Steinbeis experts create inter-company cooperative data rooms for enhanced transparency at all stages of the supply chain
Bread, the kind of regional food item that can be traced step by step – from the grain to the loaf – using digital information? For a project that was hitherto unique in farming wholesale, a number of agricultural, trading, and production companies have now succeeded in making this concept a reality. The subject of their project was emmer wheat, which – with the help of a cooperative data room model – was tracked along the entire value chain. This extended from sowing in the field to harvesting, storage and distribution at wholesalers, the milling process of millers, production at the bakery, all the way to the shopping bag of the customer. Implemented by the Ferdinand Steinbeis Institute in close cooperation with industry association grosshandel-bw, the project was funded by the Baden-Wuerttemberg Ministry of Economics, Labor, and Tourism.
Outline of a cooperative data room
Impossible for the consumer to know at first glance, but scan in the QR code on packaging, and beneath the printed ribbon lies a fully transparent history of the very origins of bakery produce – from sowing certified emmer grain in the field of local farmers in the spring, to the day of milling at Bischoff grain mills in Landau, storage at ZG Raiffeisen in Karlsruhe, right through to production and sale at Haerdtner Bakeries in Neckarsulm as well as Peter’s Good Bakehouse in Buehl. Valuable information can now be recorded digitally, such as weather conditions as crops grew in the field or the quality of the flour. To the partner companies involved in the project, this adds particular value.
Agricultural wholesaler ZG Raiffeisen, which is responsible for storing the emmer harvest, as well as removing wheat husks and distribution to the mill with the support of farmers, joined forces with experts at the Ferdinand Steinbeis Institute to have such a data room programmed for the emmer transfer project.
As a supplier of certified wheat, the agricultural wholesaler occupies the space at the very beginning of the emmer value chain. It also acts as a sales and marketing partner to farmers, thus forming an important link to processing companies. The role of the wholesaler is to collect harvested grain from farms and transport it, ready for processing, to the mill. In turn, the mill produces the quantity of emmer flour ordered by the two bakeries. Data stored for this purpose in the cooperative data room now enables other interested stakeholders to put information to other uses, for example to gain 100% traceability in the event of a product recall.
Jochen Schneider, who at the time the project was being set up held responsibility at ZG Raiffeisen for digital activities in agriculture, recognized the potential of a collaborative data room the moment he was approached by the Steinbeis experts: “Mapping the value chain seamlessly, which in this case is also entirely contained within the local region, plays directly to growing consumer demand for transparency. The data room model might also become important when it comes to tighter supply chain regulations.”
The two bakeries and the mill involved in the project see interesting potential to scale their business model in the future. For example, local companies could gain competitive advantage by pointing to the regional heritage of produce – from the field of the farmer, to the plate on the table.
In Germany, wholesalers form a link between raw material producers and the companies that process those raw materials, refine products, and carry out selling and marketing. Until now, most information has been exchanged within supply chains between upstream and downstream companies.
It is known from previous transfer projects conducted by the Ferdinand Steinbeis Institute, as well as discussions with experts in business, science, and politics, that wholesale companies are in a particular favorable position to use cooperative data rooms to map entire supply chains. This is not only because of the structural networks they already have in place, but also thanks to their role as an established, critical link in the supply chain, within a business environment that is increasingly being shaped by digital transformation. This offers the industry a significant opportunity. Drawing on the historical notion of successful network structures and the future shift of new approaches to value creation into corporate networks (digital ecosystems) – which will be facilitated by intercompany, supply chain-focused data rooms – in the future it will be possible to come up with a number of digital services for new business models.
To jointly develop the cooperatively used data room, each participating company contributes with relevant information. This is pooled to enable all involved parties to offer new digital services to their respective target groups, for example by offering transparency in production and the traceability of goods. Data transparency for all partners thus offers new benefits over and above existing business models, and these can be offered as digital services to a new, shared customer base. Furthermore, information can be enriched by the addition of freely accessible information, such as weather data or price trends. Sharing dynamic data is also conceivable, such as sharing temperatures, or inventory readings measured by a partner with sensors.
Future outlook
The partner companies involved in the emmer wheat project are currently working on future implementation options in the overlapping areas between farming, the skilled crafts sector, and SMEs (producers). Their aim is to determine if there are any other value chains offering future benefits by making use of the new data space. One option for scaling the model could be to apply it to other agricultural products. Extending it to high-volume products such as spelt or rye, or transferring lessons learned to malting barley, for example, holds potential. This would thus allow “bread and data” to be followed by “beer and data.” Another scenario could be to allow engineering companies to derive value from data gathered from baking processes to make product enhancements to equipment, or improve maintenance.
From a research perspective, the Ferdinand Steinbeis Institute is also looking into new approaches to billing concepts and pricing models for using cooperative data rooms. The goal is to enable transparent evaluations to be made and services to be billed in overlapping areas.
COOPERATIVE DATA ROOMS AND BUSINESS OPERANDI
Increasing digitalization is shaping the way value will be added in the future. Both in science and practice, it is becoming increasingly clear that classic value creation processes are breaking down with the increasing emergence of more complex value creation networks and digital ecosystems. The exchange of data and information in digital ecosystems forms the basis for shaping new value creation. Findings from research and numerous examples of transfer projects at the Ferdinand Steinbeis Institute show that databases put to cooperative use lay a good foundation for introducing new digital solutions and services.
Especially in medium-sized business, cooperative data rooms offer the opportunity to forge networks with partner companies and thus build on bigger pools of data. The Ferdinand Steinbeis Institute has taken on the task of researching the structure, design, sustainability, and related revenue generation options of cooperative data rooms.
Drawing on three projects involving wholesalers, it has also developed business operandi options, suitable for companies to apply directly to implementational strategies. Its offering includes training for entrepreneurs, trainers, consultants, and coaches interested in this area. Methods have been designed to work as modules so they can be adapted to the individual needs of companies. The concept and methods of these services include modules on understanding the initial situation, selecting partners, branding, designing prototypes, the financing and business model of kick-off and follow-up projects, and staff involvement. The programs of individual modules are based on the TOOLBOX method developed by the Ferdinand Steinbeis Institute.
Contact
Prof. Dr. Daniel Werth (author)
Senior Researcher/Head of Multilateral Ecosystems
Ferdinand Steinbeis Institute, Heilbronn (Heilbronn)
www.ferdinand-steinbeis-institut.de
Alexander Neff (author)
Scientific assistant
Ferdinand Steinbeis Institute, Stuttgart (Stuttgart)
www.ferdinand-steinbeis-institut.de
Claudia Franz (author)
Senior Project Manager
Ferdinand Steinbeis Institute, Heilbronn (Heilbronn)
www.ferdinand-steinbeis-institut.de