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The Stanford Diaries: Hope in a VUCA world

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Exponential technologies and new food trends offer great opportunities for New Zealand’s agri businesses, provided we learn how to go up the value chain, writes Richard Hegan.

Richard Hegan is the general manager rural for ASB and recently attended the Te Hono Stanford Bootcamp with leaders across the primary sector in New Zealand, as they focussed on how to grow New Zealand’s competitive advantage in global markets.

A few months ago I was pretty sure the world was stuffed.

Let’s start with the population. With an estimated 7.5 billion people projected to grow to 11.2 billion by 2100, having enough food and clean water alone is a huge concern, let alone the unknowns around climate change and whether the earth’s resources can sustain the impact humans have on it.

I was also worrying about the future of work for my kids. Will jobs as we know them be obliterated by accelerating automation, robotics and artificial intelligence?

The speed of disruption and change is certainly alarming, and it’s easy to feel overwhelmed as social and political landscapes change in what academics have coined the VUCA (volatile, uncertain, complex and ambiguous) world.

What’s changed for me recently however, is that I have gained new confidence that the exponential technologies disrupting aspects of our lives and businesses (think about what Uber has done to the taxi industry) are not necessarily to be feared.

Instead, new technology is driving innovation that might unlock solutions to some of the greatest challenges facing the planet.

Embracing change and doing things a bit differently

I recently had the privilege of joining a number of agri business leaders at Stanford University for the Te Hono Stanford Bootcamp, focussed on making New Zealand’s primary sector the very best it can be and extracting greater value from our commodities in offshore markets.

The Stanford faculty set a clear challenge for New Zealand: We have some of the best natural resources in the world in terms of fresh water, soil typography, farming expertise and a clean, safe national brand.

But how do we move on from being, predominantly, a commodity market participant in our legacy agricultural products? In other words, how do we take New Zealand ‘up’ the value chain?

Impossible foods

One of the guest speakers at Stanford was Pat Brown from Impossible Foods, a Silicon Valley-based start-up developing imitation meats and cheeses made entirely from plants.

Brown will tell you his plant-based hamburger patty uses 95% less land, 74% less water and creates 87% fewer greenhouse gas emissions than one from grass-fed beef.  He believes Impossible Foods can make the world’s food system more sustainable by feeding the whole population on just 2% of the world’s land.

It would be a big mistake to think Impossible Foods is just going to be a lab-based food product for mainstream consumers. Brown has Michelin-star chefs working to create products for top restaurants, targeting premium consumers that like the sustainability story behind the product.

I think Impossible Foods demonstrates the tremendous challenge and opportunity for New Zealand among evolving food trends.

On one hand, there’s no question Brown’s plant-based meat is a threat to New Zealand’s operating model  given the importance of meat and dairy exports to our economy.

But what about the opportunity in thinking about how we can partner with this type of innovation and get our share of the added value?

Designing a better future for New Zealand means reframing challenges or threats, such as plant-based proteins, as opportunities across the whole supply chain, alongside our legacy products.

This requires a bold, adaptive mindset and an industry working  together to be in tune with  our customers to know what they want as food trends evolve.

We can no longer produce products and then try to find a market; rather we need to produce for those markets.

A few years ago plant-based protein wasn’t on anyone’s lips. Now, at least in California, it’s on everyone’s. What’s the next big thing?

As we go after premium markets, New Zealand’s farming standards need to be the very best. We also need to be the best at telling our story to consumers. Afterall, we are not just selling them food or fibres; we are selling an experience associated with New Zealand.  

And lastly, we must keep embracing technology. Playing to our strengths is easy, but change requires us to keep pushing into new areas and understanding how agritech, new nutrition and applied precision farming might help us address the big challenges around food and sustainability of our natural resources.

If we can do this, perhaps the future isn’t so stuffed after all.

 

Hope in exponential technology

‘Exponential technology’ is a bit of a buzzword and I’ve been fascinated to hear great thinkers from Singularity University talk about how they believe it offers solutions to some of society’s most pressing challenges.

For a technology to be ‘exponential’ its performance (power or speed) relative to its cost doubles each year. The concept is explained by Moore’s Law - named after Intel co-founder Gordon Moore, who observed the number of transistors per square inch on integrated circuits doubled approximately every year since their invention in 1958, and predicted this trend would continue in the future.  

As the prices of these technologies drop, it becomes possible to incorporate into our everyday lives.

Smartphones are a good example. Today’s smartphones are millions of times faster than all of NASA’s computers in the 1960s (which managed to land people on the moon) yet we buy them for are a fraction of the cost.

For this reason, exponentially accelerating technologies are re-shaping industries and our lives. They include artificial intelligence (AI), robotics, drones, digital biology and biotech. Transportation (think autonomous and electric vehicles) and energy are other obvious areas for exponential technologies to be harnessed.

Like all exponential technology, they are likely to move from a deceptively slow pace to fast-paced disruption, with potential to upset traditional business models and industries.

In Silicon Valley – the locals talk about the Rule of 10’s.  It’ll take 10 years longer than predicted for the technology to arrive, but when it does, it will be 10-times bigger.

ASB and Te Hono

At ASB we’re committed to helping Kiwi businesses achieve their ambitions, whatever they are.

Whether that's growing a global business, becoming the best in your field or building a sustainable legacy for future generations,

We’re here to collaborate and support your primary sector growth aspirations.

ASB is proud to partner with Te Hono, an organisation closely aligned to our own values and vision for the New Zealand primary sector.

Find out more about Te Hono.

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