Do we really know what’s coming?

One of the questions I am often asked is: “How does farming in NZ compare with the UK”?

Right now I think it’s a slightly loaded question with all the Brexit talk – subsidies and all that. But in reality given the context of the question is usually in the knowledge I head up a UK-based subsidiary of an NZ agri-software business, what many are really asking is: “How will technology change what we are doing, and is NZ ahead of the UK”?

Now this is a harder question to answer. I guess at a high level I would say adoption of technology in the NZ dairy sector is some years ahead of the UK, but equally, there are big advances in UK arable and hort which one might say are further ahead than NZ. One thing I would say is that NZ farmers are, more typically, open to change and innovation and less wedded to the way it is.

But I think there is something bigger going on than simply comparing one country with another. Sure NZ is a focus for our sector just now because of the way it has, in a generation, turned itself into a very globally focused and innovative economy; one that tops the global rankings for ease of doing business (and one that I would say punches well above its weight, and that’s not just the All Blacks!). No. I think we are witnessing the early stages of an utterly transformative period in global agriculture.

And that’s why I ask the question: “Do we really know what’s coming?” By this I mean, how is technology (and maybe digital and data in particular) going to change the sector?

In short, from where I sit, I would say those of us in the tech world do have a good hunch about what’s coming and the potential impact it will have. But I am not at all convinced the “average farmer” (which is a horrid term) does.

To me it is inconceivable that a farming business (whether in the UK or elsewhere) will be in any way competitive without the use of data-driven decision support tools in the future. The level of accuracy and objectivity that data will deliver (and we are seeing this already) simply puts subjective observation in the second tier of good decision making.

That isn’t to say good husbandry and farming experience have no place in the future (of course they do – I know some brilliant, intuitive and innovative farmers) but those who apply that experience with the latest technological tools will become the Premier League while others languish in the lower divisions.

Give me an example I hear you cry? Ok! A couple of weeks ago I sat down with the CEO of an innovative dairy cow data capture company (based in the UK) that is effectively putting Fitbits on cows. The volumes of behavioural data they are collecting from those animals is now substantial. But it’s what they are doing with it that so impressed me.

By using clever algorithms to understand normal and outlier behaviour of animals they are achieving two great things. The first is the ability to provide alerts flagging animals that are not exhibiting typical behaviour. In other words, “go look at those ones, that’s where you should prioritise your time”.

But the second is what really excites me. Who’d have thought that by analysing cow behaviour data it would be possible to identify lameness, mastitis and other disorders days (even weeks) ahead of when the clinical signs might be observed? I don’t care if you are the best herdsman in the world, it is hard to compete with decision support from data that is identifying things well before they are ever observable by the human eye.

This “power” has the potential to transform the way we run our farms. The application of digital technology will not only potentially save time and labour, it will enable better focus on meeting market requirements, predicting and avoiding problems, and increasingly importantly, be able to provide a substantial evidence base to back and improve welfare standards and all sorts of other production areas currently under scrutiny.

But this future is a far cry from where many on our farms sit currently. Sure there are those that are the early adopters, but I think there is a large majority who simply don’t see this massive change coming, or if they do are in denial.

There are many analogies over the years of where technological change has been transformative and where at the time many did not see it coming: Henry Ford and so on. But it’s the sheer scale of change from tech-driven ag that I think we underestimate at our peril.

The upside is that all this talk of agriculture being a high-tech industry that our children and students should be enthused about is not just talk. It is absolutely true. The more we can find demonstrable examples of great (even cool) innovation, the better it will be for our farming sector, not only because we can farm better, but because we can also excite the right people into the industry.

In my 25-plus years in the ag world in the UK and NZ, never have I felt there is a better time and more opportunity for non-farming people to get involved in the industry, whether that’s in agribusiness, science or on the farm.

And if, as I suspect, we see a reasonably aggressive scaling back of direct farm support in the UK (assuming we Brexit!), that could open the door to a new generation of tech-driven farmers, unencumbered by the past and able to deliver from the potential of the land and associated technology alone. They will be the new competition.

Can’t see it coming? The iPhone is only a little over 10 years old. Things will look very different a decade from now in agriculture. That’s really not very far away. Are you on the train or is it leaving without you?

New grass establishment

#EvokeAg – Making the agritech ecosystem visible and discoverable

We recently attended and exhibited at EvokeAg, the new agrifood international technology event specifically for the food and farming community hosted by AgriFutures Australia.

EvokeAg brought together more than 1100 attendees from across the Australian and wider agriculture and agritech industries, including 100+ attendees from New Zealand and a substantial contingent from Israel. The event featured over 100 speakers from 20 countries, but importantly there was opportunity for all participants to share and be involved.

What was big?

Presenters, panels, exhibitors, and discussions covered a wide variety of topics. A few themes emerged:

  • The start-up and investment ecosystem – more about this below;
  • Irrigation and monitoring systems such as Lindsay FieldNet and Wildeye irrigation monitoring;
  • Automation and robotics (Robotics Plus, Yamaha, Bosch, and more);
  • Data collection, analysis, and the application of artificial intelligence. Comments like “Data is the new gold” abounded.

I’m not personally sure that data is the new gold. I think data is more like an ore that needs to be mined, processed, and refined to extract the real gold. Or maybe data is more like electricity – its intrinsic value is established from use, rather than collection.

