2019 INDUSTRY WARGAME RESULTS

Wargame Scenarios Draw Parallels to Times of Crisis, COVID-19 Pandemic

In November of 2019,  Aimpoint Research hosted an Industry Wargame with over 50 of the country’s top leaders across the agri-food value chain. A wargame is a dynamic, interactive event, often utilized by the military and strategic leaders, where participants think deeply about the future, test plausible scenarios and explore likely outcomes, revealing cooperative and competitive forces.

Participants included executives, leaders and experts from the industry’s top organizations representing the agri-food value chain, including financial services, ag inputs, farmers, distributors and processors.   

“Helping the industry look to the future has always been a foundational pillar of our work at Aimpoint Research. The Industry Wargame is a highly collaborative and strategic event that allows leaders to think critically and competitively across all sectors of the agri-food value chain and plan for the future,” said Brett Sciotto, CEO and founder of Aimpoint Research.

Building from Aimpoint Research’s Farmer of the Future Wargame in 2018, the 2019 Industry Wargame explored three plausible future scenarios set in 2040. The alternative futures focused on trending conditions challenging the industry including alternative proteins, consolidating supply chains, future consumer demands, climate change, agriculture and food’s role in national security, and technological and scientific innovations. The conditions were set against varying political, economic, social and environmental landscapes.

Wargame Scenarios Draw Parallels to Times of Crisis, COVID-19 Pandemic

In addition to trending conditions, the wargame scenarios presented challenging dynamics and explored how the value chain would react to disruptive events such as an earthquake in California, a widespread animal disease similar to African Swine Fever and a prolonged period of drought.

“While not as significant as a global pandemic, we can draw parallels between the disruptions we explored in the wargame scenarios and the disruptions we are experiencing now with COVID-19,” explained Sciotto. “The scenarios dramatically affected supply chains, causing players across the agri-food value chain to reevaluate and diversify production, markets, distribution and logistics.”

“While today’s environment can seem chaotic and uncertain, there is a bright spot that we can glean from the Industry Wargame. In the times of crisis, we saw the agri-food value chain come together and unite to solve problems. The COVID-19 pandemic, coupled with the prolonged trade and economic uncertainty that ag has been experiencing for the last couple of years, may be the driving forces for change and cooperation,” said Sciotto.

Preview of Industry Wargame Topline Themes & Insights:

The stressors of the wargame, changing scenarios, and dynamic competition and collaboration revealed several insights the agri-food value chain will contend with in the future. The following themes offer a preview of the Industry Wargame topline takeaways:

Ripe for Disruption

Conceding the Consumer Relationship

Transparency & Traceability

Advocacy & Global Leadership

Food not Farms

Urban & Vertical Farming

Ripe for Disruption

The Industry Wargame revealed tremendous overlap and inefficiency across the agri-food value chain, which makes traditional industries and institutions vulnerable to disruption.

“The dynamic of overlap and inefficiency presents a significant vulnerability to disruption from players outside of the agri-food value chain given the tremendous monetary potential at stake,” shared Sciotto. “This vulnerability could be turned into an opportunity if a clear leader emerges in the industry to lead disruption from within.”

Transparency & Traceability

One visible theme throughout the wargame is that transparency and traceability will be the future standard for the food system. Therefore, the product for consumption includes not only the commodity, but also the production and input data.

“Transparency and traceability requirements will eventually be imposed on all sectors of the supply chain, including ag inputs. Currently, the industry lacks a clear leader to lead data collection and transmission. In the absence of a leader, food companies and retailers will likely develop and own the technology, setting the standards and requirements for the rest of the food system,” said Sciotto.

Food not Farms

Industry teams did not place an emphasis on saving struggling farms, with accelerated rates of consolidation generally accepted and acknowledged. Traditional farms received pressure from the value chain to meet future transparency and traceability requirements. Industry groups across the supply chain, including ag inputs, chose to focus on the consumer as their end customer, not the farmer. The future is about food, not farms.

Conceding the Consumer Relationship

In spite of recognizing the need to produce for the consumer, groups across the value chain largely conceded consumer relationships to food companies and retailers. This dynamic is likely to propel growth and increase vertical integration, shifting greater market share and power to food companies and retailers.

“Neglecting the consumer relationship will put segments of the agri-food value chain at a significant disadvantage in the industry,” cautioned Sciotto. “As consumers evolve, food companies and retailers are in the position to quickly adapt to consumer demands. Traditional organizations in agriculture will need to align more closely with consumers. The path to success centers around delivering what the consumer wants and fostering those relationships with a focus on shared values.”

Advocacy & Global Leadership

Wargame groups across the agri-food value chain made significant investments in policy in response to all three future wargame scenarios presented.  During the wargame, U.S. government institutions were perceived to lack the proactive focus and agility to seize the initiatives proposed. This dynamic sets the conditions for other state actors and private global companies to bypass U.S.-based operations.

“There is a clear need for private and governmental organizations to proactively lead and advance U.S. food power that is being challenged by China and others across the globe. U.S. agriculture needs a unified and proactive advocacy effort pursuing opportunities, countering threats and preparing for contingencies to support a vibrant future for the industry,” shared Sciotto.

Urban & Vertical Farming

Throughout the wargame, participants gave little consideration to vertical and urban farming.

“This blind spot to disruption in the industry could prove to be a missed opportunity as vertical and urban farming continue to grow with significant capital backing their expansion. Urban and vertical farming also provide solutions to consumer concerns around climate, traceability, local foods, and they greatly reduce distribution costs,” explained Sciotto.

Who Participated? 

Executives and leaders participated in the 2019 Industry Wargame from the following organizations: 

  • American Farm Bureau Federation
  • Becks Hybrids
  • Compeer Financial
  • Farm Credit Mid-America
  • Farm Journal
  • FCC Services
  • GROWMARK
  • Harshberger Enterprises
  • Lakner Farms LLC
  • Land O’Lakes
  • National Council of Farmer Cooperatives
  • National Pork Board
  • Nationwide
  • North Carolina Chamber
  • National Corn Growers Association
  • Puerto Rico Farm Credit
  • Purdue University
  • Sakata Seed America
  • Syngenta
  • Tennessee Farmers Cooperative
  • The Kernmantle Group
  • Three Rivers FS
  • United Producers Inc.
  • United Soybean Board
  • University of Tennessee Institute of Agriculture
  • U.S. Army War College
  • Valent
  • Winfield United

What’s Next? 

Wargame participants received a comprehensive report summarizing the Industry Wargame insights and impacts. To learn more about the Industry Wargame and in-depth insights, contact us.   

Aimpoint Research will continue to conduct and refine predictive research on the evolving agri-food value chain. Aimpoint Research will host the third annual Industry Wargame next November in Nashville, Tennessee. In addition to the Industry Wargame, Aimpoint Research has also established the Executive Intelligence Network to provide ongoing insight and situational awareness to industry leaders.

“In the military, it’s important to have a complete view of your environment in order to make the best decisions, because in conflict, those decisions can have very serious consequences,” explained Sciotto. “The same applies in business. Leaders need superior intelligence and complete visibility of the current situation in order to make the most informed and competitive decisions, which is why we’ve established the Executive Intelligence Network.”

Through the Executive Intelligence Network, Aimpoint Research’s team of analysts continually monitor the agri-food value chain and report on trends, innovations and disruptions, including COVID-19, that could represent threats or opportunities for leaders. 

JOIN THE EXECUTIVE INTELLIGENCE NETWORK

To join the Aimpoint Research Executive Intelligence Network, or for more information, please contact us.