If we are to truly re-imagine the global agri-sector then Intellectual Capital must be prized and nurtured across our entire business from the farm, through trading, to logistics and processing.
This is made possible by the skills and competencies inherent in our Human Capital, as well as dedication to talent attraction and retention. But we must also recognise that as the world continues to experience rapid changes driven by technology, the farms and factories of the future may not look like those of today and that new skills, competencies and Intellectual Capital will be required.
Intellectual Capital is defined by the International Integrated Reporting Council as organisational, knowledge-based intangibles including intellectual property, such as patents, copyrights, software; organisational capital such as tacit knowledge, systems and protocols; and intangibles associated with brand and reputation – we have extracted the latter as a separate capital given its importance. At this stage we are still considering impact accounting methodologies over and above financial reporting.
A critical contributing factor to our Intellectual Capital has been our focused strategy and differentiated business model, coupled with the strength and on-the-ground experience of our talent base, particularly in the tough-terrain emerging markets where they have grown highly profitable businesses. Through the ‘The Olam Way’, we have carefully applied our Intellectual Capital to build a highly defensible business where we have a unique participation portfolio.
Intellectual Capital – desired outcomes
- Consistently out-perform the sector through strategy and innovation
- Partner of choice for customers through differentiation
- Agile business to maximise emerging trends and adapt to rapidly changing business environment
- Sustainable sourcing scaled much more quickly
- Brand equity and reputation grows
- Inspired employees strive for more
- Employer of choice
- Become trusted implementation partner for customers, NGOs, development finance institutions, governments etc.
Supporting Intellectual Capital – The Olam Prize for Innovation in Food Security 2017
“Winning the Olam Prize was an honour. It’s great to see that private sector companies like Olam are supporting research that could positively impact the lives of farms in Senegal. The Prize money will help us build awareness of our durum wheat discovery so that more farmers are able to adapt to a changing climate while also boosting their incomes and creating an additional source of food.”
Dr Filippo Bassi – ICARDA
- Identify and focus on long-term drivers of intrinsic value
- Follow the Olam Way 2.0 (see Group CEO Review)
- Support and strengthen governance, and risk systems and processes to enable Intellectual Capital to grow responsibly. Equally improve operational excellence and project management processes
- Live values of being a disruptor and entrepreneur while assessing and monitoring risk exposures within risk appetite and tolerance
- Advance digital across the business to enable better integrated thinking through sharper and more holistic/ integrated analysis
- Listen to stakeholders, apply learnings
- Continuously invest in growing the knowledge of employees (new Olam Learning Academy) through internal programmes and external experts
- Invest in Research and Development for new products and sustainable solutions
- Drive Communities of Practice to achieve respective visions through enhanced competencies (e.g. World’s Best Planter, World’s Best Trader)
- Develop partnerships with research institutions and other expert organisations to expand Intellectual Capital base. These include Agropolis Foundation, CSIRO, Center for Land-Based Learning, ICARDA, Temasek Life Sciences Laboratory, University of California, Davies and many more
- Ensure employees uphold the Olam Code of Conduct which stipulates protection of Olam’s Intellectual Property and equally that Olam will respect the Intellectual Property rights of third parties
- Explore additional methodologies to better account for Intellectual Capital, especially Olam’s intellectual contribution in partnerships.
Challenges and influencing factors in 2017
- New skill-sets increasingly required – e.g. data analysts, application developers
- The major challenges facing the sector, particularly for Natural and Social Capital impacts, require much greater pre-competitive collaboration which must be carefully managed to protect Intellectual Capital
- Increasing cyber security threats
- Upgrading legacy systems for improved operational excellence.
Using digital to re-imagine agriculture for smallholders
Digitalisation was identified as a vision enabler so the Digital Task Force was established in 2017. Together with IT, it supports the business to realise disruptive ideas and operational efficiencies, offering new revenue streams and cost savings through automation, e-commerce and sustainable sourcing.
Of critical importance is how technology can drive the pace of change so badly required among smallholder supply chains. With more than 4 million farmers in our indirect sourcing network, very few companies have the same number of touch points through which to cascade change. The DTF identified 4 key areas:
- Increasing the opportunity to sell directly to Olam rather than having to go through intermediaries (see the Olam Direct story)
- Improving yields through crop analysis and best practice guidance
- Empowering farmers by creating a conducive environment for the exchange of information – now possible with just a mobile phone if the right infrastructure is in place
- Improving farmers’ access to technology, particularly through mobile phones which in turn can bring access to wider banking services and financial inclusion.
- Culture: success of digitalisation requires a big ask of all stakeholders in terms of being open amid change and being receptive to new ideas
- Infrastructure development: requires working closely with Telecoms suppliers and governments need to invest in the infrastructure base. Even SMS networks are good enough as a starting link to many services.
- Through collaboration we can increase the pace of change – and potentially have wider economic benefits as local hotbeds of tech savvy communities establish themselves and come up with even more solutions.
From smart phones to Smart Farms
- We are developing an autonomous technology called Vertebrate Pest Detection and Deter System (VPDad) for detecting and sustainably deterring animals like elephants from destroying crops. It is being developed in collaboration with the Commonwealth Scientific and Industrial Research Organization of Australia (CSIRO). The technology uses several reactive ‘sense-and-deter’ nodes that emit sounds and lights, warning animals away from plantations without harm.
- AgriPal, a mobile app, is being developed to capture real-time data on the ground to monitor worker productivity, crop production and quality, as well as nutrient and palm stress, enabling fast response.
- The LeBamba Analytical Services Laboratory (LASL) in Gabon was constructed as a strategic move to further enhance our Research and Development capabilities. It is planned to be the most state-of-the-art R&D centre in Africa. Phase 1 includes the analytical lab – water, fertiliser, soil and nutrients, tissue culture lab and sections of seed production, breeding, agronomy and precision agriculture.