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ISSUE 18 | 2016
Complimentary article reprint
BY WILL SARNI, JOE MARIANI, AND JUNKO KAJI
> ILLUSTRATIONS BY ALEX NABAUM
FROM DIRT
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DATAThe second green revolution and the
Internet of Things
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The first “green revolution”—a series of rapid technological
and agronomic advances that took place after World War
II—transformed agriculture, saving over a billion people from
starvation1
and setting the stage for the world’s population to
increase from 3 billion in the late 1960s to an estimated 7.3
billion today.2
Despite this phenomenal growth, however, there
are significant challenges to the continued expansion of this
first green revolution, and in some ways it has been the victim
of its own success.
Increased water use for irrigation, soil degradation, and
chemical runoff are just some of the unintended consequences
impacting the landscape. The deterioration of the agricultural
resource base due to these factors is thought to have
contributed, in part, to a slowdown in yield growth that began
in the mid-1980s. These environmental costs suggest that the
long-term success of the first green revolution may be at risk.3
Meanwhile, the need to produce more food remains urgent.
The world population is expected to reach nearly 11 billion
by 2050, representing an increase in agricultural demand of
approximately 70 percent—a figure that can only be met with
a new revolution in agriculture.4
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BY WILL SARNI, JOE MARIANI, AND JUNKO KAJI
> ILLUSTRATIONS BY ALEX NABAUM
The second green revolution and the
Internet of Things
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Fortunately, we are on the cusp of another full-scale green revolution, one with
the potential to address some of the unintended consequences of its predecessor—
including those related to both resource use as well as the economic and social well-
being of farmers in emerging economies. In one sense, the first green revolution’s
unintended consequences were due to new methods of farming: new seeds, new
fertilizers, new techniques. To avoid the same kinds of unintended consequences
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NORMAN BORLAUG
The first “green revolution” was led by Norman Borlaug, an American agronomist who
is considered to have “saved more lives than anyone who has ever lived” through his
achievements.5
These included the development of high-yielding varieties of cereal grains and
the distribution of hybridized seeds, synthetic fertilizers, and pesticides to farmers.6
Borlaug’s
contributions, as well as the widespread buildout of irrigation infrastructure and the adoption
of modern management techniques, greatly increased yields without requiring an expansion in
agricultural land.7
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as we search for new increases in production, the second revolution will likely be
driven not by new techniques but rather by technology—by giving farmers the data
to help make better decisions. In short, this second green revolution will likely be
catalyzed by the set of connected technologies collectively called the Internet of
Things (IoT).
This second green revolution will likely make use of very different tools and
techniques than the first. It will likely be grounded in the use of data to inform more
efficient and effective farming practices and drive associated environmental and
social benefits. Technologies such as advanced sensors and monitoring equipment
can now allow farmers to monitor crops more precisely and continuously than in
the past. The data collected by these technologies can enable farmers to make more
effective and strategic decisions that increase productivity with reduced impacts on
the environment.
From manipulating the growing environment to produce low-potassium lettuce
to attaching sensors to cows to identify potentially sick animals, there is little ques-
tion that the second green revolution holds the potential for remarkable results.8
To manage all this, IoT technologies will likely take center stage on the farm of
the future.
IOT AND AGRICULTURAL PRODUCTION
New insights, new productivity
Historically, the agricultural sector could rely upon a relative abundance of
resources such as water and nutrients to increase yield. Farmers and compa-
nies managed goals predicated upon that abundance, and relied upon the expecta-
tion of an ongoing flow of these inputs. However, the world continues to face an
unprecedented demand for food and increased competition for these critical re-
source inputs. To meet this demand, the IoT should consider going beyond simply
improving existing agricultural processes; it must introduce innovation that breaks
traditional trade-offs. The good news is that this seems feasible: It is estimated that,
with new techniques, the IoT has the potential to increase agricultural productivity
by 70 percent by 2050.9
The IoT’s ability to collect and correlate resource data means that the agricul-
tural sector can develop solutions to do more with less—for instance, by enabling
automated precision agriculture.10
In other words, the IoT’s ability to make visible
detailed resource data enables farmers to increase the efficiency with which they
apply scarce and costly inputs. In addition, IoT-enabled farmers can also reap bene-
fits in improved environmental and social performance in areas such as sustainable
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Figure 1. The Information Value Loop
Graphic: Deloitte University Press | DUPress.com
TECHNOLOGIESSTAGESVALUE DRIVERS
AGGREGATE
ANALYZE
COMMUNICATE
ACT
CREATE
Network
Standards
Sensors
Augmented
intelligence
Augmented
behavior
R I S K
T I M E
Scale FrequencyScope
Security Reliability Accuracy
TimelinessLatency
M A G N I T U D E
THE INFORMATION VALUE LOOP
The suite of technologies that enables the IoT promises to turn almost any object into a source of
information about that object. This creates both a new way to differentiate products and services
and a new source of value that can be managed in its own right.
Realizing the full potential of the IoT motivates a framework that captures the series and sequence
of activities by which organizations create value from information: the Information Value Loop.
To start with the obvious, the value loop is a loop: An action—the state of behavior of things in
the real world—gives rise to information, which then gets manipulated in order to inform future
action. For information to complete the loop and create value, it passes through the stages of the
loop, each stage enabled by specific technologies. The amount of value created by information
passing through the loop is a function of the value drivers identified in the middle. Falling into three
generic categories—magnitude, risk, and time—the specific drivers listed are not exhaustive but only
illustrative. Different applications will benefit from an emphasis on different drivers.
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agriculture, fair wages, and humane labor practices, which are increasingly impor-
tant to food manufacturers, retailers, and consumers.11
To do so, it is crucial to collect new data on a real-time basis and make these
data readily available for analysis and action to stakeholders along the food value
chain. One of the more powerful developments in this regard is NASA’s Gravity
Recovery and Climate Experiment (GRACE) mission. GRACE, launched in 2002,
uses two spacecraft to map variations in the Earth’s gravity field. The gravitational
research is, in part, collecting relevant agricultural data on factors such as ground-
water availability and stress as they relate to global agricultural production areas.
Maps developed using the GRACE data are able to identify the difference between
climate-related drought conditions and the depletion of aquifers through ground-
water extraction that exceeds recharge. However, currently, this information is
typically only available in specialized scientific journals. By making this informa-
tion more available to farmers, the IoT, drawing on GRACE as a sensor, could help
farmers make more efficient and effective use of water resources.12
Bringing IoT technologies closer to earth, aerial drones are also an example
of how new sensors are making data more readily available. Drones can be a very
useful tool for agricultural companies in that they provide aerial data and imagery
for large expanses of land, delivering insights into the health of the land and po-
tential problem areas. One company working to simplify the creation and analysis
of drone data is DroneDeploy. The company’s eponymous software program for
mobile phones significantly simplifies multiple aspects of drone usage for mapping
land and monitoring applications. The software creates flight plans, pilots the drone
on the plan, and then automatically analyzes the pictures it takes to construct a 3D
map of the land.13
This eliminates the need for users to learn how to fly a drone for
mapping purposes, reduces the cost of software required to process aerial imagery
data, and shortens the time it takes processing software to analyze the imagery and
deliver insights. Because of this, DroneDeploy may offer opportunities to agricul-
tural companies to cut significant time and costs associated with managing large
areas of land without the technological learning that both drone use and data pro-
cessing can often require.14
Not just more, but better
Beyond increasing agricultural productivity, IoT technologies can improve the
nutritional value of food.15
For example, Fujitsu has produced a raw lettuce with less
than 80 percent of the potassium content of traditionally grown lettuce; high potas-
sium is unhealthy for people on dialysis or suffering from chronic kidney disease.
