Boot camp to inspire development of New Zealand Inc

This week a high powered Boot Camp, attended by a group of key New Zealand agribusiness executives, will take place at Stanford University, California, with facilitation by Professor of Marketing Baba Shiv whose research expertise is in neuroeconomics. 

The Boot Camp is the brainchild of Keith Cooper from Silver Fern Farms and John Brakenridge, Chief Executive of NZ Merino, who visited Stanford to discover new ideas on how to market Silere lamb from the two companies’ JV established last year with assistance from the Primary Growth Partnership fund.

 

The outcome of that visit was the identification of Silere merino lamb’s unique properties and the product story which would encourage restaurants to adopt it at a premium price. Buoyed by the response from restaurants in New Zealand, SFF has taken Silere overseas, which is clearly desirable and necessary for the offtake volume which will satisfy the grower contracts under the Alpine Origin Merino programme, stated to be worth $45 million in the last 12 months.

 

The emphasis of Shiv‘s research is on the role of neural structures related to emotion and motivation in shaping decisions and experiences. His more recent work examines the interplay of the brain’s “liking” and “wanting” systems and its implications for marketing, innovation, leadership and decision making. As part of that work he has studied the effect of pricing on judgements about a wine’s quality and found fairly conclusively people find the more expensive wine better than a cheaper one, even if they are the same wine marked with different prices.

By extension the intention of the Boot Camp is to develop the concept of New Zealand Inc or more accurately a New Zealand brand which will enable the marketing of our food and agricultural products further up the value chain and at a premium price. This is designed to overcome the perennial problem our products face of being viewed as commodities unable to command a price premium except in times of scarcity which of course only lasts until price resistance kicks in.

I understand sponsorship has been provided by AgMardt which has a mandate to encourage innovation and develop world-class capacity and capability within the agribusiness sector.

People at the Boot Camp will include senior executives from the food, wine, agricultural and seafood sectors who want to develop branded, high quality, high value products to meet the needs of sophisticated consumers.

 

Among the attendees will be private sector representatives from ANZCO, First Light, Fonterra, Zespri, Sealord, Craggy Range, Comvita and PGG Wrightson as well as the public sector, represented by the Minister, Hon David Carter, Wayne McNee, Director General of MPI, Peter Chrisp DG of NZ Trade and Enterprise and Chris Kelly of Landcorp.

 

According to Cooper, they are not seeking publicity from the Boot Camp, but want to achieve implementation of what many people have been talking about for a long time without actually making tangible progress. He believes there have been too many reports, all of which make perfectly good sense, with no real improvement or attempt to tackle the problems identified in them. He sees better results coming from collaboration between like minded people with similar interests or, as he calls it, a ‘coalition of the willing.’

 

The presence of Government and public sector representatives at Stanford is designed to gain their support, but the Boot Camp is still seen very much as a private sector initiative. As such it will demonstrate private sector buy in without holding out the begging bowl to the Government.

 

Interestingly the Riddet Institute’s Call to Arms report, released two weeks ago, expressed the hope the Boot Camp would focus on the report’s primary recommendation to establish a peak body which would spearhead the agri-foods industry’s target of trebling revenues by 2025, as defined by the government’s Economic Growth Agenda. Dr Kevin Marshall, chairman of the Institute’s Thought Leadership Team, expressed the view the government had done quite a lot since the Food and Beverage taskforce report was released, but industry hadn’t stepped up to the plate.

 

This mirrors Keith Cooper’s opinion, but there appears to be a divergence of thought about the formation of a peak body and who might be part of it. Both parties agree on the need for innovative solutions to the problem, but Riddet Institute’s approach is more formal and structured and risks going the same way as other strategy documents. However Call to Arms contains much good analysis and some worthwhile thoughts on what needs to happen to lift performance from a 3% to a 7% compound annual growth rate.

 

The more private sector orientated solution envisaged on this side of the Tasman contrasts strongly with the Australian approach to trying to solve the same problem. Ian Joseph, chairman of the Agribusiness Council of Australia, sent me the ACA’s press release which highlights what they are calling ‘market failure’ of the Australian agribusiness sector.

 

They have identified the main cause of this as a failure of education and skills training, leading to a lack of graduates and trainees essential for productivity growth. Consequently, the ACA is looking to bi-partisan political action to drive the increase in human resources necessary to support the agribusiness sector.

 

I have a feeling both private and public sector involvement will be essential to achieve the desired results on both sides of the Tasman.

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Tags: Agmardt, Agribusiness Council of Australia, ANZCO Firstlight, Boot camp, Call to Arms, Chris Kelly, Comvita, Craggy range, David Carter, Dr Kevin Marshall, Fonterra, Food & Beverage Taskforce, John Brakenridge, Keith Cooper, Landcorp, Mark Clarkson, Ministry for Primary Industries, NZ Inc, NZ Merino, NZ Trade and Enterprise, Peter Chrisp, PGG Wrightson, Primary Growth Partnership, Prof Baba Shiv, Riddet Institute, Silere, Silver Fern Farms, Stanford University, Wayne McNee, Zespri