Adopting New Zealand Dairy Farm Principles and Practices in Argentina

The dairy sector is important to Argentina because it creates genuine wealth and employment. Milk production at competitive costs is crucial for the endurance of the Argentine dairy sector; therefore the development of competitive dairy farm systems is important for Argentina. New Zealand (hereafter NZ) dairy farm systems are internationally known for their competitiveness without the presence of subsidies. Though Argentine dairy farmers have been attracted to NZ systems for more than 40 years and despite the fact that the NZ knowledge appears to be beneficial to Argentine farms, NZ practices have been rarely adopted. This seemingly fruitless effort in extending this technology shapes the research question of the present study: Can Argentine dairy farmers benefit from adopting New Zealand dairy farm principles and practices? Seven Argentine dairy farmers were selected as case studies because of their awareness of NZ dairy systems; the research data was collected through interviews, farm physical and economic records, and field visits to the farms. Two frameworks were utilized to analyse the qualitative and quantitative data: the Diffusion Theory (Rogers, 2003) and the IFCN network (International Farm Comparison Network www.ifcnnetwork.org), respectively. Ten NZ innovations were defined; they were principles and practices considered typical in NZ dairy farms and not common in Argentine dairy farms. The innovations were related to four areas of the dairy system: pasture management, herd management & genetics, farm structure & organization, and human resources. The seven farmers selected differed in the level of adoption or rejection of the innovations. Results revealed that higher levels of adoption of NZ innovations by a group of Argentine dairy farms were associated with higher levels of Return on Investment; this was mainly due to a higher utilization of the main asset and most limiting production factor of Argentine and New Zealand dairy farms, the land.Argentine dairy farm systems, New Zealand innovations for Argentina, Argentine dairy industry, Argentine dairy systems, diffusion of innovations, adoption of innovations, Livestock Production/Industries,

Factors for Successful Development of Farmer cooperatives in Northwest China

Chinese cooperatives, successful factors, cooperative development, Northwest China, Community/Rural/Urban Development, Farm Management, Health Economics and Policy, International Development,

A Critique of the Use of the Balanced Scorecard in Multi-Enterprise Family Farm Businesses

Business strategy is very important to small and medium family businesses as many are both fragile and vulnerable; strategy provides a solid foundation for survival. Various studies have identified that businesses that engage in strategic management outperform those that do not. Despite this knowledge the uptake of many aspects of strategic management by farm businesses has been slow. Although the development of business plans is now common there is often a disconnect between monitoring and strategy. The Balanced Scorecard (BSC) was applied to case study farms during both the planning process and as they implemented and controlled their strategic choices to determine areas of difference that restrict or enhance it as a management tool for both family and farming businesses. The BSC was immediately applicable in the strategic management process for those businesses with current business plans. It could be used to test the degree of balance between the goals already identified in their plans. It was able to be used to critique the control measures they had in place and to determine how well they could be used to derive the causal chain from the operational level to family goals. In some instances either outcome or driver measures were recognized as being missing, in others the wiring within the balanced scorecard revealed some strategic measures without linkages.Farm Management,

Risk - An Opportunity or Threat for Entrepreneurial Farmers in the Global Food Market?

uncertainty, farm management, opportunities, threats, Agribusiness, Q12,

New Zealand Agribusiness Success: An Approach to exploring the role of strategy, structure and conduct on firm performance

This paper presents a framework to explore agribusiness success in New Zealand. The framework provides the basis for historical analysis. It draws on existing theory based on the structure-conduct-performance paradigm but expanded to take account of firm strategy and the analysis of value chains.Agribusiness, structure, conduct, performance, history, Agribusiness,

Application of the Adjusted Weak Axiom of Profit Maximization to New Zealand Dairy Farming

The weak axiom of profit maximization is a nonparametric, empirical approach that has been used in the United States to analyze dairy farmers’ production and profit behavior under input and output price changes to determine whether farmers effectively respond to these changes. The expectation is that profit calculated using the current year’s input and output combination will be greater than that calculated from the previous year’s combination with current prices more often than due to chance. This approach was replicated using New Zealand dairy farm data (1,785 pairs of records over five years). Current year’s profits were significantly greater in two of the years and less in two years and in total. New Zealand’s pasture-based systems mean that this approach has limitations in evaluating farmers’ input and output decisions in response to price changes. Factors such as climatic impacts on pasture availability (a volatile input not included in the data set), and hence purchased feed requirements, affected the results. Farmer responses to costs and prices were not readily differentiated from other factors that affected input decisions or output. Results were interpreted with respect to climate, production, and income and cost changes, both nationally and regionally, with some interesting observations on farmer responses to variability