The hardware sensors used by Fujitsu in this project are similar to those used in a
semiconductor plant—in fact, Fujitsu’s test bed is a converted chip manufacturing
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plant. The data collected by sensors throughout the building are used to adjust
the controls for the climate, light, and other conditions needed to grow low-
potassium lettuce.16
Beyond merely lettuce, the IoT is also being applied to livestock to improve care
quality and herd productivity. Writtle College’s Jonathan Amory has attached sen-
sors to dairy cows to help farmers identify illnesses earlier, with the aim of reducing
animal suffering and increasing milk yields. By analyzing the cows’ movement pat-
terns, researchers were able to identify individual animals that had fallen ill. They
could then provide treatment only to those animals that needed it, which not only
improved the quality of life for that animal but also lowered the risk of contagion
across the herd, increasing overall productivity.17
Such a targeted approach to vet-
erinary care can have the added benefit of reducing the need for herd-wide preven-
tative antibiotics, which have been shown to contribute to drug-resistant bacteria.18
VALUE FOR ALL: MODELING VALUE CAPTURE USING THE IOT VALUE LOOP
The World Economic Forum (WEF) recently identified the IoT as one of its 21
“tipping points,” or moments when a specific technological shift hits main-
stream society.19
According to WEF, the IoT is expected to reach its tipping point
by 2022, although some might expect the tipping point to come much sooner given
the pressing increase in agricultural demand and the associated resource scarcity
challenges.20
However, achieving that tipping point relies on all users of the IoT,
whether large company, smallholder farmer, food manufacturer, retailer, or con-
sumer, being able to capture value. (For more information on how value capture
can impact technology adoption, see “Power struggle” in Deloitte Review issue 17.21
)
As the IoT proves its value in industry after industry, the main questions now
for stakeholders in the nascent agricultural IoT ecosystem—farmers, food and bev-
erage manufacturers, distributors, retailers, and technology companies—are how to
commercialize and scale the technologies, and who will pay for their development
and deployment.22
To address these issues, innovative partnerships coupled with
technology innovation will need to occur in ways that extend the depth and com-
plexity of stakeholder relationships across the agricultural value chain.
Large-scale industrial farmers
For agribusiness, food and beverage companies, and technology companies—
as well as for investors—the question of finding value in the IoT is largely one of
corporate strategy: identifying where to play and how to win. The key step for the
producers and users of the technology that make IoT solutions work is to find the
IoT applications that create the most value.
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Perhaps the best-known examples come from traditional agriculture players.
One such company has instrumented tractors and farm equipment, enabling own-
ers to know their precise location via Global Positioning System and numerous
other parameters. The same company has also created multiple online portals to ag-
gregate individual farmers’ data from all over the world. For the individual farmer,
these data, enhanced by up-to-date weather conditions, can help the farmer make
better-informed decisions on planting, harvesting, and other actions that impact
crop yields. At a community level, websites aggregate data from a wide range of
equipment in order to better understand equipment performance: fuel usage, pro-
ductivity levels, and estimates of when and how equipment might break down. The
broader community of information can be used to understand how to get even bet-
ter results from specific equipment.23
On the other hand, new entrants to the industry, such as technology company
Granular, are exploring how industrial farmers can capture value with IoT technol-
ogies, not only for field production but to run their businesses. Granular is a farm
management cloud software company that has created a system by which farms are
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able to manage their business “off the field.” Granular’s technology allows farmers to
plan, budget, and manage cost and inventory from one integrated platform. By in-
corporating data from IoT-enabled equipment, farmers can incorporate real-time
data such as crop yields into those decisions. Improved yield information provides
a feedback mechanism for farmers to adjust inputs accordingly. The system also
benchmarks business performance in order to improve the overall cost of produc-
tion, allowing farmers to make informed decisions about additional investments in
the technology or equipment that runs the farm.24
Smallholder farmers
Additional value can be created when one considers the role of agriculture
in emerging economies. In these economies, the IoT can provide value not only
through increased resource efficiency and crop productivity, but also by providing
social value and financial benefits for smallholder farmers.
Examples of where IoT deployments have created social value include the
Grameen Foundation’s Community Knowledge Worker (CKW) program in
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Even if not directly engaged in its production,
perhaps no other stakeholder group is
more concerned with food than consumers.
Consumers, after all, feel the greatest impact
from the availability of high-quality food—or its
lack. In this respect, consumers can capture value
not only by having enough food on the table but
also by knowing more about what they are eating
and its origin.
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Uganda, which aims to give farmers smartphone technology to help address animal
health risks; and the Rainforest Alliance’s pilot project to provide data and informa-
tion on agricultural best practices to coffee growers in Guatemala. Working with
the Cisco Foundation, the Grameen Foundation provides smallholder farmers with
smartphones on which they can access information about weather, crop and animal
diseases, and market prices.25
These projects show that information about the world
is among the most critical needs for smallholder farmers.
While current solutions such as CKW rely on hand-entered data, the potential
for these solutions to improve quality of life when paired with true IoT-enabled
sensors is massive.26
The IoT could provide farmers not just reference information
but also real-time data about the health of their crops or the price of their livestock,
improving not just agricultural productivity but also the farmer’s social well-being.
Consumers
Even if not directly engaged in its production, perhaps no other stakeholder
group is more concerned with food than consumers. Consumers, after all, feel the
greatest impact from the availability of high-quality food—or its lack. What’s more,
they also generate the demand that drives so much change within the industry—
witness the trend toward organic or locally sourced food, for instance.27
In this re-
spect, consumers can capture value not only by having enough food on the table but
also by knowing more about what they are eating and its origin.
The IoT has already been applied to certain portions of the food supply chain.
Specifically, it is already helping suppliers keep products fresh by monitoring
temperature during transit and even adjusting shipping routes to shorten transit
times.28
Beyond this, consumers can directly benefit from this type of tracking in
the food supply chain. For example, tagging and tracking fish can help verify its
provenance as sustainably sourced, helping to prevent illegal catch being passed off
as legitimate.29
This not only helps promote healthy fish stocks but also delivers val-
ue to consumers, who gain confidence that they are doing their part by purchasing
responsibly. This consumer demand, in turn, can provide direct economic incentive
for farmers, fishers, and others to implement the IoT technologies that can provide
the other productivity and quality benefits listed above.
WHERE ARE THE BOTTLENECKS?
To realize the IoT’s full benefit for all stakeholders across the value chain, a
certain critical mass of information must flow through the Information Value
Loop. By visualizing where bottlenecks are currently limiting information flow, we
can start to see what must be improved to achieve the full benefits of the IoT.
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Kenneth Zuckerberg, executive director and senior analyst in Rabobank’s Food
and Agribusiness Research and Advisory team, captures the challenges in this way:
Over the long term, Rabobank believes that “smart farming” (that is, the combination
of data, technology, smart connected devices, and precision farming techniques) has
the potential to create in excess of $10 billion of value in the United States. Before
that value can be realized, however, there are several bottlenecks that the agricultural
industry needs to overcome. First, the existing first generation of data-intensive prod-
ucts does not yet offer enough tangible benefits over the cost of investment to justify
customer adoption. Second, most farms lack a basic, reliable, and secure technologi-
cal infrastructure to efficiently access the requisite cloud and enterprise services associ-
ated with digital agriculture. And third, the large farm input players that have already
made significant investments in data-driven precision and prescriptive farming services
need to embrace open architecture platforms to enable data collection, monitoring,
analysis, interpretation, and action by farmers that purchase unbundled products and
services from an assortment of vendors.30
Currently, the most obvious and largest bottleneck in the IoT value loop frame-
work is at the communicate stage due to the limited infrastructure and connectivity
challenges faced by farmers in developing countries—and even within the United
States. While sensors may already be able to gather data about the water provided
to crops or the location of livestock, communicating that information reliably and
consistently back to the cloud or Internet gateway in remote environments poses
a serious challenge. Even in the United States, many rural areas are not served by
the same major Internet service providers that cover suburban and urban areas; in-
stead, farmers often get their Internet access through wireless ISPs, DSL providers,
satellite service, or even by leveraging 4G networks, sometimes at extremely high
costs.31
Similarly, the need to communicate over long ranges and, often, difficult ter-
rain typically requires high-power transmitters, which are also costly.32
To create a truly functional IoT value loop in the second green revolution, farm-
ers will need to have access to reasonably priced, reliable, low-power, long-range
communications. Luckily, there is already work under way to break those trade-offs
within communications to produce new types of radios for IoT applications.33
Solving one challenge, however, may reveal the next. Once farmers are able to
effectively communicate data about their land and crops to the Internet, the bottle-
neck may move to the next stage or stages—perhaps to the need to aggregate data
together so that individual farmers may benefit from the data of all. With access to
aggregated data, even a smallholder farmer is not limited to a few acres of experi-
ence, but can gain a wider view of the world to help understand weather or disease
patterns that may impact planting or crop care decisions.
