From agriculture to agribusiness

Agriculture differs from other industries, a difference dictated by the climate and the rhythms of nature, but agribusinesses can effectively deal with the unique aspects of their field with the appropriate managerial tools. Learning how to use them is becoming more urgent than ever due to phenomena such as climate change, globalization and market volatility. To stay competitive and to make the primary sector a vital driver of the economic development of Italy once again, agribusinesses must turn their attention to new technologies, and adopt modern managerial criteria to guide their strategic choices and investment decisions.

A practical guide for running an agribusiness in the twenty-first century is the newly-released Agribusiness. Management dell’azienda agricola, published by Egea in April 2022.  Edited by Vitaliano Fiorillo and Marianna Lo Zoppo, this manual was realized with the support of the Romeo and Enrica Invernizzi Foundation.

From strategic business management to business performance analysis, collaborating with other agribusinesses, building an effective marketing plan, production and innovation management, project and people management, even the latest internationalization strategies: this volume is the fruit of classroom experience and research by the instructors who work or collaborate with the AGRI Lab at SDA Bocconi School of Management.

We contacted the editors of the book to ask them about some of its central themes.

In the foreword of your book, the Executive Director of the Romeo and Enrica Invernizzi Foundation, Gianantonio Bissaro, reminds us how over the centuries, the evolution of our society was linked to the renewal of the agriculture industry. A renewal, Bissaro goes on to say, that agriculture needs to take on more urgently than ever before. What are the main aspects of the evolution that companies in the industry have to contend with?

During what became known as the “Green Revolution,” the combined use of new high-yield hybrid varieties, crop protection products and fertilizers, along with agricultural mechanization all resulted in a surprising upsurge in farm production for the main food crops. If on one hand this revolution in agriculture undeniably improved food security, on the other the negative impact that the industry had on the environment was considerable. Today we are aware of the fact that the kind of development that happened in the past is no longer sustainable today. The evolution is precisely this awareness, which also manifests in the choices that final consumers make.

In the chapters that you wrote personally, you address the issues of operations and supply chain management, as well as strategic collaboration between agribusinesses. What are the key considerations in these contexts?

Vitaliano Fiorillo: The players in the agribusiness value chain, upstream and downstream from farms, have developed knowledge and advanced competencies in the context of operations management, making this function a crucial aspect of actioning strategy. For a number of reasons, the technological transformation that farm production has experienced did not come with an evolution in managerial tools, which are still grounded in the tactical and empirical nature of agricultural activity in a strict sense. But farmers have to be able to ramp up their operations management so it becomes a key strategic tool that will allow them to adapt to, anticipate and take advantage of the changes that are underway.

Marianna Lo Zoppo: Global competition, shortened product life cycles, the development of technology and the speed of change in consumer demand are the reasons why today staying competitive is becoming more and more complex (and more than ever before for small companies). In a landscape like the one we have in Italy, made up of small farms, collaborative relationships are a key asset for responding to this complexity in today’s world, and knowing how to nurture these relationships is an essential managerial skill.

If you had to choose, what would you describe as the three biggest challenges that agribusinesses are facing, in a few words?

In our opinion, the challenges are:

• increasing productivity in the agriculture industry while reducing the environmental impact;
• telling consumers in a compelling way about ongoing efforts to achieve the objectives above (and more generally everything being done so that agribusiness has a positive impact on the environment and on society as a whole);
• surviving in a highly competitive global market, where unexpected upheavals, like what we’ve seen these past two years, are always right around the corner.

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