Hamish Gow – Inside the Value Chain Innovation Programme

Sarah Perriam-Lampp, CEO and Editor-in-Chief, CountryWide:
Welcome to another episode of the CountryWide podcast, and catching up with one of my favourite people, Hamish Gow from Lincoln University. Today we’re going to talk about the Value Chain Innovation Programme, something that I absolutely loved doing a few years ago. I’m sure it’s evolved a little bit from the first one?

But I’m really keen to hear about what everyone gets up to on the programme because the deadline to submit your application for 2026 is coming up soon. So, Hamish, can you tell us a little bit about the programme and how it’s evolved?

Hamish Gow, Professor, Lincoln University:
Well, it hasn’t really evolved a lot, right? Because it’s designed to give the participants a model or framework to be able to understand and evaluate value chains and how we create value in those value chains. Then we walk through the four major value chains in New Zealand, two in the livestock sector and two in horticulture.

The Four Value Chains

HG: We walk through the dairy value chain and analyse and evaluate how Fonterra creates economic value for farmers and how that comes back to them. We then walk through the Zespri value chain and look at how that brings value back to both the orchard owners as well as into the other members of it, which are the packhouses, and understand that model. We then look at the apple industry and how that creates value for the growers.

Then finally, we look at the red meat sector and understand how value comes back to farmers and producers in the red meat sector. And around the edges of that, we look at government support, regulation, and legislation, and how that’s enabled some of them and caused constraints on them, and then technology, and how that’s supporting it as well.

It hasn’t changed a lot from when you went on, the only difference is, we’ve gone in reverse. We used to start in Hamilton with the dairy sector and work to the Hawke’s Bay and end with apples. Now we’re starting in the Hawke’s Bay with apples and working our way through to Hamilton and ending with the dairy sector.

Target Participants

SPL: For those who are unfamiliar with it, this is a programme run as part of the Rural Leaders organisation (they look after Kellogg and Nuffield). It is really for quite a wide range of people, getting farmers and growers to look beyond the farm gate, isn’t it? As well as those who work in the sector to fully understand the vertical integration of a value chain.

HG: Yes, it’s aimed at both people who are directors and senior leaders within the industry. So it could be farmers, it could be people inside the processing facilities, it could be marketers who are trying to understand it, it could be entrepreneurs, as well as the government players who are supporting as well as the input providers, bankers, insurance providers, fertilisers, etc.

Core Learning Framework

HG: It really gives you this end-to-end understanding all the way from the basic inputs all the way through to understanding the market and how we really create economic value for our customer in the market. It’s also, what’s the mechanisms that we use to be able to capture that value and then share that across everyone in the value chain? And that’s the key piece is really understanding not just that this is how it all operates, but then this is the mechanisms that are used to be able to create value, capture that value, and then share that value and how that gets shared back to everyone.

And what makes some channels work in one way versus other channels work in a different manner or form. We look at three basic models of value chains.

Intellectual Property Insights

SPL: It really does open your eyes, particularly if you are quite industry-centric in your day-to-day – If you’re really in the dairy industry or sheep and beef and don’t really understand as much about horticulture. I took away so much, and there’s lots of little gems, Hamish, but one of them was I’d never appreciated plant licencing and breeding and how that IP is controlled and how that flows through the value chain.

HG: Absolutely. In the horticulture industry, that’s the key way that they capture value, because it stops people trying to copy them. We’ve got two different models. We’ve got a model that operates within the kiwifruit industry, which is everyone combined within Zespri. And then Zespri owns the IP. Zespri doesn’t own a lot of things, but it owns all the IP around the plant variety rights for the gold kiwifruit, for the Sungold. And then it also operates in a slightly different model in the apple industry. And that’s the real two key pieces. It’s those plant variety rights which give them protection for an extended period of time and allow them to build a value chain that creates economic value, allows them to capture it and then return it back to the owners of their IP. But also they have a sharing mechanism which allows them to share it across the growers and the other players along that channel.

Rethinking Value Creation

SPL: The other major thing I realised, which is really interesting timing with the sale of Fonterra’s consumer brands, is how a lot of these supply chains are built to not actually have value, because it’s more around operational efficiency and that is the value.

HG: Yes, lots of people are only now coming to the grips with this. In New Zealand government, we’ve had this whole idea about value add, but we don’t actually understand it. Our naïve perspective of value add, is just put a brand on things and sell it to a customer. But there’s a whole lot of value to be created by being the provider of the highest quality ingredients. Therefore, that allows your customers, the processor/food manufacturer, to be able to run their systems a lot more efficiently and deliver a lot more consistent product to their customer.

It’s very expensive to go and work with a final consumer, but stepping back from that and delivering the best quality inputs to them, which are really, really consistent, allows them to operate way more efficiently. There’s huge value opportunities there, which is what Fonterra does. Fonterra is this amazing producer of high-quality specialty ingredients that the top food companies absolutely require from us. And that’s always one of the ‘a-ha moments’ that comes out of it. People realise we don’t actually need all of these brands. We actually spend a lot of money on them.

