Today’s farm technology is not what it was five or even two years ago. In the past several years, most farms have revisited the way they monitor, control, assess and capture everything from data, activities, applications, usage, and outcomes.
If it can be quantified or measured, some tech or data company is undoubtedly working to create a tool, app, platform, or sensor to harness that information. While some of these innovations are wildly impactful, many fail to deliver on their promises, but not necessarily for the reasons you think.
“The real challenge with most farm technology originates in your office,” says Peter Martin, Pinion finance and growth consultant. “As an industry, we have largely failed to keep our farm offices up to date. We seldom make the investments in people, technology, and software to operate an office with sophistication commensurate with our field operations.”
Let’s face it, investing in the office is often an afterthought. Your office, however, is the hub of your farm’s data and technology eco-system. Don’t just blame the farm management system, it’s nearly impossible for any technology to integrate with your antiquated office. Your office and the information it generates is capable of becoming the biggest competitive advantage of your farm.
While there are significant supply chain opportunities in the works for farms with modern offices and great information, there are some immediate “wins” that can generate an ROI on your farm office investments.
5 Ways Farm Office Tech Creates ROI
1. Identifies discrepancies.
When growers spend hundreds of thousands – if not millions – of dollars on input products, it can be very possible to miss costly discrepancies. With the complexities of their days, they simply don’t have time to go over every transaction with a fine-tooth comb. However, systems now exist to easily reconcile errors and identify gaps.
“With the use of data standardization and reconciliation software, it’s very common to identify where growers either overpaid for a product or they paid for a product and never received it,” explains Martin. “Unfortunately, $30-$70,000 discrepancies are not-uncommon; but with the right systems to reconcile inputs, you can easily catch and correct those billing issues and save thousands of dollars.”
2. Reduces the supply chain squeeze.
Within the supply chain, the grower is usually surrounded on either side by big players. On one side you have the input companies, and the other side are the buyers. Both tend to be large, well organized, and well capitalized businesses.
“What we remind growers is that they’re essentially getting squeezed by both sides, given the resources these companies can put towards data, insights, information and risk management in their business,” says Martin. “So, optimizing your office, understanding your cost of production, harnessing the on-farm information being created, and running your business with accurate, timely and standardized data is critical to reduce that supply chain squeeze.”
3. Access information on every acre for validation of practices.
Across the farm and farm office there are countless data points getting collected. Whether it’s water usage, nitrogen applications, or financial information – ag tech has made it possible to get info on every acre of your farm. Back-office platforms take all that data and standardize it.
“Data standardization allows you to connect farm data collection and financial data collection,” explains Martin. “When you marry up those records, you really unlock a whole world of reporting – you can validate what occurred on those acres easier than ever before.”
4. Relief from back-office management.
“Most farmers don’t get into farming to sit in an office – they don’t really want to do the nuts and bolts of bookkeeping and accounting,” says Martin. “Back-office technology and support take the heavy load off the grower and also reduce the need to hire a full-time employee to handle it.”
Especially today, when labor is so tight, even if you can find somebody to manage back-office operations, they are expensive to employ and create succession problems in your office. Investing in office technology drives efficiency and lets farmers focus on what’s most valuable to them without sacrificing accuracy or support.
5. New level of insight on farm data to identify true costs.
With data rich insights, farmers can see their true numbers. From cost of production to the cost of repairs, to cost of buying and operating another wheat field – they can see the true spending and costs of operation to guide their decisions.
“In the past, so many decisions have been made by gut feel. But the technology finally exists, to move to the level of sophistication that other industries have had, to make validated decisions,” explains Martin. “Farmers who implement whole farm data management will certainly have a leg up in the coming years.”
Contact a Pinion strategic advisor to discuss your back-office challenges or request a demo of Pinion IO — Pinion’s scalable, professional back-office solution for accounting, finance, and HR needs.
