Summary

Digitalisation offers the Dutch greenhouse horticulture chain the opportunity to (once again) become world leaders in vegetables and ornamental products That is the core of the ‘Feeding and Greening the Megacities’ strategy, which consists of the pillars Knowledge & Innovation, Selling products and services to (residents of) Western European megacities, and the International sales of such concepts.

These pillars can to a large extent be realised by using new technologies. This will enable the sector to meet challenges in the areas of securing green knowledge, establishing short chains, and responding to consumer desires.

The sector is no stranger to the use of digital technologies. The Dutch greenhouse horticulture chain has made great strides in recent decades. A large amount of information has already been digitised (e.g. auction paperwork), and there are also business processes (such as climate control) that have been fully computerised for many years. This means that the sector has already made considerable progress in the first two levels of digitalisation, namely digitisation (converting information from a physical to a digital format) and digitalisation (using digital information to set up processes).

There are still concrete tasks remaining in the second level. For example there is room for decision support systems to be established in various links of the chain. Autonomous cultivation is a clear example of this; it is the domain of robots, Artificial Intelligence (AI), sensors, vision technology and mechatronics, amongst others.

These technologies undergo further market development autonomously; no joint, co-operative actions are required. But the sector does need to ensure that the preconditions are present for these technologies to succeed. These preconditions are a good ecosystem, the digitalisation of green knowledge, and the creation of awareness and knowledge amongst users (such as the production companies)

There is also a third level of digitalisation: digital transformation. This involves a fundamental change to the business model, chain processes and business processes and the employees, through the application and acceptance of technological innovations. This is also referred to as ‘Horticulture 4.0’. Digital transformation is the next industrial revolution.

Digital transformation is not a short-term process, and it’s certainly not something that will happen overnight. It’s hard to predict what the digital transformation of the sector will look like. The first outlines are already visible; for example, growing as a service is expected to rise.

So on one hand, this third level is difficult to predict, but the sector can certainly prepare for the digital transformation by, for example, working on making data widely accessible, developing data standards, and continuing to work on awareness and an open attitude amongst business owners.

Because no matter how digital the future is, it’s people who are in charge. But in order to do that they – the business owner or the employee – must have the right competences. So digitalisation also places demands on the ‘humanware’ in the sector.

1. Introduction

From auction paperwork written out by hand to unmanned growing and e-commerce platforms: Dutch horticulture has developed enormously in recent years. Digitalisation has played a leading role in almost all developments, and that role will increase in the coming decades. It’s thought that sensors, robots, artificial intelligence, big data and vision technology, for example, are on the brink of their real breakthrough.

One question that often comes up is: What does this breakthrough mean for the future of horticulture? But there are other questions that are just as important: what breakthroughs does the horticultural sector want, and how is the sector going to direct those breakthroughs? After all, digitalisation isn’t something that is just happening to horticulture; digitalisation is also a question of setting a goal and a vision yourself.

There is no such goal and no such vision at this stage, or in any case not for the entire horticultural cluster. Various organisations within the sector have created visions of the future of digitalisation, but these visions often relate to their own subsector or organisation, while one of digitalisation’s specific qualities is that its effects cross the borders of (sub)sectors.

So it’s high time that a common goal and a common vision was set for the horticultural cluster with regard to digitalisation. This will mean that stakeholders within the cluster know what the direction is, why, who does what, who doesn’t, and which steps need to or can be taken together. Additionally, a collective vision means connections with regional and national initiatives involved with economic development.

You will find that vision in this document, which has been compiled with the help of many clever minds both inside and outside the horticultural sector. It’s a document by and for all of us. And it’s also – as they say – a ‘living document’. Digitalisation doesn’t stand still. It’s up to the horticultural sector to keep up with – or better still, stay ahead of, steer, come up with and take advantage of – developments in digitalisation.

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2. Why this vision?

Digitalisation doesn’t need a vision; it almost happens on its own. Even without a hefty document packed with reflections, outlooks and advice, robots, sensors, and AI devices are going to be developed by knowledge institutions and the tech industry, and put to use in the horticultural sector. So why is a vision needed?

Digitalisation is much more than just the rise of a new technology. It’s a revolution, comparable to the industrial revolution. “The digital revolution has transformed almost every aspect of life since the start of the 20th century and has resulted in a digital world, just as the Industrial Revolution 200 years earlier resulted in the industrial society,” according to Wikipedia.

The effect of digitalisation will be huge, and they can be seen already. Shopping streets have competition from online stores, hotels are booked via websites, and you keep in touch with friends and family using social media.

Digitalisation has also been apparent in horticulture for a long time. For decades greenhouse climates have been controlled by computers, auction paperwork has been electronic, and greenhouses have sensors to monitor variables such as temperature and humidity. And that’s just the start.

Robots, drones, AI, big data, blockchain: in recent years new technologies have been cautiously entering the sector. There are a number of reasons why they are not yet commonplace; more on this later in this document. But they are going to break through in the near future; that’s a foregone conclusion.

The creators of this document expect that digitalisation is constantly developing and will result in a digital revolution. In other words: digitalisation will not only have an effect on the way that individual companies operate from day to day, but on their business models as well as on the entire sector.

A simple example. A digital marketplace enables production companies to make direct contact with buyers and acquire valuable market information. This then places those companies in a different position in the chain. But that does demand a lot from the business operations, including in the areas of logistics and quality. And the education sector, for example, will need to respond to this too.

Something similar happened during the first Industrial Revolution. Economist Jeremy Rifkin describes how the rise of the steam engine led to the rise of the railways in America. It resulted in the creation of enormous construction companies, and even of big grocery chains and branded products. A lot of coal was required to fuel the trains, so mines were purchased. And the railways needed welleducated staff for the stations. It had a huge effect on education: all American students needed to have more or less the same competences, such as being good at sums.

The impact of digitalisation on the sector will also be historic. The chain as we know it is going to change; power relations might be turned upside down. And maybe there will be new entrants, just as Airbnb and Uber have changed the hotel industry and taxi services.

The horticultural sector therefore needs to develop a vision for this, to avoid being taken by surprise by the developments. A proactive attitude is needed more than ever. This piece can be read as a continuation and further development of the role of digitalisation in the ‘Feeding and Greening the Megacities’ strategy.

The consequences of digitalisation are impossible to predict. The course of events depends on a lot of different factors. One important factor is the businesses themselves. They could become key

players in future developments. In order to do so, though, they need to be thinking about their role already. For example, do they want to be at the forefront of digital innovation development, or do they simply want to be an end user of these innovations?

So business owners need to think about their role in the chain, both now and in the future. That’s a complex task. In order to do so, more knowledge is required about what digitalisation is and its possible effects, opportunities and challenges. This is then the most important reason to have a digitalisation vision: to give business owners the insight they need in order to make choices. Providing that insight is a collective task.

Digitalisation is too big, too complex and too comprehensive for an individual business owner. He or she needs support; not only strategic support, but also support from the education sector and government authorities, for example. These parties therefore also benefit from a digitalisation vision. So that we all know where the future leads, and above all: which future we want.

3. The tasks for the Dutch horticultural sector

3.1 The Dutch horticultural sector: key figures

The Dutch greenhouse horticulture sector is an economic powerhouse. At the core of the sector are the thousands of production companies, with a total acreage of 9,693 hectares of greenhouses. Each year a portion of this is replaced by new greenhouses. Based on the technical lifespan of the fixtures and fittings (20 to 25 years), 400 hectares should be replaced each year, but in reality the figure is higher. Technological developments mean that installations and greenhouses have a shorter technical (and economic) lifespan.

The sector’s strength is also reflected in the employment figures. There are 146,000 people employed in the chain, including business managers and owners. The total employment totals almost 254,000 annual work units. Around 58% work in production companies, with the remainder of the jobs in supply and distribution businesses. The sector’s production value is €27.9 billion, making horticulture the biggest sector in the area of primary agriculture and horticulture. The entire horticultural chain contributes 2.7% to Dutch GDP. The export value is around €24.5 billion, meaning that the sector accounts for 4.7% of total Dutch goods exports. Technical businesses (such as greenhouse builders) and services (such as seed breeders) are responsible for relatively high export value.

So the Netherlands is a world player when it comes to greenhouse construction. Each year around €1.4 billion is invested in new greenhouse construction worldwide, with Dutch companies responsible for €900 million of this. More and more often, this new construction involves high-tech greenhouses and vertical farming: the acreage of these is growing faster than the low-tech greenhouse surface are.

Table 1 Overview of covered cultivation acreage worldwide

Type of covered cultivation worldwide Acreage 2018

Low-tech greenhouses

High-tech greenhouses

Vertical farming 550.000 ha

50.000 ha

40 ha Growth estimate

4% per year

7% per year

15% per year

(Source: Een goed klimaat voor tuinbouwtechniek. Toeleveranciers groeien en veranderen) Acreage 2025

+ 700.000 ha

+ 80.000 ha

+ 100 ha

In 2017 the sector spent €765 million on research and development, amounting to approximately 4.5% of all R&D investment in the Netherlands. More than three-quarters involves expenditure on the company’s own activities or on outsourced activities. Around two-thirds of the R&D investment was made by businesses outside the primary sector, particularly companies active in the breeding and propagation of seeds and young plants. The sector’s total annual investment in digitalisation, and how many businesses invest in it, is not known. In order to answer this question, we must first define what is understood by ‘digitalisation’. This vision is a contribution to this definition.