Global Market Reality

HG: It’s easy to do branding when you’re selling to your own domestic consumers. But New Zealand is the only developed country in the world for which their primary market is not a domestic consumer. Therefore, there’s 180 countries in the world that we sell to. And there’s thousands, well, actually tens of thousands, hundreds of thousands of different markets across all those countries that we sell to. It’s very difficult from a branding standpoint to really understand who that customer is and what we need to do with them.

They’re in a different country, different culture, different language, different institutional structures. Often, it’s an ingredient space that actually creates us the greatest value. That’s where we’re creating most of our economic wealth in New Zealand, without us knowing that.

Preparation for International Engagement

SPL: For those who have been fortunate to go in market overseas, what I’ve taken away from it, is how you’ve structured it so that the Nuffielders do the Value Chain tour before they do go overseas, which means that you actually understand your own backyard. So, you’re informed on a value chain before you go in market overseas. Many of us don’t actually understand that piece, do we?

HG: Yes, we often know our little wee piece of the value chain, but we don’t actually understand how a whole value chain operates or works. We know how to make money in our piece, but we don’t actually understand how all the pieces of the puzzle all connect together and collectively how they create value. Then, because we don’t understand that, we don’t actually understand our adjacent value chains, how they operate and how they make money.

Mental Models for Analysis

HG: And so we make assertions about them, which are really assumptions, and they’re actually incorrect. And so it’s only when you walk and understand those different models that they have, that you’ve got this ability to be able to engage and learn and understand how you make money in your value chain. But then you can start looking at other value chains that are operating out there in the world, both in New Zealand, but also overseas. Because effectively, we simplify it down to basically three different models that run.

And that’s the key thing.  Once you get it down to that level, you can look at almost any value chain and go, ‘that’s this type of value chain. How’s that different from the ones we’ve looked at? It’s different in this way.’ Suddenly, you’ve got this mental model that you can use and make sense of.

Programme Success Stories

SPL: What have been some of the highlights for you on the programme? It’s been three times you’ve run it? If you think about the people that have been through the programme, that you’ve seen real ‘a-ha moments’ or anything that’s come from it that’s been impressive?

HG: We’ve had a couple of key players who came through, were both chairmen of the boards of a startup on this last programme with a range of farmer suppliers coming into it. They had a massive answer to a-has, and you watched them as their mind changed with the way that they could articulate what they were doing and how they could share that to all of their constituent farmer suppliers.

But also how they could communicate what they were doing to their key industry partners who were processing for them to help them understand how they were doing stuff and the way they were running their business model and value chain and how that differentiated from their market partners, so they weren’t actually in competition with each other.

Organisational Alignment

HG: So that was a really important a-ha, and they suddenly had the power to be able to have a conversation with all those different stakeholders and help them understand how they were different and what that meant for them strategically. And what that meant for them as far as investment goes, how they could communicate with everyone. I’ve watched that happen since the last programme.

They came through… it was this a-ha moment. Now you just watch how their communication and the alignment and getting everyone to… it’s like a rowing eight. They’ve got everyone rowing together in the same direction at the same stroke rate, and they’re just pulling ahead as a result of that. It’s fantastic. It’s got everyone throughout the organisation, all the way from the board through management, to all of their strategic partners, all the way back to the farmers.

They are now all lifting together as they row that eight forward all in the same direction. Before, they were actually going against each other and they were crabbing at times. Now, it’s a smooth drive forward.

Learning Environment

SPL: Lovely analogy. The power is in the visits, but the magic happens on the bus, isn’t it?

HG: Yes, the experience where you look at things is on the visits, but the power and the real engagement and magic is on the bus and the group of people on the bus. The bus becomes our learning environment, it’s our safe haven. What I act as is the ‘honest broker’ to be able to facilitate the discussion and the debate as we go on the bus and we unpack what we’ve seen. But we also help set up what we’re expecting to see. Then people go in there and they look at it and they go, ‘actually, that’s not what I expected’.

Then we unpack where that conflict occurs. That’s really powerful. It’s those discussions and debates as you go along on the bus, that’s where all the power is. That’s where everyone has that real aha moment as they make sense of that. And not only make sense of what they’ve seen, but it’s this application of ‘how does that apply to my business that I run and my value chain that I’m operating in’ and asking hard questions about how you do things and how they need to operate.

Programme Details and Networking

SPL: And you make some fantastic friends. I ended up going to one of their weddings because he married my friend. So that was really nice. But really great networking as well of different people across the city that you probably wouldn’t meet otherwise. For those who are interested, it will run between the 8-14 of February, 2026. Applications will close on the 23rd of November 2025. We’ll put a link in the description below so that you can get all of the information.

It is a five-day tour, and as Hamish said, starting in the Hawke’s Bay and ending in Hamilton. You’re with your group the entire time, staying at various places, and then on the bus, as he was saying there. Thank you very much for your time, Hamish. I look forward to following who ends up on the programme next year. There’s lots of familiar faces, and just Hearing from them firsthand afterwards is pretty inspiring, and just around how much their mind has been blown.

To apply for the 2026 Value Chain Innovation Programme (runs 8-14 February) head to the Rural Leaders site.