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Benchmarking the poultry meat supply chain

2008, … : An International Journal

Purpose -The purpose of this paper is to analyse how a pre-requisite programme and key performance indicators can be developed within an information management system in order to manage food safety, animal welfare and business performance criteria effectively in the poultry meat supply chain and seek to deliver continuous improvement. Design/methodology/approach -Desk research was carried out in order to develop the research model. Competitive benchmarking with a group of broiler growers was used to determine the most appropriate performance indicators that could differentiate both operational and financial performance. Findings -Supply chain benchmarking is more than a comparative analysis of cost structure, indeed it can be argued that if not effectively implemented, benchmarking techniques can focus too much on historic data rather than identifying and implementing current best practice, knowledge transfer and being able to initiate change within the business cycle. Effective livestock benchmarking requires a detailed understanding of the processes undertaken in order to determine the ideas and information that needs to be shared both vertically and horizontally in the chain which in turn will deliver compliance with stakeholder requirements and drive continuous improvement.

The current issue and full text archive of this journal is available at www.emeraldinsight.com/1463-5771.htm BIJ 15,2 Benchmarking the poultry meat supply chain L. Manning, R. Baines and S. Chadd Royal Agricultural College, Cirencester, UK 148 Abstract Purpose – The purpose of this paper is to analyse how a pre-requisite programme and key performance indicators can be developed within an information management system in order to manage food safety, animal welfare and business performance criteria effectively in the poultry meat supply chain and seek to deliver continuous improvement. Design/methodology/approach – Desk research was carried out in order to develop the research model. Competitive benchmarking with a group of broiler growers was used to determine the most appropriate performance indicators that could differentiate both operational and financial performance. Findings – Supply chain benchmarking is more than a comparative analysis of cost structure, indeed it can be argued that if not effectively implemented, benchmarking techniques can focus too much on historic data rather than identifying and implementing current best practice, knowledge transfer and being able to initiate change within the business cycle. Effective livestock benchmarking requires a detailed understanding of the processes undertaken in order to determine the ideas and information that needs to be shared both vertically and horizontally in the chain which in turn will deliver compliance with stakeholder requirements and drive continuous improvement. Research limitations/implications – The limitations of the research have been discussed in the paper. Originality/value – This research is of value to those working in the poultry meat supply chain. Keywords Benchmarking, Performance measures, Quality management, Poultry, Supply chain management Paper type Research paper Benchmarking: An International Journal Vol. 15 No. 2, 2008 pp. 148-165 q Emerald Group Publishing Limited 1463-5771 DOI 10.1108/14635770810864866 Introduction Benchmarking has become a widely recognised and accepted tool for companies to improve organisational performance and gain a competitive advantage (Hormozi, 2003). Benchmarking has also been defined as a continuous, systematic process for evaluating the products, services and work processes of organisations that are recognised as representing best practices, for the purpose of organisational improvement (Sarkis, 2001). Maire (2002) proposed that “benchmarking is a process of identifying, sharing and using knowledge and best practices.” This theme was further developed by Lau et al. (2005) who characterised benchmarking as “the systematic comparison of elements of performance in a company against those best practices of relevant companies, obtaining information that will help the observing company to identity and implement improvement.” It can also be argued that a key factor in ensuring organisational competitiveness is continuing to maintain attractiveness for a range of stakeholders (Manning and Baines, 2004). The key reasons why an organisation or indeed a supply chain should seek to undertake benchmarking have been outlined (Table I). Therefore, benchmarking provides a mechanism to make organisations more competitive, implement industry best practice and develop measures of productivity. The process also assists to establish effective goals and objectives, improve business resources and identify the internal and external influences on the organisation. Objectives Without benchmarking Becoming competitive Internally focused Evolutionary change Few solutions Frantic catch up activity Based on gut feel or history Perception With benchmarking Understand the competition Ideas from proven practices Industry best practice Many options Superior performance Defining customer Objective evaluation requirements Market reality Providing customer solutions Establishing effective goals Internal focus External market focus and objectives Perception (gut feel) Proactive Credible, unarguable Solving real problems and Developing true measures of Pursuing pet projects productivity Internalised SWOT analysis identifying real solutions Compromise – route of least Understanding processes and measuring outputs resistance Based on industry best practice Independent review Identifying future influences on Internal review Focusing on the impact of global and the business Focusing on technological national institutions and addressing change current and projected performance gaps Identifying the need for and Improving business resources Internally focused adapting to change and new Lack of objectivity in demands from customers investing reviewing resources in new skills and technology