3.2 The ‘Feeding and Greening the Megacities’ strategy

Dutch greenhouse horticulture excels in a number of related areas. The sector has the knowledge and skill to realise large production quantities extremely efficiently. It means that Dutch flowers fly all over the world, and Dutch vegetables are transported throughout Europe. At the same time, Dutch green knowledge and horticultural technology is in great demand. ‘Made in Holland’ is a quality mark in greenhouse horticulture.

But this top position is no longer a given. Production for far-flung markets is outdated for sustainability reasons. In addition, other producing companies now possess more and more knowledge, so they are easily able to realise large production quantities themselves.

‘Feeding and Greening the Megacities’ is the answer to this new situation. The idea behind this strategy, developed by Martin van Gogh (Batenburg Techniek, Economic Board ZuidHolland, Greenport West-Holland), is that Dutch greenhouse horticulture has a strong commitment to knowledge and innovation. The sector needs to remain (or become) number one in areas such as nutrition & health, plant components, and technical systems. With this knowledge, megacities in Western Europe (the area within a roughly 500-kilometre radius of the Netherlands) can be fed. Additionally, that knowledge can be exported to megacities in other parts of the world. This often occurs as part of so-called turnkey solutions in which the greenhouse construction, the complete equipment and even the cultivation expertise are delivered from the Netherlands. In this way the horticultural cluster contributes to the ‘Sufficient and safe food in the world for everyone’ ambition.

In the ‘Feeding and Greening the Megacities’ strategy, the Dutch greenhouse horticulture sector therefore needs to shift its focus from producing lots of vegetables, flowers and plants to producing lots of knowledge. Developing, recording and using that knowledge and innovation will require far-reaching digitalisation in the sector and in businesses.

‘Feeding and Greening the Megacities’ consists of three lines:

• Number one in knowledge & innovation • Selling products and services to (residents of)

Western Europe • Selling concepts internationally

Together, they ensure a vital, healthy and sustainable future for the Dutch greenhouse horticulture cluster.

Figure 1 Feeding and Greening the Megacities

3.2.1 Number 1 in knowledge and innovation

The first line of ‘Feeding and Greening the Megacities’ is number 1 in knowledge & innovation, or, better put, back to number 1. In the mid-20th century, the Netherlands grew to become an internationally leading horticultural country. This mainly came about because different parties worked together to develop new knowledge, particularly with regard to cultivation and crops. At the same time, the sector was able to convert this knowledge into many different innovations.

This meant that for a long time, the Netherlands was a model for sectors in other countries. What came from the Netherlands was good, because it was only in the Netherlands that a lot of serious research was conducted. But the Netherlands is now in danger of losing that position – or, according to some, has already lost it. There are various reasons for this, such as fragmentation within the sector, government policy, and other countries placing more of a focus on knowledge and innovation. In the field of vertical farming, for example, other countries are now ahead of the Netherlands, and more and more often, innovative horticultural solutions are coming from distant countries. The US tech industry has also discovered food production in controlled environments as a potential revenue model.

For decades the Dutch sector’s leading position meant an economic value, not just a symbolic one. The sector will therefore need to once again place its full focus on knowledge and innovation in order to achieve a healthy future.

3.2.2 Selling products and services to (residents of) Western Europe

Production for the Western European market appears easy to achieve. After all, the Dutch horticultural sector has been doing it for decades. But appearances can be deceptive. There are now new circumstances that call for a different approach.

First of all, the sector has changed. Businesses are finding it increasingly difficult to source staff who possess green fingers and green knowledge, and this trend is expected to continue. As a result, horticultural businesses are becoming increasingly dependent on green knowledge that is stored ‘somewhere’, for example in smart devices, in order to ensure healthy business operations.

On top of that, the market has changed. Producing for auctions only is a thing of the past; if businesses are to survive, they must have a good knowledge of their market and their products. This enables them to produce better, and to develop new products or even new business models. Acquiring and applying this data is not something that humans can do: the amount of data is too large and the range of potential connections is too complex.

The world has changed too. Buyers, consumers and citizens set requirements for a product’s sustainability. They want it to be obvious that a product has been produced safely and cleanly, and preferably by a reliable local grower. Digitalisation plays a role here too. Because smart solutions enable production to become more sustainable and to become transparent, and new earning models can be developed as well.

In summary, digitalisation is essential in order to be able to continue to provide the modern Western European market with healthy, beautiful Dutch produce. Smart, connected solutions will mean that the Dutch horticultural industry can continue to produce and sell, with better conditions and a better market position.

3.2.3 Selling concepts internationally

The third line of ‘Feeding and Greening the Megacities’ is selling concepts internationally. ‘International’ refers here to countries and regions outside Western Europe. Some of these countries and regions were once important sales territories for Dutch greenhouse horticulture, but that position is now under pressure.

Local production has many advantages for countries and regions. For example, it reduces the number of kilometres travelled, a country is then less dependent on third countries for its food supply, and it means that available resources (such as money, labour and raw materials) can be better utilised.

Green knowledge is required for local production, and this is often still insufficient. As a result, there is great interest in the green knowledge held by Dutch greenhouse horticulture. There’s a reason why Dutch businesses and young talents are welcomed with open arms in distant countries!

As a result, there is also a growing market for solutions that enable Dutch knowledge on things such as cultivation to be adapted for local production. That knowledge might be present in people’s heads but, as mentioned earlier, the Netherlands itself is in desperate need of those heads for itself. Digitalisation is therefore a better answer, and more marketable too.

3.3 Horticultural scenarios

In 2020, the crisis organisation Coronacrisis Tuinbouw (www.tuinbouwscenarios.nl) developed four scenarios for the future of the horticultural industry. The scenarios serve as tools for individual business owners in the horticultural industry: they are intended for reflection on the future of each business and to make decisions regarding the business strategy. The authors, who include

business owners, knowledge institutions and government bodies, call them ‘extreme, yet plausible, futures for the horticultural cluster’.

There is a place for the ‘Feeding and Greening the Megacities’ strategy in each of the four scenarios; only the exact role of the Netherlands and the implementation will vary according to the scenario.

The four scenarios are:

• Competing globally • International corporate responsibility • Individual national operations • Regional co-operation

3.3.1 Competing globally

In the ‘Competing Globally’ scenario, countries around the world have decided to abolish existing import duties and barriers to import in order to stimulate global free trade. This results in a small group of extremely wealthy consumers. In emerging markets (Asia, Africa), the urban middle class is growing. The world also has an increased underclass hovering around subsistence level.

Global climate accords are a dead end. Sustainability is barely on the political agenda anymore. Big companies are engaged in cutthroat global competition. The flourishing of global digital platforms, which account for a large proportion of sales, is driving developments. These platforms are the direct link between major producers and buyers (both consumers and processing enterprises).

For this reason, governments are now entirely focused on creating a global level playing field. The Dutch government is contributing too, by facilitating the business community in this way. All attention is focused on supporting economic growth. If this scenario becomes reality, it will have the following consequences for horticultural businesses:

• Food crop cultivation: Big, fast, hard • Ornamental crops: Number 1 in the world • Starting Materials: Multinationals lead the way • Technology & Delivery: Maximum internationall

3.3.2 International corporate responsibility

In the ‘International corporate responsibility’ scenario, there is a great deal of international cooperation for complex cross-border tasks. But the corona crisis has deepened the existing ideological and cultural fault line between Europe, the United States and China. Governments have made a massive effort to redistribute resources (via a special tax on the rich and on assets).

The government facilitates businesses taking a sustainable approach via through tax incentives, subsidies, and certified quality marks. Companies enter into strategic alliances, and capital can be mobilised for growth through mergers and joint ventures. The strict requirements on working conditions and remuneration for migrant workers result in a boost to the robotisation and computerisation fields. This is strengthened by the decreasing supply of migrant workers, as they are able to find work in their own regions.

If this scenario becomes reality, it will have the following consequences for horticultural businesses:

• Food crop cultivation: Europe’s greenest strawberry • Ornamental crops: Healthy and sustainable, together • Starting materials: Natural pharmacists • Technology & Delivery: Competing innovation centres

3.3.3 Individual national operations

In the ‘Individual national operations’ scenario, the global economy is in depression. Countries fell deeper into debt, creating a new debt crisis. Solidarity in the European Union failed to last, with the union disintegration into a Northern and a Southern Union. The middle class in the West is under enormous pressure, purchasing power is falling.

Taxes on profit and corporation taxes are reduced in order to improve the Netherlands’ business climate and international competitiveness. In order to survive, many companies choose to open branches abroad and to produce for local markets, often under local branding. International trade is mainly limited to neighbouring countries, markets are smaller, production chains are less efficient and economic growth is slower. There is no joint approach to sustainability. The lack of scale means that fewer specialised technologies are available. Companies are focused on the short term. Longterm investments are too risky and go into decline.

