Smart Farming – Agriculture 4.0 - Part II

A glimpse into the future

Amongst companies concerned, the most commonly-held stratagem is to integrate new technology into old business models, with the hope of improving these models through the use of smarter tools and more data. However, improving upon old tools cannot suffice – not when technology allows for the creation of all-new models which render their predecessors superfluous. A more advantageous approach for these companies would be to discover and develop these new business models, and use them to create new markets. Rather than searching for a better product, companies should aim to find better solutions to the problems their customers are facing, whether they are farmers, agricultural suppliers or final consumers.  

Vertical and horizontal integration of the value chain

In the age of Industry 4.0, only companies who carry out comprehensive restructuring of their supply chain, both internally and together with the external business environment, can hope to survive the competition for customers in the long term. In particular, horizontal integration of the supply chain makes it possible to offer consumers comprehensive information on a product. The availability of Big Data applications and analyses leads to further business opportunities: Integration of the value chain creates cost optimisation in purchasing and logistics, precision planning and a more flexible adaptation to the market demand. 
To cite one example, a number of pesticide and fertiliser companies are now using new technology to improve their existing products. Precision farming - high-resolution 3D aerial photography, precision analysis of soil properties and performance of crop plants down to the last square centimetre could, in the near future, vastly reduce the need for fertilisers and pesticides.

New technology with great potential

Digitalisation has long been established in agriculture as an integral means of assisting the daily work load, and information technology is now a regular part of everyday life for farmers. Digital applications help with crop protection, harvesting and the weather forecast, and precision farming machinery is equipped with smart technology. Even though digitalisation in agriculture is more advanced than in other sectors, smart farming still remains in the early stages of its potential.

Opportunities for profit in the future

New technology is guiding the way towards a completely new value chain in agriculture, and digital companies are striking upon new opportunities for profit at every link in the chain. It is of key importance to be fully aware of your role in the agricultural value chain, to build up a network and partnerships and enter into agreements which will fortify your role. Future-oriented farms do not merely collate and use data: They also assist in standardising and analysing data in order to identify patterns and put forth recommendations. In practice, this means utilising analytics to operate machinery more efficiently, create markets and control logistics and pricing to better effect. 
John Deere, for example, are now selling progressively more data management services in addition to agricultural machinery. The company’s Operation Center system allows farmers to collect data from equipment, display and analyse this data on dashboards, exchange data with partners and control machinery remotely.   
In order to guarantee success through to 2030 and beyond, farmers must choose new technology with the greatest of care to ensure that they do not waste time and money and miss out on great opportunities. Many of them have to adapt their organisation structure and fields of business and define their position in the digitalised world in order to use smart technology to its best advantage. 

Sources:
https://handelskammer.blog/smart-farming-die-vierte-revolution-der-landwirtschaft/
https://www.pwc.de/de/handel-und-konsumguter/agrarwirtschaft-4-0-die-ernte-der-digitalisierung.html