Unless manufacturers thoroughly understand the problems they’re trying to solve with technology— and can work with the mercurial nature of tech companies — they’re wasting time, money, and putting tried-and-true processes at risk.
If you don’t really understand the pain point, you could solve for a technology problem, but it’s the wrong problem. You could miss a chance to lock up IP and surrender long term competitive advantage. And you could wind up with multiple companies, organizations and departments who cannot coordinate with one another and figure out how to commercialize anything.
The challenge feels pronounced for a company like Kubota, a venerable component of the heavy industrial sector. Kubota built its reputation on manufacturing tractors and construction equipment – tough solid vehicles built to withstand punishment and the test of time. Kubota’s R&D process takes between 18 months and two years to ensure adherence to the company’s unyielding quality standards.
Technology startups don’t operate that way. They are serial risk takers with high tolerance for failure, creating success from nimble iteration. So how does a company like Kubota manage to blend stable, predictable product design strategies with tech companies whose rapid iteration cycles feel unstable by comparison?
You don’t.
That’s what Todd Stucke, president of Kubota Tractor, finally realized. The solution lies in hooking these two very different ways of operating under a new, shared leadership structure specifically for technology development, giving one room to breathe without sacrificing the quality standards enforced by the other.
Pitching Tents in the Valley
In 2020, Kubota stepped into the world of autonomous vehicles by introducing in Japan the Agri Robo tractor series that farmers can drive manually to get the tractor onto the field and then switch to unmanned but monitored operation. Kubota in October 2020 announced a partnership with AI microchip giant NVIDIA to help develop fully autonomous vehicles.
“Quite frankly, [startups] don’t know how to commercialize. … For the most part, what I found is they don’t have the skillset. Let them do the development, the R&D, the innovation, and then use Kubota to bring process, standards and quality into the products and the process procedure you need,” Stucke says.
After a few years of trying to hit upon the right solution, Stucke in 2023 created what he refers to informally as his North American technology team.
Think of technology innovators like startups as one floor of a building, with internal Kubota R&D and equipment engineering on two other floors. The North American technology team provides the stairwells.
Rent or Own Tech Companies?
Last year, Kubota bought another technology startup, Bloomfield, that develops a plant health vision system. Kubota also began working with the Silicon Valley Innovation Center – it’s a strategy of buy some, contract with others. Stucke says the question of buying or partnering generally comes down to the complexity of the problem Kubota is trying to solve for customers.
For example, some customers want an automated picking machine. Bloomfield develops vision system technology that scans fruit to determine size, ripeness and health among other things to determine which honeycrisp to pick.
That’s only one aspect of the technical challenge. There’s also compute speed. Sending image files to the cloud slows down the identification process (assuming that you can get good Internet access at an orchard in Wapato, Washington), versus edge processing, or analyzing the images on local hardware attached to the camera.
Robotic arms have to be nimble enough to reach through and around branches to pick the fruit and end-of-arm tooling (EOAT) has to provide grippers that provide just enough force to securely grab the fruit without crushing it.
That’s four different technologies in all.
“When you go into a startup, it’s very narrow, the innovation…and when you go to the customer, they’re looking [for] an end-to-end loop. So, you take somebody like Kubota. We sell tractors and equipment…could we be the one that kind of stitches each of these [technologies] together to make an end-to-end solution for a pain point of a particular customer? And that’s why it may take us looking at two or three startups to really get the final product,” says Stucke.
Or, Kubota instead can pivot toward statement of work (SOW) and proof-of-concept (POCs) agreements with tech companies. Stucke says that’s the current trend.
“You really don’t get to guide a startup. You’re an investor. You get to know them so you can see the progress of what they’re doing. When you do an SOW, you make an agreement. And then you work with them, and you’re along beside them, and you can really see the progress. You get to learn deeper in the company, can learn the personalities, the engineers and how they work,” Stucke says.
Skanderup says working with a SOW isn’t any easier than acquiring a startup to own the technology. It’s just different. And that’s the real challenge faced by Stucke. There’s no standard operating procedure, no best practices, no rulebook to dictate how each and every interaction between Kubota and a tech company ought to go.
Everyone has to fit into the leadership structure Kubota's created, so there’s consistency from that perspective. But how specifically to handle individual tech companies within that general framework almost always presents a unique challenge.
Tech is Just a Tool, Not the Whole Solution
Commercializing the technology Kubota acquires through startups presents its own, unique headaches, for instance at the dealership level.
“If we look at AgJunction product lines and focus, it’s not too far away from what our dealers are used to already. It’s not much of a stretch. … If we look at Bloomfield, it becomes…more of a challenge, just because the product is something new.
“If we say, ‘This product will help you do something you’re already doing better, faster, cheaper’ – and it’s really tightly coupled to products our dealer already has– AgJunction’s products would fit into that [category]. If we look at Bloomfield, we’re talking about changing the way some of these operations happen altogether, and so it requires a little bit more of a paradigm shift for both their customers, their dealer and our own products,” Skanderup says.
If there’s one thing adding high technology doesn’t change, it’s having to know the customer and allowing their pain points to guide everything the company develops.
“It really comes down your people, the ones that can understand the customer, understand the problem well enough, understand the technology well enough and understand the business well enough to know where to bet the money? Where to where to go? Look at some of the inventors out there and the ones that commercialize [successfully]. It’s usually down to a couple people really [understanding all the angles]. I’m putting faith into that,” says Stucke.