If this scenario becomes reality, it will have the following consequences for horticultural businesses:

• Food Crop Horticulture: a German among

Germans • Ornamental crops: Everyone for themselves • Starting Materials: Local knowledge development • Technology & Delivery: International sales even at short notice

3.3.4 Regional co-operation

In the ‘Regional Co-operation’ scenario, governments and consumers are averse to global trade flows. It’s not ownership that counts, but the experience of the authentic product. A clean living environment prevails.

These are mainly regions that have seized political and economic power. They are focused on a reliable supply of strategic goods and services to their citizens, such as water, energy, education, transport, and food as well. A core EU has emerged as an alliance of regions from the Netherlands, Germany, Flanders and Denmark; countries with similar ambitions and interests. Regionalised markets are causing a major shift from businessto-business to business-to-consumer. Consumers demand transparency. This means that businesses are forced to enter into regional alliances that make a verifiable contribution to a stable regional social structure and circular economy. In this world there is a wide variety of technological developments underway, each of them adapted to regional needs and normative preferences. This is an obstacle to further globalisation, and to the big tech companies that go along with it. In its place there is enormous expansion of the open source principle: freely-accessible knowledge that is developed collectively.

If this scenario becomes reality, it will have the following consequences for horticultural businesses:

• Food crop cultivation: High-tech or high-touch • Ornamental crops: High-touch or high-tech • Starting Materials: Breeding becomes political • Technology & Delivery: Collaborating for internationalisation

4. Digitalisation in the horticultural sector

4.1 Digitalisation: Three levels

Ask 100 experts to give you a definition of digitalisation, and you’ll get 100 different definitions. Some will see it as a collection of technologies like Artificial Intelligence (AI) and processors, others as a series of business processes controlled by computers, and still others will believe that robots are taking over the world. In any case, what all these interpretations make clear is that there’s a lot involved in digitalisation.

For a common goal and a common vision, it’s important that we all have the same understanding of digitalisation.

Digitalisation can be described at various levels:

1. Digitisation is the conversion of information from a physical to a digital format. It involves the conversion of something physical into a digital form, i.e. ‘zeros and ones’. 2. Digitalisation is the use of digital information to set up processes. It involves (steps in) the existing process being digitalised or computerised. 3. Digital transformation involves a fundamental change to the business model, chain processes and business processes and the type of employees and the skills they require via the application of technological innovations.

The three levels of digitalisation can also be identified in the horticultural sector. Handwritten auction paperwork was mentioned in the introduction to this document. It’s now a thing of the past. Information on batches of flowers or vegetables isn’t written on carbon paper anymore; it’s stored and sent digitally. Level 1, then.

Digitalising the information on, for example, a cart of roses, enabled new processes. For example, the auction can follow a lot digitally and send invoices automatically. And it’s easy for the grower to import the trading information into the accounting system and to analyse which roses bring in the most in which period. This is an example of level 2.

But development didn’t stop there. There are now more and more companies are focusing on e-business, for example. The simplest examples are online stores selling flowers, which have processes such as purchasing and distribution that are fully automated based on market information. They cross the boundaries of their own sub-sector and even consider how breeding can be used to develop products with a longer shelf life. So this is an example of digital transformation.

The horticultural cluster certainly still faces challenges at various levels, and these challenges vary in nature. The challenges at levels 1 and 2 are about developing the right techniques, for example: how can a camera identify individual flowers in a greenhouse? On the level of digital transformation, the questions are more about chains, revenue models, internationalisation and knowledge development. For example: how can the Dutch horticultural cluster capitalise on knowledge about a healthy crop?

Later in this document we will discuss the various challenges in more detail. Unless otherwise indicated, the word ‘digitalisation’ will be used in the sense of all three definitions given above.

Last year Kate was hired by a medium-sized rose nursery. She works there as a member of the IT staff. At least, that’s how the position was described in the job advertisement. But she sees herself as much more of a ‘digital transformer’. Not because it sounds cooler, but because her work doesn’t actually have anything to do with IT. OK, she works with computers a lot. But when she talks about IT Kate means things like systems administration and application management. While the challenges faced by the rose nursery are very different.

The business still has a lot of paperwork, for example. Leave request forms, sickness registration, surely all of that could be done digitally? And that makes the next step quite a bit easier too: being able to process information within the company in an even better way. Things like planning and forecasting. Her dream is that the rose nursery will become an e-nursery, that the business won’t just sell big consignments of roses to anonymous purchasers, but will also venture into the events business. That means smaller consignments but with bigger margins, growing only what the customer has ordered. And that calls for a different kind of co-operation within the chain, for example with an events agency and a transport company. According to Kate, this is precisely where digitalisation is crucial.

4.2 Digitalisation in the horticultural industry: the state of play

The horticultural industry made an early start with digitalisation. The first climate computers were launched in the 1970s, enabling growers to manage the climate inside the greenhouse. In order to do this, climate computers are connected to sensors (for the input of variables such as temperature and wind speed) and to climate equipment (such as the central heating boiler and the windows). Thanks to this, it wasn’t long before horticulture reached the second level of digitalisation.

The climate computers were and are used by just one link in the chain: the production companies. But digitalisation is nonetheless able to cross the borders of the various links. It’s sometimes said that silos are disappearing thanks to digitalisation. Information exchange is essential if the various links are to collaborate and co-ordinate smoothly. For example, a transporter prefers to know as soon as possible how many tomatoes will be delivered or have been sold: after all, this information allows for better scheduling, which in turn means lower costs and better service provision.

So digitalisation is a precondition for things like chain integration and short chains. This is another area in which horticulture has been digitalised for decades now. The Electronic Delivery Form replaced the old hard copy auction paperwork (that growers and the trade channel used to exchange information), and for years now traders have been able to use Distance Selling (in which the trade channel and the trade exchange information and can perform transactions) to buy flowers for the auction while in their own workplaces.

The fact that the horticultural cluster made an early start with digitalisation makes it a difficult sector for other businesses to enter. After all, many solutions have already been developed, tested, and developed even further. A grower already has a lot of devices and processes in his or her business that collect data. It is estimated that an average grower has at least 80 to 100 different digital data sources. These range from the climate computer (which collects many hundreds of different data points, often every five minutes) to various sensors, models, auction and sales data, soil and crop samples, labour registration details, pesticides, crop measurements and harvest details. The links between these devices are limited, meaning that the grower is required to combine the many data

sources, often by hand or using Excel exports and imports.

But in recent years the number of entrants to the sector has been increasing. These new players have specialised knowledge in, for example, one of the digital techniques (e.g. drones), and are therefore able to deliver added value to the horticultural cluster.

LetsGrow.com was established in 1999 as a joint venture between WUR and Hoogendoorn Growth Management. The objective of the business is to store and compare crop and cultivation data. In the early years this mainly involved comparing data within crop segments. To do so, growers within a particular crop segment give access to fellow growers and consultants, enabling them to view the data remotely. Models were also developed during this period, for things such as harvest forecasts for tomatoes and the growth of potted chrysanthemums and poinsettias.

The company has had an API (Application Programming Interface) for years now, which makes it very easy to store and combine data from different sources. It allows the grower to combine a lot of data very easily, for example data captured by various sensors. Additionally, with permission from the owner (the grower), developers can easily create and test new models.

4.3 The chain

Here we will consider some of the links in the horticultural chain and ask the question: what role does digitalisation play in these businesses?

4.3.1 Breeding

For breeding companies, the main customers are production companies both in the Netherlands and overseas. For this reason, digitalisation is largely aimed at developing seeds and propagating plant material that is the best fit with the wishes of the growers and of their customers. This therefore concerns issues such as market information (i.e. the best possible analysis of market developments) and product characteristics (phenotyping), such as appearance, resistance to disease, reliability, and use of important resources (such as energy, pesticides and labour). In addition, digitalisation is obviously important for internal processes such as labour management, energy and logistics.

4.3.2 Propagation

Propagation businesses (or nurseries) grow seeds or cuttings into plant material. Logistics, planning, reliability and a healthy crop are essential factors. As a result, for these businesses digitalisation is mainly aimed at optimising internal processes and storing data during cultivation so it can be passed on to the next steps in the chain.

4.3.3 (Technical) supply companies

(Technical) supply companies, such as fertiliser and pesticide suppliers and climate computer developers, are mainly focused on developing the best possible range for cultivation businesses, and on selling that range. Purchasing, logistics/

distribution and sales are therefore essential. Digitalisation plays an important role in the R&D process for technical suppliers.

4.3.4 Project developers and greenhouse builders

Greenhouse builders have increasingly become project developers in recent years. Their greenhouses are no longer simply steel and glass constructions; they now include plastic greenhouses and high-tech buildings (indoor farms) that enable growers to achieve optimal production. This means that digitalisation is part of the product portfolio for these companies, as well as a tool for developing new projects.