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The main challenges here are the questions of who owns the data and how to
organize and use it. And there is always the potential for abuse, says Jeroen van der
Sommen of communications nonprofit Akvo:
At a time when more than 500 million smallholder farmers run 80 percent of farmland
in Africa and Asia, the path to IoT adoption needs to be forged with care. Will cor-
porations and governments fill these smallholders’ land with sensors sending data to
headquarters, or will these technologies be used to improve skills, understanding, and
opportunities for farming communities? We need to be mindful that these processes
and technologies could drive a new era of agricultural partnership or simply reinforce
exploitation through a new layer of technology.34
Finally, another barrier to the agricultural IoT lies in the ease of use for the
farmer—the act stage of the IoT value loop framework. The value loop will be
disrupted if IoT technologies are not easy for farmers to use; a high level of dif-
ficulty for users could mean that technologies are not regularly used or abandoned
altogether. In addition to general ease of use, integration of various sensors and
platforms into a single package will be important. If different parts of the greater
agricultural IoT system are not integrated, there will be too many independent ap-
plications for farmers to manage, which could lead to abandonment. This technical
integration is key, for if farmers abandon the technology, the IoT will not be able to
improve productivity and help feed the world population.35
ENGAGING THE ENTIRE STAKEHOLDER ECOSYSTEM
While there is great excitement about the IoT’s potential to fuel the second
green revolution, key issues remain, including the question of how early-
stage IoT companies can commercialize at scale and the overall question of who
will pay for the technologies to be deployed. In the agricultural sector, both rep-
resent unique challenges not lost on early-stage investors. For instance, the adop-
tion of new technologies in agriculture is particularly challenging due to thin profit
margins and relatively long payback periods.
Furthermore, when technology adoption is tied to savings in resources such as
water, the disincentive to change current practices can be daunting. For example,
from a technical standpoint, IoT technologies can easily be applied to agricultural
water use: The resource can be measured in both quality and quantity, and auto-
mated systems can be used to allocate it in an effective manner. However, the per-
sistent low price for water in the agricultural sector, even in areas of drought, can be
a barrier to IoT adoption, as farmers have little financial incentive to strategically
manage their water usage. According to Marc Robert of Water Asset Management,
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“When the underlying pricing of water rises to reflect its full business value, the case
for IoT adoption to drive water efficiency in agriculture will become compelling.”36
Many individual farmers have little economic incentive and lack the funds to
implement new technologies alone. Rather, solving the issues of who will pay for
the technology and how to scale adoption will likely require the engagement of the
entire food ecosystem: farmers (smallholders and large-scale), food manufacturers,
food retailers, and consumers. To enable this, traditional thinking about stakehold-
er relationships will not be enough. What are needed are not just new IoT technol-
ogy solutions but also innovative partnerships.
One way to encourage such partnerships is to adopt a new way of thinking
about the agricultural value chain. Traditionally, value chains have been seen as
linear—built upon relatively simple business relationships between stakeholders
in the production, manufacture, distribution, retail, consumer, and disposal steps.
Recently, however, the consumer products industry, particularly the food and bev-
erage sectors, have started to act as part of closed-loop value chains that entail more
complex relationships among stakeholders than simple sourcing, manufactur-
ing, buying, and selling. The creation of these more complex relationships enables
stakeholders to create and capture greater value across the value chain, as well as
build more sustainable and resilient systems to deliver products.37
In terms of the
IoT, a closed-loop value chain means that individual farmers need not bear the
costs of technological modernization alone; the costs, and also the benefits, can be
spread across the value chain.
Already, the IoT’s inroads into the agricultural sector begin to make clear that
a new model of the food and agriculture industries is emerging. The IoT, by giv-
ing producers, manufacturers, distributors, consumers, and others across the value
chain access to new information and new insights about the world, is delivering
value to a diverse variety of stakeholders and, in the process, forging new relation-
ships between these stakeholders. For instance, the same information that helps a
producer move its product to market in the shortest time can also help consumers
make informed choices about nutrition and sustainability. This creates an incentive
for producers, distributors, and retailers to work together in a way that creates value
for all.
FUELING THE SECOND GREEN REVOLUTION
As IoT adoption increases, it has the potential to more closely tie together a
variety of stakeholders in the agricultural ecosystem. To successfully take ad-
vantage of IoT technologies, farmers and companies alike should harness the con-
nections among stakeholders across the entire value chain. All of the stakeholders
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within the “closed loop,” including farmers, food manufacturers, distributors, re-
tailers, technology companies, the public sector, and NGOs, must work together to
alleviate the bottlenecks to information flow as they arise.
It is possible to envision the mobilization of the entire agricultural value chain to
address the challenges of “how to scale” and “who will pay.” Imagine, for instance,
that a global food manufacturer needs to increase the production of rice. Company
leaders identify deploying IoT technologies as a viable way to increase agricultur-
al yield and the sustainability and resiliency of the company’s rice supply chain,
along with delivering financial and social benefits to smallholder farmers. The food
manufacturer engages with a global ICT company (for example, a wireless service
provider), a global semiconductor manufacturing company focused on increasing
demand for its processors, and a retailer (or retailers) with a strong commitment to
sustainability who sells the manufacturer’s products. Together, they establish a pilot
project to deploy the IoT with a group of smallholder rice farmers. The IoT tech-
nology is funded by the corporate stakeholders, development banks active in the
region, and the national government. The project is a success, and the companies
build a strategy to scale—this time without the contribution from the development
banks, but with the support of the government. The strategy includes passing along
decreased costs throughout the value loop to all stakeholders, including consumers.
The value created comes from increased rice productivity, lower supply chain risk
and cost, increased supply chain transparency, and brand value from the commit-
ment to smallholder farmers’ social and environmental performance.
Collaborations like these to deploy IoT technologies will be increasingly vital if
we are to put the world’s farms on track to feed the estimated 11 billion people who
will inhabit the earth by 2050. Despite the challenges, there is cause for optimism.
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Already, the IoT’s inroads into the agricultural
sector begin to make clear that a new model of
the food and agriculture industries is emerging.
The IoT, by giving producers, manufacturers,
distributors, consumers, and others across the
value chain access to new information and new
insights about the world, is delivering value to
a diverse variety of stakeholders and, in the
process, forging new relationships between
these stakeholders.
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Investor Tamin Pechet, chairman of Imagine H2O and managing partner of Upwell
LLC, puts it this way:
Solutions themselves are becoming cheaper and better. Moreover, the channels
through which smart IoT products may reach customers have improved, and the pres-
sure on growers to adopt technology has increased. Simultaneously, food and bever-
age companies have demanded more information and more sophisticated practices
from their suppliers. These trends offer increasing hope for a smart food system.38
With the IoT fueling a second green revolution, there is real and increasing
hope that the world’s farms will be able to feed 11 billion people by 2050—not just
providing food but doing so in a way that improves environmental performance
and delivers social benefits. DR
Will Sarni is director and Social Impact practice leader, enterprise water strategy, Deloitte
Consulting LLP.
Joe Mariani is a lead Market Insights analyst with Deloitte Services LP, and editor of Deloitte’s
research series on the Internet of Things.
Junko Kaji is acquisitions editor for Deloitte University Press, Deloitte Services LP.
Special thanks to Grace Summers, consultant, Deloitte Consulting LLP, for her contributions to
this article.
