Every second business writer today seems to be talking about ag-tech, big data, and the internet of things. If you’re an agriculture sector organisation, or a company servicing or purchasing from primary producers, you might be forgiven for thinking you missed a day in the office and overnight farming has become a connected, automated, artificially-intelligent system.
Reality of course is still far from that utopia (or dystopia, depending on your point of view). What the writers are telling us is that there are a range of interesting technical possibilities that might have application in agriculture: and that some of the very early adopters, enthusiasts, and visionaries are trialling these. In some cases, they’ve used technologies in interesting experiments and learned useful things about their supply chain or farming system.
All well and good; but if you don’t consider yourself a leading edge visionary (or perhaps you don’t have the same appetite for risk) should you just ignore the hype, and wait until the technology matures?
For the pragmatists among us, who are more interested in achieving practical goals and strategic goals than experimenting, here are some areas where I think there is value in leveraging technology into your business today.
We all know that good communication between people is what keeps the wheels of business oiled and turning. Technologies, systems, and business rules are no replacement for good people relationships.
Your customers, suppliers, and business partners see all of your interactions with them as part of that same interpersonal relationship. Are your reports or invoices late? Do they lack critical information your business partners need? Personal reassurances will go so far, but if you can’t achieve timely and data-rich information delivery that helps your partners, they may look elsewhere.
We’ve helped a number of our customers lift their communications with suppliers or customers. In some instances, we’ve delivered apps that help farmers access key pieces of information as they become available. In other cases, we’ve implemented reports and visualisations that are valued by business partners for the timely insight they provide. This isn’t just data: it’s business communication.
Understanding critical business metrics
Many businesses try and track too many metrics, and don’t always closely manage the key metrics that are leading indicators of success.
What drives your business? Primary production and processing businesses are often heavily influenced by factors such as weather and global market demand, but these factors are outside the control of most businesses and may have less impact on long-term profitability than we imagine.
Its typically our response to outside factors, and our ability to continue to produce value despite them that determines long term success. Measures of productivity per unit of input, and effectiveness at delivering high-value products are better indicators than raw dollar returns or kilograms of product shipped.
For some of our customers, this has meant improving alignment between their financial data and physical data records. For instance, benchmarking kilograms of product produced, farm working expenses and profit against the potential pasture or crop production for that season, allowing more effective comparison of improvements across seasons. For others it has meant focusing on the proportion of product meeting specification for high-value markets, regardless of whether the market actually delivered the desired price premium in that particular season.
Data integration can help bring these disparate data sets together for timely comparison, and in-field monitoring technologies or remote sensing can deliver the physical data needed to make sense of the product and financial outcomes.
Responding to changing conditions
How do you assess and respond to the risk of changing weather and markets?
Studies of farmer responses to drought and similar challenges indicate that we tend to respond too late, and in a conservative, “piecemeal” fashion. We seem to bet that things will trend back to normal sooner rather than later, and under-do our response.
Monitoring tools such as climate stations and market data visualisations allow us to understand trends and risks early – before their impacts really start to bite. Of course, responding to these is still a challenge: will I reduce stock numbers only to see the weather change?
Mathematical models don’t yet give those definitive answers some futurists might lead you to expect, but they allow you to ask the “what if” questions, looking at potential decisions and impacts. These allow you to build a plan for your business and understand what your critical review and decision points need to be.
Time to start learning
The pace of change in technology is only likely to accelerate in coming years, and the technology we use in farming in ten years may be very different than what is now available. It is tempting to just “wait and see” what evolves, but advanced agricultural businesses choose to embrace technologies that can deliver concrete benefits and which align with their goals. Consider ways that technology can help you achieve more effective communication, improved understanding of business metrics, and the ability to assess and respond to change.
What technologies are you embracing in your business, and why?