4.3.5 Production companies

Various developments and trends have led to production companies increasingly becoming chain partners in recent years. For example, they have banded together in growers’ unions, becoming trading partners, or even made collective price agreements with retailers. As a result, it has become increasingly important for production companies (i.e. growers) to be able to deliver a reliable product according to a reliable schedule. At the same time, the cost price remains an important factor for production companies. The efficient use of available resources (such as energy, labour and water) is an essential part of this. The growers’ unions are also taking steps towards investigating possibilities involving digitalisation, such as the use of harvesting robots.

4.3.6 Trade, transport, packaging companies and sales

For businesses active in trade and transport, and for packaging businesses, planning and reliability are essential. For this reason, digitalisation at these companies is mainly focused on these aspects. For packaging companies involved in sales, digitalisation plays a role when it comes to market information, among other things.

The Hortivation foundation is focused on technical innovations and knowledge management in greenhouse horticulture. Hortivation, a collaboration between AVAG and TNO, developed a calculation tool for designing greenhouses: CASTA. With CASTA, greenhouse designers and builders can make calculations for the greenhouse structure, for example involving safety and light transmission. Calculations can be made to ensure that the greenhouse design meets Dutch standards for greenhouse design and construction. These calculations take into account the climatic conditions at the place the greenhouse will be built, as well as the crop to be cultivated. Cultivation in the Saudi Arabian desert calls for a different type of construction than cultivation in a temperate Dutch climate.

Fresh fruit and vegetable sales are increasingly conducted online and digitally. Customers place orders via online stores, and robots ensure that the correct products are selected for shipment. This is how it works at Van Gelder fruit & vegetables in Ridderkerk, for example. In 2019 as much as 98.4% of orders were made via the online store – around half a million orders in total. There are still a few customers who order by phone or fax, but fewer and fewer all the time.

Alongside companies that have been operational for decades – such as Van Gelder, which was founded in the middle of the last century – there are many new entrants too. Startup Vers & Vers is one example. Individual customers can buy fruit and vegetables via an app, available for download from the App Store. “It’s easy to order your fresh produce using the ultramodern app.”

And then there are businesses that specifically focus on startups in the fresh produce sector. One of these is Hollander. “In order to meet the specific demands of e-commerce, our entire operation is organised around a highly variable range and is prepared for any growth spurts that might come from start-up and scale-up customers. All your fresh produce fulfilment is quickly adaptable and scalable, while daily operations are guaranteed.”

4.3.7 Retail

Retail is the most important sales channel for Dutch greenhouse horticulture. Retail businesses are specialised in providing as many consumers as possible with the widest possible range of products. The retail focus is therefore on market information, logistics and distribution, and delivery reliability, amongst other areas.

4.3.8 Consumer

For a long time the horticultural industry had no direct business relationship with the consumer, but in recent years more and more initiatives have begun in which consumers and growers do directly collaborate and do business. For example, increasing numbers of growers now have their own online store or professional shop by the roadside. 2020’s corona crisis reinforced this effect, with many consumers buying flowers and vegetables directly from the producer as a show of support.

An important trend here is that consumers want to know how a product has been produced and transported throughout the entire chain.

4.4 Challenges for the Dutch horticultural sector

What consequences do the changing world and the ‘Feeding and Greening the Megacities’ strategies have on the practice of horticulture, and especially for issues where digitalisation could play a large(r) role?

4.4.1 Green knowledge

Digitalisation in horticulture can be divided into ‘green’ and ‘grey’ digitalisation. Green digitalisation refers to the digitalisation of everything related to the crop itself. This includes things like the length of the crop, leaf area, number of flowers, and the height of first flowering cluster. These measurements are still mostly done by hand. Grey digitalisation refers to all peripheral installations, such as the climate computer, the sorting machine, and the installation for internal transport of cultivation tables in the greenhouse.

There are still major steps to be made in the field of green digitalisation. This is remarkable: after all, cultivation starts with a green product, and thus knowledge of plant physiological processes.

However, there are fewer and fewer people who possess green knowledge (the number of ‘green students’ is falling), while internationally there is most definitely more demand for it. One solution to this is data-driven cultivation. In data-driven cultivation, various cultivation measures are advised based on observations, data, forecasts and interpretations. Such a system also has the advantage that the observations and interpretations are always carried out in the same manner. Data-driven cultivation can serve as the basis for autonomous cultivation, in which cultivation measures and possibly other actions too are controlled and executed (more or less) entirely without human intervention. Instead of having to be involved with every single action and decision, the business owner or staff can focus on the exceptions. Green knowledge will be required to make the decisions for a long time yet, but if the standard matters are sorted out automatically, fewer people with green knowledge are required. It also makes ‘remote’ cultivation easy, so a business can, for example, control its cultivation location in Morocco or Spain remotely from the Netherlands.

So as the name says, data-driven cultivation requires data. More specifically: data about the crop and the environment in which it is cultivated, as well as about matters such as demand, price and labour requirements. In other words: how does the crop react to changed conditions, for instance due to changes in the weather or because the crop is watered? This data needs to be recorded and then serves as the basis for a crop model, which can be used in future to predict how the crop will respond. By combining this crop data with the aforementioned data relating to labour, price-making, (predicted) demand and climate measurements, a model can be created to help the business owner with complex decisions. Artificial Intelligence (AI) can play a major role here; after all, it involves combining large amounts of data and many different factors all of which impact on operational management outcomes.

Obtaining the data is a question of observation and recording. Sometimes these are automated and take place within a short time frame (e.g. climate data recorded every five minutes). Other measurements are still performed entirely manually, for example crop measurements such as number of bunches, flowering height, head thickness, etc. This is very labour-intensive work and means that only a limited number of plants can be measured.

The use of digital technology can offer a solution here. The possibilities include sensors, image recognition, artificial intelligence, digital twins and blockchain. Important preconditions are the need for non-invasive methods, secure storage, data ownership, and privacy.

The recording of data also enables the creation of new products and concepts possible, and thus new revenue models. This also includes new forms of education and consultancy.

In 2020, the second edition of the Autonomous Greenhouse Challenge was held. The ‘remote tomatogrowing’ competition was won by ‘The Automatoes’. It is noteworthy that the team achieved similar production to a reference team of growers, but at a lower cost. The big winner, however, was greenhouse horticulture, because it enables more efficient cultivation. Dutch horticulture can lead the way in this development, according to tomato grower Ted Duijvestijn, a member the reference team: “This development can’t be stopped. However, you can speed it up through targeted investment. To avoid it developing willy-nilly, it could be tacked collectively for the time being.” (Source: Onder Glas, 11 June 2020)

4.4.2 Internationalisation

The Netherlands is not the only country that cultivates horticultural products. Spain, for example, has been an important European production area for some time now. This means that Spain is not a direct competitor, partly due to the fact that the range offered by the two countries can be complementary: for example, supermarkets sell Spanish tomatoes in winter and Dutch tomatoes for the rest of the year. Dutch growers are increasingly choosing to begin or take over cultivation locations in Spain – literally remote cultivation.

There is something similar at play when considering distant destinations. In recent decades, for example, a large number of Dutch businesses have started cultivation in places like China or Mexico. The products there do not complement the Dutch range; they serve a different market. And there, too, there is a need for Dutch cultivation knowledge. For example, a few years back the Chinese greenhouse in Bleiswijk was launched; a project aimed at increasing Dutch knowledge on producing under Chinese cultivation conditions.

Information (on the crop and on cultivation measures) needs to be transmitted quickly, reliably and securely when it comes to remote cultivation. In addition, more knowledge of local growing conditions is required, for example so that crop models can be adjusted.

4.4.3 Short chains

The internet’s creators saw the medium as the realisation of democracy: with an Internet connection, everyone has access to knowledge, and everyone is able to publish. Whether that idea has become reality is a question we will set aside here. However, the fact is that digital solutions enable producers to make direct contact with buyers, leading to new entrants in, for example, the hotel industry (Airbnb), the taxi industry (Uber) and the music industry (Spotify). Providers are also able to see which other parties are active in the region. In recent years various initiatives have emerged in the horticultural sector. Koppert Cress, for example, uses photos on Instagram in order to know – assisted by image recognition – which restaurants are serving cress. There is also an increasing number of digital marketplaces. These are often small-scale local initiatives – and this while an e-commerce platform has great advantages for the suppliers, such as better insights into price-setting, customer journey, valuation, and opportunities for (product) innovation. Cautious efforts to scale up these sorts of possibilities are currently underway.

Digital techniques such as data exchange, algorithms, blockchain, data management/ warehouse systems and linking to cultivation systems obviously play a major role in the realisation of these types of digital marketplaces.

Young people and first-time buyers like to have indoor plants, but they’re not keen to spend half a day in a garden centre looking for the right one. Because what should you choose? And what’s involved in plant care? Axel Persoon, son of a plant grower, had these younger, inexperienced plant-lovers in mind when he came up with the idea for Plantsome.

Plantsome is a combination of an online store and an app, aimed at making the purchase and care of indoor plants as easy, accessible and fun as possible. Established in 2017, the business has now spread beyond Dutch borders and operates in places such as Belgium, Germany and Canada.

