It is often the small changes that deliver the most meaningful results and finding these valuable points of difference is the ongoing quest engulfing the corporate world.
The agricultural sector is no different and from multinational agri-conglomerates all the way down to individual subsistence farmers, good decision making based on sound intelligence safeguards livelihoods, improves production and minimises environmental impact.
The omnipresent advance of technology is beginning to ring the changes in the agricultural sector. It is affecting companies at every point in the supply chain and is changing the conversation between brokers and their clients, whether they be farmers, food manufacturers, drinks producers, distributors or retailers.
BIG DATA IS NOT ALWAYS ACTIONABLE DATA
In the last decade the availability of data has simply exploded. The number of third-party public data sources has never been so high. Similarly, the number, sophistication and functionality of sensors, monitors, and tracking devices continues to rise.
Data collection and reporting functionality is embedded into virtually every piece of machinery used in today’s agricultural supply chain. From inspecting crops in the fields and measuring moisture in the ground, to tracking temperatures in transit and time spent on the shelves, there is detailed information on every aspect of a product’s lifecycle.
There is a huge well of first- and third-party data to draw from. But unless companies can take meaningful, actionable insights from data, storing information on servers is the digital equivalent of having warehouses full of dusty filing cabinets that never get used.
As companies become more demanding about the need to make data-driven decisions, they are also judging those they do business with by the same standard. Can partners justify their decisions and will suggested changes really deliver the benefits claimed?
Insurance brokers such as JLT also need to show they can operate in this more dynamic way and demonstrate an ability to deliver ongoing operational and performance insight that clients can use to generate tangible benefits.
For years, the leading insurance brokers have sought to move away from a purely transactional relationship with clients. Instead, they have evolved into ongoing business advisers, identifying risk and providing advice on its ongoing management, mitigation and transfer.
In today’s digital age, such insight comes from enabling clients to understand what proprietary data they hold, what public data they can access, and the analytics required to meld what is available into commercially valuable learning about their risk profile and performance.
In recent years the tsunami of data has overwhelmed a lot of businesses. They have been bruised and buffeted by the possibilities without finding ways of harnessing its power to useful effect.
It is remarkably easily for poorly scoped data analytics projects to spiral out of control. The potential possibilities can dazzle project managers and without carefully defined goals and strictly enforced parameters, costs can rise, and meaningful outcomes disappear.
ANALYTICS IN PRACTICE
JLT Specialty has the experience and expertise to set the appropriate scope for analytics projects and to ensure they are designed to generate the desired risk intelligence.
In the food and agri sector we are already using NatCat and climate change modelling to identify potential exposures and inform risk mitigation and management strategies. But away from these headline exposures, there is also a lot we can do to help companies understand their operational risks and implement measures to reduce them.
By way of example, structured information and analytics is enabling fleet managers to better understand trends in their claims experience, and the factors that manipulate claim frequency and severity. Data is collected, analysed and learning distributed virtually in real time, enabling fleet managers to make swift, effective interventions.
In the food and agri sector, timely decisions are the difference between survival and failure. Should a farmer harvest early in the face of an incoming storm? Would changing the feed mix deliver healthier, more productive animals? Do existing crop choices deliver the maximum yields from the available land?
Such analytics can deliver valuable information along the length of the supply chain, helping farmers, manufacturers, packagers, distributers and retailers to better understand their businesses and to identify small changes that could alleviate pinch-points, reduce risks, increase resilience and mitigate losses.
In addition to working with companies to define and implement risk analytics projects that deliver value, there is a need to then present findings in accessible formats. Spreadsheets can quickly become impenetrable, so we can detail results in everything from graphs, tables and infographics, to sophisticated interactive digital displays.
It may seem like a relatively simplistic point, but the more effectively we can share learning, the better clients can take the message to their own employees and partners when seeking to make positive change.
Clients are putting pressure on their insurance brokers to provide more data-driven and real-time corporate intelligence. As a result, there is an opportunity for those who deliver advice and operational recommendations that are underpinned by robust, accurate analytics.
Through its consultative process JLT Specialty can help risk managers explain the value that they bring more broadly and not just in the terms of potential claims. This will allow insurance to be seen not just as a cost for an unlikely event, but as a strategic driver in the business, elevating the risk conversation higher up the c-suite agenda.
Data analytics offers huge potential for companies to improve their operational performance. Brokers can use analytics to identify and define existing liabilities and exposures, and to suggest appropriate ways to manage, mitigate and transfer risk.
In today’s digital age, implementing and managing effective risk analytics programmes will create significant commercial advantages for businesses and the potential benefits should no longer be left unrealised.
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For further information, please contact Joyce Leo, Senior Executive of Food & Agribusiness at Joyce_Leo@jltasia.com .