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Who are the Innovators in Canadian Prairie Agriculture?: Results from a Recent Survey Dr. Eric T. Micheels Department of Bioresource Policy, Business & Economics
Alberta Agricultural Economics Association Visions 2013 Conference May 2-3, 2013 Red Deer, Alberta
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Background on project Project funded by SPAA
Matching procedure with AAFC projects
• Worked with Samira Bakhshi on project development
Improving Farmers’ Capacity to Innovate
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Innovation What do we mean by innovation?
Change in routine (Nelson and Winter, 1978)
• New to firm, not new to world • New way of thinking, doing, operating
Related to learning • Hurley and Hult (1998); Cohen and Levinthal (1990)
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Photo: travelwayoflife via Flickr Photo: Jan Tik via Flickr
Photo: USDAgov via Flickr
Innovations in Agriculture
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Previous research on innovation Innovators are those with greater: Firm size Education
• Formal and informal
Experience Number of employees Absorptive Capacity Organizational Learning Social networks
How do these increase innovative capacity?
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Research Questions 1. Who are the innovators in the Canadian
Prairies? • Are there specific characteristics common to
innovators?
2. How are they different from non-innovators? • Are these things that can be managed? • Looking for antecedents to innovation, not
consequences of innovation
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Data Questionnaire sent to farmers in SK, AB, and MB
in February and March of 2013 • Insightrix market research firm • Online and telephone • Draw for an iPad as incentive
506 respondents
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What type of innovation? Innovation measured across four categories
• Product • Process • Organizational • Marketing
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Degree of innovative activity Respondents were asked about their level of
adoption regarding different agricultural practices • Not at all • Some extent • To a great extent
www.usask.ca 0% 20% 40% 60% 80% 100%
New crop types
New crop cultivars
New livestock breeds
New livestock types
Rate of Adoption of Various Innovations in Canadian Prairie Agriculture
Some extentTo a great extent
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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Change in weed, pest and disease management practices
Change in soil management practices
New approach in fertiliser application
Use of new cropping equipment
Soil-related natural resource management
Weed-related natural resource management
Other crop practices
Pest-related natural resource management
Livestock health practice
Livestock handling practice
Livestock feeding practice
Grazing management practice
Pasture type
Fodder conversion use and practice
Irrigation and water management practice
Rate of Adoption of Various Innovations in Canadian Prairie Agriculture
Some extentTo a great extent
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0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
New approach to marketing farm’s production
New approach to labour use
Added new members with additionalexpertise on the farm management team
Use incentives to attract employees
Rate of Adoption of Various Innovations in Canadian Prairie Agriculture
Some extentTo a great extent
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Classification of innovative activity Used similar process as that of Nossal and Lim
(2011) Innovations adopted to ‘some extent’
Innovations adopted to ‘a great extent’ None Less than 3 3 or more
None Low Moderate High
Less than 6 Low Moderate High
6 or more Moderate High High
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129
264
113
0
50
100
150
200
250
300
Low Moderate High
Number of Producers Across Innovation Categories
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How are innovators different? Structural characteristics
• Size, Age, Experience, Employees, Sales
Social Activities • Number of networks, frequency, workshops
Cultural Variables • Learning, Social Capital, Absorptive Capacity
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DIFFERENCES ACROSS VARIOUS STRUCTURAL VARIABLES
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1507.52
2142.69 2129.28
0
500
1000
1500
2000
2500
Low Moderate High
Farm Size (Acres) Across Innovation Categories F = 2.503; Sig = 0.083
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25.34
27.39 27.11
24
24.5
25
25.5
26
26.5
27
27.5
28
Low Moderate High
Expe
rienc
e (Y
ears
)
Experience Across Innovation Categories F = 0.885; Sig = 0.413
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54.83
52.93 53.25
51.5
52
52.5
53
53.5
54
54.5
55
Low Moderate High
Age
of P
rinci
pal O
pera
tor (
Year
s)
As of January 1, 2013, what was the age of the principal operator?
F = 1.059; Sig = 0.348
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2.73
3.29
4.71
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
Low Moderate High
Num
ber o
f Em
ploy
ees
Number of Total Employees F = 4.133; Sig = 0.017
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10,000-24,999
25,000-49,999
50,000-99,999
100,000-249,999
250,000-499,999
500,000-999,999
1,000,000 – 1,999,999
2,000,000and over
Low 10 5 15 20 13 15 8 2Moderate 14 10 25 60 42 33 20 13High 5 5 8 14 23 14 15 9
0
10
20
30
40
50
60
70
Num
ber o
f Res
pond
ents
What was your Gross Farm Sales in 2012?
