Like other industrialized nations, Japan also faces massive demographic challenges within the agricultural sector. An aging population and an absence of younger people entering the sector to exchange them has led to farm abandonment and fields lying fallow.
The Japanese government has in fact recognized the demographic problem, because it doesn’t only affect the agricultural sector. To revitalize rural areas and curb rural exodus, the federal government has launched a national motion plan.
In line with this motion plan, SAP Japan has joined the hassle to encourage rural communities to thrive by launching a co-innovation project with PSI, an SAP partner, and the local government of Minano City.
Digitalization of the agricultural sector
The small town of Minano is positioned within the hills of Saitama Prefecture, about two hours from Tokyo. While the south of this prefecture is essentially a suburb of the Tokyo region, the west, approaching Mount Fuji, continues to be very rural and sparsely populated. As a former center of the silk industry, the region is sunny and warm on average, although there could be loads of snow in winter.
“The farms in this area are traditionally small and scattered, located between forests and mountains,” says Yoshihisa Horiguchi, chairman of MINNANO Future Create. “Large supermarkets and retailers overlook them. Nowadays, farmers grow rice and vegetables in small quantities to consume themselves, sell to their neighbors or send to their children or grandchildren living in cities.”
Since 1950, town of Minano has lost a few third of its population, largely attributable to the decline of agriculture. Today it has around 10,000 inhabitants.
“Young people often migrate to urban areas to find better education and employment opportunities,” explains Horiguchi. “Where 50 years ago a farm relied on 20 young workers, today there are only two older workers left.”
Digitalization is an obvious approach that can assist prevent complete depopulation of those areas.
“But while large farms benefit from the economic feasibility of using robotics and the like, it is financially and logistically challenging to apply such technologies to small, dispersed farms,” says Horiguchi.
Horiguchi, owner of an automotive parts manufacturing company, co-founded the local initiative MINNANO Future Create in 2019 to deal with challenges posed by population loss. Members range from the elderly to young residents, forming a various group of people including pharmacists, architectural designers and other professionals, all living in town.
For one among their projects, the Minano Digital Eco-Farm, they worked with the SAP Co-Innovation Lab in Japan.
IoT solution for monitoring agriculture
The Minano Digital Eco Farm project goals to construct a communication platform that connects farmers and concrete residents and connects small scattered farms with large supply chains, forming a portfolio that coexists with existing large-scale farms. In line with the United Nations Sustainable Development Goals (SDGs), the project will help overcome supply chain disruptions attributable to food shortages and crop failures attributable to unusual weather conditions, conflicts, disasters, etc.
To make this vision a reality, IoT sensors were distributed at various locations and controlled remotely from the headquarters.
The “Minano Digital Eco Farm” project goals to construct a communication platform that connects farmers and concrete residents.
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“The idea was to run an IoT solution on the SAP Business Technology Platform (BTP) that would help monitor all agricultural processes,” says Atsushi Minakuchi, Senior Solution Specialist at SAP Co-Innovation Lab (COIL) in Japan.
COIL partnered with PSI, which launched the Digital Material Controller (DMC), a compact, all-in-one edge controlling server that permits easy setup of a ubiquitous IoT environment. And through collaboration with the SAP Co-Innovation Lab, the DMC has also received SAP certification.
“Many IoT sensors lack cybersecurity features,” says Mitsuhiro Yamazaki, senior advisor and former president of PSI. “However, by connecting sensors to a DMC with cybersecurity capabilities, it becomes possible to securely store locally collected data on the DMC; Securely transfer to SAP BTP and collect, analyze and use data from the DMC. This enables seamless and easy integration between the SAP core system and the IoT system.”
“Working with COIL has significantly expanded the application possibilities of DMC,” says Masaki Fukui, former director of the PSI Cyber Security Lab and now on the Ministry of Internal Affairs and Communications. “Global SAP users could now have the ability to easily implement and use a ubiquitous supply chain platform through the combination of DMC and SAP Business Technology Platform.”
By integrating with SAP Business Technology PlatformThe locations can then be displayed and monitored on a dashboard.
To date, two farm proofs of concept and one miso factory proof of concept have been accomplished between March 2019 and November 2022. Agriculture and rural industry are only two areas of application. Future projects could include schools, hospitals, shops and aged care facilities.
Strengthening rural attractiveness for domestic tourism
As a company social responsibility project, the Minano Digital Eco Farm was created through the voluntary commitment of SAP employees in Japan, who supported the project along with their regular work.
The project is supported by a government program unique to Japan, called the Homeland Tax Payment, which allows residents to decide on and support the region through which they were born and raised or a community through which they need to change into involved.
“The ability to pay home taxes is very popular among Japanese people,” explains Hidenori Kurosawa, vice governor of Minano. “For us rural areas, this seems to have played a significant role in stimulating interest in rural areas. People want to get to know the cities locally and support them.”
In fact, the appeal of small, sparsely populated communities surrounded by beautiful forest landscapes has not gone unnoticed by inland Japanese tourists.
Kurosawa says: “We intend to make Minano attractive to visitors by offering return gifts that provide an experience – that allow visitors to come back to town, interact with the locals and experience things which are unique to this place. “
The Minano Digital Eco Farm project suits well with this strategy. Not only does it promote the charm of Minano, but by expanding initiatives it also addresses local challenges comparable to reclaiming abandoned farmland, increasing food self-sufficiency and reducing CO22 Emissions and improved profitability in agriculture.
“We have high expectations that this initiative will help address the city’s challenges and advance the SDGs,” explains Kurosawa, adding: “We express our sincere gratitude to SAP Japan’s volunteers for their invaluable help in the implementation of the Minano Digital Eco Farm project.”
“MINNANO” means “for everyone” in Japanese and is pronounced the identical as town’s name. Masaki Fukui from the Ministry of Internal Affairs and Communications explains the concept behind this game in words: “One action can have multiple meaningful effects. The problem of scattered small businesses facing economic challenges can be seen all over the world. By working with SAP, we hope to inspire rural communities outside our own prefecture, perhaps even outside Japan.”