4.4.4 Responding to consumer demand

Car manufacturer Henry Ford apparently once said, “You can have it in any colour you want, as long as it’s black.” Mass production made products affordable for the general public. And mass production was also what enabled the Dutch horticultural industry to grow.

But consumers have changed. They no longer want a choice of black, black or black; they want a customised product that’s suited to their individual needs and wishes. At the same time, it’s in the interest of the one who is selling to manufacture and sell a wide range of products.

This has led to the rise of a new phenomenon: mass individualisation, which is a combination of customisation and mass production. For example, customers can buy a customised can of Coca-Cola or design their own Nike sports shoes.

The horticultural industry has increasingly segmented its production in recent decades. Consumers can now choose from countless different shapes and flavours of tomatoes. True mass customisation is not yet economically viable when it comes to products, but the changes to the (sales) chain do present opportunities. With e-commerce applications, for example, a consumer would have the option of choosing from products from various suppliers, so would no longer be reliant on the range available on the supermarket shelves.

4.4.5 Optimising sales

In recent decades, it has become increasingly important for producers of horticultural products to produce what the market demands (or can accommodate). This is a cultural shift compared to the time when the auctions could still direct and have a correcting effect on the market.

A number of factors are required for marketoriented production. To begin with, it goes without saying that market access and market knowledge are essential. Until now that access has mainly been via trading partners. The same is largely true of knowledge; trading partners are often the ones who hold knowledge on demand. With, for example, short chains, this system could be (partly) broken.

Market-oriented production also means being able to steer and predict production. Great strides have already been made in this area. For example, crop models are able to predict how a crop will respond to cultivation measures. This is then used as a basis for predicting production, and cultivation measures can be selected with the aim of speeding up or slowing down production. However, these crop models are still very much in their infancy. Obviously production can be steered using the existing crop computers. Additionally, tools such as image recognition can be used to identify the precise moment that flowers should be pollinated or harvested to ensure optimal shelf life.

Both consumers and society are making increasingly strict demands on both products and production. These demands relate to issues such as sustainability, safety, food waste and transparency. Digitalisation can play a major role in this area too, for example by safeguarding processes and information, realising more efficient production, and developing new revenue models.

4.4.6 Using resources more efficiently

For a long time, high production meant high profits, which is why the Dutch horticultural industry has long been focused on increasing production. However, with the current resources it appears that the ceiling has been reached: the production realised by Dutch businesses is already at the highest level. In addition, if more is produced, the produce needs to be harvested. This requires staff, which means additional costs. Labour costs are already the biggest expense production companies, and this could mean a threat to the international position of the Dutch horticultural industry. As a

result, high production no longer automatically means high profits. Unless a robot can harvest the produce, but more on that later.

So the goal isn’t to achieve high production in itself; it’s also about the product:resources ratio. In other words, efficient cultivation with the lowest possible use of things such as water, fertilisers, energy or pesticides. The West-Holland horticultural cluster, for example, has agreed to use 30% less energy by 2040. These types of savings require the use of data and models to enable crops to be managed better.

In addition, the emergence of Artificial Intelligence (AI) will mean that the optimal use of resources comes under even more careful consideration. Once the algorithms are better and are able to take a lot more factors into account that growers are currently able to manage in their heads, production (expressed in, for example, kilograms per unit of water or energy used) will increase even further.

4.4.7 Sustainability

The Dutch horticultural industry wants to be climate neutral by 2040, and thus reduce its CO2 footprint to zero. Efforts are underway in various areas, include regional heat networks and the availability of CO2. Good demand and supply management is the starting point in a so-called Multi Commodity Smart Grid. This is necessary for both electricity and heat, in order to be able to do more with the sustainable energy sources that are available, and to make optimal use of the infrastructure.

Sustainability is not only about the use of resources. For example, there is increasing attention paid to biodiversity. A healthy ecosystem in and around the greenhouse is beneficial for the crop and helps the horticultural sector to improve its image. Monitoring insects is one way to improve biodiversity. This monitoring still needs to be done by humans for the time being, making it labour-intensive. The measurements perform many functions: first of all, obviously, making any necessary adjustments, and secondly they can be shared with public parties. This informationsharing can be carried out in many ways, for example via a digital map of a larger area.

Digital techniques enable fertilisers and pesticides to be applied in a more targeted manner. For example, image recognition (e.g. by a harvesting robot) can indicate the place in the greenhouse where there’s an infestation. This can be controlled by, for example, a robot or a drone. At Koppert Cress, drones fly amongst the crops creating ‘moth confetti’ where necessary!

Spot protection of crops is both more efficient and better for the crop. Working spot-by-spot is precisely what drones are good at. When the PATS base station detects an infestation, a drone goes into action. “The drone is sent after the insect and eliminates it mechanically in mid-air, where it’s at its most vulnerable,” according to the PATS website. “This prevents the pests spreading further through the greenhouse.”

4.4.8 Unmanned growing

The availability of people with green knowledge is one of the challenges faced by Dutch growers, but other countries suffer from shortages too. In the Netherlands, these people and their knowledge are required in order to stay at number one, while in other parts of the world, these people and their knowledge are needed for increased, better, and safer production.

This means that one of the directions that digitalisation is taking is to enable cultivation using as few people as possible. In other words, to be able to deploy people who possess the required (green) knowledge as efficiently as possible.

Labour- and time-intensive activities therefore need to be supported as much as possible or, where possible, taken over by digital solutions. These digital solutions are often able to perform those activities faster, cheaper and more consistently. This includes ‘unmanned growing’.

Two important areas can be distinguished here. The first of these is the support of decisions in the cultivation and production process. This is what is now often referred to as ‘autonomous growing’. It involves the use of software and models to do things such as control the climate computer based on observational data recorded by sensors in the greenhouse. The second component is carrying out the physical work. This refers to things like picking tomatoes and roses, and making crop observations. Only when both areas come together can we speak of ‘unmanned growing’.

‘Unmanned growing’ doesn’t mean that people will no longer be involved in cultivation in the Netherlands or further afield. There are different levels, so, for example, it could be that only ‘simple’ repetitive tasks are computerised: this can be viewed as the beginning of ‘unmanned growing’. This system can be expanded step by step to encompass increasingly complex tasks. In the most extreme case, the crop is completely unmanned. It is certainly conceivable that Dutch growers don’t yet want fully unmanned cultivation. In some foreign countries, however, there is a need; after all, less green knowledge is available there.

This creates striking tensions. Dutch growers possess a high level of knowledge, so the growers have high demands for new solutions and will only want to apply them if they – according to their own feeling and insight – perform better than what the growers are doing now. This makes it difficult for suppliers to develop new solutions for the Dutch market, so developments proceed more slowly than they might.

At the same time, overseas there is a great hunger for new knowledge and applications. In order to be able to serve these customers, Dutch innovation needs to stay at a high level so we can continue to develop and test here, and subsequently introduce our products to other countries.

Dutch growers have a uniquely green thumb. They get the best results in the greenhouse. The idea of autonomous growing is that these ‘thumbs’ are entered into a computer, enabling good vegetables and flowers to be cultivated in other parts of the world too. For example, the company Blue Radix has the Crop Controller, which is able to make decisions based on local information (such as the weather and greenhouse climate) and existing green knowledge. An operator watches from a distance. Depending on the selected level, the grower is still able to make changes from the location itself (in this case the Crop Controller plays a supporting role). At the highest Crop Controller level, the grower on location only needs to keep track from his or her desk and intervene in exceptional situations.

4.4.9 People

A successful digital transformation needs more than suitable technologies; it also calls for people with the right competences. This means not only the competences of current business owners and staff, but also the inflow of new employees with the appropriate competences. This relates to employees with different education levels, from lower secondary professional education and intermediate vocational education employees who work with the new technology, through to university graduates who design the robots, Artificial Intelligence (AI) or new revenue models.

In all cases, it is essential to know which competences are needed for the technology of the future and how these can be acquired. This therefore needs close collaboration between, for example, companies and educational institutions. In addition, there’s a need to create awareness of the consequences of these new competences. The internal organisation of, for example, a company, will also need to be adapted. Here it must be taken into account that we work with both the ‘frontrunners’ and the ‘pack’, each of which require a different approach.

It is also important to realise that digitalisation doesn’t necessarily mean fewer jobs, but it does mean different jobs. For the horticultural sector and for society in general, it’s important not to forget the people in the old jobs that are disappearing and who don’t ‘automatically’ have sufficient skills to get to work in the new jobs.

5. The future of digitalisation in the horticultural industry

As set out earlier in this document, digitalisation is going to have major consequences the entire horticultural chain. Not only with regard to individual business processes, but also in terms of revenue models and chains. Some of these consequences are in the hands of the sector itself; for example, the decision of whether or not to buy a harvesting robot is one for the individual business owner. But for other consequences, it’s important for the sector itself to retain in control, so it can remain the world’s number one.

