Digitally Enabled Agribusiness
By Rob Innes, 21 March 2019
Digital Transformation in Agriculture
Agri-tech, smart farming, precision agriculture… however you name it, digital technology is transforming agricultural businesses. We call it Digitally Enabled Agribusiness - the use of digital technology to connect new data sources like sensors and micro-controllers with traditional farm management data to improve visibility, planning, yield and profitability.
Digital technologies impact farm operations from planting densities and application of fertilisers but also impact the supply chain within which a farm operates. Both upstream and downstream partners are undertaking their own digital transformations to support improved service. For example, retailers believe, a connected supply chain improves visibility, reduces uncertainty and provides some measure of supply assurance. For local and national governments, digital production chains can improve provenance and proof of supply. Lack of digital connectivity may limit some producers from fully participating in future supply agreements. First-movers may not achieve massive advantage, but laggards certainly risk being shut out or bearing higher costs to participate.
Many producers have technology from different time periods and from different providers. And whilst ‘point solutions’ can be adept at controlling finances, monitoring inventory, tracking antibody or pesticide use, this does trend towards data silos making it harder to project an integrated view. Data management techniques and digital dashboards abstract interpretation and action away from source systems and allow for a holistic business view.
Changing Farm Technology
Land and vegetation mapping using Unmanned Aerial Vehicles (UAVs) or more commonly referred to as drones, are increasingly used for measuring crop densities, identifying frost damage, estimating crop health and thus yield. Simple drones can be used as a first-person view to get, literally, a lay of the land, over surveyed territory. This use-case can be still be of interest to producers but attaching multi-spectral imaging cameras to the drones allows light from the non-visible spectrum to be captured. This expands the data available for interpretation, allowing cell structure and water content to be captured and analysed.
Whilst the cost of drones is dropping, at the same time range and flight control capability is rising fast, making these devices more accessible and usable than ever before. That said, most producers are unaccustomed to the collection, management and visualisation of data streams from new sources such as multi-spectral imaging. When soil or machine sensors, are added to the mix, the variety of data sources producers need to deal with is rising fast.
These new data sources don’t just introduce new data formats. The data volumes can be extremely large, and the pace with which digital data is produced can be extremely rapid (environmental sensors may report their status several times a minute, for instance). Existing methods of management, visualisation and analysis often need to be upgraded to cope with new data forms and to track data across different silos.
Connections Beyond the Farm
Farms are part of increasingly complex supply chains with up-stream users expecting better and faster information for their own planning. Supermarkets, for example, may use statements of work, supply contracts and the like, to lay down an expectation of how a business relationship is conducted, however, increasingly they want to validate the contract terms with near real-time data. Are the actuals tracking towards forecast values or might there be a need to consider alternative routes of supply?
The flow of digital information is not one-way, weather forecasting models are in use by many businesses and the increasingly granular accuracy gives better prediction of local consumer intentions. More ice cream? More BBQ sauce? More salad? Supermarkets don’t plan for volume for the season for the whole country, they want to plan daily for micro regions and have a completely integrated digital path to producers. Compliance with modern supply chains is increasingly a fact of life for farms but there is an opportunity as well. By becoming data savvy, producers can be more than just end-nodes in a digital supply chain, they can use all data available to become data collaborators and manage their business better to provide higher service levels and potentially, bid to supply on contracts better suited to their set-up, using rich data analysis to inform their decisions.
Similarly, digital data can work downstream too. Just as buyers are requesting more detailed information, farms can look to their supply chains to gain better support for chemical supply, etc. Logistics is another area to consider as it’s an increasingly connected industry and has the means to start collecting very granular route data. Ten years ago, delivery data might have been limited to Pick-up Time and Drop-off Time. Now there are capabilities to track vehicles through every node on a journey, or even real-time through every mile. Used reactively, this is a stick to beat up providers, but used proactively, this is rich source of data to improve route planning, scheduling pick-ups, avoiding wait times, etc.
When data is gathered for analysis, the User Experience (UX) of the solution is vital. Highly featured dashboards and reporting tools need clean, simple interfaces and that can take time investment to get right. But the value of getting it right is huge – improved business decisions, improved yield, improved profitability.
Farming is a complex industry and running a farm is like running a support business, a shop and a chemical company, all in one. Connecting digital data sources to visual dashboards (which can support mobility through smartphone apps), farms can enable smart decisions to be made and poor decisions avoided.
A digitally enabled agribusiness is awash with data. Smart use of that data can mean more of the smart decisions and fewer of the poor ones.