Endnotes
1.	 Abhijit Sarkar et al., “Proteomics potential and its contribution toward sustainable agriculture,” Agroecology,
Ecosystems, and Sustainability, ed. Noureddine Benkeblia (CRC Press, 2014), pp. 151–80.
2.	 Infoplease, “Total population of the world by decade, 1950–2050,” www.infoplease.com/ipa/A0762181.html, ac-
cessed October 13, 2015; Worldometers, “Current world population,” www.worldometers.info/world-population/,
accessed October 13, 2015.
3.	 Prabhu L. Pingali, “Green revolution: Impacts, limits, and the path ahead,” Proceedings of the National Academy
of Sciences 109, no. 31 (2012): pp. 12302–08, www.ncbi.nlm.nih.gov/pmc/articles/PMC3411969/; Staffordshire
Learning Net, “GCSE revision—Agriculture—The green revolution,” www.sln.org.uk/geography/schools/blytheb-
ridge/GCSERevisionAgricultureGR.htm, accessed October 13, 2015.
4.	 World Bank, “Overview,” April 1, 2015, www.worldbank.org/en/topic/foodsecurity/overview#1.
5.	 Gregg Easterbrook, “The man who defused the ‘population bomb’,” Wall Street Journal, September 16, 2009, www.
wsj.com/articles/SB10001424052970203917304574411382676924044.
6.	 Sarkar et al., “Proteomics potential and its contribution toward sustainable agriculture.”
7.	 Easterbrook, “The man who defused the ‘population bomb.’”
8.	 Nicole Kobie, “The internet of food: Why your steak might have come from a connected cow,” Guardian, August 5,
2015, www.theguardian.com/technology/2015/aug/05/internet-of-things-connected-cows-agriculture-food-
production.
9.	 Beecham Research, Towards smart farming: Agriculture embracing the IoT vision, January 31, 2015,
www.beechamresearch.com/download.aspx?id=40.
10.	 R. Bongiovanni and J. Lowenberg-Deboer, “Precision agriculture and sustainability,” Precision Agriculture 5, no. 4
(2004): pp 359–87.
11.	 Aspirationals, “The shift,” http://theaspirationals.com/shift, accessed October 13, 2015.
12.	 Alan Ward, “Gravity Recovery and Climate Experiment (GRACE),” NASA, March 30, 2004, http://earthob-
servatory.nasa.gov/Features/GRACE/; Alexandra S. Richey et al., “Quantifying renewable groundwater
stress with GRACE,” Water Resources Research 51, no. 7: pp. 5217–38, http://onlinelibrary.wiley.com/
doi/10.1002/2015WR017349/full.
19
DELOIT TEREVIEW.COM | Deloitte Review
FROM DIRT TO DATA
13.	 Daniel Terdiman, “DroneDeploy tech creates aerial maps in real time, often before a drone even lands,” Venture
Beat, March 31, 2015, http://venturebeat.com/2015/03/31/dronedeploy-tech-creates-aerial-maps-in-real-time-
often-before-a-drone-even-lands/.
14.	 Matt McFarland, “How DroneDeploy’s app is about to make farming more efficient,” Washington Post, March 31,
2015, www.washingtonpost.com/news/innovations/wp/2015/03/31/how-dronedeploys-app-is-about-to-
make-farming-more-efficient/.
15.	 Kobie, “The internet of food.”
16.	 Ibid.
17.	 Ibid.
18.	 Hang Wang et al., “Housefly larvae vermicomposting efficiently attenuates antibiotic resistant genes in swine
manure coupled with distinct bacterial population change,” Applied and Environmental Microbiology, August 21,
2015, doi: 10.1128/AEM.01367-15.
19.	 World Economic Forum, Deep shift: Technology tipping points and societal impact, September 2015,
www.weforum.org/reports/deep-shift-technology-tipping-points-and-societal-impact.
20.	 Will Sarni, “Deflecting the scarcity trajectory: Innovation at the water, energy and food nexus,” Deloitte Review 17,
Deloitte University Press, http://dupress.com/articles/water-energy-food-nexus/.
21.	 Michael E. Raynor and Brenna Sniderman, “Power struggle: Customers, companies, and the
Internet of Things,” Deloitte Review 17, Deloitte University Press, http://dupress.com/articles/
internet-of-things-customers-companies/.
22.	 For more information on exactly how IoT has created value in different industries please explore www.dupress.
com/collection/internet-of-things to see more.
23.	 Bernard Marr, “From farming to big data: The amazing story of John Deere,” May 7, 2015, www.datasciencecen-
tral.com/profiles/blogs/from-farming-to-big-data-the-amazing-story-of-john-deere.
24.	 Granular, http://www.granular.ag/, accessed October 13, 2015.
25.	 Alexis Raymond, “How Grameen Foundation connects the unconnected,” Cisco Blogs, October 9, 2013, http://
blogs.cisco.com/csr/how-grameen-foundation-connects-the-un-connected; Grameen Foundation, “Personal
stories: Gonzaga Kawuma,” www.grameenfoundation.org/impact/personal-stories/gonzaga-kawuma, accessed
October 13, 2015.
26.	 Rainforest Alliance, “Connecting farmers with each other and the world,” June 15, 2015, http://thefrogblog.
org/2015/06/15/connecting-farmers-with-each-other-and-the-world/.
27.	 Mikael Klintman and Magnus Boström, “Chapter 5: Researching transitions in green food consumption: Looking
behind and beyond the organic shelf,” Food Practices in Transition: Changing Food Consumption, Retail and
Production in the Age of Reflexive Modernity, eds. Gert Spaargaren et al. (New York: Routledge Press, 2012).
28.	 Joe Mariani, Evan Quasney, and Michael Raynor, “Forging links into loops: The Internet of Things’ potential
to recast supply chain management,” Deloitte Review 17, Deloitte University Press, http://dupress.com/articles/
internet-of-things-supply-chain-management/?coll=11711.
29.	 Heather Clancy, “State of green business: Supply chain transparency ramps up,” GreenBiz, February 24, 2015,
www.greenbiz.com/article/state-green-business-supply-chain-transparency-ramps.
30.	 Personal communication from Kenneth Zuckerberg, Rabobank, October 9, 2015.
31.	 Lee Badman, “Overcoming the challenges of wiring farm networks,” TechTarget, http://searchnetworking.
techtarget.com/tip/Overcoming-the-challenges-of-wiring-farm-networks
32.	 Jessica Codr, “Wireless options for providing Internet services to rural America,” Washington University in
St. Louis, Computer Science department survey paper, last modified April 21, 2008, www.cse.wustl.edu/~jain/
cse574-08/ftp/rural.pdf, accessed October 13, 2015.
33.	 Ian Poole, “LoRa Wireless for M2M & IoT,” Radio-electronics.com, www.radio-electronics.com/info/wireless/
lora/basics-tutorial.php, accessed October 13, 2015.
34.	 Personal communication from Jeroen van der Sommen, Akvo.
35.	 Bekele A. Shiferaw, Julius Okello, and Ratna V. Reddy, “Adoption and adaptation of natural resource management
innovations in smallholder agriculture: Reflections on key lessons and best practices,” Environment, Development
and Sustainability 11, No. 3 (2009): pp 601–19.
36.	 Personal communication from Marc Robert, Water Asset Management.
37.	 World Economic Forum, Redesigning business value: A roadmap for sustainable consumption, January 2010,
www.weforum.org/reports/redesigning-business-value-roadmap-sustainable-consumption.