To clarify this, we will look at the three levels of digitalisation described earlier (see 4.1): Digitisation, Digitalisation and Digital Transformation, with relevant developments and collective actions for each level. We will use this structure here too when outlining areas for special attention.

5.1 Digitisation

Digitisation is the conversion of information from a physical to a digital format. In the horticultural chain, this has already happened to a large extent: auction paperwork has been delivered digitally for decades, digital images of ripe flowers are available, and growers can print out nice, neat tables and graphs of the greenhouse climate.

This first level of digitisation is an important precondition for the other levels. But for various reasons including the sector’s strength, the low threshold of digital applications, and questions from buyers, at this level a joint approach is not required.

5.2 Digitalisation

The second level is digitalisation. This is the use of digital information to set up processes. It involves (steps in) the existing process being digitalised or computerised.

One feature of this is that new and existing techniques are combined. A cucumber harvesting robot is an example of this. The robot uses things such as sensors, vision technology, mechatronics, artificial intelligence and cloud storage to recognise and assess the cucumbers’ ripeness. The cucumbers are harvested using mechatronics (a combination of mechanisation and electronics), a 3D-printed gripper, and a laser knife. To transport the robot and the harvest, techniques such as automated guided vehicles (AGV), battery and charging technology, and positioning technology are needed.

The GearVision by Gearbox Innovations is a noteworthy example of combining technologies. Using vision technology, big data and artificial intelligence, amongst others, the GearVision analyses produce on a conveyor belt. Each fruit is assessed for moisture, length, colour, possible damage, and misshapenness, amongst other things. The device is also able to trace this information back to the location in the greenhouse. In the words of Gearbox Innovations: ‘The harvested produce, a tomato, cucumber, sweet pepper, or even a kalanchoe, gerbera or rose is a sensor’.

The technologies are also intertwined; technology developed for one application can be used in another. A smaller, cheaper and more energyefficient temperature sensor can be put to use in a greenhouse for breeding, growing, or in an indoor farm. An improved camera can be used in various places where crop characteristics are determined.

This makes smart applications possible. Wageningen University & Research, for example, uses the term ‘Smart Horticulture’ instead of ‘digitalisation’. ‘Smart’ was originally short for ‘SelfMonitoring, Analysis and Reporting Technology’, but is commonly known as ‘smart’ through the idea that previously inanimate objects are able to talk to us and even steer our behaviour. But what’s more important for smart technologies is that the devices concerned are connected, for example to each other or to the Internet.

Richard grows cucumbers on five hectares. It’s a great crop, but it’s labour-intensive – cucumbers grow quickly, and a lot of crop operations are required. Having a robot harvest the cucumbers would make a very big difference, so Richard is watching the harvesting robot’s development with interest. The robot uses a camera to take a photo of the crop, identifies any cucumbers that may be there, and then assesses which ones are big and heavy enough to harvest. Cucumbers that are not yet ripe are remembered for next time, and for creating a harvest forecast.

The robot uses stereo vision to calculates the distance to the ripe cucumber, and a route free from obstacles. Then a thermal knife cuts the cucumber off at the right spot. The robot then places the cucumber on a harvest cart, which automatically drives to the shed. The harvest cart (a so-called ‘automated guide vehicle’) also charges itself, knows the route to the barn, and avoids striking people and any objects along the way.

On this second level there are already a large number of horticultural developments, such as the harvesting robot mentioned earlier. At the same time, the sector has not yet made full use of the opportunities that the second level provides: there are more technological possibilities available for meeting the aforementioned challenges facing the Dutch horticultural industry. The following themes are relevant here:

5.2.1 Decision support

As explained previously, a shortage of knowledge and qualified workers means that there is room for decision support systems for the businesses in the chain. Autonomous growing, in which digitalisation makes cultivation decisions (based on the grower’s green knowledge), is a well-known example of this.

Decision support can also make a big contribution when planning crops based on expected (future) demand. For example, take a pot plant company that has many different crop types, pot sizes (and therefore cultivation periods), and clients who have slightly different requirements. It’s not a simple challenge to properly co-ordinate potting dates, delivery, and spacing, especially if you consider that some crops have a cultivation period of a few weeks and others have a cultivation period of 1.5 years. Here, too, the possibilities presented by decision support can be put to much better use.

Market-oriented production is dependent on having access the right information and making the right decisions. There is now so much data available – with yet more to come – that people require support to make the right decisions. We’re also seeing this in the logistics and trading companies that work with complex systems.

5.2.2 Hardware & mechanisation

Digitalisation presents the possibility of farreaching, people-supporting technology. The harvesting robot is an obvious example. It enables ‘unmanned growing’, with not only the knowledge being computerised, but the (physical) labour too.

Hardware and mechanisation can provide support to people in transport and sales, for example with sorting and packing activities, just as they do in cultivation.

5.2.3 Sensing

In the horticultural chain, a lot of things are measured. However, it mostly involves measuring the conditions in which the crop grows (so-called ‘grey’ digitalisation). The measuring of the crop itself (‘green’ digitalisation) is still in its infancy. Developments such as digital twins could make a major contribution here. The use of new and smarter sensors, and the interpretation and application of the results they detect, also falls under the ‘sensing’ theme. This includes new options for measuring possibilities, as well as – for example – reducing the size of the current sensors so that they can actually be inserted ‘into’ a plant for measuring.

Sensing is also an important topic in logistics and sales. Tracking factors including transport time, temperature, relative humidity and ethylene will enable better predictions about the shelf life and quality of the produce.

5.2.4 Sales/consumers: Traceability & transparency

Consumers want to know about a product’s origin. Further development of good tracking & tracing capabilities is required for this. An important factor here is the data that is captured during the ‘journey’ through the entire chain.

5.2.5 Actions required

The following actions must be taken in the coming years to accelerate the abovementioned themes:

5.2.5.1 Digitalising green knowledge

As mentioned previously, there has still been insufficient green knowledge recorded. This recording is essential for the effective use of decision support systems in cultivation, in particular.

5.2.5.2 Creating awareness

Owners of horticultural businesses need to be more aware that level 2 digitalisation presents many untapped opportunities for better yields. This awareness will make business owners into discussion partners for non-sector and/ or technological companies that have potential solutions. It will also give them a better understanding of the impact of technologies on their business, what an appropriate risk profile is, and with whom they might be able to collaborate.

5.2.5.3 Building collaboration

A good ecosystem is a prerequisite for the development and the implementation of new technologies. More attention must therefore be paid to bringing various parties together (for example businesses, organisations) who will be able to collaborate on a technology.

5.2.5.4 Making better use of knowledge from other sectors

There are many issues involved in greenhouse horticulture that are not unique to this sector. It’s important to look into which other places the same

issues are occurring (and might already have been solved). It is important to realise that sometimes just a simple copy-paste is required and the solution can be applied immediately. Often, however, a copy-adapt-paste action will be required, based on the examples found in other sectors. In other words: use the examples as inspiration, adapt them to the needs of the horticultural sector, and then apply them.

In order to do so, it is important to have an overview of what is going on in businesses in other sectors, but it is also important to make use of (fundamental) knowledge such as that developed by knowledge institutions outside the horticultural industry.

5.2.5.5 Integration

It’s important to realise that new technology and knowledge need to be put to use as part of a total system. By way of illustration: a sensor alone doesn’t have a function; it is given a function when the data that it measures is used in other technologies and applications. Together they form a digital greenhouse. The figure below explains the components that make up a digital greenhouse.

CYBERSECURITY PROCESS

(software) Data(sharing)

Climate control

Models (AI)

PEOPLE

Awarenes

Retraining and further training

Collaborate

DIGITAL GREENHOUSE CULTIVATION AND CROP KNOWLEDGE

Digitization of knowledge grower

Digitize crop characteristics

HARDWARE

Picking robot

Sensors

Cultivation systems (greenhouse, VF)

SURROUNDINGS

Society

Legislation

5.3 Digital transformation

The third level of digitalisation is digital transformation. While level 2 is about actions that are going to take place in the next five to eight years, digital transformation mainly involves issues with a longer time horizon. This involves a fundamental change to business models, chain processes and business processes, as well as to and the skills and employees required for the application and acceptance of technological innovations.

Digital transformation might be called the next Industrial Revolution, which is why the term ‘Horticulture 4.0’ is also used (comparable to Industry 4.0). The number 4 here refers to the fourth Industrial Revolution. In the first Industrial Revolution (in the 18th century), steam engines enabled mass production. In the second (in the 19th century), the production process was broken down into separate pieces, partly thanks to the use of conveyor belts. In the third Industrial Revolution (the 1970s), production was automated thanks to computers. In the fourth Industrial Revolution, production processes will become smart, in part because different processes and locations are connected to each other (see also Smart). In addition, mass customisation, i.e. flexible deployment of mass production, is possible, enabling products to be produced in small quantities at low cost.

While in level 2, digitalisation is used in the existing environment (i.e. with the current greenhouses, crops and people), in level 3 the surroundings are likely to be completely changed or to have already changed. This might mean, for example, completely new cultivation systems with new varieties to go with them, and work done by drones and robots. We don’t yet know exactly what that will look like, but there are already some very promising developments. One example is Growing as a Service, where parties make mutual agreements on aspects of the cultivation and harvesting process, and where tasks are clearly broken down into categories. No longer will projects or greenhouses be sold, but instead (for example) a guaranteed quantity of x quality tomatoes per week.

