Harnessing Innovation in the World’s Startup Nation
By Jan Lee
This article is sponsored by Maala and went through our normal editorial review process.
Innovative technology is critical to today’s sustainable and growing communities, and nowhere is that more evident than in Israel. A country with a population of less than 9 million people and a land mass smaller than the U.S. state of Vermont, it has become the go-to place for disruptive technology that can answer some of the world’s biggest social and environmental challenges.
But for many of Israel’s innovators, it isn’t just ingenuity that drives progress. The United Nations’ 17 Sustainable Development Goals (SDGs) are increasingly seen as the fundamental pillars to business development in Israel.
Events like the annual Maala International Con(fair)ence in Tel Aviv are helping to increase support for corporate responsibility. The conference, now in its third year, serves as a platform for companies that support sustainable business growth. The Maala Index, which was launched in 2003, also serves as a means for ranking and encouraging publicly traded companies to integrate SDGs into their company portfolio.
And support is growing. Companies like Netafim, a global leader in irrigation technology, Strauss Group’s think tank, The Kitchen and Israel’s forward-thinking leader in construction, Shikun & Binui, are becoming the face of Israel’s efforts to address the world’s most pressing problems — as outlined in the Sustainable Development Goals — with innovative thinking.
Netafim: Promoting global water conservation
Water has always been Israel’s greatest challenge. With limited freshwater resources and barely three inches of rainfall a year in Israel’s parched desert regions, the country is constantly in demand of new and better ways to irrigate its crops and at the same time, promote and increase water conservation. The UN’s sixth SDG continues to be Israel’s greatest challenge and its greatest level of accomplishment as a sustainable nation.
Few Israeli companies are as well known for their contribution to that effort as Netafim, the maker of the world’s first commercial drip irrigation systems. The effort to develop a sustainable irrigation method for food crops in low water-retention areas some 50 years ago is now helping to revolutionize the way that crops are fertilized and irrigated. And in so doing, it’s helping to shape the way the world addresses food scarcity.
Naty Barak, Netafim’s chief sustainability officer, is a huge proponent of the drip irrigation system. Smart irrigation systems, he said, have not only transformed Israel’s desert landscapes but helped governments reshape their regional economies.
Barak said when Ninxia, the autonomous region of China, asked for Netafim’s help in building a new irrigation system, it was facing two substantial hurdles. The first was to find a sustainable way to nurture China’s prestigious wine country.
“They came to us because the challenge they faced from losing water from the Yellow River due to over-pumping in that province,” said Barak. “And the head of the province sent his agricultural people to Israel to Kibbutz Hatzerim [where Netafim is based] to learn about drip irrigation.” Netafim established a manufacturing plant and training center in China and taught local farmers how to increase their yields using less resources and smarter management.
“It saved a lot of water,” said Barak.
But the outcome – which began as the second challenge – surprised even the Chinese government.
“They came back to us and said, ‘You know, we have another challenge that we didn’t think drip irrigation would help,’” said Barak. “And this was the migration [of farmers to the city].”
Over the years, thousands of farmers, faced with dwindling water resources and increasing poverty had begun migrating to China’s cities to in search of new work. But as the new irrigation systems were gradually introduced, farmers not only returned to the area but investments in Ninxia’s agriculture rose as well.
“The younger farmers were attracted to the [new technology],” Barak explained. Implementing innovative methods not only improved crops and revitalized the economy but inspired a whole new interest in “smart” agritech. It offered a new educational platform for reducing poverty, while transforming ecosystems with better water management.
But Netafim is only one example of how Israel’s smart water technology is helping to ensure the 6th Sustainable Development Goal is met through water conservation methods. New apps developed in Israel now allow farmers in the Galilee, for example, to monitor a tree’s “thirst” from miles away and regulate crop irrigation, reducing crop loss and increasing sustainable food production.
Other startup companies are advancing that effort with wireless monitoring systems that may one day be able to anticipate drought conditions caused by climate change and offset the chances of a famine in remote areas of the world.
Strauss Group: Israel’s food tech kitchen
The Strauss Group, Israel’s biggest food tech corporation, has come up with a different, but equally impactful way to inspire global innovation, this time around Sustainable Development Goal 2, No Hunger. The two-company corporation is home to more than 50 brands, many with international popularity.
