Choosing Precision Agriculture Technologies

With the end of winter in sight, many in the agricultural industry are starting to get serious on their choices of precision agriculture technologies for the upcoming growing season. Whether the choice is equipment, software, or just taking soil samples in a new pattern, a lot of thought — accompanied with a lot of anxiety — precedes the actual decision. This decision is commonly made without an appreciation of the value expectations on the part of the user (e.g., grower, consultant, rep) and the hidden costs on the part of the provider of the technologies. In this article, I wish to discuss how the precision agriculture “ante” for making a choice is much greater than the purchase price — with some important implications for an organization. I have added some visuals to help elucidate my arguments.

The precision agriculture ante can be best understood with the interplay of two curves: perceived or demonstrated value of new technology to improve production (technology value) vs. user cost, and the necessary user education of the new technology (user education) vs. seller cost. I have assumed in my arguments that the seller will initially bear the cost of educating a user on a new technology. As a technology becomes mature, third-party vendors may provide another educational option. I will first discuss each curve and then discuss the interplay between them. A graph of the technology value (in terms of improved production) versus user cost curve is in Figure 1 , while a graph of the user education versus seller cost is in Figure 2.

The technology value vs. user cost curve in Figure 1 is the classic “diminishing return” curve. There is a diminishing return in the production value for each successive investment in new technology (dotted lines in figure). Viewed another way, you get the biggest bang for your buck on your first purchase of a new technology with lesser returns on future purchases relative to the improvement in production (e.g., higher yields, more efficiency).

The user education versus seller curve in Figure 2 has the inverse relationship to the “diminishing return” curve in Figure 1. There is an increasing return in the education of the user of a new technology for each successive investment in training (dotted lines in figure). In other words, a user can more quickly grasp new technologies after getting an initial grounding with the first technology. However, the increase in user education comes at an increasing cost to the seller. Now, with an understanding of what each curve means alone, we combine them to get greater insight into the precision agriculture ante.

The Education Equation

The interplay of the curves reveals the age-old struggle between introducing a new technology to a user and at the same time providing adequate education to support that technology. In the best case for both the user and seller, the introduced technology is simple to use (little education at little cost to seller) and has been proven to have high value towards improving production (high value at little cost to user). Since the best case rarely happens, we can explore other more likely scenarios, the extreme of which are dreaded by both the user and seller alike.

The first more likely scenario is that the user needs more education and support to use the new technology (more training at more cost to seller), but there is a demonstrated value of improved production after adapting the technology (high value at little cost to user). The result is that the seller is frustrated (because of additional training costs) even though there is delivery on the technology.

The second more likely scenario is that the user sees little value in the new technology even after receiving adequate education from seller. The result of this second scenario is the user is frustrated (because of diminishing return in value of the new technology relative to earlier technologies) even though there is delivery on the technology. The most dreaded interplay of the curves is when the user fails to see the value of the new technology in production and the seller keeps spending on the education of the user to adapt the technology. In this worst case, both the user and seller are frustrated and there is no delivery on the technology (at least as perceived by the user).

The best and worst cases for the interplay of curves have far reaching implications for an organization. In the best case of high value to user with little education cost to seller, both the user and seller end up on a positive note. The user sees the value that precision agriculture brings to its organization and will be favorably disposed to try new technologies in the future. Furthermore, the same user will be more patient if there is the need for more education with a new technology since the value of the first technology has been established. The seller needs, however, to be aware that the user may see a diminishing return on the next technologies relative to the success of the first and therefore must adjust marketing goals accordingly.

In the worst case of low or no value to user with ongoing education costs to seller, both the user and seller immediately start off on a negative note. The user rejects the technology and with it all future innovations in precision agriculture, while the seller goes out of business. In this worst case, the organization of the user very likely will become less competitive with its neighbors as the new technologies bring benefits to them. The “gun shy” user organization and the failed seller company represent a setback to all of precision agriculture.

The take-home message of the “curves” is that both the user and seller must be aware of the value of a new technology relative to previously adapted technologies and set expectations accordingly. Both the user and seller must be aware of the true educational needs of the user when introducing a new technology. Without this awareness, the ante for technology adoption may be so high that neither the user nor the seller will want to gamble on precision agriculture.

Editor’s note: This article first appeared in the Spring 2007 issue of PrecisionAg Special Reports.