As a completely different example, there’s the development of digital marketplaces. In the last century, trading co-operatives were created via the establishment of large logistical infrastructures focused on auctions as a price-setting mechanism. Now, completely new sales structures are emerging based on digitalisation technology in which access to data is what makes the difference. Direct sales to end users, new price-setting mechanisms from the financial world, other forms of collaboration not only amongst growers, but also with farmers from other sectors, the entry of major logistics service providers from outside the horticultural industry, data platforms, non-traditional investors, etc. It’s not yet clear where all of this will lead, but it is certain that a lot will change.

5.3.1 Actions required

It is important that the sector prepares for level 3, precisely because what it is going to look like is still unclear. Being prepared for the future is therefore the main message of this document. By exploring the possibilities together, we can help to speed up their application. And it is important that not only the businesses in the chain work together on this, but knowledge institutions and the regional authorities too. The expectation is that digital transformation will have consequences for all stakeholders, and will offer opportunities for revamping the services and ways of working and collaborating. These preparations will include the following points of special interest:

5.3.1.1 Making data accessible, and standardising

The use of data to develop new products, services and processes lies at the heart of digital transformation. As mentioned previously, the amount of available data is enormous. The process

of datafication is underway. The amount of data is only increasing. However, this data is still scattered across various providers, each of which uses its own method. This is understandable, but it does form a hindrance to a good breakthrough to level 3. Because for the next step – the step towards Horticulture 4.0 – it is important for data to available and usable in sufficient quantities. This calls for relevant data (for example on crops) to be standardised. Under ‘accessibility’ there is also the need for a good and reliable infrastructure, enabling data to be transported quickly and safely.

5.3.1.2 (Data) infrastructure in order

As more and more data are collected and realtime information is used, it is important that the infrastructure is in order. Edge computing and 5G play an important role here.

Edge computing involves the information being processed at the ‘edge’ of the network. Instead of sending the data to a central server for processing, the processing takes place close to or ‘inside’ the sensor that is making the observations. The advantages of edge computing are time savings and less use of bandwidth in the network. The speed is also important. The shorter the ‘path’, the quicker the response can be. In a system with realtime applications – like determining whether a tomato is ready for harvest or not, or an application for sorting individual seeds – the milliseconds that are (not) required for data transmission and processing via the Cloud can make a big difference. This also includes data in the chain.

The availability of 5G will be the big boost to the use of edge computing. The 5G-netwerk will enable one million devices to be connected per square kilometre, as well as enabling the rapid exchange of large amounts of data.

5.3.1.3 Developing microservices and independent components.

We do not know exactly what is going to change in the future with regard to the technical, cultivation and operational aspects of growing businesses and the businesses in the supply chain, so it is important to be aware that being prepared for the future means being able to be flexible. Part of this flexibility is to ensure that business processes and IT solutions are organised into separate, interchangeable components.

In software development there is often talk of microservices. Microservices involve software being developed in smaller blocks.

This might be something like an observation of a tomato’s colour or a measurement of a plant’s head thickness. Hardware development can also involve working with small components that can be used like a box of building blocks. It is a feature of a ‘block’ that it possesses unambiguous functionality, and can be scaled and tested independently. If future cultivation systems and varieties are different to what they are now, then the blocks of hardware and software can be put together in a different way without the need to redevelop the entire product from scratch.

5.3.1.4 Security by Design

When working following Security by Design, security is taken into account right from the beginning of the design process for a product or service. In the data field, for example, this might mean thinking about the need to store things: which data is really needed and which isn’t? The entire data life cycle needs to be considered too: the storage, ownership, modification and deletion of data.

Alongside the technical aspects, human and organisational aspects play a role too. There is thought given in advance to how a working method fits into an organisation, and the way in which people work with products and services.

By considering things in advance rather than not trying to make the products ‘secure’ until afterwards, cost savings can be made and there is better consideration of security in terms of risks to the end user. It is also important that the end users, not just the product developers, continue to give thought to security throughout the product’s entire life cycle. After all, circumstances can change at any time.

Many products in the horticultural sector were originally made for stand-alone use. There are currently an increasing number of products and services being connected to each other and to the internet. The security implications need to be reconsidered right at the moment that this happens.

Incidentally, it’s important to realise that security isn’t just abut the risks posed by, for example, hackers – even ‘just’ the damage caused to a fibreoptic network during roadworks can have major consequences.

5.3.1.5 Awareness and training

It would be a good thing if the horticultural sector made an effort to increase awareness and promote the development of knowledge and skills. Not only business owners but also other horticultural industry stakeholders should be assisted with preparing for the digital transformation. There are a lot of options available for this, from IT training and courses to campaigns, as well as attracting new talent, developing new positions and images of the professions. Digitalisation has considerable consequences, especially at level 3, both for the business owners in the chain and for the staff. There is still a need for further exploration and deepening of the consequences. It is logical to connect to Greenport West-Hollands’s Human Capital Agenda and the partners involved with regard to this.

Conclusion

In this digitalisation vision, the authors have endeavoured to explain what the horticulture chain looks like and what the main challenges are. There is also a description of the current state of digitalisation in the horticultural sector, the developments that can be expected relating to digitalisation, and which actions should or could be taken by the sector itself. This vision has been drawn up based on many written and spoken sources, both within and outside the horticultural industry.

With this vision, the initiators – Greenport WestHolland, InnovationQuarter, and Topsector Tuinbouw & Uitgangsmaterialen – want to ensure that the horticultural cluster makes proper preparations for a future in which digitalisation will play a leading role.

A lot of developments in the digitalisation field happen autonomously, meaning that technological applications are developed and applied within the market or sector, without the need to draw up a collective vision. There are plenty of examples of this. For example, ‘distance selling’ was introduced for ornamental plant cultivation decades ago, and there are many businesses with logistics systems that bring vegetables or flowers to the processing area completely automatically. Digitalisation is thus already well underway.

But for the development and/or breakthrough of a lot of other technologies, a concerted effort is required. ‘Unmanned growing’ is one example. One of the things it requires is that the growers’ green knowledge is digitalised. Only then can a good decision support system be developed. The need for such systems is growing too, not only in the Netherlands but further afield. Green knowledge is becoming increasingly scarce.

The automation of business processes – such as cultivation or internal transport – is an example of level 2 digitalisation. This level will have a major impact on the future of the horticultural industry. One prerequisite is that the first level of digitalisation (the digitisation of data) is in order; this is certainly the case in the horticultural sector.

Level 3 of digitalisation will have an even bigger impact on the future of the sector. This level is known as digital transformation or Horticulture 4.0. It will mean a fundamental change to business models, chain processes and business processes, and the employees through the application and acceptance of technological innovations.

Technology can change entire sectors; in recent decades this has been made clear in many other sectors, for example music distribution or booking hotel rooms. New businesses have emerged, while existing ones were forced to adapt or have disappeared.

This is not yet the case in the horticultural sector, but there are already visible signs of the sector’s transformation. For example, people are already talking about the concept of ‘Growing as a Service’, in which links in the chain are connected to each other via a ‘subscription’ (rather than just as buyer/ seller). And big tech companies, particularly in America, are increasingly looking at fresh food production.

The authors of this vision realise that it is difficult to predict exactly what the digital transformation will look like, but what is possible is to prepare the sector for this new reality. These preparations are partly technological and partly in the field of ‘humanware’.

To start with ‘humanware’: it is absolutely essential that the horticultural industry works to raise awareness of digitalisation amongst business owners and employees. The third level demands a lot from people; they might need to brush up on their knowledge, look for a new position, leave their business or start a new one. All of these choices

begin with the awareness that the world is going to change.

Perhaps the biggest change will be not the technology, but a completely new structure for the sector. The current structure emerged gradually several decades ago, with a close-knit network of businesspeople (both production companies and suppliers) who worked together to organise things such as information and advice, sales and research. If, for example, tech giants from outside the sector, such as Amazon and Tencen, decide to enter it, or if, for example, the concept of ‘Growing as a service’ is ultimately realised, this will have major consequences for the entire sector. And these are only examples that are conceivable today.

Further digitalisation is therefore going to have a much broader impact than on individual companies alone. At some point the existing agreements and structures are going to have to be abandoned. But how? What will take their place? Who will organise that? Who will take which risk?

These questions need to be asked, and the first step towards that is awareness. Business owners need to be included in the question: what role do I want to take in this new reality? And what skills will I need for it? But knowledge institutions, financiers and governments also have an important role to play in this development. Not only a facilitating role, but also in terms of setting up infrastructure and regulations.

As mentioned above, the preparation is partly technological. Because regardless of what the future of digitalisation looks like, it is important to set standards for data storage, so that business owners and research institutions can use this data to develop new technological concepts. It is challenging to determine the knowledge themes for which the greenhouse horticulture cluster itself will be required to invest in research, and where use will be made of developments from other sectors. It goes without saying that digital security is paramount in all developments, but we will need to take major steps in this area too.

