New Zealand’s largest farming co-op drives cultural change via digital transformation

Soon after joining Farmlands as CEO in 2015, Peter Reidie realized that the co-operative was suffering from a fragmented culture. “After the 2013 merger, the business took one name and one logo,” says Reidie. “But, at that moment, we didn't consider what kind of organization we want to be, and how to build a culture for our people to rally around.”
This lack of unity was also reflected in the fractured digital approach. Multiple Point of Sale (POS) systems were used across regions—which led to data entry double-ups, inaccuracies, and questions about invoices. Farmlands had seven separate Enterprise Resource Planning (ERP) platforms which were not agile, having a four-month lead time for software adjustments. According to Richard Wilkinson, Farmlands’ Chief Digital Officer, “Our legacy systems had become a high cost, high-risk roadblock that no longer supported the business. This severely impaired our ability to quickly respond to industry changes and build for the future.”

Driving cultural change with digital change

Reidie realized that Farmlands can create organizational culture change through digital change. “Rather than try to tackle the two separately, we decided to create an entire culture change program that was enabled by the introduction of a modern and capable system,” explains Reidie.
That change program became project Braveheart—named for the late-13th century Scottish warrior, whose innovative thinking united the kingdom’s many clans towards a common cause. For Farmlands, the goal was similar. They needed to unite every arm of the business—from finance, human resources and eCommerce, to point-of-sale and supply chain management—under one end-to-end digital solution.
Farmlands consolidated their seven ERP systems into a single platform, Microsoft Dynamics 365. “Project Braveheart’s purpose was to take Farmlands from being internally-focused and backwards-looking, to outward-focused and future-looking,” says Reidie. “We wanted to underpin that culture with a system backbone, and that backbone was Microsoft Dynamics 365.”

Creating business-wide results

The three-year Braveheart project has now been implemented organization-wide, touching every part of the business. Across Farmlands’ 1400 staff and network of 82 stores, the results have been transformational.
Microsoft Dynamics 365 has brought Farmlands’ vast data and insights into one easily accessible place. “All of the backroom transactional accounts, from accounts payable to accounts receivable, we used to have different levels of support and different people and different systems across the business,” Reidie explains. “We've brought that together. We're now working with getting greater efficiency in that group.“
“Our sales force are now more skilled and adept at selling across our portfolio because they’re supported by Microsoft Dynamics Customer Engagement (CE),” Reidie adds. “The catchphrase for us is ‘all of business’—if we could get all of our customers buying across our portfolio the way our best customers do, that’s 50% growth without adding a customer or a product. We want to grow by understanding our customers’ purchase history and potential needs. That’s one of the benefits from Dynamics CE that we’re starting to extract.”
Operating on a single system has also provided better supply chain visibility, and allowed Farmlands to build one consolidated national inventory. The Microsoft Dynamics Supply Chain module has helped Farmlands plan, procure, and transport inventory more quickly and efficiently according to Andrew Horsbrugh, Director Agri Products and Services at Farmlands. “Clearer oversight means the business has been able to reduce their number of SKUs by 50 percent  and overall inventory by 4 percent, which has had a positive impact on cash-flow,” he explains. “Deeper real-time insights mean we now have the right product at the right place at the right time. We’ve been able to build customer satisfaction and increase sales, all with lower inventory levels.”

Click-and-collect through the cloud

Aside from shifting to Dynamics 365, Farmlands also worked with Microsoft to migrate to the cloud. The move was seen as a way to drive continuous improvement in scalability, performance, cost optimization, and data security. In March 2020, the global health crisis put this view to the test.
“Prior to project Braveheart, our eCommerce platform had to talk to multiple different systems,” says Reidie. “It wasn’t effective, so we had it taken down with the intent of bringing up a new platform next financial year (2021).” Before Farmlands was able to complete a new eCommerce platform, COVID-19 hit, and a strict lockdown saw New Zealand businesses close their physical stores for over a month.
With its new system in place, Farmlands was able to respond to the new business environment swiftly. “We got an interim eCommerce ‘click-and-collect’ solution up and running in just three weeks,” says Reidie. In its first week live, the interim solution had already captured four times the sales that the previous eCommerce platform achieved in a year. “Microsoft Dynamics 365 and the cloud didn’t just help us create a far better eCommerce platform. They also helped us adapt and respond to our customers’ needs in a way we wouldn’t even have dreamed of a year ago.”

Unlocking a future of change

After three years of transformational change, Farmlands is excited by the prospect of what’s next. “Our job now is to determine how we do things differently and more effectively,” says Reidie. “Artificial intelligence, eCommerce, and greater automation of our business are all on our agenda. Our first go-live was just the beginning.”
With an innovative and creative approach, Farmlands has created a digital and internal culture that’s primed for the future. “We used to have a few broken ribs and a pretty faulty back. Now we have the fittest backbone you could possibly imagine,” says Reidie. “And we have Microsoft behind us, investing and keeping that backbone strong.”