Agility Update September 2021

Agility Update September 2021

This month, September, marks 18 months since Australia closed its borders. With growing recognition that there’s no going back plus the need for larger government economic investment and structural change to build resilience, Agility Update September offers articles on extreme transformation, tools to support remote work and the tremendous opportunities at the touchpoint of Australian agriculture and technology.

Reinventing for Success

With the Delta variant digging in to stay, Australian companies must “go all in” to reinvent themselves rather than harking back to business as usual. Unfortunately, much talk of transformation is just that: talk.

Analysing the most recent annual reports of ASX 100 companies, McKinsey found that while about 80% mention transformation in their reports, in the past five years only about 50% have undertaken a major programme with transformative outcomes. Overall, just 25% executed multilever transformations of multiple big moves comprising a mix of performance and portfolio moves over a 10-year period. Those that undertake both categories of moves are 3 times more likely to move up the power curve, found McKinsey.

In transformation, McKinsey favours the “future–back” approach. This is where a company reimagines their core businesses and define a bold, strategic end state, then work backwards across 3 dimensions – strategy, digital and analytics, and operating model – to craft a journey to get them to their destination.

An example of an “all in” transformation that is still unfolding is that at Commonwealth Bank. The bank’s transformation began with a cloud project in 2009 when it sat at the bottom quartile in customer satisfaction. In 2019, it kicked off an overhaul of its centralised architecture function to remove internal complexity and apply a group-wide lens to its decision-making. At the same time, CEO Matt Comyn stated a goal that the bank will invest $5B dollars over the next 5 years to improve digital capabilities and rebuild consumer trust.

Although ANZ was first with a mobile banking app in September 2010, CommBank is racking up numerous first mover advantages enhancing its CommBank mobile app launched in 2011. Its recent purchase of buy now, pay later (BNPL) StepPay is the first BNPL from a major bank. Added to its new strategic partnerships with local e-commerce start-up Little Birdie and energy startup Amber, its move to be the first ADR among Australia’s Big Four banks Australia’s new Consumer Data Rights regime allows customers to release their data – including from other banks – to CommBank. Being an official data recipient will further allow CommBank to offer even more customised or tailored solutions to its clients, and further promote itself as the convenient portal to access a marketplace of services i.e., a Super App like China’s WeChat and AliPay, and Singapore’s Grab.

KPMG’s view suggests that, at least for the next decade or so, the trend among consumers and businesses is towards super apps while McKinsey states platforms are the favoured operating model for 7 of the world’s 12 largest corporations. For further reading, see The platform economy, Digital platform strategy: 5 questions your company must ask now, and Why every platform wants to be a super app.

Remote Work Tools

A huge opportunity has opened for digital-first remote work tools as increasing numbers of high-profile organisations including Spotify, Twitter, Square, Atlassian and Unilever announce their employees can work from home forever.

The key driver – revealed in numerous surveys here, here, and here – is the desire for flexibility and work-life-balance, suggesting the biggest change will be in the way workers interact as they work from different locations asynchronously. In addition to a computer and reliable internet access, the work-from-anywhere worker is typically supplied with a toolbox of 7 items for:

1. Synchronous communications for the team to meet and work together, like the popular Zoom,
2. Asynchronous communications for informal chats like Slack, or virtual spaces for members to hang out like Microsoft Teams,
3. Project management tools like Jira or Basecamp to track team and individual targets, commitments, and progress,
4. Managing information with OneDrive or DropBox to host a single version of each document in the cloud instead having multiple versions floating around as emailed attachments,
5. Facilitating group thinking or brainstorming, e.g., Mural or Miro,
6. Quick status checks with Happy or Not or Tiny Pulse to track individual and team morale,
7. Information security for secure communications and access e.g., LastPass, NordVPN.

But, to make this all work better and surmount Zoom fatigue or email burnout, we need to move away from high-effort communication towards low-effort coordination. Professor Howard Yu of IMD Business School says: “The most elegant way to do this is to document everyone’s work automatically and make it searchable in real time. This way a large company can still have a single source of truth,” he says, pointing to GitLab’s handbook-first approach.

Read also 6 top remote work startups impacting companies during a pandemic, and Remote work tools we'd love to see in 2021 that don't yet exist to see how asynchronous collaboration tool Complish.app works around this with templates, as well as How to collaborate effectively if your team Is remote or hybrid.

Agtech Starting to Sprout

Among its myriad impacts, the pandemic has catapulted awareness of the essential importance of Australia’s agricultural industry to city folk and Smart Company believes investment interest in agtech is starting to sprout. Existing investment in agtech has been focused on farm management software, sensing and IoT technologies, leaving a huge opportunity for funding in areas like supply chain technologies disruption, it says.

According to Agthentic, a sustainability and innovation consulting firm for the food system, the 3 trends driving the growth of agtech are:

1. Barriers to entry are dropping as the cost of technology fall while performance increases.
2. Consumer preferences are shifting at an astounding pace to foods and fibres that are healthy, safe, affordable, and good for their families and the planet.
3. Agriculture is a massive and growing industry contributing approximately A$50B annually to Australia’s economy. Globally, the $500B market for agtech products and services is expected to grow to $730B in the next 3 years.

In the agtech space, AgriWebb is the clear leader. Started in 2014, AgriWebb is now worth $100M and often touted to be a Soonicorn – companies with high valuation and good chances of soon becoming unicorns valued over US$1B. AgriWebb is a livestock management platform and provides a tablet computer with its software that helps cattle farmers plot out their lands, moderate weights and health of cattle and monitor their movements, remotely. It also offers a low-cost water level sensor Trough Sentry that helps farm owners check trough water levels through the tablet, and a platform for listing and buying stock for cattle through their online portal AgriWebb Saleyard.

Agthentic lists other world-class Australian agtech companies creating value for producers and investors:

• FluroSat – A world leader in remote crop sensing, FluroSat has attracted international capital and is actively and successfully expanding overseas.
• Observant – A cloud-based platform for remote water management founded in 2003 and acquired by Jain Irrigation, one of the largest irrigation companies in the world in 2017.
• AgDNA – A farm management software platform founded in 2012 and acquired by multinational corporation CHN Industrial in 2019.
• Vow Foods – A Sydney-based cellular agtech company growing a suite of cultured meat products.
• Swarm Farm Robotics – A Queensland-based autonomous agriculture vehicle platform.

For Australian unicorn club members as of 30 July 2021 click here, see also Tracxn’s Soonicorn Club 2021: Top tech startups in Australia.