PR - Strategic Management Of Farm Businesses: The Role Of Strategy Tools With Particular Reference To The Balanced Scorecard

Strategic management has been described as being different from other levels of management in several ways. It is non-routine, non-programmable, unique and creative, more ambiguous, uncertain and complex than ‘operational’ management and yet it has the greatest impact on the future of the business. There are a number of strategy tools available that can be used by farm businesses to guide strategic thinking, strategic decision-making and strategy implementation. The range of strategy tools used by rural professionals is not wide; of particular note is the observed misuse of the SWOT analysis with subsequent poor identification of external opportunities. The use of the balanced scorecard (BSC) tool is described and how it has been adapted for use in farm and ranching businesses discussed. To be successful, both farm and non-farm businesses can and have utilised the flexibility provided by the BSC tool to design a framework that fits their purpose and delivers to their vision

Competitive Strategy Analysis of NZ Pastoral Dairy Farming Systems

The purpose of this paper is to examine the financial performance of five pastoral dairy farming systems through the use of financial ratio analysis in the form of the Du Pont model and to determine any differences in the drivers of financial success between systems. The differing level and allocation of resources, or organisational structure, that each farm system adopts was the basis for a test to determine superior competitive advantage. This test was on the premise that if a farm system has a competitive advantage it would exhibit above average performance. While the on-farm competitive strategy is the same for all systems, cost leadership, the organisational design, and the resource configuration differ between farms. There are low-input farms which achieve low cost production through cost control (the numerator effect) and high-input farms which achieve it through improved outputs (the denominator effect). There has been significant debate in New Zealand as to which system is better with discussion focusing often on misleading metrics. The focus on competitive advantage and the rigour provided by the Du Pont model analysis enables a more balanced assessment of the benefits, or not, of intensification on New Zealand farms. The results highlight how misleading commonly used metrics can be. Despite differences in production and operating profit per hectare there is very little difference between return on assets and return on equity between the systems. Of particular interest is the consistency in operating profit margin between systems indicating no loss in operating efficiency as systems intensify. The only exception to this was the more intensive systems in 08/09 when input and output market price relativity was extremely unfavourable. Further research is required to determine if farms switch between systems as input and output market prices change and to explore those farms that are more resilient to such changes

Competitive strategy analysis of New Zealand pastoral dairy farming systems

The purpose of this paper is to examine the financial performance of five pastoral dairy farming systems through the use of financial ratio analysis in the form of the Du Pont model and to determine any differences in the drivers of financial success between systems. The differing level and allocation of resources, or organisational structure, that each farm system adopts was the basis for a test to determine superior competitive advantage. This test was on the premise that if a farm system has a competitive advantage it would exhibit above average performance. While the on-farm competitive strategy is the same for all systems, cost leadership, the organisational design, and the resource configuration differ between farms. There are low-input farms which achieve low cost production through cost control (the numerator effect) and high-input farms which achieve it through improved outputs (the denominator effect). There has been significant debate in New Zealand as to which system is better with discussion focusing often on misleading metrics. The focus on competitive advantage and the rigour provided by the Du Pont model analysis enables a more balanced assessment of the benefits, or not, of intensification on New Zealand farms. The results highlight how misleading commonly used metrics can be. Despite differences in production and operating profit per hectare there is very little difference between return on assets and return on equity between the systems. Of particular interest is the consistency in operating profit margin between systems indicating no loss in operating efficiency as systems intensify. The only exception to this was the more intensive systems in 08/09 when input and output market price relativity was extremely unfavourable. Further research is required to determine if farms switch between systems as input and output market prices change and to explore those farms that are more resilient to such changes

Alternative management strategies and drafting policies for irrigated Canterbury sheep farms

Other studies reported in this series include Research Report No.103 (A Study of Excess Livestock Transport Costs in the South Island of New Zealand by R.D. Innes and A.C. Zwart) and Research Report No.123 (Seasonality in the New Zealand Meat Processing Industry by R.L. Sheppard).The study reported in this publication is part of the A.E.R.U.'s continuing research effort into the seasonality of ruminant animal production in New Zealand. The philosophy behind the programme of research is that production, transport and killing and processing activities should be viewed as an integrated system in order to maximise the efficient use of resources. Smoothing the existing seasonal peak flow of lambs should allow the downstream sectors to be more efficient resulting in lower charges to the producing sector. However, producing other than at the 'peak' can be more costly at the farm level. The objective of the research programme is to estabish the relative costs and savings associated with changes in different parts of the production-processing system. In the present study, Nicola Shadbolt (graduate research fellow in the A.E.R.U. from 1979 to 1981) reports on a simulation model that addresses the management potential for smoothing the peak production of lambs on irrigated Canterbury sheep farms