How a semiconductor veteran turned over a century of horticultural knowledge into AI-led aggressive benefit
For many years, a ritual performed out throughout ScottsMiracle-Gro’s media amenities. Each few weeks, staff walked acres of towering compost and wooden chip piles with nothing greater than measuring sticks. They wrapped rulers round every mound, estimated top, and did what firm President Nate Baxter now describes as “sixth-grade geometry to determine quantity.”
At this time, drones glide over those self same crops with mechanical precision. Imaginative and prescient programs calculate volumes in actual time. The transfer from measuring sticks to synthetic intelligence alerts greater than effectivity. It’s the seen proof of considered one of company America’s very unlikely expertise tales.
The AI revolution finds an surprising chief
Enterprise AI has been led by predictable gamers. Software program corporations with cloud-native architectures. Monetary companies companies with huge information lakes. Retailers with wealthy digital touchpoints. Shopper packaged items corporations that deal with bodily merchandise like fertilizer and soil weren’t anticipated to steer.
But ScottsMiracle-Gro has realized greater than half of a focused $150 million in provide chain financial savings. It stories a 90 p.c enchancment in customer support response occasions. Its predictive fashions allow weekly reallocation of promoting assets throughout regional markets.
A Silicon Valley veteran bets on soil science
Baxter’s path to ScottsMiracle-Gro (SMG) reads like a calculated pivot, not a company rescue. After twenty years in semiconductor manufacturing at Intel and Tokyo Electron, he knew tips on how to apply superior expertise to advanced operations.
“I form of initially mentioned, ‘Why would I do that? I’m operating a tech firm. It’s an business I’ve been in for 25 years,’” Baxter recollects of his response when ScottsMiracle-Gro CEO Jim Hagedorn approached him in 2023. The corporate was reeling from a collapsed $1.2 billion hydroponics funding and going through what he describes as “stress from a leverage standpoint.”
His spouse challenged him with a direct immediate. In case you are not studying or placing your self in uncomfortable conditions, you must change that.
Baxter noticed clear parallels between semiconductor manufacturing and SMG’s operations. Each require precision, high quality management, and the optimization of advanced programs. He additionally noticed untapped potential in SMG’s area information. 100 fifty years of horticultural experience, regulatory know-how, and buyer perception had by no means been absolutely digitized.
“It turned obvious to me whether or not it was on the backend with information analytics, enterprise course of transformation, and clearly now with AI being entrance and middle of the patron expertise, a variety of alternatives are there,” he explains.
The declaration that modified every little thing
The pivot started at an all-hands assembly. “I simply mentioned, , guys, we’re a tech firm. You simply don’t understand it but,” Baxter recollects. “There’s a lot alternative right here to drive this firm to the place it must go.”
The primary problem was organizational. SMG had developed into purposeful silos. IT, provide chain, and model groups ran impartial programs with little coordination. Drawing on his expertise with advanced expertise organizations, Baxter restructured the patron enterprise into three enterprise models. Common managers turned accountable not only for monetary outcomes but additionally for expertise implementation inside their domains.
“I got here in and mentioned, we’re going to create new enterprise models,” he explains. “The buck stops with you and I’m holding you accountable not just for the enterprise outcomes, for the standard of the artistic and advertising, however for the implementation of expertise.”
To help the brand new construction, SMG arrange facilities of excellence for digital capabilities, insights and analytics, and inventive capabilities. The hybrid design positioned centralized experience behind distributed accountability.
Mining company reminiscence for AI gold
Turning legacy information into machine-ready intelligence required what Fausto Fleites, VP of Information Intelligence, calls “archaeological work.” The staff excavated many years of enterprise logic embedded in legacy SAP programs and transformed submitting cupboards of analysis into AI-ready datasets. Fleites, a Cuban immigrant with a doctorate from FIU who led Florida’s public hurricane loss mannequin earlier than roles at Sears and Cemex, understood the stakes.
“The pricey a part of the migration was the enterprise reporting layer we’ve in SAP Enterprise Warehouse,” Fleites explains. “It’s essential uncover enterprise logic created in lots of circumstances over many years.”
SMG selected Databricks as its unified information platform. The staff had Apache Spark experience. Databricks provided robust SAP integration and aligned with a choice for open-source applied sciences that reduce vendor lock-in.
The breakthrough got here via systematic information administration. SMG constructed an AI bot utilizing Google’s Gemini giant language mannequin to catalog and clear inside repositories. The system recognized duplicates, grouped content material by subject, and restructured info for AI consumption. The hassle diminished information articles by 30 p.c whereas rising their utility.
“We used Gemini LLMs to really categorize them into subjects, discover comparable paperwork,” Fleites explains. A hybrid strategy that mixed fashionable AI with methods like cosine similarity turned the muse for later functions.
Constructing AI programs that truly perceive fertilizer
Early trials with off-the-shelf AI uncovered an actual threat. Common-purpose fashions confused merchandise designed for killing weeds with these for stopping them. That mistake can smash a garden.
“Completely different merchandise, should you use one within the improper place, would even have a really destructive final result,” Fleites notes. “However these are type of synonyms in sure contexts to the LLM. So that they had been recommending the improper merchandise.”
The answer was a brand new structure. SMG created what Fleites calls a “hierarchy of brokers.” A supervisor agent routes queries to specialised employee brokers organized by model. Every agent attracts on deep product information encoded from a 400-page inside coaching handbook.
The system additionally adjustments the dialog. When customers ask for suggestions, the brokers begin with questions on location, targets, and garden circumstances. They slim potentialities step-by-step earlier than providing ideas. The stack integrates with APIs for product availability and state-specific regulatory compliance.