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DIFFERENCES ACROSS VARIOUS CULTURAL VARIABLES
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Organizational Learning Nine item scale measuring commitment to learning and
open-mindedness (Sinkula, Baker, and Noordewier, 1997)
• The sense around here is that employee learning is an investment, not an expense.
• Learning in my farm is seen as a key commodity necessary to guarantee organizational survival.
• We encourage employees to “think outside of the box.”
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33.48
35.98
36.84
31.00
32.00
33.00
34.00
35.00
36.00
37.00
38.00
Low Moderate High
Lear
ning
Sum
mat
ed S
cale
N
ine
Item
s (L
iker
t Sca
le)
Organizational Learning F = 4.858; Sig = 0.008
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Social Capital Eight item scale measuring use of social contacts
(Molina-Morales and Martinez-Fernandez, 2010)
• There is an informal network among customers, suppliers and competitors.
• You consider that other firms feel a special duty to stand behind you in times of trouble, so you consider it only fair that your company should also give support to other firms.
• Your company has received considerable information about products and markets from local institutions.
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24.38
27.14
28.67
22.00
23.00
24.00
25.00
26.00
27.00
28.00
29.00
Low Moderate High
Soci
al N
etw
ork
Sum
mat
ed S
cale
Ei
ght I
tem
s (L
iker
t Sca
le)
Social Networking F = 12.400; Sig = 0.000
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Absorptive Capacity Theory that firms that invest in innovative activities will
be more able to assimilate innovations from others (Cohen and Levinthal, 1990)
• Potential Absorptive Capacity • Realized Absorptive Capacity
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Potential Absorptive Capacity How do firms acquire and assimilate knowledge?
• People on our farm have frequent interactions with business
partners to acquire new knowledge. • We collect industry information through informal means (e.g.
lunch with industry friends, talks with trade partners). • We quickly recognize changes in technical possibilities.
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20.39 22.74
25.28
0.00
5.00
10.00
15.00
20.00
25.00
30.00
Low Moderate High
Pote
ntia
l Abs
orpt
ive
Cap
acity
Su
mm
ated
Sca
le
Seve
n Ite
m (L
iker
t Sca
le)
Potential Absorptive Capacity F = 20.247; Sig = 0.000
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Realized Absorptive Capacity What is the process of implementing new
knowledge into innovative activities?
• Our farm quickly recognizes the usefulness of new external knowledge to existing knowledge.
• We convert external information directly into new business applications to be used on our farm.
• Application of external information to our farm contributes to our profitability.
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33.44
37.10
39.89
30.00
32.00
34.00
36.00
38.00
40.00
42.00
Low Moderate High
Rea
lized
Abs
orpt
ive
Cap
acity
Su
mm
ated
Sca
le
Elev
en It
em (L
iker
t Sca
le)
Realized Absorptive Capacity F = 12.155; Sig = 0.000
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DIFFERENCES ACROSS VARIOUS SOCIAL VARIABLES
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1.94
2.29
2.73
0
0.5
1
1.5
2
2.5
3
Low Moderate High
Num
ber o
f Net
wor
ks
How many formal or informal networks do you belong to?
F = 3.471; Sig = 0.032
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7.88 7.12
9.82
2.4
3.97
6.15
0.8 1.67 2.03
0
2
4
6
8
10
12
Low Moderate High
Num
ber
How many other people do you talk to?
FarmersSuppliers *Consultants *
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4.91 4.52
6.96
0
1
2
3
4
5
6
7
8
Low Moderate High
Day
s
On average, how many days per year do you spend attending workshops and conferences?
F = 3.588; Sig = 0.029
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Preliminary findings Innovators are those farmers that:
• Operate larger farms • Employ more workers
• Have more social capital • Belong to more informal networks • Talk with more people
• Value continuous learning • Attend workshops
• Have greater potential and realized absorptive capacity
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Future Work 1. Data-driven cluster analysis on innovation
2. Can these factors be used to predict inclusion
in innovation categories?
3. What role do stakeholders have in removing barriers to innovative activity?
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Eric T. Micheels
Questions?
Assistant Professor Department of Bioresource Policy, Business & Economics University of Saskatchewan 3D14 Agriculture Saskatoon, SK S7N 5A8 Email: [email protected] Twitter: @ericmicheels
