The previous IT (information technology) wave was more in outsourcing, but youngsters now are no longer satisfied with just a pay package and a cubicle life, observes Venkata Subramanian, Founder and Managing Director, eFarm, Chennai (http://bit.ly/F4TeFarm). With hardware and software costs becoming so affordable, entrepreneurs with a niche idea and know-how to combine the IT strength to a craving business need can see great success, he adds, during a recent lunch-hour interaction with Business Line. “We are optimistic that the next generation will be the ones who will bring about a change in agriculture…”
Yes, it is agriculture that Venky is talking about. And if you wonder whether agriculture can attract the talent that it needs, he reasons that a key factor behind the decline of agriculture is the moving away of general talent to cities/ services industry; and that thanks to the current downturn in services and manufacturing, people seem to be looking at the real green on other side of the valley.
“We see a lot of enquiries coming from people currently in the IT industry wanting to shift over – partly out of frustrations and work pressures and partly from the need to apply their talents to new domain areas so far unexplored. We also see a lot of entrepreneurship activities mushrooming in campuses and students increasingly taking to launch businesses and become job-creators rather than job-seekers. Even otherwise, the need to go organic and turn to safer food sources is making many urban people look seriously at the farm sector today.”
Excerpts from the interview.
Is there money for the IT industry from agri sector?
As India’s agri economy has been perceived as a slow-growth sector, and farmers being invariably illiterate, it is a common misconception that there is not much scope for any ‘high-tech’ ICT (information and communications technology) usage in this domain.
But being an IT person myself (for over a decade), and now running an agri supply chain company working with farmers and traders on a daily basis, one thing I can confidently say is that the reality is otherwise: This is one industry which is badly in need of simple solutions to help bring in efficiencies and growth.
Even a small farmer, owning 2 acres of land, has asset worth anywhere from Rs 20 lakh to a crore, owing to real estate boom. Thus, his income from the land may be low, but his net asset value is high. Almost all farmers today have a mobile phone, and buy talk time – not from subsidies but at the same cost as an urban customer. Not all farmers are poor; there definitely is a creamy layer here too.
Where do you see the relevance of technology in making the lives of our farmers better?
Some of the ICT implementations which were done earlier probably failed as they put the cart in front of the horse. They were too far ahead of technology (like wireless in villages, before the telecom revolution superceded them; or ICT kiosks in villages – now broadband is so cheap that every town, the Xerox shops have all transitioned to cyber cafes). Or, though the technology was in place, the applications were not – thus the farmers did not know how to use email or web-chat as it did not relate to the way they did business.
With the mobile telephone revolution, cellular coverage is across segments and geographies, and has become the great unifier and enabler. As farmers constantly need to communicate with various buyers, traders and suppliers through the mobile phone, they are already adapting to the new mediums faster than we think. In fact, the handsets which they use are standard ‘English’ based. They have learnt the menus by using the graphical icons and button positions, even if they don’t ‘read’ the language. This has been a great way to break the language barrier.
The IT industry previously has always been trying to ‘sell’ them a software solution. Rather, the approach should be to build something which ‘they’ want.
Can you describe a few examples of how you have implemented technology solutions for farmers?
Some of the solutions we developed are so simple that they are almost laughable – but the ground reality is that since agri sector has been devoid of any IT usage, we literally had to build from ground-up.
Farmers, though complaining of getting poor prices, when actually confronted with the question – ‘what price do YOU want’ – often sheepishly never give an answer. They are always used to having the middlemen set the price for them – which is why the dependence on the middlemen is so high.
Reason: they never keep accounts and don’t know what their input costs are. Shocking, but true! They just keep spending all their money, take loans, and wait till the harvest is sold to even know what returns they got.
The first application we built was a simple spreadsheet where we input all the costs of the farmer, his crop details, yield patterns, to arrive at a ‘break-even’ price. The farmer now knew what bare minimum price to expect and whether he made a profit or loss from a sale more accurately.