38.	 Personal communication from Tamin Pechet, Upwell LLC.

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Deloitte Review: From Data to Dirt (with quote by Kenneth S. Zuckerberg of Rabobank)

  • 1. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www. deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s more than 200,000 professionals are committed to becoming the standard of excellence. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the “Deloitte Network”) is, by means of this communication, rendering professional advice or services. No entity in the Deloitte network shall be responsible for any loss whatsoever sustained by any person who relies on this communication. © 2016. For information, contact Deloitte Touche Tohmatsu Limited. ISSUE 18 | 2016 Complimentary article reprint BY WILL SARNI, JOE MARIANI, AND JUNKO KAJI > ILLUSTRATIONS BY ALEX NABAUM FROM DIRT TO DATAThe second green revolution and the Internet of Things
  • 2. 4 FROM DIRT TO DATA Deloitte Review | DELOIT TEREVIEW.COM
  • 3. 5 DELOIT TEREVIEW.COM | Deloitte Review FROM DIRT TO DATA The first “green revolution”—a series of rapid technological and agronomic advances that took place after World War II—transformed agriculture, saving over a billion people from starvation1 and setting the stage for the world’s population to increase from 3 billion in the late 1960s to an estimated 7.3 billion today.2 Despite this phenomenal growth, however, there are significant challenges to the continued expansion of this first green revolution, and in some ways it has been the victim of its own success. Increased water use for irrigation, soil degradation, and chemical runoff are just some of the unintended consequences impacting the landscape. The deterioration of the agricultural resource base due to these factors is thought to have contributed, in part, to a slowdown in yield growth that began in the mid-1980s. These environmental costs suggest that the long-term success of the first green revolution may be at risk.3 Meanwhile, the need to produce more food remains urgent. The world population is expected to reach nearly 11 billion by 2050, representing an increase in agricultural demand of approximately 70 percent—a figure that can only be met with a new revolution in agriculture.4 FROM DIRT TO DATA BY WILL SARNI, JOE MARIANI, AND JUNKO KAJI > ILLUSTRATIONS BY ALEX NABAUM The second green revolution and the Internet of Things
  • 4. 6 Deloitte Review | DELOIT TEREVIEW.COM Fortunately, we are on the cusp of another full-scale green revolution, one with the potential to address some of the unintended consequences of its predecessor— including those related to both resource use as well as the economic and social well- being of farmers in emerging economies. In one sense, the first green revolution’s unintended consequences were due to new methods of farming: new seeds, new fertilizers, new techniques. To avoid the same kinds of unintended consequences FROM DIRT TO DATA NORMAN BORLAUG The first “green revolution” was led by Norman Borlaug, an American agronomist who is considered to have “saved more lives than anyone who has ever lived” through his achievements.5 These included the development of high-yielding varieties of cereal grains and the distribution of hybridized seeds, synthetic fertilizers, and pesticides to farmers.6 Borlaug’s contributions, as well as the widespread buildout of irrigation infrastructure and the adoption of modern management techniques, greatly increased yields without requiring an expansion in agricultural land.7
  • 5. 7 DELOIT TEREVIEW.COM | Deloitte Review as we search for new increases in production, the second revolution will likely be driven not by new techniques but rather by technology—by giving farmers the data to help make better decisions. In short, this second green revolution will likely be catalyzed by the set of connected technologies collectively called the Internet of Things (IoT). This second green revolution will likely make use of very different tools and techniques than the first. It will likely be grounded in the use of data to inform more efficient and effective farming practices and drive associated environmental and social benefits. Technologies such as advanced sensors and monitoring equipment can now allow farmers to monitor crops more precisely and continuously than in the past. The data collected by these technologies can enable farmers to make more effective and strategic decisions that increase productivity with reduced impacts on the environment. From manipulating the growing environment to produce low-potassium lettuce to attaching sensors to cows to identify potentially sick animals, there is little ques- tion that the second green revolution holds the potential for remarkable results.8 To manage all this, IoT technologies will likely take center stage on the farm of the future. IOT AND AGRICULTURAL PRODUCTION New insights, new productivity Historically, the agricultural sector could rely upon a relative abundance of resources such as water and nutrients to increase yield. Farmers and compa- nies managed goals predicated upon that abundance, and relied upon the expecta- tion of an ongoing flow of these inputs. However, the world continues to face an unprecedented demand for food and increased competition for these critical re- source inputs. To meet this demand, the IoT should consider going beyond simply improving existing agricultural processes; it must introduce innovation that breaks traditional trade-offs. The good news is that this seems feasible: It is estimated that, with new techniques, the IoT has the potential to increase agricultural productivity by 70 percent by 2050.9 The IoT’s ability to collect and correlate resource data means that the agricul- tural sector can develop solutions to do more with less—for instance, by enabling automated precision agriculture.10 In other words, the IoT’s ability to make visible detailed resource data enables farmers to increase the efficiency with which they apply scarce and costly inputs. In addition, IoT-enabled farmers can also reap bene- fits in improved environmental and social performance in areas such as sustainable FROM DIRT TO DATA
  • 6. 8 Deloitte Review | DELOIT TEREVIEW.COM FROM DIRT TO DATA Figure 1. The Information Value Loop Graphic: Deloitte University Press | DUPress.com TECHNOLOGIESSTAGESVALUE DRIVERS AGGREGATE ANALYZE COMMUNICATE ACT CREATE Network Standards Sensors Augmented intelligence Augmented behavior R I S K T I M E Scale FrequencyScope Security Reliability Accuracy TimelinessLatency M A G N I T U D E THE INFORMATION VALUE LOOP The suite of technologies that enables the IoT promises to turn almost any object into a source of information about that object. This creates both a new way to differentiate products and services and a new source of value that can be managed in its own right. Realizing the full potential of the IoT motivates a framework that captures the series and sequence of activities by which organizations create value from information: the Information Value Loop. To start with the obvious, the value loop is a loop: An action—the state of behavior of things in the real world—gives rise to information, which then gets manipulated in order to inform future action. For information to complete the loop and create value, it passes through the stages of the loop, each stage enabled by specific technologies. The amount of value created by information passing through the loop is a function of the value drivers identified in the middle. Falling into three generic categories—magnitude, risk, and time—the specific drivers listed are not exhaustive but only illustrative. Different applications will benefit from an emphasis on different drivers.
