protein/meal. At 3 and 6 months respectively, mean ± SD protein intakes were 30.1 ± 9.9 g and 29.7 ± 12 g for breakfast; 37.5 ± 8.2 g and 35.6 ± 9.3 g for lunch; and 40.7 ± 13.7 g and 39.2 ± 8.1 g for dinner; daily protein intake was 1.2 ± 0.3 g/kg bw. In contrast, the C-WL protein intakes remained unchanged (0.8 g/kg bw). ConclusionsThese findings confirm the feasibility of a balanced, higher protein weight loss diet for obese middle-aged and older adults. HP-WL participants achieved notable weight reduction while also meeting meal protein goals. This practical dietary approach may offer superior long-term outcomes for physical function in this high-risk population; thus, further study of these potential benefits is warranted. Funding SourcesBeef Checkoff and Pork Checkoff, North Carolina Pork Council, Smithfield Foods, NIH (T32 AG000029), and US Department of Veterans Affairs Rehabilitation Research and Development Service Program (CDA-2/IK2 RX002348).

From order-to-cash to wall-to-wall: Four SAP implementations at Smithfield Foods

This case examines a transformation journey at Smithfield Foods, a global pork processing company. In 2005, Mansour Zadeh, a company’s CIO, initiated a replacement of the old order management legacy system with an SAP SD (sales and distribution) module in one of company’s independently operating divisions. The case ends in 2017 when the entire corporation switches business operations to a company-wide SAP HANA system. The case allows for a discussion of strategic alignment of business and IT, issues involved in selection and customization of an Enterprise Resource Planning package, and structure of IT governance.

News Briefs

Consumers Energy Foundation commits $500,000 for Michigan environmental projects. Aetna Foundation announces winners of Healthiest Cities & Counties Challenge. eBay for Charity raises over $100 million in 2018 donations. Lockheed Martin launches new scholarship program. Smithfield Foods donates over 30,000 pounds of protein to Indiana food bank. Wells Fargo Foundation awards almost $13 million to support indigenous communities. Sodexo awards $40,000 for D.C.‐area food banks.

Smithfield Foods: Activists and Acquisitions

This research-based case uses the circumstances surrounding Virginia-based Smithfield Foods' (Smithfield's) buyout offers from multiple foreign firms to examine the political and cultural constraints of a regionally rooted global firm in pursuing its strategic objectives. Smithfield's senior leadership receives offers from three firms, ShuangHui International (ShuangHui), JBS S.A. (JBS), and Charoen Pokphand Foods (CPF), based in China, Brazil, and Thailand, respectively, to acquire all of Smithfield's outstanding assets and liabilities. Smithfield's history was one of aggressive growth through acquisition, skirting government regulations, and truculence with respect to labor and environmental activists. However, as revenues plateaued, the firm faced increasing investor pressure to either trim costs or sell off portions of the company to improve shareholder value. Though the company's operations crossed continents, its identity and brand were tied to southeastern Virginia. Would it be best for the company or its shareholders to sell? If so, to whom? What risks would the firm face, politically and culturally, if it decided to do so? Because of its many details, the instructor teaching this case can approach the content from a number of strategic or leadership perspectives. Excerpt UVA-S-0308 Apr. 1, 2019 Smithfield Foods: Activists and Acquisitions C. Larry Pope, CEO of Smithfield Foods (Smithfield), and Joseph W. Luter III, chairman of Smithfield's board of directors, were in Williamsburg, Virginia, for a meeting with the company's board of directors on April 21, 2013. Joining Pope, Luter, and the board were advisers from Barclays Investment Bank and representatives from the international law firm of Simpson Thacher & Bartlett. Their purpose that day was to map the future direction of the company, then the largest pork production, processing, and packaging firm in the United States. Despite its size, Smithfield was anchored to a regional history and community. The company was founded in and had continued to operate out of the town of Smithfield, Virginia, since 1936. Although its population was less than 8,000, the town's name had been synonymous with cured hams in the South as early as the 1870s. Remarkably, among the possible futures to be discussed that day, none was more urgent than the question of whether Smithfield would continue to operate as a publicly traded US company or become a subsidiary of China-based meat processing firm ShuangHui International (ShuangHui), Brazil-based JBS S.A. (JBS), or Thailand-based Charoen Pokphand Foods (CPF). The events leading Smithfield to this decision had begun in early March, after the company released its third-quarter earnings. Continental Grains Company (Continental), one of Smithfield's largest institutional investors, had issued a letter on March 7 accusing the company's leadership of acting against shareholder interests by not splitting up the firm and selling its unprofitable fresh-pork division to another meat firm, while spinning off its more profitable meat packaging and international meats divisions. The letter noted the company's stock had declined 26% over the last seven years, paid no cash dividends, and had no clear strategy for growth. In contrast, Continental noted that Smithfield's competitors, Tyson's and Hormel's, stock returns were 70% and 131%, respectively, with $ 429 million and $ 729 million paid out in cash dividends during the same period. Pope and

