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Agrimarketing : May 2015
: The Context Network ASSISTING AGRIBUSINESS’ SUCCESS Name: Tray Thomas Title: Founding Partner, The Context Network Education: Master of Science in agricultural economics from Purdue University. Executive education training at Harvard Unversity. Career: Professional management consultant with Arthur D. Little, Inc. Former executive with ICI’s Global Seed Division. AM: Tell us about the founding of the Context Network and its current activities. TT: Twenty-three years ago I founded Context with a vision to provide long-term business strategy support for agricultural companies. Among the first in this space to establish a virtual network, Context has become the world’s premier agriculture and bioscience management consulting firm, helping each client achieve exceptional results and advance agriculture. Today we have nine partners, more than 100 dedicated high-level executive professionals, both employees and contractors, and a global network of experts serving agricultural interests on five continents. Our clients are the fastest growing companies in the industry. Our strategies are being implemented, and the results can be seen weekly in the news. We will continue to work together with our clients, partnering to advance agriculture. AM: What are some of the trends and challenges currently facing agribusiness? TT: Perhaps the biggest challenge agribusiness companies is that there are multiple challenges coexisting in a complex industry. No longer is there just one direction with one or two drivers influencing our decisions. It’s not one OR the other, but often it is how we manage very different scenarios simultaneously. In production ag inputs, there used to be a couple of traits that would drive a host of decisions for a company. Today a multitude of mostly undifferentiated traits and trait combinations exist. Simultaneously, we have growth in old commodity chemistry and biologicals; each growing, 54 Agri Marketing s May 2015 competing, and in many cases, even complementing one another within a company’s offering. Organic production and GMO products both continue to grow — at the same time, within a single company. Today’s ag companies are increasingly likely to manage growth within several opposing forces which creates opposing products. The investment space is another significant area of challenge/ opportunity. During the past six quarters, the agriculture sector has continued to see growing interest from institutional investors. Money invested includes very large price tags paid for giant ag interests including the likes of Becker Underwood, Climate Corp., Arysta, etc. In the past, the giants spending money to buy agricultural companies were other primarily agricultural companies, but that is no longer the case (e.g. Pinnacle and Platform). Context expects this investor interest to continue, causing consolidation domestically and internationally. The increase in the global middle class will require companies to conduct business in multiple geographies. South America, India and Southeast Asia markets are rapidly developing and African agriculture is quickly evolving. Successful strategies used in one market are not likely to work the same in other geographies, so how do you grow, compete? These are the types of questions we address for our clients. AM: What opportunities does it have? TT:Challenge and opportunity are two sides of the same coin. Context believes agriculture is facing a period of bold moves, and that companies have some exciting opportunities in how they conduct business as they feed, fuel and clothe the world. It is a time for new alliances, partnerships, and methods to meet the needs of the players both up and down the value chain. In this era of bold moves, those companies who move slowly will become irrelevant and will be absorbed by others who are faster, better, more efficient. Mergers and acquisitions will occur. Many will be from interests outside of traditional ag. But this provides those of us within agriculture a whole set of positive opportunities to become more proficient and relevant across a system of products and services. AM: What will be required for agribusinesses to succeed? TT: Each company needs to: • Evaluate goals and determine whether to make a bold move or play it safe. For most, playing it safe leads to stagnation. • Know what it takes to be successful for the long run. • Get the help needed to stay competitive, grow and thrive. In the end, determining how to work in this new environment and approaching it full throttle will allow the industry winners to emerge. Our client list looks dramatically different than it did even two years ago — a firm indication of the types of involvement we will continue to see from many new and different players entering agriculture. Context has a long history of working on the commercialization of technologies in agriculture, making it more productive, more efficient and more sustainable. We will continue to support ag companies as they bring their specific understanding of their products, services and business to the table. That knowledge is of epic importance and monumental value to the new players in the mix. AM