The second system we built was to consolidate their supply information. We found that the government data about crops are outdated and often not dynamic enough as some crops (especially vegetables) have very short life-cycles. Also, any changes to weather, or pest attacks had great impact in availability.
We recorded what the farmer was cultivating, the land areas, expected yield, harvest frequencies and built a simple mobile-based application to keep the data updated periodically. This gave a dynamic status of the supply situation to enable forward planning and marketing.
The third system (currently under development) is a mobile-based trading system where the farmer’s supply information is automatically broadcast to all interested buyers. Transactions can be handled through SMS, or offline on calls. The trucks can also be booked through mobile, as the logistics providers’ data are also available in the system, thus saving the farmer a lot of time, and also offering lot more choice to reduce the dominance of the local agents. We could thus assist farmers even in areas where eFarm doesn’t have a physical on-ground presence.
In summary, the key gap in the agri sector is the lack of data. A combination of server-side application and mobile front-ends can help build the database, keep it updated, and also provide valuable transactional info for more accurate analysis. This will make the whole farm-to-city supply chain more transparent, faster and efficient. Many of these systems already exist for other industries; these only need to be customised.
What are the other components of the agri supply chain demanding the attention of IT?
There are several highly sophisticated solutions for supply chain management in the organised industries. But what often stumps IT solutions providers when they deal with farmers is that they may ‘individually’ be not having the scale or size to directly ‘buy’ the entire solution. This, in a way, is a problem and a boon. For, this is one industry which is the most ideal for SaaS-based model/ a ‘pay-per-use’ transactional model which is what all IT vendors are moving to.
Let’s look deeper into the specific needs:
First, neither the supply nor the demand data about this industry are clearly available. Government has so far been the sole controlling body of this industry with data collection left to census cycles and crude projections. Also, there are numerous different departments within the overall agriculture ministry having silos of data, mostly redundant.
Ironically, the Revenue Departments have accurate details of farm pattas, ownerships and digital maps of farm lands (thanks to e-governance and huge demand for real estate), but we don’t know WHAT is being GROWN in that land! The most critical need of this industry, therefore, is to map out what the farmers are cultivating and also to conduct market surveys/ focus groups to assess actual demand volumes (both domestic and export).
The solutions space itself is varied, and there is no ‘one person or company’ who handles all departments. So be ready to deal with different people and entities which need to be ‘connected’ to complete the system. The system should open up to multiple parties interacting asynchronously.
Thus the ‘supply side planning’ (a.k.a. production planning systems) such as farm management and cropping/ harvesting planning may appeal to farmers. The logistics side planning may appeal to truckers. Order placement modules may appeal to end customers such as traders, wholesalers, caterers, export houses, food processors. The inventory management modules may appeal to warehouse/cold fleet operators.
Secondly, the end users in this industry are more comfortable with mobile phones/ SMS than with PCs/ websites. The applications should shield complex operations and offer the end user simple interfaces accessible from a basic phone (read NOT smart-phone).
Thirdly, though the end users’ needs may be simple, let’s not forget that the internal processes and needs are quite complex. There are over a thousand agriculture crops and produces, each with multiple varieties. The quality and grading of a product are sometimes based on size (large/ small), sometimes on texture (bright/ dull), and sometimes on ripeness etc. Needles to say, the price varies with the quality.
To add more, the weight of product may also vary with water content – a wet produce weighs more than dry one. Perishability is a key factor which makes the ‘pricing’ system more dynamic. Prices vary with time, as produce quality diminishes. Some products (like leafy vegetables) will depreciate 100 per cent of their value in less than a few hours. Inventory management under such circumstances is also more complex, whereby physical stock and system data have to be collected more periodically.
Now that even basic phones have GPRS facility, and 3G has already been launched, even a simple mobile phone based tracking system to monitor the movement of the ‘vegetable subjiwallah’ is not that far-fetched now.