  • 7. 9 DELOIT TEREVIEW.COM | Deloitte Review agriculture, fair wages, and humane labor practices, which are increasingly impor- tant to food manufacturers, retailers, and consumers.11 To do so, it is crucial to collect new data on a real-time basis and make these data readily available for analysis and action to stakeholders along the food value chain. One of the more powerful developments in this regard is NASA’s Gravity Recovery and Climate Experiment (GRACE) mission. GRACE, launched in 2002, uses two spacecraft to map variations in the Earth’s gravity field. The gravitational research is, in part, collecting relevant agricultural data on factors such as ground- water availability and stress as they relate to global agricultural production areas. Maps developed using the GRACE data are able to identify the difference between climate-related drought conditions and the depletion of aquifers through ground- water extraction that exceeds recharge. However, currently, this information is typically only available in specialized scientific journals. By making this informa- tion more available to farmers, the IoT, drawing on GRACE as a sensor, could help farmers make more efficient and effective use of water resources.12 Bringing IoT technologies closer to earth, aerial drones are also an example of how new sensors are making data more readily available. Drones can be a very useful tool for agricultural companies in that they provide aerial data and imagery for large expanses of land, delivering insights into the health of the land and po- tential problem areas. One company working to simplify the creation and analysis of drone data is DroneDeploy. The company’s eponymous software program for mobile phones significantly simplifies multiple aspects of drone usage for mapping land and monitoring applications. The software creates flight plans, pilots the drone on the plan, and then automatically analyzes the pictures it takes to construct a 3D map of the land.13 This eliminates the need for users to learn how to fly a drone for mapping purposes, reduces the cost of software required to process aerial imagery data, and shortens the time it takes processing software to analyze the imagery and deliver insights. Because of this, DroneDeploy may offer opportunities to agricul- tural companies to cut significant time and costs associated with managing large areas of land without the technological learning that both drone use and data pro- cessing can often require.14 Not just more, but better Beyond increasing agricultural productivity, IoT technologies can improve the nutritional value of food.15 For example, Fujitsu has produced a raw lettuce with less than 80 percent of the potassium content of traditionally grown lettuce; high potas- sium is unhealthy for people on dialysis or suffering from chronic kidney disease. The hardware sensors used by Fujitsu in this project are similar to those used in a semiconductor plant—in fact, Fujitsu’s test bed is a converted chip manufacturing FROM DIRT TO DATA
  • 8. 10 Deloitte Review | DELOIT TEREVIEW.COM plant. The data collected by sensors throughout the building are used to adjust the controls for the climate, light, and other conditions needed to grow low- potassium lettuce.16 Beyond merely lettuce, the IoT is also being applied to livestock to improve care quality and herd productivity. Writtle College’s Jonathan Amory has attached sen- sors to dairy cows to help farmers identify illnesses earlier, with the aim of reducing animal suffering and increasing milk yields. By analyzing the cows’ movement pat- terns, researchers were able to identify individual animals that had fallen ill. They could then provide treatment only to those animals that needed it, which not only improved the quality of life for that animal but also lowered the risk of contagion across the herd, increasing overall productivity.17 Such a targeted approach to vet- erinary care can have the added benefit of reducing the need for herd-wide preven- tative antibiotics, which have been shown to contribute to drug-resistant bacteria.18 VALUE FOR ALL: MODELING VALUE CAPTURE USING THE IOT VALUE LOOP The World Economic Forum (WEF) recently identified the IoT as one of its 21 “tipping points,” or moments when a specific technological shift hits main- stream society.19 According to WEF, the IoT is expected to reach its tipping point by 2022, although some might expect the tipping point to come much sooner given the pressing increase in agricultural demand and the associated resource scarcity challenges.20 However, achieving that tipping point relies on all users of the IoT, whether large company, smallholder farmer, food manufacturer, retailer, or con- sumer, being able to capture value. (For more information on how value capture can impact technology adoption, see “Power struggle” in Deloitte Review issue 17.21 ) As the IoT proves its value in industry after industry, the main questions now for stakeholders in the nascent agricultural IoT ecosystem—farmers, food and bev- erage manufacturers, distributors, retailers, and technology companies—are how to commercialize and scale the technologies, and who will pay for their development and deployment.22 To address these issues, innovative partnerships coupled with technology innovation will need to occur in ways that extend the depth and com- plexity of stakeholder relationships across the agricultural value chain. Large-scale industrial farmers For agribusiness, food and beverage companies, and technology companies— as well as for investors—the question of finding value in the IoT is largely one of corporate strategy: identifying where to play and how to win. The key step for the producers and users of the technology that make IoT solutions work is to find the IoT applications that create the most value. FROM DIRT TO DATA
  • 9. 11 DELOIT TEREVIEW.COM | Deloitte Review Perhaps the best-known examples come from traditional agriculture players. One such company has instrumented tractors and farm equipment, enabling own- ers to know their precise location via Global Positioning System and numerous other parameters. The same company has also created multiple online portals to ag- gregate individual farmers’ data from all over the world. For the individual farmer, these data, enhanced by up-to-date weather conditions, can help the farmer make better-informed decisions on planting, harvesting, and other actions that impact crop yields. At a community level, websites aggregate data from a wide range of equipment in order to better understand equipment performance: fuel usage, pro- ductivity levels, and estimates of when and how equipment might break down. The broader community of information can be used to understand how to get even bet- ter results from specific equipment.23 On the other hand, new entrants to the industry, such as technology company Granular, are exploring how industrial farmers can capture value with IoT technol- ogies, not only for field production but to run their businesses. Granular is a farm management cloud software company that has created a system by which farms are FROM DIRT TO DATA
  • 10. 12 Deloitte Review | DELOIT TEREVIEW.COM able to manage their business “off the field.” Granular’s technology allows farmers to plan, budget, and manage cost and inventory from one integrated platform. By in- corporating data from IoT-enabled equipment, farmers can incorporate real-time data such as crop yields into those decisions. Improved yield information provides a feedback mechanism for farmers to adjust inputs accordingly. The system also benchmarks business performance in order to improve the overall cost of produc- tion, allowing farmers to make informed decisions about additional investments in the technology or equipment that runs the farm.24 Smallholder farmers Additional value can be created when one considers the role of agriculture in emerging economies. In these economies, the IoT can provide value not only through increased resource efficiency and crop productivity, but also by providing social value and financial benefits for smallholder farmers. Examples of where IoT deployments have created social value include the Grameen Foundation’s Community Knowledge Worker (CKW) program in FROM DIRT TO DATA 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 Even if not directly engaged in its production, perhaps no other stakeholder group is more concerned with food than consumers. Consumers, after all, feel the greatest impact from the availability of high-quality food—or its lack. In this respect, consumers can capture value not only by having enough food on the table but also by knowing more about what they are eating and its origin.
  • 11. 13 DELOIT TEREVIEW.COM | Deloitte Review Uganda, which aims to give farmers smartphone technology to help address animal health risks; and the Rainforest Alliance’s pilot project to provide data and informa- tion on agricultural best practices to coffee growers in Guatemala. Working with the Cisco Foundation, the Grameen Foundation provides smallholder farmers with smartphones on which they can access information about weather, crop and animal diseases, and market prices.25 These projects show that information about the world is among the most critical needs for smallholder farmers. While current solutions such as CKW rely on hand-entered data, the potential for these solutions to improve quality of life when paired with true IoT-enabled sensors is massive.26 The IoT could provide farmers not just reference information but also real-time data about the health of their crops or the price of their livestock, improving not just agricultural productivity but also the farmer’s social well-being. Consumers Even if not directly engaged in its production, perhaps no other stakeholder group is more concerned with food than consumers. Consumers, after all, feel the greatest impact from the availability of high-quality food—or its lack. What’s more, they also generate the demand that drives so much change within the industry— witness the trend toward organic or locally sourced food, for instance.27 In this re- spect, consumers can capture value not only by having enough food on the table but also by knowing more about what they are eating and its origin. The IoT has already been applied to certain portions of the food supply chain. Specifically, it is already helping suppliers keep products fresh by monitoring temperature during transit and even adjusting shipping routes to shorten transit times.28 Beyond this, consumers can directly benefit from this type of tracking in the food supply chain. For example, tagging and tracking fish can help verify its provenance as sustainably sourced, helping to prevent illegal catch being passed off as legitimate.29 This not only helps promote healthy fish stocks but also delivers val- ue to consumers, who gain confidence that they are doing their part by purchasing responsibly. This consumer demand, in turn, can provide direct economic incentive for farmers, fishers, and others to implement the IoT technologies that can provide the other productivity and quality benefits listed above. WHERE ARE THE BOTTLENECKS? To realize the IoT’s full benefit for all stakeholders across the value chain, a certain critical mass of information must flow through the Information Value Loop. By visualizing where bottlenecks are currently limiting information flow, we can start to see what must be improved to achieve the full benefits of the IoT. FROM DIRT TO DATA
