From technology to farm management – how smart is Swiss agriculture, part 2
Smart farming and technology in agriculture are the topics of the moment, which are also of concern to the Fenaco agricultural cooperative. What business risks does the digital transformation entail? How well does the collaboration between business and IT work? How digital is logistics? And what about the hype topics of blockchain and AI?Societybyte author and digitalisation expert Reinhard Riedl talksabout this with Michael Buser, Head of IT and Logistics at Fenaco, in part 2 of an interview.
Part 1 of the interview can be foundhere.
Question: How well prepared is Fenaco for foreign retailers with a lot of money and technical expertise coming into the country one day and attacking the local players with their offerings?
Michael Buser: We are well positioned – and remain vigilant. In England, for example, Amazon is also relatively broadly positioned and active in the food sector. In future, the company could also drive into rural areas in Switzerland with delivery vans and put pressure on our Volg shops. In the non-food sector, the competitive situation is already obvious today. Everything you can buy at Landi is also available from Amazon. However, our Landi shops can differentiate themselves with customer proximity and a good combination of bricks-and-mortar retail on site, where I can see and smell products, and online retail.
What is the situation in agriculture?
The “Fenacos of Europe” are united in the Intercoop Europe association and meet from time to time to exchange opinions and information. CIOs are expecting Amazon to penetrate the wholesale markets, as is Alibaba. Abroad, it has been observed that both are hiring agricultural experts and writing to farmers to hold talks. However, the big players will not be the first to come to Switzerland. Switzerland has too many smaller farms and logistics that are too complex and costly.
A now classic challenge of digitalisation is the collaboration between business and IT. Where does Fenaco stand? What direction will it take in the future?
When I joined Fenaco, the first thing I did was to take stock of the current situation in IT. I realised that a relatively consistent, centralised approach was being pursued in the areas of infrastructure, hardware and PC servers. In the area of applications, on the other hand, the subsidiaries had fairly free decision-making competences. As a result, the IT landscape at application level was quite heterogeneous. At some point, this becomes difficult to manage, complex and very expensive.
As a result, we presented a plan to the Executive Board and the Board of Directors to harmonise, standardise and become more cost-efficient and secure. This is only possible with a transparent project portfolio. Only if we know what is being done at the subsidiaries can we manage them. Since then, all IT projects have had to be reported centrally. And because almost every business project is linked to IT, this means that almost every business project is also reported to this portfolio.
Our schedulers are still one step ahead of AI. But one day the tide will turn. Perhaps sooner than we think.
Will the business go along with this?
We in IT have no decision-making or command authority, we can only make recommendations. I think that’s good and right. Our business architects recognise the potential for synergies. And we can intervene with good arguments. We have achieved a lot in recent years and the openness for support, advice and implementation from us in central IT has also increased significantly thanks to increasing complexity and the shortage of skilled labour.
You are also responsible for logistics. How far has scheduling been digitally transformed? Do you want to use autonomous driving in the future?
As an IT specialist, I am always amazed at how crucial the human factor still is in transport logistics. Orders are accepted digitally, but the distribution of orders to lorries is more or less done manually by the dispatchers. Their expertise and experience are crucial. Our dispatchers are still one step ahead of AI. But one day the tide will turn. Perhaps sooner than we think. As far as intelligent driving is concerned, that’s not an issue for the time being and I don’t think the time will be ripe for it for some time yet. However, alternative drive systems are something we are working on intensively.
In conclusion: What is your general opinion on the current hype topics of blockchain and AI?
I don’t believe that the blockchain approach will be widely adopted. For typical utilisation ideas, such as the traceability of food chains from the farm to the shop shelf, there are conventional solutions that do not require a lot of computing power. At fenaco, on the other hand, we are already using artificial intelligence in certain areas, such as fruit and vegetable sorting. This technology will become established. Where broad expertise is required and this is well documented, AI is massively superior to us. I’m thinking of certain areas of agricultural advice, for example.
From Landi to Ramseier Most
Fenaco is an agricultural co-operative based in Bern. Its members are 153 agricultural organisations, most of which operate under the Landi brand. The majority of Fenaco is therefore indirectly owned by around 41,000 members of the Landi co-operatives, of which around 23,000 are active farmers. Well-known Fenaco companies and brands include the beverage manufacturer Ramseier Suisse, the meat processor Ernst Sutter AG, the retail companies Volg and Landi, the fertiliser brand Landor, the animal feed manufacturer UFA and the mineral oil company Agrola.
The Fenaco cooperative employs around 11,500 people and generated a turnover of around CHF 8.06 billion in 2022.
Partnership with BFH
Fenaco is a partner of the Digital Technology Management Institute. In addition, BFH Wirtschaft offers customised management training in IT for Fenaco managers.