How the Kiwifruit Is a Data-driven Christmas Miracle

Image credit: iStockphoto/Serhii Shleihel

It might not be immediately apparent, but it is a supply chain miracle when you see a humble kiwifruit at the grocers or in the supermarket.

The Kiwifruit is named after its country of origin, New Zealand. But although NZ is home to the dominant Zespri organization, the fruit is grown internationally.

In addition to the 2,500 NZ farmers, there are 500 in Italy, 800 in Japan, 130 in Korea, and 100 in France — all part of Zespri, a cooperative organization formed in 1997 responsible for around 30% of the world supply. They sell into more than 60 countries around the world.

It’s an organization that produces and ships a lot of the products. The world consumes almost 6 million tons of Kiwifruit each year, and the industry is worth more than NZD10 billion annually.

Besides the supply chain logistics, from storage and road, rail, and ship transport, there is a significant data dimension to getting the Kiwifruit from the farmer to the fruit bowl.

With the number of kiwifruit trays well into the millions and with so many suppliers and distributors, Zespri’s business would function best with all that data integrated on the same platform. Yet, the organization has been working for two decades with legacy internal systems and processes.

The pandemic also significantly impacted the Zespri supply chain, with people working at home on their devices, labor shortages due to border closures, and disruptions to the global shipping industry.

Not keeping pace

Bruce Cameron, the chairman of Zespri, concedes that the producer’s business had expanded in scale and complexity as an industry, but its systems had not kept pace.

In 2014, Zespri took its first steps into the cloud with an SAP migration to Azure, delivered by Datacom. It was touted at the time as the world’s largest migration of a production-based SAP installation to Microsoft’s cloud.

“High-quality data is the fuel of automated, productive responsive processes — from vine to plate”

This year, Zespri has greenlit a digital transformation that will take the organization further into the cloud and standardize and automate processes across finance, supply chain, sales and planning, and grower enablement functions.

Zespri reportedly spent NZD160 million over four years on a Deloitte-led digital transformation to implement SAP’s ‘Rise with SAP’ S/4HANA program in the cloud. Zespri will continue to use Azure for its enterprise infrastructure, but the former Microsoft Azure public cloud will be migrated to the SAP S/4HANA private cloud.

“Zespri is a large and fast-growing business, and we need mature processes and systems to fuel our next stage of growth,” Zespri’a chief digital officer Dave Scullin told NZ media recently.

“This will also enable us to collect and analyze more data, helping us to plan our supply chain more accurately and improve our decision making around shipping and market allocation.”

Vine to plate

The system tracks every stage of a crop’s evolution, from harvest to marketing. 

The move to standard systems has reduced business risks. Zespri can now collect and analyze more data, helping to better plan a complicated supply chain governed by variables including weather, consumer demand, and pandemic-era border and import restrictions.

Capabilities such as machine learning will also improve shipping and market allocation decisions.

One innovation uses robotics to capture images of the fruit growing under canopies. Data and insights produced from the images help Zespri predict fruit volumes. In the future, the plan is to combine this data with orchard management, climate, and other internal and external data.

This will enable Zespri to predict better fruit quality, which will drive a better supply chain experience and ultimately an improved customer experience.

Zespri is taking a phased approach to the delivery of the program, and each phase will require a new and separate business case.

“Original business use cases change over time,” said Zespri’s Scullin. “You need that underlying capability to move ahead with changes in sync with new cases.”

“It’s not just about analytics. High-quality data is the fuel of automated, productive responsive processes – from vine to plate,” he added.

Lachlan Colquhoun is the Australia and New Zealand correspondent for CDOTrends and DigitalWorkforceTrends, and the editor of NextGen Connectivity. His fascination is with how businesses are reinventing themselves through digital technology and collaborating with others to become completely new organizations. You can reach him at [email protected].

Image credit: iStockphoto/Serhii Shleihel