Benchmarking in pig production

Transcription

1 Benchmarkng n pg producton Thomas Algot Søllested Egeberg Internatonal A/S Agenda Who am I? Benchmarkng usng Data Envelopment Analyss Focus-Fnder an example of benchmarkng n pg producton 1

2 Who am I? M.Sc. n Agrcultural Scence Master thess n Advanced Herd Management Research assstant - IHH, KVL modelbased decson support Advsor - Landscentret, Svn Software development (BEDRIFTSLØSNING, FarmWatch, Focus-Fnder) IT-advsor - TNM Teknk ApS IT support n agrculture Proect Manager Egeberg Internatonal A/S What s Benchmarkng? Benchmarkng s a systematc comparson of ndvdual busnesses relatve to Best Practce wth the am to learn from the best busnesses Best practce s the best managed comparable busnesses Benchmarkng can be performed usng smple key fgures,.e. produced pgs per year sow, or based on methods usng (advanced) mathematcal models 2

3 The am of benchmarkng Evaluate own effectveness Vsualze the potental result obtaned by a purposeful adustment Support to defne realstc and ambtous goals Motvate to changes/adustment of producton Best practce Benchmarkng n agrculture s often based on a sngle key fgure from the accounts or from producton reports A sngle key fgure does not necessarly offer the possblty to be systematcally compared wth best practce In a system usng several nputs and outputs t has to be defned whch nputs and outputs s the most mportant The most mportant nputs and outputs dffer between farms the set of comparable farms s dfferent between farms 3

4 Basc queston In a system wth only one nput and one output t s smple to defne who s performng best In a system wth several nputs and outputs t s dffcult to defne who s performng best because we don t know the (farmer s) preferences Further more we don t know the producton possbltes,.e. how much output can theoretcally be produced wth a gven amount of nput How to evaluate busnesses performng smlar tasks when preferences and possbltes are unknown? Basc deas Absolutte effectveness max U ( x, y ) U ( x, y ) s. t.( x, y ) T Unknown pref. U Produce more wth less Absolutte effcency. e. E = mn{ E ( Ex, y ) T} Unknown poss. T Estmate producton possbltes T* Relatve effcency. e. E = mn{ E ( Ex, y ) T*} 4

5 Data Envelopment Analyss (DEA) Data Envelopment Analyss (DEA) s a method based on economc theory that handles both the unknown preferences as well as the unknown possbltes DEA s a non-parametrc model no estmaton of parameters DEA calculates the relatve effcency for each busness relatve to a reference set DEA can be solved usng Lnear Programmng: an nput based mnmzng problem an output based maxmzng problem In practce the dstance from a producton fronter s calculated Basc Effcency Measures Input based: E = fnd largest proportonal contractons of all nputs E = mnmal nput/actual nput E = 0.7 means that all nputs could be reduced by 30% Output based: F = fnd largest proportonal expansons of all outputs F = maxmal feasble output/actual output F = 1.4 means that all outputs could be expanded by 40% 5

6 DEA - llustrated Output y'' T CRS y' C C 0 B y* A D T VRS 0 0 A 0 x* Input Output based DEA A P F = 0 0 P' P F = max F,λ F Output 2 P B C D s. t. x Fy λ 0 λ x λ y E Output 1 6

7 Pros and Cons of DEA PROS Requres no or lttle prce or prorty nformaton Requres no or lttle technologcal nformaton Makes weak a pror assumptons Handles multple nputs and multple outputs Identfes best practce Supports learnng, plannng, motvaton CONS Weak theory of sgnfcance testng One should dscuss goals movng slowly n the rght drecton may be better than runnng fast n the wrong drecton Focus-Fnder Internet applcaton for benchmarkng n pg producton Based on an output based DEA model The farmer reports hs own data The farmer chooses the reference set Effcency score s expressed as a producton ndex The producton ndex s used to calculate an economc potental 7

8 Focus-Fnder Tool for DB-Tek benchmarkng based on a sngle key fgure (Net ncome per year sow) Uses addtonal economc key fgures reported by agrcultural advsors Ranks all of the farmers accordng to Net ncome per year sow Best practce defned as the smple average of the 5 best farmers (Net ncome per year sow) Focus-Fnder Demonstraton 8