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ASCM Insights

Going High-Tech with Wine

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Wine making may be an ancient art, but many wine producers now use up-to-the-minute technology to gain competitive advantages in this profitable industry, according to a February 10 article in TechCrunch

“Using tech and science to gain every possible advantage can help producers keep their costs and prices down, their environmental footprint small, and their wines as high-quality as possible,” Lora Kolodny writes for TechCrunch. If advantages are achieved, a bigger slice of the market pie can be worth quite a bit. In fact, the Wine Institute estimates that California wine by itself accounts for $31.9 billion in retail sales and $1.6 billion in exports.

In addition to planes, helicopters, and drones, wineries now use sensors, apps, and other hardware in the fields to gather and monitor agricultural data. TechCrunch profiles Treasury Wine Estates, the company behind Beringer, Sterling Vineyards, Stags’ Leap, and others, and looks at how the winemaker is using the latest technology to protect and perfect its harvests.

“In some of its vineyards, Treasury Wine Estates uses mobile apps to connect managers with workers in the field; tractors outfitted with high tech systems that allow them to cut away debris [and] harvest and sort grapes efficiently; ground-based sensors that can gauge the health of their soil or plants, track the weather, and help manage irrigation; and truck-mounted lasers that take precise measurements of vines and leaves,” Kolodny writes.

That’s right, lasers. The lasers measure vine growth and balance, known by winemakers as the “fruit-to-shoot” ratio. Producers use these measurements along with other data, including information about droughts, storms, and different fertilizers, to make adjustments and minimize variability.

For example, “over the past three months, California has shifted from a state with about 88 percent of its total area coping with drought conditions to one with 59 percent in these conditions,” Kolodny writes. “Such a dramatic shift could impact the flavor of a given wine, if a farmer isn’t changing tack appropriately.”

Another tool that workers at Treasury Wine Estates utilize is the Pulsepod, which is made by Arable. The Pulsepod measures a wide variety of factors, including exact rainfall and the color of grapes on the vine. The pod, which is solar-powered, sends data to the cloud, enabling wine producers to more effectively forecast crop yield.
The wineries also use another app, developed by Skycision, for their drone flights. From the Skycision app, farmers examine data—gathered via a high-definition camera on the drone—to identify pests, diseased vines, and weeds.

“High value crops like grapes tend to see an aggressive spread when certain diseases show up, causing farmers to have to rip out huge amounts of vines to contain them,” Kolodny writes. “More precise data helps them rip out only what they must, or better yet, prevent the disease from ever spreading.”

Not all of these technologies come from third parties, though. Will Drayton is Treasury Wine Estates’ chief of innovation. He explains that the company developed its own mapping and routing app to help harvester operators know which fields need fruit picked, irrigation, or fertilizer application.

Red or white, the future is high-tech

The proof is in the punch, or wine in this case. The TechCrunch article doesn’t include the results of Treasury Wine Estates' experiences using these technologies. And, some winemakers argue that embracing every gadget that comes along isn’t necessarily what’s best for the wine. However, effectively using technology can help keep production costs and wine prices down.

Consider the following definition of resiliency from the APICS Dictionary, 15th edition: “In the supply chain, the ability to return to a position of equilibrium after experiencing an event that causes operational results to deviate from expectations. Resiliency is increased by strategically increasing the number of response options and/or decreasing the time to execute those options. Resiliency is improved by risk monitoring and control.”

No matter if your organization makes wine or builds cars, risk will always play a role in business. How can you reduce risk and increase resiliency? Can increasing the use of technology reduce risk? APICS can help you answer these complicated questions. For example, together with the Institute of Business Forecasting & Planning, APICS will present the Best of the Best S&OP conference June 16–17 in Chicago. This conference covers the latest trends and best practices in supply chain and operations management, including managing and mitigating risk through sales and operations planning. For more information about this event or to register, visit http://www.apics.org/best

About the Author

Abe Eshkenazi, CSCP, CPA, CAE CEO, ASCM

Abe Eshkenazi is chief executive officer at ASCM, the largest nonprofit association for supply chain and the global leader in supply chain organizational transformation and innovation. Prior to this, he was the managing director for the Operations Consulting Group of American Express Tax and Business Services. His leadership roles have included project management, business process redesign, and individual and organizational alignment. Eshkenazi may be contacted through editorial@ascm.org.

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