The Italian agri-food industry must now seize the opportunity of the digital transformation: this is the message that launches your search ” The Impact of Digital Transformation on the Agrifood industry ” made by Digital Transformation Institute with the collaboration of Cisco Italy.
A message to listen carefully, because it concerns one of the main sectors of the Italian economy, employing between agriculture and the food industry 21.7% of Italian workers and now to grow and remain competitive must face, in addition to economic and social changes even the digital transformation: with so many opportunities that you need to understand, to invest more.
For example in our wine sector – a billion bottles exported in 2015 – 77.3% of companies did not value investments in ICT, or has scored for less than EUR 5,000 over the past five years. The positive signs are there : because 52% of companies plan to make investments in excess of this threshold in the near future, but we must engage even that 31% of companies, medium-sized species, which did not deliver the same level of interest.
“The agri-food sector has a very important role in the economy of our country, so it is vital that it fits firmly into the digitization trend. Through this research we wanted to understand in detail the state of the technology in terms of a division which is very complex, consisting actually quite different from each other and from different sectors: an overall view needed to find a common language with which to reach out to the industry and support its digital transformation, “said Michele Festuccia , responsible for projects aimed at the agri-food sector in the investment plan Digitaliani Cisco Italy.
“Today we have solutions that can enhance even more the excellence that our agri-food expresses and exports all over the world, protect it and enhance it, and at the same time to understand what he needs: for example, as is clear from the research, need training, a more systematic approach, greater support in exploiting the impact of innovation: and we must take them into account ”
The research, the first complete mapping of the agricultural sector to understand impact and opportunities of digitization
“The impacts of the digital transformation on the agrifood sector” is broad and in-depth study that for the first time offers a complete mapping of the use of technology in the agricultural sector , analyzing the different stages (production, processing etc), related processes – from logistics and traceability to the management of controls and environmental impact – and the different sectors (meat, fish, dairy, fruit and vegetable, wine, oil).
The research was conducted by the Digital Transformation Institute involving in focus groups and in-depth interviews over 30 experts from industry associations, universities and research, corporate entities, institutions – with the goal of understanding the state of the whole sector, with regard to digitization.
In the first place we have been identified in all technologies, not only ICT , which have had so far greater spread in every area of the agro-food sector (agriculture and food industry); It has been made an assessment of such technologies have had and will have a major impact on what are the critical points for the path of innovation, such as the contact points between the different links in the chain. Downstream of this was then developed an analytical model to be able to look – even from an economic and social point of view – the level of digitization, the type of technology, investment in various productive sectors : meat, fish, milk , fruit and vegetable, wine, oil.
The analysis model later became a questionnaire, which was used to start with the wine industry: have been involved 307 companies, selected to form a representative sample of the industry, interviewed with the SWG support.
Agro-food industries: not an overview of and appropriate skills, you lose the challenge of the digital transformation
“An overall view, able to decline in view of the agri-food and agri-industry key technology trends – not only in ICT – would put in place a common approach, capable of helping the growth processes, facilitate the aggregation and a stronger planning in a fragmented and diverse industry, “explains Stefano Epifani , president of Digital Transformation Institute . From mapping emerges, however, the absence of a true overall picture, which makes it difficult to spread in the industry awareness of the technology opportunities and the urgency to seize them to remain competitive globally.
This difficulty is compounded by another big problem: the scarcity of figures in the field qualified with the skills needed to drive a digital transformation . Without a guide, it is even more difficult to develop awareness of the need for innovation and, where appropriate, address the issue of digitization systematically.
Poor perception of the need for innovation and the absence of a systematic approach are the other pain points highlighted by the research: sore spots that have serious consequences, such as the inability to effectively evaluate the impact of investments that are well made.
This is demonstrated, for example, what emerged from the survey carried out at the companies in the wine sector , as well 47% of them claim that investments in technology have not yet led or will lead to an increase revenues , and 15 % can not assess the advantage that may be obtained.
That said, we can not say that the situation is 100% uniform throughout the sector. It particularly noted that the focus on digital transformation is prevalent in industrial-sized businesses , and shows that to really feel the benefits of digitization are in fact only those companies that already invest in digital technologies.