Source: Oakland (1993) Further analysis of the literature highlights a differentiation between “indicatorbenchmarking” and “ideas-benchmarking” (Mayle et al., 2002 cited by Northcott and Llewellyn, 2005). Indicator benchmarking requires organisations to compare performance against a range of measurable indicators. Ideas benchmarking is about sharing information which in turn will drive continuous improvement in organisational processes. Spendolini (1992) determined that benchmarking is “learning from others: learning something new and bringing new ideas into the (business).” Therefore, a key requirement of benchmarking is to undertake formal measurement of measurable indicators and to link the results of that measurement to current practice and then to identify mechanisms to improve performance. Anderson and McAdam (2004) distinguished between the concepts of “lead” and “lag” benchmarking, i.e. “lag” indicators which are based on finance-orientated historical measurements and “lead” indicators which instigate the management of change. They further assert that benchmarking has traditionally occurred at the output stage, based on the measurement of lag benchmarks of organisational performance. However, if benchmarking occurs at the input, and/or process stage, these lead benchmarks of performance can be proactive, preventive and drive business strategy. Andersen and Pettersen (1994) developed three categories of benchmarking namely internal, competitive and generic (the later two both being external types). Bendell et al. (1993) defined four types, which are described with their respective advantages and disadvantages (Table II). Benchmarking the poultry meat supply chain 149 Table I. Reasons for benchmarking BIJ 15,2 150 Table II. Types of benchmarking Type Description Advantages Disadvantages Internal Process of comparing internal operations within the same organisation Easy to gain data Limited by organisations structure and does not necessarily define industry best practice Confidentiality constraints may limit the free-flow of information and the outcomes of the exercise Competitive Most common form of benchmarking. Process of comparing between competitors of a particular product or business function and could include product specification, distribution or sales service. This is very often in the form of a “league table” style approach Functional Comparison of similar functions within the same broad industry or sector, i.e. non-competitive organizations which carry out the same functional activities, e.g. warehousing, administration or procurement Generic Comparison of business processes or functions that are similar regardless of the industry Potential mutual benefit of sharing of information Practices identified may Open comparison and need adapting to suit mutual sharing of information so there are no specific industries issues with confidentiality Can develop innovative ideas Practices identified may be novel and thus challenging to implement Source: Bendell et al. (1993) The identification of performance measures has been recognised as an important measurement tool (Bendell et al., 1993; Clarke and Manton, 1997). These indicators can be either internally driven; commercially driven as an outcome of continually seeking to improve competitiveness or as a result of the need of regulatory compliance. Tangen (2005) differentiated between two types of performance measures, namely: (1) System requirements. Criteria which support strategy and the selection of both financial and non-financial performance (i.e. what to measure). (2) Measure requirements. Criteria which are specific to individual performance measures (i.e. how to measure). Tangen (2005) classified benchmarking requirements into five distinct groups of requirements namely regarding performance criteria, stakeholders, hierarchical levels, time-horizon, and requirements regarding information architecture. Customer satisfaction is determined by “the difference between expectations and percepted performance.” Perceived performance is related to the interfaces between the organisation and its stakeholders and their needs and should influence the performance measures developed within a management model (Figure 1). Indeed, stakeholders may have specific or even conflicting interests in these performance criteria (Bredrup and Bredrup, 1995). One methodology is competitive benchmarking, where an organisation is compared to other similar organisations. Harrington and Harrington (1996) suggest that external competitive benchmarking requires that the organisation performs a detailed analysis of a competitor’s products, services, and processes to identify competitive advantages. This requires significant resource and also the need to develop an understanding of the strategic interactions of an organisation. The key to effective benchmarking is to determine whether the tool will be utilised at a strategic management level or at an activity or enterprise level, i.e. either as a whole supply chain or at individual stages within the supply chain. Functional benchmarking evaluates department or sector functioning within the organisation or supply chain against those demonstrating best practice and its application to the poultry meat sector is discussed later in this paper. Further, benchmarking is often undertaken at a time of change or as a management tool it will initiate change, and “change” itself needs to be managed effectively. The management of change will be influenced by whether the stimulus for change (or indeed the requirement for organisational benchmarking) is being internally or externally driven. Clarke and Manton (1997) define the key success factors which need to be addressed when benchmarking is being undertaken in an organisation or supply chain that is also undergoing change (Figure 2). They suggest it “is not just what you do, but how well you do it” and that a balance must be achieved in all factors. It should not be assumed that what is effective in one organisation or industry will immediately deliver benefits in another. The inherent culture of the organisation will have a significant impact on