Benchmarking and Tools to Maximize Profit

Presented by Greg Bilbrey, Agri Stats Inc Fort Wayne Indiana at the 2009 London Swine Conference.

Agri Stats is a privately held company providing professional services to the commercial livestock industries. Greg Bilbrey spoke on the how information from a swine benchmarking program can be used to identify opportunities and help improve profits.

Benchmarking is simply the act of comparing data to a contemporary group with the goal of improving performance. To be effective it must receive a committed and on going effort and the comparisons should be against those companies or (swine operations) of similar structure.

One benefit of benchmarking is that it contributes to the ability to a see outside personal or professional practices. The term "paradigm blindness" refers to the situation when an individual or business becomes so focus on or entrenched in the operation of their respective activities, they fail to see what is going on outside their world. This blindness may be a source of stagnation and an impediment to progress. Benchmarking allows visualization of what individual, companies and/or competitors are doing and how one compares to them. Effective benchmarking breaks this paradigm blindness and leads to creation of practices or processes that improve performance. In swine operations benchmarking can range from simple production comparisons to elaborate and sophisticated total production and financial comparisons. Each and every commercial swine operation is encouraged to participate in some benchmarking effort.

In the current swine industry, much discussion is given to the maximization of performance in specific production variable such as pigs per mated sow per year, ADG, FC. Efforts to improve performance in each area of production is important and necessary for growth, yet including only production measurements can lead to ineffective efforts and may create a level of "paradigm blindness". Some measurements of cost and or financial performance should also be included. We must remember the ultimate goal is increasing the profitability-not simply increasing the production level.

It should be clear that benchmarking can help identify opportunities and focus efforts on the opportunities with the greatest economic gain. Though all producers may not be a member of a large benchmarking company like Agri Stats, producer groups could design their own or seek out other companies providing similar services. In these challenging economic times each producer must capitalize on opportunities to increase efficiency, lower cost and improve profit.

Related Links

• London Swine Conference

June 2009 Pork News & Views - Table of Contents