This vision therefore makes no suggestions that picking robots or algorithms should be developed. Such products are also created without hefty documents. What this vision does propose is that responsible, committed partners in the region take business owners by the hand so that they can together embark on a journey into the future. We need to work together to turn the points mentioned here into reality. The follow-up is a first step here. It will be carried out in various ways, including the theme of digitalisation within Greenport West-Holland’s Innovation Pact II, in collaboration with the partners.

That future will be beautiful and digital, and the Dutch horticultural sector can ensure that it is fresh, healthy and beautiful too.

Sources

Written and digital sources

• AgentschapNL, 2010. IOP Photonic Devices.

Tweede Meerjarenplan • Gregory Astill, Agnes Perez and Suzanne

Thornsbury (United States Department of

Agriculture), 2020. Developing Automation and

Mechanization for Specialty Crops: A Review of U.S. Department of Agriculture Programs. A

Report to Congress • AVAG. Notes to the Roadmap Greenhouse

Technology • Nico Bondt, Robbert Robbemond, Lan Ge, Linda

Puister and Cor Verdouw (Wageningen Economic

Research), 2016. Nut van ICT-gebruik voor tuinbouwondernemers • Shane Bryan, David Fiocco, Mena Issler, Mallya

Perdur, Michael Taksyak (McKinsey & Company), 2020. Creating value in digital-farming solutions • CBS, 2019. Horticulture statistics 2019 • FoodSwitchNL. Extra verdienvermogen voor Nederland door wereldwijde duurzame voedselproductie • Greenport West-Holland, 2018. Greenport West-

Holland Innovation Pact • Lambert van Horen, René Gomersbach (RaboResearch), 2020. Een goed klimaat voor tuinbouwtechniek. Toeleveranciers groeien en veranderen • Robert Hoste, Hyun Suh and Harry Kortstee (Wageningen University & Research), 2017. An inventory in the Netherlands. Smart farming in pig production and greenhouse horticulture • N.J.J.P. Koenderink, J.L. Top, P. Goethals, A.

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Devoldere (TNO), 2019. Samen innoveren in de glastuinbouw • Rob Morren (ABN Amro), 2018. True cost accounting, de werkelijke kosten van ons voedsel • Erik Pekkeriet and Gerben Splinter (Wageningen

University & Research), 2020. Arbeid in de toekomst; Inzicht in arbeid en goed werkgeverschap in de tuinbouw • Krijn Poppe (Wageningen University & Research), 2020. Het Nederlandse voedselsysteem na corona • Province of Zuid-Holland, Municipality of

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Water, Voedsel • Horticultural scenarios, https:// tuinbouwscenarios.nl • Olga van der Valk and Gerben Splinter (Wageningen University & Research), 2016.

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Spoken sources:

• Aad van den Berg • Amelia Oei • Colinda de Beer • Eric Poot • Erik Persoon • Evelien Stilma • Jan van der Ende • Maarten Hermus • Marga Vintges • Margreet Schoenmakers • Mart Valstar • Mike Poodt • Peter van der Sar

• Rob Baan • Woody Maijers • Various growers and supply companies, at specially organised sessions to discuss the digitalisation vision

Annex

Overview of technologies

Some of the technologies falling under the term ‘Smart Horticulture’ are given below. They are listed in alphabetical order. More information on each technology can be found in the Annex.

• Artificial Intelligence • Augmented Reality and Virtual Reality • Big data • Blockchain • Connectivity • Decision Support • Digital Twins • Drones • Internet of Things • Quantum computing • Robots • Sensors • Sequencing Technology • Vision Technology • 3D printing

Artificial Intelligence (AI)

Artificial Intelligence (AI) aims to develop functions of intelligence outside the human brain. Machine Learning (ML) is concerned with the development of algorithms and techniques for the application of Artificial Intelligence (AI). ML uses large amounts of data to train the machine to perform tasks. Deep Learning (DL) is an ML method based on complex neural networks; the algorithm (whether controlled or independent) determines a relationship between the input and output of data. In the horticultural industry, this is applied in various ways including developing models for autonomous growing. It forms an important building block in the development of things such as harvesting robots.

Augmented Reality and Virtual Reality

Augmented Reality (AR) is the technique of adding information and images to reality. It can be used to, for example, help employees recognise particular situations, for example in a greenhouse. Virtual Reality (VR) involves the creation of a new environment, separate from the existing one. This is mainly used in design processes, simulations, games, and training sessions. Combining Augmented Reality and Virtual Reality results in Mixed Reality.

Big data

Big data is a collective term for large quantities of data. It involves a combination of different data sources with structured or unstructured data. The term ‘big data’ is often used incorrectly. There are various definitions, but one that is commonly used comes from research company Gartner. The first part of their definition states that big data is when we’re dealing with ‘high-volume, highvelocity and/or high-variety information’. In other words, a combination of volume, speed and variety. Volume involves a great deal of data. Speed is not only about ‘real-time information’; it might also refer to data that doesn’t come in at a steady pace, but comes in at different speeds and at different times. Variety involves many different types of data, such as input that consists of a combination of ‘typed’ text, images and sounds.

Blockchain

Blockchain is a method of securely recording and sharing data with stakeholders. With blockchain, identical copies of data collections are distributed over the internet. Each addition or change is immediately registered in each copy as a new transaction in a kind of digital ledger. This ensures the transparency – and thus the reliability – of the data. Examples of blockchain include digital currencies (such as Bitcoin) and chain information systems (for example for recording the cultivation, processing, transport and trade of agricultural products).

Connectivity

Connectivity means that fast broadband connections are needed for reliable, efficient and robust data exchange. Issues affecting connectivity include the development of 5G, and the need for

technical solutions and tools in a network to be standardised and integrated.

Decision Support

Decision Support helps users to model, simulate and interpret data, and to use the data and the context in decision-making. Decision Support occurs at different levels: operational (e.g. machine control, harvest inspection support), tactical (e.g. scheduling and reporting) and strategic (e.g. investment decisions).

Digital Twins

A Digital Twin can be a digital representation of a physical object, but also of a complete process or organism (such as organs, plants, animals, or even people). A Digital Twin can be used in areas such as process design, real-time monitoring and real-time forecasting (for example of times when maintenance will be required). Examples of Digital Twins include digital plants (for testing a picking robot) or a digital tunnel freezer (to build and test the optimal design before it is physically built).

Drones

Drones or Unmanned Aerial Vehicles (UAVs) are, as the name says, unmanned aerial vehicles. They are flown by remote control, or follow a specific, pre-programmed route. Drones are often used for remote sensing, and also used for transport and crop care tasks. In addition to drones for the air, there are also drones for conducting unmanned observations in the water.

Internet of Things

The Internet of Things means that more and more sensors, devices and tools are now connected directly to the Internet. They exchange data with other connected devices and with other users. This allows processes to be computerised and steered in real time (with or without human intervention). Examples of the Internet of Things include smart refrigerators that keep track of their own contents and are able to order from the supermarket independently, and soil moisture sensors that wirelessly monitor the soil’s moisture content.

Quantum computing

Quantum computers are intelligent and powerful computers that process information in a new way. A quantum computer can make a billion calculations in the time it takes a classical computer to make just one. This enables major and important breakthroughs to be forced. Quantum computers will mainly be used in places where there is the need to make large numbers of calculations. Cybersecurity is often used as an example. In the horticultural sector, breeding might well be an initial area of application. Enormous numbers of calculations are required in order to predict specific outcomes of crossbreeding, and to speed up things like breeding for disease resistance.

Robots

Robots are applications that are intelligent to a greater or lesser degree. They operate according to a paradigm: sense-think-act. Robots are reliable, fast, good at performing repetitive work, and able to withstand difficult conditions. There are already many robots used in the horticultural sector, for example in packaging lines. In the short term, robots will not only replace people but will primarily support them with their tasks.

Sensors

Sensors are small applications for collecting data, for example on the condition of a product, a process, or the surroundings. Examples of sensors include temperature loggers, cameras, NIR sensors, lab-on-a-chip (a number of laboratory functions collected on a single chip), and biochemical sensors. Common applications are quality assurance, information on origins, optimisation, and transparency. Wireless sensors and smart sensors (that measure/store data and are able to steer processes) are on the rise.

Sequencing Technology

Sequencing Technology refers to determining the DNA or RNA of a sample. Software can be used to analyse which organisms are present in a sample and what function they perform. This quickly provides information on food security and food safety.

Vision Technology

Vision Technology is the technology with which a computer interprets visual information (e.g. photographs or real-time images). Artificial Intelligence and Big Data are often used as well.

3D-printing

3D printing (or Additive Manufacturing) is a production technique that builds up a product layer by layer based on a digital design. It can be done using plastics and metals, for example, but also food. In that case there is a decoupling of the production of the raw materials and the production of the final food product. In addition, 3D printing enables the production of personalised food based on, for example, genotype, phenotype, behaviour and preferences.