From drones to demand forecasting throughout the enterprise
The transformation runs throughout the corporate. Drones measure stock piles. Demand forecasting fashions analyze greater than 60 components, together with climate patterns, client sentiment, and macroeconomic indicators.
These predictions allow sooner strikes. When drought struck Texas, the fashions supported a shift in promotional spending to areas with favorable climate. The reallocation helped drive optimistic quarterly outcomes.
“We not solely have the power to maneuver advertising and promotion {dollars} round, however we’ve even gotten to the purpose the place if it’s going to be an enormous weekend within the Northeast, we’ll shift our discipline gross sales assets from different areas up there,” Baxter explains.
Shopper Companies modified as properly. AI brokers now course of incoming emails via Salesforce, draft responses primarily based on the information base, and flag them for temporary human assessment. Draft occasions dropped from ten minutes to seconds and response high quality improved.
The corporate emphasizes explainable AI. Utilizing SHAP, SMG constructed dashboards that decompose every forecast and present how climate, promotions, or media spending contribute to predictions.
“Sometimes, should you open a prediction to a enterprise particular person and also you don’t say why, they’ll say, ‘I don’t imagine you,’” Fleites explains. Transparency made it attainable to maneuver useful resource allocation from quarterly to weekly cycles.
Competing like a startup
SMG’s outcomes problem assumptions about AI readiness in conventional industries. The benefit doesn’t come from proudly owning essentially the most refined fashions. It comes from combining general-purpose AI with distinctive, structured area information.
“LLMs are going to be a commodity,” Fleites observes. “The strategic differentiator is what’s the further degree of [internal] information we will match to them.”
Partnerships are central. SMG works with Google Vertex AI for foundational fashions, Sierra.ai for production-ready conversational brokers, and Kindwise for pc imaginative and prescient. The ecosystem strategy lets a small inside staff recruited from Meta, Google, and AI startups ship outsized affect with out constructing every little thing from scratch.
Expertise follows affect. Typical knowledge says conventional corporations can’t compete with Meta salaries or Google inventory. SMG provided one thing totally different. It provided the possibility to construct transformative AI functions with instant enterprise affect.
“When we’ve these interviews, what we suggest to them is principally the power to have actual worth with the most recent information in these areas,” Fleites explains. “Lots of people really feel motivated to return to us” as a result of a lot of massive tech AI work, regardless of the hype, “doesn’t actually have an effect.”
Crew design mirrors that philosophy. “My direct stories are leaders and never solely handle folks, however are technically savvy,” Fleites notes. “We at all times are continually switching palms between growing or sustaining an answer versus technique versus managing folks.” He nonetheless writes code weekly. The small staff of 15 to twenty AI and engineering professionals stays lean by contracting out implementation whereas protecting “the know-how and the route and the structure” in-house.
When innovation meets immovable objects
Not each pilot succeeded. SMG examined semi-autonomous forklifts in a 1.3 million sq. foot distribution facility. Distant drivers within the Philippines managed as much as 5 autos without delay with robust security information.
“The expertise was really actually nice,” Baxter acknowledges. The autos couldn’t elevate sufficient weight for SMG’s heavy merchandise. The corporate paused implementation.
“Not every little thing we’ve tried has gone easily,” Baxter admits. “However I believe one other essential level is you must deal with a couple of important ones and you must know when one thing isn’t going to work and readjust.”
The lesson tracks with semiconductor self-discipline. Investments should present measurable returns inside set timeframes. Regulatory complexity provides issue. Merchandise should adjust to EPA guidelines and a patchwork of state restrictions, which AI programs should navigate accurately.
The gardening sommelier and agent-to-agent futures
The roadmap displays a long-term view. SMG plans a “gardening sommelier” cell app in 2026 that identifies crops, weeds, and garden issues from pictures and gives immediate steerage. A beta already helps discipline gross sales groups reply advanced product questions by querying the 400-page information base.
The corporate is exploring agent-to-agent communication so its specialised AI can interface with retail companions’ programs. A buyer who asks a Walmart chatbot for garden recommendation might set off an SMG question that returns correct, regulation-compliant suggestions.
SMG has launched AI-powered search on its web site, changing key phrase programs with conversational engines primarily based on the interior stack. The longer term imaginative and prescient pairs predictive fashions with conversational brokers so the system can attain out when circumstances counsel a buyer might need assistance.
What conventional industries can be taught
ScottsMiracle-Gro's transformation gives a transparent playbook for enterprises. The benefit doesn't come from deploying essentially the most refined fashions. As an alternative, it comes from combining AI with proprietary area information that rivals can't simply replicate.
By making basic managers answerable for each enterprise outcomes and expertise implementation, SMG ensured AI wasn't simply an IT initiative however a enterprise crucial. The 150 years of horticultural experience solely turned beneficial when it was digitized, structured, and made accessible to AI programs.
Legacy corporations competing for AI engineers can't match Silicon Valley compensation packages. However they will provide one thing tech giants usually can't: instant, measurable affect. When engineers see their climate forecasting fashions straight affect quarterly outcomes or their agent structure forestall clients from ruining their lawns, the work carries weight that one other incremental enchancment to an advert algorithm by no means will.
“We now have a proper to win,” Baxter says. “We now have 150 years of this expertise.” That have is now information, and information is the corporate’s aggressive edge. ScottsMiracle-Gro didn’t outspend its rivals or chase the most recent AI mannequin. It turned information into an working system for progress. For an organization constructed on soil, its largest breakthrough may be cultivating information.