Leave a Reply

Systems Management Stories
Data ManagementBeck’s Builds Out ‘Freemium’ FMIS Offering
August 17, 2017
Beck’s today announced the release of several new tools available in their precision farming service, FARMserver, which enhances farmers’ ability Read More
Area-of-Interest-Web-Soil-Survey-screenshot
Data ManagementSignificant Updates Made to SoilWeb, Web Soil Survey Programs
August 15, 2017
Agronomic professionals and technicians dealing with precision farming must understand the soils within the field before writing effective prescriptions.  A Read More
Spray Drift
Data ManagementJanzen: Data to Play Key Role in Sorting Out Dicamba Disaster
August 10, 2017
You would have to live under a rock to not have heard about farmers’ issues with dicamba this growing season. Read More
Data ManagementDuPont Acquires Ag Tech Startup Granular for $300 Million
August 9, 2017
DuPont announced that it has signed a definitive agreement to acquire San Francisco-based Granular, Inc., a provider of software and Read More
Trending Articles
Agri-AFC-cotton-baler
Business ManagementBringing a Southern Sensibility to Precision Agriculture
August 7, 2017
Amy Winstead considers herself blessed to have gotten in on the ground floor of precision ag adoption in the Southeast. Read More
Sensors/IoT2017 Yield Monitor Calibration Checklist — Part I
August 4, 2017
With fall harvest a few weeks away for most of the country, ag service providers from every walk of life Read More
Wade-Barnes
Excellence AwardsBuilt By Agronomists: 2017 Award Of Excellence Winner Wade Barnes on the Making of Farmers Edge
August 2, 2017
Farmers Edge President And CEO Wade Barnes reflects on the process of building his company, shortly after receiving the Crop Adviser/Entrepreneur Award during the InfoAg Conference in July. Read More
Data ManagementInfoAg 2017 Recap: Service Providers Take Center Stage
July 28, 2017
As I sit here and ponder just what it was that we all experienced last week, off the top of Read More
Resistant-weeds-in-Brazil
InternationalUsing Precision Agriculture to Control Herbicide-Resistant Weeds in Brazil
July 24, 2017
The occurrence of weeds in agricultural fields of grain and fiber production has caused losses to farmers for a long Read More
Yield Data Image
Data ManagementYield Data: More Than a Pretty Picture
July 13, 2017
It is mid-July, which, for the Australian cotton industry, means that picking is still going on for some growers. A Read More
Latest News
Grower Services & SolutionsAgribusinesses Launch FieldReveal Platform for Local Ag…
August 22, 2017
Four leading agribusinesses, Wheat Growers, Landus Cooperative, Central Valley Ag and WinField United, have signed a letter of intent to Read More
Industry NewsTrimble to Distribute Promising SIMPAS Application Syst…
August 21, 2017
AMVAC Chemical Corp. has signed a non-binding Memorandum of Understanding with Trimble. The two companies are working toward an agreement Read More
Data ManagementBeck’s Builds Out ‘Freemium’ FMIS Off…
August 17, 2017
Beck’s today announced the release of several new tools available in their precision farming service, FARMserver, which enhances farmers’ ability Read More
Israel-Irrigation-system-featured-image
InternationalIsraeli Precision Ag Companies Lead in Water Use Effici…
August 16, 2017
In the last week, AgriHub, formed by farmers and consultants from Brazil, visited 10 Israeli agribusiness companies, including the Ministry Read More
Gregoire-tractor
ProfessionalsMechanization Key to the Future of Vineyard Management
August 15, 2017
Precision technology moves at different speeds across different segments of agriculture. For example, technologies like curve compensation, precision spraying, and Read More
Area-of-Interest-Web-Soil-Survey-screenshot
Data ManagementSignificant Updates Made to SoilWeb, Web Soil Survey Pr…
August 15, 2017
Agronomic professionals and technicians dealing with precision farming must understand the soils within the field before writing effective prescriptions.  A Read More
Univ.-of-Illlinois-Palmer-in-soybean1
Business ManagementOpinion: How to Leverage Precision Agriculture to Launc…
August 14, 2017
To continue where my last article left off (which you can check out here), a precision ag company that specializes Read More
Industry NewsFarm Dog Inks Non-Funded Cooperative Agreement with USD…
August 14, 2017
Farm Dog, a pest and disease management platform for growers and agronomists, has entered into a Non-Funded Cooperative Agreement (NFCA) Read More
Lisa-Prassack-Photo-Credit-Weekly-Times-Now
InternationalAgtech: What the Umbrella Term Really Means
August 10, 2017
Acclerator, incubator, start-up, connectivity — the buzzwords of the digital age can be clear as, well, mud, writes Alex Sampson Read More
Spray Drift
Data ManagementJanzen: Data to Play Key Role in Sorting Out Dicamba Di…
August 10, 2017
You would have to live under a rock to not have heard about farmers’ issues with dicamba this growing season. Read More
New-Zealand-Precision-Ag-Tour
InternationalNew Zealand Study Tour to Demonstrate Recent Advances i…
August 10, 2017
If you’re interested in an intense, week-long immersion in the use of high-tech products and practices in New Zealand agriculture, Read More
Data ManagementDuPont Acquires Ag Tech Startup Granular for $300 Milli…
August 9, 2017
DuPont announced that it has signed a definitive agreement to acquire San Francisco-based Granular, Inc., a provider of software and Read More
EventsSDSU Prof to lead Profit-Focused Panel at Upcoming Inno…
August 9, 2017
Convening a day prior to this summer’s Farm Progress Show at the I Hotel in Champaign, IL (about an hour’s Read More
AGCO White planter 9800VE
ProfessionalsAGCO Crop Tour 2017 Features Precision Planting Add-Ons
August 8, 2017
Higher yields and greater returns are the ultimate goals for crop producers. To help corn growers better understand the role Read More
Corn
Business ManagementCrop Pro Insurance Closes $8 Million in Series A Fundin…
August 8, 2017
Crop Pro Insurance today announced the close of an $8 million Series A round of financing co-led by top agriculture Read More
Agri-AFC-cotton-baler
Business ManagementBringing a Southern Sensibility to Precision Agricultur…
August 7, 2017
Amy Winstead considers herself blessed to have gotten in on the ground floor of precision ag adoption in the Southeast. Read More
Satshot imagery
Imagery/SensingImagery in Agriculture: Some Sage Advice
August 6, 2017
SatShot President Lanny Faleide has been a fixture on the remote imagery scene for as long as about anyone still Read More
Blue-River-See-Spray-technology
ProfessionalsHow Blue River’s See & Spray Technology Could Chang…
August 5, 2017
The blistering West Texas heat rocketing towards triple digits, the affable cotton grower trudged across his dusty field and approached Read More