Pork Commentary: The ending of one year...

US - The ending of one year and the beginning of another can be a trigger to contemplate and reflect where we have been and where we are going. We started writing this commentary in summer of 1998- over seven years ago. Much has happened in this industry over this time.
calendar icon 1 January 2006
clock icon 6 minute read

There have been two major cycle declines, and then the profits and equity infusion over the last two years. We also had major consolidation with many people who produced in 1998 now out of business. Since 1998, on a personal level, both of my parents passed away, I had another son born, personally rode the roller coaster of the hog cycle down, down, then up again. Don’t we wish we all knew in the summer of 1998 what laid ahead? Then again, maybe it is better we didn’t. The unknown future is probably better then a known destiny.

We have been fortunate over the past seven years to have the interaction with producers that this commentary has afforded. Presently it is our understanding that is read and exposed to more producers than any other weekly pork commentary in the world through our multiple internet partners in several languages. We appreciate the recognition and support and are thankful that our dialogue is read by so many. Thanks to all.

The Iowa Pork Congress

Consider attending the largest winter swine event the Iowa Pork Congress – January 25-26 Des Moines, Iowa- www.iowaporkcongress.org

What Makes a Top Producer?

Over the last while we have given some throughs to what separates a top producer from the others. Our company Genesus will have over three dozen producers wean over 25 pigs in 2005. In our opinion, (and industry statistics back this up), 25 pigs puts you in the top percentile of all producers. When we contemplate the possible key common thread we see with all the top producers there is one major characteristic – motivated engaged personnel or knowledge workers. The top producers have evolved their management style. Peter Drucker, one of the greatest management thinkers of all time puts it this way. “The most important, and indeed the truly unique contribution of management in the 20th century was the fifty fold increase in the productivity of the manual worker in manufacturing“

“The most important contribution management needs to make in the 21st century is similarly to increase the productivity of knowledge work and the knowledge worker.“

“The most valuable assets of a 20th century company were its production equipment. The most valuable asset of a 21st century institution whether business or non-business, will be its knowledge workers and their productivity.“

In some ways fancy words, but in many ways it is right on target for the swine industry. Why?

When we visit producers weaning over 25 pigs, discussion involves everyone in the barn. All personnel appear to be appreciated, all have input. It is not top down management. On walk throughs everyone in the barn is involved and though anyone over 25 pigs is already doing well the desire and interest to do better is at everyone of theses three dozen farms. Twenty five pigs is the goal but not a finish line. (of note: the nurseries, finishers of the 25+ are a continuation of the production excellence. It is not a reflection of single category concentration)

We personally used to think pig production was manufacturing but not anymore. We were wrong. There is no absolute template for minute by minute decisions in a hog barn. It takes motivated knowledge. For example, how much sow feed in this farrowing crate, does that pig need treatment, how many pigs in a pen, right shipping weight… The number of decisions needed to be made in a barn is almost infinite daily. The top production units recognize that all personnel must make decisions and take responsibility. What also comes with this is job satisfaction. All the top producers have satisfied personnel and extremely low turnover. It goes without saying that top production is impossible with a revolving door of personnel coming and going.

We observe the lower producing units’ managers are still applying the “industrial age“ control model. Many in positions of authority do not see the true worth and potential of their people. They manage people as they do things. It is like accounting which makes people an expense and machines assets. The top producers have moved on, the recognition and respect for workers leads to a big payoff. Recognition and goal setting works. A customers of our told all his personnel if they weaned 25 pigs in 2004 they would all get an expense paid vacation to Mexico. They worked as a team through out the year. They exceeded 25+ pigs. They all went to Mexico. Everyone won. Happy personnel, happy owner.

Another observation about producers getting over 25 pigs is there is no secret formula. It is basic husbandry and execution and prudent use of the top technology available to all. We have 25 year old barns doing over 25 pigs, and we have new barns (size ranges from 300-3000 sows). We have customers with high health herds and herds that have gone through PRRS breaks. In the end we all know of new barns with the latest technology weaning 19 pigs and they cannot keep personnel. Trapped in the manufacturing age, thinking machinery and capital is the solution when the ability to motivate and inspire productivity of people is the main answer.

Decisions are made by people. Some are right, some wrong. We are in the genetic business. We are who we are. The three dozen over 25 producers Genesus customers used the knowledge available to make the decision to work with us. It matters. Some genetic companies only dream of customers reaching 25 pigs. To get top results the ceiling must be taken off genetic productivity potential. Coupled with motivated knowledge workers 25+ pigs is quite achievable. You have the tools available, it is not magic. Embrace and engage your personnel. Treat them like assets not liabilities. The human mind and body is sustainably motivated by joy and satisfaction. Fear motivation is a short term solution mirage. Challenge your people, support your people. They will stay. They will be more productive. It is an investment in your future. We all lived through the years of anguish in the hog market. Make your business bullet proof. Lead your people and production over 25 pigs. It is save to say no one has ever gone broke weaning 25+ pigs.

Source: Jim Long, Genesus Genetics / Keystone Pig Advancement Inc. - 1st January 2006
Reproduced courtesy Farms.com

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