Servitization holds the key to driving the digital farming revolution

Feeding a growing global population is a momentous task and embracing digital tools will be key to securing a sustainable food supply. Yet how can the world’s army of smallholders afford and access this technology? Only by shifting the focus from up-front capital expenditure to long-term outcome-based services can we achieve the democratisation of digital innovation.

Servitization, the process through which companies compete by offering services rather than simply the sale of products, is opening doors to help address some of the world’s greatest challenges. Food Production as a Service is a key theme of this year’s Servitization Live and the event provides a platform to explore how advanced services can help global smallholders use technology to meet global demand.

Taking place between 4th and 6th October, the event is hosted by the Advanced Services Group at Aston Business School and will explore the latest business models and technologies that are accelerating service transformation. On the second day of the conference, attention will focus on what the future of farming and how servitized business models will be key to giving everyone access to safe, healthy, and sustainably produced food. Keynote speaker, Dr Rajendra Prasad Sharma, Professor at the Indian Institute of Foreign Trade, will discuss the need for more imaginative thinking around the delivery of digital tools.

Dr Sharma says: “Servitization holds the key to helping the farming community access the latest farming equipment and techniques. Advances service solutions provide more flexible payment schedules and address the operational risk of equipment breakdown. The Farming-as-a-Service model brings together farmers, equipment manufacturers, agri-tech companies and governments onto a single platform and it’s a trend that’s really starting to gain momentum.”

Dr Sharma argues that a pay-as-you-use model drastically reduces costs for farmers in countries like India, whilst allowing them to exploit technology to boost productivity. Be it using IoT to track equipment performance, ordering use of machinery through mobile apps, or accessing satellite images to monitor the health of crops, there are huge opportunities for innovative businesses to help revolutionise farming through the provision of advanced services.

Meeting the challenge

The world’s population has quadrupled in the last century and by 2050, demand for food is forecast to increase by a further 70%. Already, around 700 million people are under-nourished, and the number of people affected by hunger continues to increase at an alarming rate. Farming techniques have evolved enormously over time, yet the sector has never been under greater pressure to guarantee a sustainable food supply as it is today.

The Covid-19 crisis has also highlighted the need to build a food system with greater resilience, higher capacity, and a lower carbon footprint. Boosting crop and livestock productivity without having to source extra labour or lose more land through deforestation will be a critical element in the fight against climate change.

Embracing digital tools

That is a major ask and won’t be achieved without embracing new ways of farming. Sustainable food production cannot come about whilst we rely on resource intensive high-input farming methods. The answer lies in embracing innovation and the evolution of digital tools presents a unique opportunity to take farming to a new level.

Digital agriculture is all about using disruptive technology to allow farmers to make more informed decisions to increase productivity and drive efficiencies. It makes use of digitally enabled devices and apps, Artificial Intelligence and analytics to take operations to a new level. That could involve the likes of farm machinery automation and robotics, connected weather stations, the use of satellite data and sensors to monitor livestock and crops, and digital logistics services to streamline supply chains. When you add to that the precision application of water and chemicals, digital tools become a game-changer for modern farming.

Big data analytics provides invaluable insight on the health of crops, animals, and soil, informing robots and autonomous equipment to help boost productivity and ensure a farm operates at maximum efficiency.

The digital divide

The ability of data-driven farming to improve yields and profitability will have the greatest impact in the developing world, which faces the biggest challenges in feeding its growing population. Yet inequality of access means that those who need it most are the least able to exploit digital transformation.

Smallholders in emerging markets are hampered by poor internet and mobile coverage and the cost of accessing data is a major barrier to entry. Smart farming technology is expensive, making it hard for smaller farms to compete with larger holdings and corporates.

It is imperative that governments, NGOs and private sector innovators gear up to address the challenge and support the democratisation of digital tools. That might mean investing in networks and digital skills, introducing systems of device sharing, developing affordable subscription models, or offering services that don’t require a high-speed internet access.

At your service

Many of those hurdles around accessibility can be overcome by taking a servitized approach to digital delivery. Private sector companies able to give smallholders use of disruptive technologies on an affordable and straight forward subscription model can exploit a huge global market.

By allowing smallholders to share in the fruits of new technology without taking on the cost of purchasing and maintaining equipment, businesses can revolutionise agricultural practices. Servitization changes the goal posts by changing the value proposition. New business models focused on advanced services support the mass adoption of digital tools. By providing equipment, data monitoring and management on a pay-as-you-go basis, companies move from offering one-off transactions to forming long-term partnerships with farmers around the world where both parties share the same goals.

This servitized Farming-as-a-Service approach supports the mass adoption of new technology and super charges sustainable food production. It is attracting interest from a range of stakeholders, from governments to venture capitalists looking to support start-ups as they develop new service-based business models.

The private sector is starting to change the lives of global farmers in using service models to access disruptive technologies. The challenge now is to scale up the provision of Farming-as-a-Service, making digital tools accessible to the world’s poorest smallholders. Agriculture faces unprecedented challenges, yet our innovators are seizing the opportunity to transform our food systems. Servitization will play a key role in that transformation, building resilience, sustainability, and equality of access into future food production.

Servitization Live

Servitization Live is the business event solely dedicated to servitization and advanced services. Taking place 4-6 October 2021 at the ICC Birmingham and Online, it brings together the global community of leading industry executives and servitization researchers for sharing real servitization strategies and journeys, showcasing the technologies that enable advanced services and presenting the latest research on servitization.

For more information and to register visit: https://www.servitizationlive.com

The three-day event is sponsored by Servitly, Capgemini, Senseye, Allsee Technologies, DEAS+, IFS, Xait CPQ and DLL, and supported by Field Service News.