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Best Practice Benchmarking in Australian Agriculture: Issues and Challenges

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  • Ronan, Glenn
  • Cleary, Gordon

Abstract

The quest to shape Australian agriculture for improved and sustainable profitability is leading Research and Development Corporations, agri-service consultants and government to devote substantial effort into development of new farm business analysis and benchmarking programs. ‘Biz Check’, ‘Pork Biz’, ‘Wool Enterprise Benchmarking’, ‘Dairy Business Focus’ and ‘Business Skills and Best Practice’ for beef and sheep meat producers are examples of current farm management and training programs where business analysis and benchmarking are integral components. Benchmarking is currently very popular with farmers, service providers and funding agencies. However, benchmarking has been likened to comparative analysis with both criticised by past and present prominent agricultural economists as ‘random numbers’ and ‘rampant empiricism’. The authors agree with advocates of benchmarking that it has potential as a supply chain and farm business improvement tool. They also agree with critics that much of what is currently flagged as benchmarking is actually financial analysis, lacks linkage to underlying enterprise operations and fails to add value in between-business comparison. Most packages do not encompass off-farm, supply-chain environment factors. Further, some ‘benchmarking’ employs some unsound methodology. Reconciliation of current conflicting, polar positions is recommended in the development of best practice benchmarking, differentiated by its process based, diagnostic power. In best practice mode, benchmarking should be capable of delving beneath performance outcomes and into a logical framework for making changes to enterprise processes that are systemically linked to productivity and profitability.

Suggested Citation

  • Ronan, Glenn & Cleary, Gordon, 2000. "Best Practice Benchmarking in Australian Agriculture: Issues and Challenges," 2000 Conference (44th), January 23-25, 2000, Sydney, Australia 123728, Australian Agricultural and Resource Economics Society.
    • Handle: RePEc:ags:aare00:123728
    DOI: 10.22004/ag.econ.123728
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    References listed on IDEAS

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    1. Ferris, Alexandria & Malcolm, Bill, 1999. "Sense and Nonsense in Dairy Farm Management Economic Analysis," 1999 Conference (43th), January 20-22, 1999, Christchurch, New Zealand 123803, Australian Agricultural and Resource Economics Society.
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    Cited by:

    1. Ronan, Glenn, 2002. "Delving and Divining for Australian Farm Management Agenda: 1970-2010," 2002 Conference (46th), February 13-15, 2002, Canberra, Australia 174039, Australian Agricultural and Resource Economics Society.
    2. Franks, J.R. & Collis, Jimi, 2003. "On-Farm Benchmarking: How to Do It and How to Do It Better," 14th Congress, Perth, Western Australia, August 10-15, 2003 24326, International Farm Management Association.
    3. Ronan, Glenn, 2002. "Delving and Divining for Australian Farm Management Agenda: 1970-2010," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 10, pages 1-24, September.
    4. Elisa I. Cano Montero & Clara Isabel Muñoz Colomina & Elena Urquia Grande, 2007. "Agri-environmental indicators in the management of farms. the Spanish case," Documentos de trabajo de la Facultad de Ciencias Económicas y Empresariales 07-04, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales.
    5. Sefton, Clive A. & Cox, Rodney J., 2005. "A business performance index model that measures wealth change in Australian farm businesses," AFBM Journal, Australasian Farm Business Management Network, vol. 2(2), pages 1-13.

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    Keywords

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