  • 12. 14 Deloitte Review | DELOIT TEREVIEW.COM Kenneth Zuckerberg, executive director and senior analyst in Rabobank’s Food and Agribusiness Research and Advisory team, captures the challenges in this way: Over the long term, Rabobank believes that “smart farming” (that is, the combination of data, technology, smart connected devices, and precision farming techniques) has the potential to create in excess of $10 billion of value in the United States. Before that value can be realized, however, there are several bottlenecks that the agricultural industry needs to overcome. First, the existing first generation of data-intensive prod- ucts does not yet offer enough tangible benefits over the cost of investment to justify customer adoption. Second, most farms lack a basic, reliable, and secure technologi- cal infrastructure to efficiently access the requisite cloud and enterprise services associ- ated with digital agriculture. And third, the large farm input players that have already made significant investments in data-driven precision and prescriptive farming services need to embrace open architecture platforms to enable data collection, monitoring, analysis, interpretation, and action by farmers that purchase unbundled products and services from an assortment of vendors.30 Currently, the most obvious and largest bottleneck in the IoT value loop frame- work is at the communicate stage due to the limited infrastructure and connectivity challenges faced by farmers in developing countries—and even within the United States. While sensors may already be able to gather data about the water provided to crops or the location of livestock, communicating that information reliably and consistently back to the cloud or Internet gateway in remote environments poses a serious challenge. Even in the United States, many rural areas are not served by the same major Internet service providers that cover suburban and urban areas; in- stead, farmers often get their Internet access through wireless ISPs, DSL providers, satellite service, or even by leveraging 4G networks, sometimes at extremely high costs.31 Similarly, the need to communicate over long ranges and, often, difficult ter- rain typically requires high-power transmitters, which are also costly.32 To create a truly functional IoT value loop in the second green revolution, farm- ers will need to have access to reasonably priced, reliable, low-power, long-range communications. Luckily, there is already work under way to break those trade-offs within communications to produce new types of radios for IoT applications.33 Solving one challenge, however, may reveal the next. Once farmers are able to effectively communicate data about their land and crops to the Internet, the bottle- neck may move to the next stage or stages—perhaps to the need to aggregate data together so that individual farmers may benefit from the data of all. With access to aggregated data, even a smallholder farmer is not limited to a few acres of experi- ence, but can gain a wider view of the world to help understand weather or disease patterns that may impact planting or crop care decisions. FROM DIRT TO DATA
  • 13. 15 DELOIT TEREVIEW.COM | Deloitte Review The main challenges here are the questions of who owns the data and how to organize and use it. And there is always the potential for abuse, says Jeroen van der Sommen of communications nonprofit Akvo: At a time when more than 500 million smallholder farmers run 80 percent of farmland in Africa and Asia, the path to IoT adoption needs to be forged with care. Will cor- porations and governments fill these smallholders’ land with sensors sending data to headquarters, or will these technologies be used to improve skills, understanding, and opportunities for farming communities? We need to be mindful that these processes and technologies could drive a new era of agricultural partnership or simply reinforce exploitation through a new layer of technology.34 Finally, another barrier to the agricultural IoT lies in the ease of use for the farmer—the act stage of the IoT value loop framework. The value loop will be disrupted if IoT technologies are not easy for farmers to use; a high level of dif- ficulty for users could mean that technologies are not regularly used or abandoned altogether. In addition to general ease of use, integration of various sensors and platforms into a single package will be important. If different parts of the greater agricultural IoT system are not integrated, there will be too many independent ap- plications for farmers to manage, which could lead to abandonment. This technical integration is key, for if farmers abandon the technology, the IoT will not be able to improve productivity and help feed the world population.35 ENGAGING THE ENTIRE STAKEHOLDER ECOSYSTEM While there is great excitement about the IoT’s potential to fuel the second green revolution, key issues remain, including the question of how early- stage IoT companies can commercialize at scale and the overall question of who will pay for the technologies to be deployed. In the agricultural sector, both rep- resent unique challenges not lost on early-stage investors. For instance, the adop- tion of new technologies in agriculture is particularly challenging due to thin profit margins and relatively long payback periods. Furthermore, when technology adoption is tied to savings in resources such as water, the disincentive to change current practices can be daunting. For example, from a technical standpoint, IoT technologies can easily be applied to agricultural water use: The resource can be measured in both quality and quantity, and auto- mated systems can be used to allocate it in an effective manner. However, the per- sistent low price for water in the agricultural sector, even in areas of drought, can be a barrier to IoT adoption, as farmers have little financial incentive to strategically manage their water usage. According to Marc Robert of Water Asset Management, FROM DIRT TO DATA
  • 14. 16 Deloitte Review | DELOIT TEREVIEW.COM “When the underlying pricing of water rises to reflect its full business value, the case for IoT adoption to drive water efficiency in agriculture will become compelling.”36 Many individual farmers have little economic incentive and lack the funds to implement new technologies alone. Rather, solving the issues of who will pay for the technology and how to scale adoption will likely require the engagement of the entire food ecosystem: farmers (smallholders and large-scale), food manufacturers, food retailers, and consumers. To enable this, traditional thinking about stakehold- er relationships will not be enough. What are needed are not just new IoT technol- ogy solutions but also innovative partnerships. One way to encourage such partnerships is to adopt a new way of thinking about the agricultural value chain. Traditionally, value chains have been seen as linear—built upon relatively simple business relationships between stakeholders in the production, manufacture, distribution, retail, consumer, and disposal steps. Recently, however, the consumer products industry, particularly the food and bev- erage sectors, have started to act as part of closed-loop value chains that entail more complex relationships among stakeholders than simple sourcing, manufactur- ing, buying, and selling. The creation of these more complex relationships enables stakeholders to create and capture greater value across the value chain, as well as build more sustainable and resilient systems to deliver products.37 In terms of the IoT, a closed-loop value chain means that individual farmers need not bear the costs of technological modernization alone; the costs, and also the benefits, can be spread across the value chain. Already, the IoT’s inroads into the agricultural sector begin to make clear that a new model of the food and agriculture industries is emerging. The IoT, by giv- ing producers, manufacturers, distributors, consumers, and others across the value chain access to new information and new insights about the world, is delivering value to a diverse variety of stakeholders and, in the process, forging new relation- ships between these stakeholders. For instance, the same information that helps a producer move its product to market in the shortest time can also help consumers make informed choices about nutrition and sustainability. This creates an incentive for producers, distributors, and retailers to work together in a way that creates value for all. FUELING THE SECOND GREEN REVOLUTION As IoT adoption increases, it has the potential to more closely tie together a variety of stakeholders in the agricultural ecosystem. To successfully take ad- vantage of IoT technologies, farmers and companies alike should harness the con- nections among stakeholders across the entire value chain. All of the stakeholders FROM DIRT TO DATA
  • 15. 17 DELOIT TEREVIEW.COM | Deloitte Review within the “closed loop,” including farmers, food manufacturers, distributors, re- tailers, technology companies, the public sector, and NGOs, must work together to alleviate the bottlenecks to information flow as they arise. It is possible to envision the mobilization of the entire agricultural value chain to address the challenges of “how to scale” and “who will pay.” Imagine, for instance, that a global food manufacturer needs to increase the production of rice. Company leaders identify deploying IoT technologies as a viable way to increase agricultur- al yield and the sustainability and resiliency of the company’s rice supply chain, along with delivering financial and social benefits to smallholder farmers. The food manufacturer engages with a global ICT company (for example, a wireless service provider), a global semiconductor manufacturing company focused on increasing demand for its processors, and a retailer (or retailers) with a strong commitment to sustainability who sells the manufacturer’s products. Together, they establish a pilot project to deploy the IoT with a group of smallholder rice farmers. The IoT tech- nology is funded by the corporate stakeholders, development banks active in the region, and the national government. The project is a success, and the companies build a strategy to scale—this time without the contribution from the development banks, but with the support of the government. The strategy includes passing along decreased costs throughout the value loop to all stakeholders, including consumers. The value created comes from increased rice productivity, lower supply chain risk and cost, increased supply chain transparency, and brand value from the commit- ment to smallholder farmers’ social and environmental performance. Collaborations like these to deploy IoT technologies will be increasingly vital if we are to put the world’s farms on track to feed the estimated 11 billion people who will inhabit the earth by 2050. Despite the challenges, there is cause for optimism. FROM DIRT TO DATA Already, the IoT’s inroads into the agricultural sector begin to make clear that a new model of the food and agriculture industries is emerging. The IoT, by giving producers, manufacturers, distributors, consumers, and others across the value chain access to new information and new insights about the world, is delivering value to a diverse variety of stakeholders and, in the process, forging new relationships between these stakeholders.