Its all about the Ecosystem

We think that the biggest impact of EvokeAg is its impact on the agricultural innovation ecosystem. The event brought together a diverse, fragmented, and sometimes vaporous ecosystem of people and organisations and made it concrete and discoverable in the moment. Examples of groups brought together included:

  • Start-ups and new agritechnology players;
  • Investors, incubators and accelerators, and trade partners; and
  • Research and development organisations and funders.

Making connections

A particular genius of this event was the way that conversations and interactions were facilitated.

  • Braindates, facilitated by an app for discovery and bookings, brought together participants with shared interests, making it easy for those who did not know each other to connect.
  • Careful layout of the food stations, with plenty of tables, seats and leaners for eating encouraged fortuitous conversations, as did the set of food trucks outside providing lunch and evening food around a grassy courtyard.
  • A good blend of exhibitors, lounges, and a “start-up alley” encouraged attendees to look around and interact. Brad and I nearly lost count of the number of people who stopped by the Rezare Systems stand, took a seat and had a relaxed discussion.

The challenge for AgriFutures (the organisers of EvokeAg) and the wider industry is how to capitalise on the positive ecosystem effects to drive growth and innovation. The #growAg initiative announced at the conference, along with AusTrade’s Agriculture 4.0 focus should make a big difference. We’ll play our own part as well – continuing the conversations with those who met with us, and offering an Ag Innovations Bootcamp in early June, an in-depth workshop on design and customer engagement in agriculture, suitable for both start-ups and established Australian agribusinesses looking to innovate.

 

Chess player considering strategy

Is this the year you take your agribusiness digital?

Is this the year you take your agribusiness digital?

It’s the time of year when people of all backgrounds make new year resolutions, institute new habits and reflect on their journey. It’s not uncommon for business leaders too, to reflect on business performance and goals for the future.

Here’s a question for your business planning during the quiet days at the start of the year:

Are you ready to take your agribusiness digital?

You’re thinking that your business is already digital. You have an ERP and a CRM, a web site and a mobile app. Your IT team has already virtualised your core business systems. What else is there?

You already use technology in your business. You may even use it well, though many agribusinesses are saddled with 10 to 15-year-old software and significant “technical debt” that acts as a drag on business agility. Taking your agribusiness digital however, implies something more significant: transformation.

Gartner defines digital transformation as the creation of new business designs that blur the boundary between the digital and physical worlds. More than just digitisation in support of business processes, it is making use of technology to change your:

  1. Customer engagement model;
  2. Connection with the ecosystem of your partners; and/or
  3. Core business model.

Most agriculture and food businesses, rural supply, and advisory businesses have grown over many years, starting life and establishing business models well before the connectivity, data flows and analysis of today were envisaged. Would your business look the same if it were started today?

1.      Customer Engagement

With the internet and mobility connecting most people on the planet (and likely your customers), how could your business leverage technology to substantially change how you engage with your customers, streamlining their experiences and introducing greater perceived value?

A short story of two pizza companies

Dominos’ Pizza (DXP) and Papa John’s Pizzas (PZZA) both had a market cap of around US $600M at the start of 2010. Both companies still sell pizzas with take-out and delivery options. Dominos invested early and continuously in technology innovation for customer engagement, radically changing the way that pizza is ordered, and delivery is tracked. The value proposition for customers was a different, improved, and easier experience in ordering pizza. A benefit for Dominos was an increase in average order value and a massive switch from phone to internet orders. Arguably, Dominos has set the customer engagement bar that other pizza franchises have followed, and in the process grown its market cap to over US $12B, while Papa John’s followed incrementally, and has grown to US $3B.

2. Connected Ecosystems

What transformative opportunities could your business leverage by effectively connecting its digital information with suppliers and supply-chain partners? Common data standards, APIs, principled and secure sharing of data open the way for you and your partners to gain new insights and radically change business logistics.

Seven of the top 12 largest companies in the world by market capitalisation: Alibaba, Alphabet (Google), Amazon, Apple, Facebook, Microsoft, and Tencent – are ecosystem players, sharing data and common services with their supply chains and partners. At least one of those companies may have been too connected on occasion! We recommend principled and secure sharing.

Benefits of an open platform

Newspaper “The Guardian” developed its open platform in 2009 and has been evolving it ever since. The platform provides APIs for developers and for partners. Many sites and mobile services use the Guardian API to deliver timely news, and the Guardian benefits with referrals, ad placements, and the ability to understand how and when people consume its content. Partner integrations allow the Guardian to crowd-source additional data for its services (such as location tagging), and to position its brand beside influential partners.

3. Changing Business Models

Many of our agricultural and service businesses, or their forerunners, started life 80 or 100 years ago. The fundamentals remain, but models of communication and distribution, use of information and analysis have all changed dramatically. Our business models – how we create and monetise value – have changed more incrementally.

Digital transformation offers agricultural sector businesses the opportunity to reframe their business models for the new and evolving business environment.  Ford has started to redefine itself as “a mobility company and not just as a car or truck manufacturer”. GE is seeking to make analytics the new “core to the company”. Certainly, if you were starting a personal transport company today in the face of Uber and Lyft, it would not look like an existing taxi company.

How might your business leverage technology and connectedness to create value in different ways?

 

Considering your digital agribusiness options for 2019?  Contact us for a free initial discussion.

Consider using one of our digital agriculture strategists, Andrew Cooke or Julian Gairdner to facilitate a workshop our help with your thinking.