And ‘the classic snake biting its tail, with a mechanism that is in serious danger of leaving behind another queue: the “long tail” of the food industry , as has defined Stefano Epifani, made up of thousands and thousands of small businesses and medium , which through technology could look out on a broader market, improve control of their production processes, recognize and acknowledge the quality, excellence, originality of their products – and growing.
“The key to modify this mechanism is the widespread dissemination, in this area, more than ever, culture and digital competences” said Epifani. “Starting from school, from vocational schools, to get to initiatives involving industry players and institutions on a path to build awareness and capacity.”
The wine sector: tradition and digitization
The analysis carried out in detail on the wine sector has been realized with a structured questionnaire from the key findings in the mapping of the sector. The wine was chosen first because it has a consistent presence on the Italian territory , and consists for the vast majority of companies that have an integrated production chain – from grape production to bottling and distribution and direct sale of the product (respectively 92% and 93%).
In addition, the wine is certainly a standard of excellence for the country, with 1 billion bottles exported in 2015; It is a mature industry in its traditional configuration , compared with the global competitive environment.
- Investment in innovation: especially on the last part of the supply chain
- The 77.3% of Italian wine companies did not invest or has investitofino to 5,000 euro in ICT over the last five years . Of the remaining 22.7% – which has invested more than EUR 5,000 – half (49%) it is represented by larger companies. From a geographical perspective, the distribution between those who invest in digital technology and those who do not see a greater investment, albeit slight, on the part of companies and South Islands.
- The bulk of the investment in digital carried out so far highlights the goal of expanding the customer base of the company, speaking on the final part of the supply chain : in 41% of cases on the distribution , in direct sales to the public for 43%. As a result, the most interesting technologies are mainly related to management and business management (74%), traceability (57%), to “receive and transmit information in electronic form (53%). They are also important aspects required by the bureaucratic demands and regulations, since 41% have invested in technologies related to licensing systems and control by the PA.
- Future investments: more interest in the production and process optimization
- Looking to the future investment forecasts, there is a tendency to take greater account of the value of digitization. The 52% of companies plan to invest more than the minimum threshold of EUR 5,000 : 30% of those who intend to invest consists of medium to large companies. 31% of those who do not intend to invest is made up of small and medium companies .
- The technologies on which it intends to invest in the future are in particular those related to the cycle of production and optimization of transformation processes (49% and 57% considers interesting) and are central issues related to the traceability and safety of the product, but also logistics and management and business management.
- The results of the investments in digital: still unclear
- The investment made in digitalisation does not seem to be always effective in terms of growth. 47% said that investments have a positive impact on revenues, 15% does not know how to evaluate it ; 21% declares to have seen a moderate positive effect, only 7% real increase in turnover.
- These poor results can be tied to the overwhelming choice of adjusting the timing, Web, e-commerce – without careful consideration of the processes behind it : in fact, only 19.3% of companies have a logistical system organized in an innovative way , while 38% of non-computerized logistics and 40% say they have no logistical planning.
- Traceability: a key issue for the quality
- The issue of traceability is extremely important for the wine industry. Only 4% of respondents to label as a “fashion” that soon will pass; 51% of the sample believes that it should always be required (strongly agree).
- Although 30% strongly agree with the fact that it is “a cost to the manufacturer” and 29% believe it should be the institutions to bear the costs, as required by the European Union – a similar proportion (31%) recognizes that it is useful to promote the products commercially .
- The space of intervention is still large , as for example well 65% of the companies keep a register of treatments of the product in the field still in paper form , therefore not suitable to integrate it also automatically with the product data to add it in a more system wide traceability.
“Analyzing a total state of digitization in the wine sector shows a relationship between the quality of the product (DOC, DOCG) and provision for the Digital Office: those who produce quality wine is also those who make more investments in ICT and includes better dimensions of the revolution underway, “concludes Stefano Epifani. “Although there is no systematic correlation between the two, there is an obvious risk you: that in a world where the ability to move into the digital market is increasingly important to have widened the gap between high-quality producers investing in digitization and the other producers, leading them to have serious problems of competitiveness. ”
As for the sector as a whole, you have to work to create in companies in the wine industry more aware of the opportunities, and before that to make sure that businesses are aware of the need to support the digitization ; all this must be accompanied by investments in education, because they serve young people who know the digital dynamics and help these thousands of companies in the path of change. In this sense, universities have a central role but also the institutions of higher professional training, technical, agricultural.