  • 16. 18 Deloitte Review | DELOIT TEREVIEW.COM FROM DIRT TO DATA Investor Tamin Pechet, chairman of Imagine H2O and managing partner of Upwell LLC, puts it this way: Solutions themselves are becoming cheaper and better. Moreover, the channels through which smart IoT products may reach customers have improved, and the pres- sure on growers to adopt technology has increased. Simultaneously, food and bever- age companies have demanded more information and more sophisticated practices from their suppliers. These trends offer increasing hope for a smart food system.38 With the IoT fueling a second green revolution, there is real and increasing hope that the world’s farms will be able to feed 11 billion people by 2050—not just providing food but doing so in a way that improves environmental performance and delivers social benefits. DR Will Sarni is director and Social Impact practice leader, enterprise water strategy, Deloitte Consulting LLP. Joe Mariani is a lead Market Insights analyst with Deloitte Services LP, and editor of Deloitte’s research series on the Internet of Things. Junko Kaji is acquisitions editor for Deloitte University Press, Deloitte Services LP. Special thanks to Grace Summers, consultant, Deloitte Consulting LLP, for her contributions to this article. Endnotes 1. Abhijit Sarkar et al., “Proteomics potential and its contribution toward sustainable agriculture,” Agroecology, Ecosystems, and Sustainability, ed. Noureddine Benkeblia (CRC Press, 2014), pp. 151–80. 2. Infoplease, “Total population of the world by decade, 1950–2050,” www.infoplease.com/ipa/A0762181.html, ac- cessed October 13, 2015; Worldometers, “Current world population,” www.worldometers.info/world-population/, accessed October 13, 2015. 3. Prabhu L. Pingali, “Green revolution: Impacts, limits, and the path ahead,” Proceedings of the National Academy of Sciences 109, no. 31 (2012): pp. 12302–08, www.ncbi.nlm.nih.gov/pmc/articles/PMC3411969/; Staffordshire Learning Net, “GCSE revision—Agriculture—The green revolution,” www.sln.org.uk/geography/schools/blytheb- ridge/GCSERevisionAgricultureGR.htm, accessed October 13, 2015. 4. World Bank, “Overview,” April 1, 2015, www.worldbank.org/en/topic/foodsecurity/overview#1. 5. Gregg Easterbrook, “The man who defused the ‘population bomb’,” Wall Street Journal, September 16, 2009, www. wsj.com/articles/SB10001424052970203917304574411382676924044. 6. Sarkar et al., “Proteomics potential and its contribution toward sustainable agriculture.” 7. Easterbrook, “The man who defused the ‘population bomb.’” 8. Nicole Kobie, “The internet of food: Why your steak might have come from a connected cow,” Guardian, August 5, 2015, www.theguardian.com/technology/2015/aug/05/internet-of-things-connected-cows-agriculture-food- production. 9. Beecham Research, Towards smart farming: Agriculture embracing the IoT vision, January 31, 2015, www.beechamresearch.com/download.aspx?id=40. 10. R. Bongiovanni and J. Lowenberg-Deboer, “Precision agriculture and sustainability,” Precision Agriculture 5, no. 4 (2004): pp 359–87. 11. Aspirationals, “The shift,” http://theaspirationals.com/shift, accessed October 13, 2015. 12. Alan Ward, “Gravity Recovery and Climate Experiment (GRACE),” NASA, March 30, 2004, http://earthob- servatory.nasa.gov/Features/GRACE/; Alexandra S. Richey et al., “Quantifying renewable groundwater stress with GRACE,” Water Resources Research 51, no. 7: pp. 5217–38, http://onlinelibrary.wiley.com/ doi/10.1002/2015WR017349/full.
  • 17. 19 DELOIT TEREVIEW.COM | Deloitte Review FROM DIRT TO DATA 13. Daniel Terdiman, “DroneDeploy tech creates aerial maps in real time, often before a drone even lands,” Venture Beat, March 31, 2015, http://venturebeat.com/2015/03/31/dronedeploy-tech-creates-aerial-maps-in-real-time- often-before-a-drone-even-lands/. 14. Matt McFarland, “How DroneDeploy’s app is about to make farming more efficient,” Washington Post, March 31, 2015, www.washingtonpost.com/news/innovations/wp/2015/03/31/how-dronedeploys-app-is-about-to- make-farming-more-efficient/. 15. Kobie, “The internet of food.” 16. Ibid. 17. Ibid. 18. Hang Wang et al., “Housefly larvae vermicomposting efficiently attenuates antibiotic resistant genes in swine manure coupled with distinct bacterial population change,” Applied and Environmental Microbiology, August 21, 2015, doi: 10.1128/AEM.01367-15. 19. World Economic Forum, Deep shift: Technology tipping points and societal impact, September 2015, www.weforum.org/reports/deep-shift-technology-tipping-points-and-societal-impact. 20. Will Sarni, “Deflecting the scarcity trajectory: Innovation at the water, energy and food nexus,” Deloitte Review 17, Deloitte University Press, http://dupress.com/articles/water-energy-food-nexus/. 21. Michael E. Raynor and Brenna Sniderman, “Power struggle: Customers, companies, and the Internet of Things,” Deloitte Review 17, Deloitte University Press, http://dupress.com/articles/ internet-of-things-customers-companies/. 22. For more information on exactly how IoT has created value in different industries please explore www.dupress. com/collection/internet-of-things to see more. 23. Bernard Marr, “From farming to big data: The amazing story of John Deere,” May 7, 2015, www.datasciencecen- tral.com/profiles/blogs/from-farming-to-big-data-the-amazing-story-of-john-deere. 24. Granular, http://www.granular.ag/, accessed October 13, 2015. 25. Alexis Raymond, “How Grameen Foundation connects the unconnected,” Cisco Blogs, October 9, 2013, http:// blogs.cisco.com/csr/how-grameen-foundation-connects-the-un-connected; Grameen Foundation, “Personal stories: Gonzaga Kawuma,” www.grameenfoundation.org/impact/personal-stories/gonzaga-kawuma, accessed October 13, 2015. 26. Rainforest Alliance, “Connecting farmers with each other and the world,” June 15, 2015, http://thefrogblog. org/2015/06/15/connecting-farmers-with-each-other-and-the-world/. 27. Mikael Klintman and Magnus Boström, “Chapter 5: Researching transitions in green food consumption: Looking behind and beyond the organic shelf,” Food Practices in Transition: Changing Food Consumption, Retail and Production in the Age of Reflexive Modernity, eds. Gert Spaargaren et al. (New York: Routledge Press, 2012). 28. Joe Mariani, Evan Quasney, and Michael Raynor, “Forging links into loops: The Internet of Things’ potential to recast supply chain management,” Deloitte Review 17, Deloitte University Press, http://dupress.com/articles/ internet-of-things-supply-chain-management/?coll=11711. 29. Heather Clancy, “State of green business: Supply chain transparency ramps up,” GreenBiz, February 24, 2015, www.greenbiz.com/article/state-green-business-supply-chain-transparency-ramps. 30. Personal communication from Kenneth Zuckerberg, Rabobank, October 9, 2015. 31. Lee Badman, “Overcoming the challenges of wiring farm networks,” TechTarget, http://searchnetworking. techtarget.com/tip/Overcoming-the-challenges-of-wiring-farm-networks 32. Jessica Codr, “Wireless options for providing Internet services to rural America,” Washington University in St. Louis, Computer Science department survey paper, last modified April 21, 2008, www.cse.wustl.edu/~jain/ cse574-08/ftp/rural.pdf, accessed October 13, 2015. 33. Ian Poole, “LoRa Wireless for M2M & IoT,” Radio-electronics.com, www.radio-electronics.com/info/wireless/ lora/basics-tutorial.php, accessed October 13, 2015. 34. Personal communication from Jeroen van der Sommen, Akvo. 35. Bekele A. Shiferaw, Julius Okello, and Ratna V. Reddy, “Adoption and adaptation of natural resource management innovations in smallholder agriculture: Reflections on key lessons and best practices,” Environment, Development and Sustainability 11, No. 3 (2009): pp 601–19. 36. Personal communication from Marc Robert, Water Asset Management. 37. World Economic Forum, Redesigning business value: A roadmap for sustainable consumption, January 2010, www.weforum.org/reports/redesigning-business-value-roadmap-sustainable-consumption. 38. Personal communication from Tamin Pechet, Upwell LLC.