What I learnt on universal food retail challenges at Singularity University
Article published on LinkedIn on January 6, 2020
Business Explorer. Shopper Advocate. Data Science Interpreter. Opportunity Connector. Human-centered Economist.
Building an ecosystem that provides high-quality food in a sustainable way for us and the generations to come is becoming a daunting task. Yet it seems disconnected from much of what we as retail professionals do every day, like filling the next promotional slots and beat competition to re-divert store traffic. We take the availability and abundance of good food for granted. Discussing food as an issue was something of the past, mostly concerning food shortage. Now the challenge is universal and close; increasingly it concerns the quality of our food intake. How come obesity levels are rising everywhere, to the point that obesity levels in Iraq are at the same level as in the US? To make matters even more complicated: We need to ensure that production and distribution methods are in the best interest of Mother Nature.
Though not having all the answers – nor the claim to do so – if there is one thing that Singularity University Benelux Executive Program has taught me is that there are many ways in which exponential technologies can address the universal great challenges we find ourselves in. The program made me feel optimistic and positive that solutions are out there and a bunch of highly creative and smart people can help to make them happen. There is also a risk though: The same bread knife can be used for slicing bread and for hurting people. In the same manner excitingly promising new technologies and artificial intelligence may fall into the ‘wrong’ hands. New technologies applied for the ‘wrong’ purpose and by ‘bad’ leaders make the discussion on ethics as important as the discussion on technology.
My lessons from Singularity University
Specifically regarding the challenge of sustainable quality food retail. The program inspired me in many ways: Showing best practices that I can apply immediately, providing methods of thinking, making me think about analogies between my retail practice and new technologies. Here are some of my concrete take-outs and inspiration from the program.
1. Proven best practices
- Tapping into the large resource of sea water to produce fresh drinking water by desalination is not a new idea in itself. However, Elemental Water Makers came up with the concept of conducting reverse osmosis with help of solar panels – all packed in an easy to transport container and ready for local communities. It may inspire food professionals to think better how they can reduce water in their offices and production facilities. It may not only save them costs but also leave more water for sanitation and drink water for consumption.
- During the Singularity University Benelux Executive Program we enjoyed herbs and vegetables cultivated from the vertical food production set up in our event space. It reminded me of the Whole Foods Lynnfield store that produces fruits and vegetables on its rooftop. Green roofs yield produce for commercial purposes and at the same insulate the building, absorb rain water and lower distribution costs. The next time retail executives talk about ‘store of the future’ and ‘local marketing programs’ you may give this a completely new dimension.
- The Dutch research institute TNO has come up with 3D printing of carrots and other multi-ingredient fresh foods. At first you may think: ‘bah’. And though the current version does not necessarily come with the bite that we are used to, this attribute offers a great benefit for people with mastication and swallowing problems. In a society with increasing levels of ageing 3D printing sounds very promising. Certainly when you realise the other advantages such as adaptation of food to one’s personal diet and flexible design of new compositions, ratios and textures in order to produce more healthy stuff.
2. Methods of thinking
- Whereas in linear thinking you take a step by step approach, in case of exponential thinking you make large leaps. At times it leaves me a slightly confused if it is really true and possible. Take a simple example: When you fold a standard piece of paper 42 times, you end up with 4.398.046.511.104 layers of paper, or 439.000 kilometres – the distance between you and the moon. This exponential growth surprise factor becomes easier to understand when you trust new technologies. And you do – after just one day at Singularity University. Many exciting technologies were presented but let me share with you one of them: The Lightyear car that may net net produce more energy through its solar layers than take in.
- Exponential growth cycle occurs in six phases according to Peter Diamandis who came up with the Six Ds of Exponentials: digitization, deception, disruption, demonetization, dematerialization, and democratization. It all starts with digitisation that drives much of current exponential growth because anything digital is easy to access and share. At first you may be in a deceptive phase, because well, the old technology based on linear thinking actually produces a better return. Once the digitised product outperforms in an exponential manner, you move from disruption to demonetization, dematerialisation and democratization of the product. In our world of food retail I could imagine this happening as well. For example, the value that health insurance companies adhere to information about the degree consumers shop healthily, may become worth more than the retail distribution of food itself. At such a moment shoppers may obtain the products from their grocery stores for free under the condition they provide data about all their purchases to their health insurers.
- Nanotechnology studies materials at atom-size (some 1.2 nm), and shows us that properties can change in unexpected ways. For example, most of us know iron as a solid material that melts at 1538°C. However, when nanotechnologists restrict the number of iron atoms to less than 20.000, iron melts at a much lower temperature. By playing with the number and composition of atoms an infinite number of new materials and properties arises. Nanotechnologist Aaike van Vugt believes we use less than 1% of the potential of materials. In itself, a fantastic achievement, but could we reapply this way of thinking in food retail? For example, if we restrict the number of meal and grocery delivery organisations like we did in case of the iron atoms, will drop efficiency increase, city traffic drop and customer satisfaction go up?
- One of the natural fears of humans is that technology takes over control. And let’s be honest: robots can do things a lot faster and better. Take the example of autonomous cars: They do not drink alcohol, do not tap messages while driving, and do not have the macho-genes of speeding to impress others. However, their biggest advantage is also their biggest challenge. Autonomous cars are programmed in such a way that they may cross dotted lines, but may not cross continuous lines. Now imagine an autonomous car driving into two circles: first a dotted line, next a continuous line. It is trapped in its own algorithm. However, humans grasp the difference between formal and unspoken rules. In addition, we solve ethical puzzles that are nearly impossible to program: For example, when the car is bound to hit a person, will we steer towards a 80+ senior or a teenager? Finally, all human beings are creative, more so than robots. Returning to the autonomous car example, in literal and metaphorical manners we think outside the lines.
After joining the executive program at Singularity University Benelux I feel very optimistic about the exponential power of technology to solve our universal challenges, also when it relates to food retail. The question that I ask myself is what and how I can contribute. Let me share with you: I have not yet found the final answer. However, I sense that it relates to my mission of delivering shopper happiness. And I now know that I can make that mission exponentially more powerful with the help of these insights and the power of the concrete examples shared above. One great example I could think of relates to one of my clients, a natural and organic food retailer, who asked me to help them set priorities among conflicting interests of animal welfare, environmental protection, health and success as a business model. For example, apples from a nearby farm come with less CO2 thanks to less transport however these apples do not necessarily contain more vitamins that make shoppers healthier. After deciding on the priorities that blurry and mixed message needs to be communicated in an appealing retail context. Perhaps I could make an even bigger impact when I convince fast-food chains to offer more healthy stuff than a handful of salads or accelerate the elimination of three plastic pollution items that come with their current business model: Plastic straws, plastic bags and expanded polystyrene foam in cups and containers. So far my approaches have been more incremental but I keep my eyes open for the exponential curve, in my consultancy practice and as a advisory board member. Feel free to get in touch and let’s see what we can do together.
About the author:
Constant Berkhout is a passionate practitioner of Retail Marketing. He is the founder and owner of Rijnbrug Advies, a consultancy in the areas of Retail Marketing and Shopper Insights based in the Netherlands. He is author of two retail marketing books.
For more information on Constant Berkhout: http://www.constant-opportunities.com/
For more information on the SingularityU Benelux Executive Program.