US consumer reactions to China's Shuanghui acquisition of Smithfield Foods and its neural basis

AbstractThe $4.7 billion acquisition of Smithfield Foods by China's Shuanghui International (now WH Group) marks the largest Chinese takeover of a US company in history. Using electroencephalography along with an incentive compatible willingness‐to‐pay (WTP) elicitation mechanism, our study provides neural based evidence that the Shuanghui–Smithfield acquisition lowered consumers' preference for the Smithfield brand, but increased it for the Chinese brand. Consumers' neural preference for American brands increased after learning about the acquisition, implying a positive spillover effect to US brands in the US market. We also find that, after learning that an item is a product of the United States, consumers' neural preference decreased although their willingness‐to‐pay increased, consistent with some empirical reports that many US consumers prefer to purchase cheaper products made abroad rather than products of the United States with higher prices.

From order-to-cash to wall-to-wall: four SAP implementations at Smithfield Foods

From order-to-cash to wall-to-wall: four SAP implementations at Smithfield Foods

News Briefs

File‐sharing software Smithfield Foods donates 42,000 pounds of protein to Second Harvest. Hikma Pharmaceuticals launches medical relief partnership. All Nippon Airways partners with XPRIZE on avatar competition. ExxonMobil awards $7 million for women's empowerment initiatives. Disney awards $1 million for Boys & Girls Clubs youth programming. MetLife Foundation awards $5.4 million for financial inclusion. SC Johnson donates insect repellent to counter mosquito‐borne diseases.

Fertilizer start-ups attract backers

Two start-ups with opposite approaches to making fertilizers have won backing. Anuvia Plant Nutrients will partner with Smithfield Foods to make sustainable fertilizer from hog manure. This “renewable resource” is already routinely spread on fields in the southern U.S., but the odor brings complaints and lawsuits from neighbors. Anuvia says it converts the waste to neighbor-friendly, slow-release fertilizer. Separately, BayoTech raised $12.5 million from investors to commercialize a modular chemical reactor for making ammonia and urea fertilizer from natural gas. The firm says the machines are smaller and cheaper and use less gas than traditional reactors.

A National Security Study of the Shuanghui-Smithfield Case

This article studies the Shuanghui – Smithfield Foods case from the perspective of national security review. The article firstly introduces the background of the case and the political and national security questions to the case. It then explains U.S. CFIUS review in detail. The third part of the paper analyzes that national security concerns of the deal are from the nature of meat industry, the business scale of the two parties, the nationality of the acquirer. The paper ends up with the effect of the deal to U.S. national security review mechanism, predicting that food security may become part of consideration of CFIUS review and the Department of Agriculture may take a more active part in the review.

Corporate Profiles

Spirit AeroSystems Holdings Inc. The Kong Company LLC Yakima Products Inc. American International Group Inc. Netgear Inc. Smithfield Foods Inc. Charter Communications Inc. Legrand SA Hampton Lumber Sales Co. Rheem Manufacturing Co. Inc.

The Value of 'Product of USA': Impact of Chinese Acquisition of a US Company on Consumer Willingness-to-Pay

The $4.7 billion acquisition of Smithfield Foods, Inc. by China’s Shuanghui International Holdings Ltd. (now WH Group Ltd.) marks the largest Chinese takeover of a U.S. company in history. In this study, we explored how this acquisition affected consumers’ willingness-to-pay for meat products in China by conducting incentive compatible second price auctions, before and after the regulation approval of the acquisition. Our results suggest that Chinese consumers were willing to pay significantly more for US products than similar domestic products, plausibly due to food safety concerns. We found that the Shuanghui-Smithfield acquisition significantly increased Chinese consumers’ willingness-to-pay for Chinese products, but decreased their willingness to pay for US products.