But it’s Strauss’ outlook on food technology and what defines innovative strategies, said Chief Technology Officer Dr. Eyal Shimoni, that provides its cutting-edge advantage.
“For us, food tech is not a type of technology, rather the field where you apply this technology solution,” said Shimoni, who pointed out that a farm food supplier can be many things. It can be a company that excels in research and quality control, energy management or waste solutions. It’s a critical part of the product’s success.
“So when we look at food tech, we actually look at the whole supply chain, from farm to fork, while asking ourselves is this technology contributing to either our productivity or our safety, our product edge and if it does, then it is part of what we call food tech.” These solutions span the food chain from agriculture practices (to increase yields) to solutions to reduce spoilage and food waste, all working in concert toward the shared goal of hunger reduction.
For Strauss, food technology is also a pathway to global sustainability. So in 2010, Shimoni said, the corporation began looking for ways to increase its “sustainable ecological edge.” Innovation had always been a part of Strauss’s successful brand, which had worked with global companies like Pepsi through the years. Collaborative innovation seemed like a natural progression. But how?
It established what it called the “Alpha Strauss” initiative, the first level to increasing partnerships between businesses across the world. Then, in 2014, it launched its incubator, The Kitchen.
The incubator model allows companies, both well-established and fledgling startups, to address different elements of the food chain challenge collectively. The idea, Shimoni said, wasn’t just to come up with new ideas, but to build the foundation for better food for the planet that could meet demands in developing countries as well as places like North America, Israel and Europe.
“[Strauss] cannot provide the market for all the technologies developed here. So we brought – and are still bringing food innovators” that can help build new ecosystems, said Shimoni.
Startups like food-safety company Inspecto, “fast-learning robotics solution” Deep Learning Robotics, and purveyor of non-dairy probiotic Yofixa have since joined the initiative, helping to develop new, ecologically sustainable ways to feed the planet. At the same time, The Kitchen is providing a means in which the world’s most challenging social goals can be addressed through collaboration.
Shikun & Binui’s BuildUp Program
Shikun & Binui, Israel’s largest construction contractor was initially founded in the 1920s as a Jewish workers’ union in British-controlled Palestine. Today it is a multinational construction company with investments in renewable energy and real estate.
According to Orry Ben-Porath, Shikun & Binui’s vice president of sustainability, marketing and innovation, the company aligns its goals with those of the UN’s 11th SDG, the aim of ensuring that the world’s cities are sustainable, inclusive and safe environments in which to live.
But integrating cutting-edge technologies into the construction sector has often been a challenge, said Ben-Porath. And Israeli construction firms aren’t alone in facing that hurdle.
Ben-Porath said there are many reasons for that shortage of innovation: a constantly changing labor force, economic factors in an industry with a relatively narrow profit margin, and the nature of the construction work.
“We’re always on the move,” said Ben-Porath. “We are [at the work site] for a year, two or three and then leave.” Constant turnover of both personnel and working environment has made it difficult to introduce and train workers on new, ever-changing technology.
So in 2016, the company launched the BuildUp initiative, aimed at attracting innovative approaches to the industry’s most pressing needs.
The BuildUp tools help constructions firms operate more efficiently and integrate sustainability standards more easily. After several years of effort, the industry is beginning to see results. New apps that use augmented reality are helping pair the specifications of blue prints with onsite human expertise. Drones, smart cranes and robotics are automating a workplace that has largely relied on manual labor.
To date, BuildUp has constructed an ecosystem of more than 600 organizations that have a vested interest in increasing innovation in relevant markets.
“What we believe at Shikun & Binui is that we are uniquely positioned as a global construction company headquartered in Israel, to leverage the innovation here … and to put it to work for our benefit and the industry’s benefit.”
Disruptive tech with a purpose
Today, Israel is in a league of its own when it comes to capitalizing on the benefits of disruptive technology. Its R&D budget is almost twice that of the United States, ranking even above South Korea. But it’s the growing number of Israeli companies that are incorporating SDGs into their corporate vision, acknowledges the United Nations, that is truly sending a message: Investment in corporate responsibility has a global impact.