Agility in Agriculture: Why Farms Will Succeed and Food Corporations May Not

Extreme weather has thrown off fruit and vegetable production schedules by a couple of weeks around the country this year. Anyone who’s a CSA member or an avid farmers’ market-goer knows it – farmshares are starting delivery a couple of weeks late in some regions and markets are still displaying spring greens in others. In the Pacific Northwest, there is much talk of compromised fruit crops. Cherries, which usually hit the stands well before the 4th of July, will make their way to Portland markets one of these days, but for now the strawberries will do just fine. Most people seem okay with that.

American consumers are increasingly choosing to be part of a dynamic agricultural experience. The value of agricultural products marketed directly from the farm to individuals through CSAs and farmers’ markets grew 104.7% from 1997-2007, representing over $1.2 billion in revenue in 2007 alone. Alternative channels have taken hold in part because consumers have demonstrated great capacity to adjust their expectations to the realities of agricultural production. Late cherries are not a nuisance, the thinking goes, but part of a story that connects people with the larger system that feeds them. Direct communication between farmers and people has also given producers insight into what their customers want, allowing diversified farms to adjust their crop plans to people’s tastes.

Meanwhile, the food industry is on a hunt for a “sustainable” production and marketing model. A recent Fast Company piece describes how companies like Unilever and PepsiCo know that they need to prepare their supply chains for a volatile climate and assuage their customers through social responsibility. However, food companies need more than a revision in their procurement strategies and waste policies; they need to completely rethink their design, development, and manufacturing processes. If they are to source from farms, they ought to meet dynamic production systems with an equally dynamic processing and marketing strategy instead of the unwavering product needs they present the market with today.

A farmer and a corporate procurement manager probably agree that it will be harder and harder to force a static basket of consistent, timely products out of the land for years to come. But the two have wildly different capacity to deal with this reality. While the farmer can reasonably adjust her production methods and planting choices to the ecological and market conditions her farm faces, the procurement team will have an awfully hard time figuring out how to redesign a nutrition bar in light of a cold spell in the Pacific Northwest in order to use extra strawberries as an ingredient in lieu of those missing cherries.

The future of farming does not lie in producing the same thing over and over again – the soil can’t take it and neither can farmers’ bank accounts. The future lies in an agile production system and in building producers' capacity to respond to changing markets, environmental conditions, and tastes. Farmers are good at managing for diversity and unpredictability. Individuals are getting better at it. Companies with keystone products, hefty manufacturing infrastructure, and entrenched organizational wisdom will have a hard time adjusting, I predict.

Agility means a push of what the land gives up into the markets and eventually the hands of people who eat, not a pull of ingredients through a supply chain, and it may require thinking beyond traditional measures of productivity and efficiency. As Fred Kirschenmann has remarked, economies of scale and specialization are not appropriate gauges for agriculture. Yet those are measures that food companies have typically been keenly focused on. There is a profound disconnect in food supply chains if scale is not the solution at the farm level but is the only measure of success at the corporate level.

One way forward is for farmers and people to get together and sort it out themselves (that’s where Plovgh comes in). Another is for companies to begin investing immediately not just in new procurement strategies but in a responsive product development and marketing mentality. Companies will have to do more than get closer to the farms that supply them; they need to rethink how they design and manufacture products that involve agricultural risk.

I see great potential in farmers, who demonstrate agility out of necessity, driving the future of agriculture (what a funny thing to have to say). I also see great potential in the ability of human beings, who are integrating agriculture – the culture of the land, as a reality in their daily lives, to adapt to changing conditions. I have much less faith that global, publicly held, quarterly measured corporations will figure out how to upend entrenched organizational processes, branded products, and global manufacturing in order to lead our agricultural future.


This piece is also posted at www.plovgh.com.