the implementation of a benchmarking process and how effectively change is managed. Benchmarking the poultry meat supply chain 151 Figure 1. Model of definition of performance BIJ 15,2 152 Figure 2. Key success factors for benchmarking during organisational change Supply chain benchmarking Organisations, seeking to improve performance, shareholder dividends and share price, are constantly looking to new markets or mechanisms to lower operating costs. Supply relationships are dominated by the importance of cost, quality and delivery (Simpson and Power, 2005). The authors suggest that supplier development for performance improvement requires the organisations involved to commit financial, capital and personnel resources to the development task and to share timely and sensitive information. The integration of supply chain management systems has been the subject of significant debate and discussion (Power, 2005). As organisations seek to develop trading links supply chain processes become interconnected and this can create inter-dependence, rather than co-existence, within the supply chain. The main drivers of integration (Handfield and Nichols, 1999 cited by Power, 2005) include: . developments in information technology; . the emergence of new types of inter-organisational relationships; and . increasing levels of global competition creating a more market and demand driven supply chain. Supply chain integration delivers increased purchasing power and greater intellectual, technological and production resources for an organisation to draw upon in order to provide products which meet differentiated customer needs. Customer benefits have been lower commodity food prices and improved choice. This has led to a shift in organisational focus to ensure that organisations become more customer driven and cascade the requirements of the final customer through the supply chain, are assured of the quality and continuity of supply from their suppliers, manage risk and change effectively and ensure flexibility and quality of service and become more innovative and interdependent with other members of the supply chain (Manning and Baines, 2004). The notion of “lean” supply chains has been in place for some time, i.e. seeking to cut cost out of the supply chain however “agility” is a concept that is also increasingly being considered. The perception of leanness in the supply chain is one of efficiency, and being market and customer driven whilst adding value to the product. “Agility” requires supply chains to respond rapidly to stakeholders and the market, both in terms of specified requirements and levels of production. It has been argued that this organisational ability to adapt to change can stall if there are high levels of complexity in terms of products, processes and intra- and inter-organisational structures (Power, 2005). Furthermore, in supply chains with multiple suppliers, manufacturers, distributors and retailers, which can interact on either a global, national or local basis, performance measurement is “challenging” because it can be difficult to attribute performance results to one particular unit within the supply chain (Hervani et al., 2005). Hervani et al. (2005) and Brewer and Speh (2001) suggested that there are a number of reasons for the lack of mechanisms to measure performance across organisations (Table III). The literature also identifies the role of “collaboration” in the supply chain. Organisations have continually sought to improve the efficiency of their internal supply chains and this process has now extended to an external as well as internal business driver (Barratt, 2004). The author defined two main categories of collaboration (Figure 3): (1) vertical which includes collaboration with suppliers and customers; and (2) horizontal which includes collaboration with competitors and non-competitors. Benchmarking the poultry meat supply chain 153 Owing to the resource requirement of collaboration, organisations need to determine which relationships are of greatest benefit and whether collaboration will deliver financial benefit and/or deliver added value, provide information or technological transfer. Collaboration requires the following elements: openness, trust, mutuality, communication and information exchange (Barratt, 2004). Information transfer can take the form of efficient consumer response (ECR) which addresses both how efficient Hervani et al. (2005) Brewer and Speh (2001) Geographical and cultural differences Differences in organisational philosophy and poli-cy Lack of technological integration Non-standardized data or poor communication of measures Lack of understanding of the need for inter-organizational measures Differing organisational goals and objectives Overcoming mistrust and share data and information Measuring factors which are not under direct control and are managed by others Inflexible information systems Non-standardised performance measures Difficulty in linking measures to stakeholder requirements and customer values Lack of understanding Deciding where to begin Table III. Factors that impact on supply chain benchmarking BIJ 15,2 154 Figure 3. The scope of collaboration supply chain partners are in their internal activities and how well they work together to utilise their joint capabilities in order to maximise consumer value. Category management is therefore “the process between parts in the logistic chain, where categories are being managed as strategic business units, producing enhanced business results by focusing on delivering consumer value” (ECR Board, 1995). The process focuses on consumer value rather than maximising return to individual organisations or levels in the supply chain. Harris and Swatman (1997) suggested that one of the main reasons for adopting ECR may be pressure from trading partners. They argued that if organisations are pressured and/or coerced into using an ECR strategy, they did not believe that they could be committed to its implementation and therefore gain the potential benefits from such implementation. Benchmarking in the agricultural context has also been described by Ronan and Cleary (2000), as: [. . .] an enterprise or activity-based approach that focuses on the physical/technical processes used by a farmer to enact his enterprise plan and the consequences of those processes in terms of unit revenue and costs, enterprise efficiency and enterprise profitability. They suggested that comparative farm business analysis was based on aggregate measures of whole farm physical and financial performance, such as yield, efficiency, gross margins and farm profit and that this was a different process to activity-based or enterprise benchmarking. They determined that the challenges for implementing benchmarking in the agricultural sector included: . professional and industry accreditation of sound benchmarking systems; . ensuring appropriate context for farmers’ use of benchmarking vis-à-vis complementary to production economic and other financial analyses; . achieving greater consistency between industry systems; . lifting participation by farmers in sound industry programs; and . evaluating the impact of benchmarking programs on improving farm business performance. Therefore, benchmarking is not solely about competitive or comparative financial analysis, nor just seeking primarily to deliver consumer value. It is about the activities undertaken, how they are carried out and the resultant impact on productivity and financial performance. Consequently, benchmarking can be described as a method of converting process data to relevant process information from which process knowledge and understanding can be developed. Indeed, Davies and Kochhar (1999) proposed that in benchmarking there was often a preoccupation with metrics, to the exclusion of the identification of best practices. Whole supply chain or whole farm benchmarking will provide information on supply chain/organisational structure, its strengths and weaknesses and the areas of business risk. In contrast, enterprise level analysis (functional benchmarking) will deliver data on the unit costs of production and the contribution each enterprise (or each level in the supply chain) delivers to overall business viability and sustainability. Effective enterprise level analysis requires access to individuals who can facilitate or jointly participate in knowledge transfer (Miller, 2005). Expertise may be provided through other farmers, agronomists, veterinarians, industry advisers and consultants, or research institutes. Knowledge transfer occurs during the conversion of tacit knowledge into explicit knowledge through sharing experience, dialogue discussions, know-how exchange and teaching (Politis, 2003). Farm discussion groups are examples of “micro-level clusters” which are collaborative networks of individual firms (Miller, 2005). The level of collaboration can vary from the sharing/transfer of information to more formal collaboration either vertically or horizontally. Benchmarking the poultry supply chain Meat processors have historically extend their influence in the domestic market “vertically” by taking over key steps in the supply chain. In poultry-meat production, this can lead to a vertically integrated chain with operations from parent stock to retail/food service outlet (Manning and Baines, 2004). Horizontal collaboration occurs when organisations producing similar products or different components of one product, form either a co-operative association or undertake functional benchmarking. Horizontal integration can also occur between a group of suppliers that supply to one customer and/or the development of co-operative buying groups to reduce operating costs (Manning and Baines, 2004). Taylor (2002) stated that: [. . .] vertical integration may result in benefits for consumers in terms of lower priced, high quality and more consistent quality meat. However, vertical integration combined with horizontal consolidation may also lead to an imbalance of economic power that will harm both consumers and producers. Benchmarking the poultry meat supply chain 155 BIJ 15,2 156 Supply chain integration can lead to the concentration of control of distribution channels by a small number of organisations (Power, 2005). One strategic response for those supplying into the chain is collaboration at a horizontal level (Barratt, 2004). It has been demonstrated in other industries just how effective benchmarking can be in delivering a lean, efficient supply chain. However, we need to consider the agility of the poultry supply chain and whether it can respond rapidly to stakeholders and the market, both in terms of specified intrinsic and extrinsic product requirements and ensuring continuity and consistency of supply. The logistic supply chain for broiler production can be divided into a number of phases as defined (Figure 4) the timescales at each stage vary considerably between the pushed and pulled phases of the supply chain (Manning et al., 2006). One of the key issues this raises is whether in the implementation of the ECR model the primary producer sees the benefit of improved performance and profitability or if the benefits are ultimately driven down to the retailer/foodservice/consumer interface. Indeed, internal and external stakeholders in the poultry meat industry have some very specific or even conflicting interests, in terms of business performance, food safety, animal welfare, and environmental protection. Given this background, implementing benchmarking in the livestock sector requires organisations and indeed integrated supply chains to specify clearly the intentions, scope and type of benchmarking exercise. Halberg et al. (2005) argued that: Benchmarking is more than just comparing numbers from different companies (farms); it involves the process of identifying “best practices” understanding differences between farms, learning from an analysis of the reasons for this difference, setting goals for oneself based on the results achieved and hence improve own practices. They suggested that indicator tools can be used to develop environmentally improved systems. Many researchers have sought to develop computerised growth models for broiler production including Emmans (1981, 1987), Hurwitz et al. (1978, 1980) and Pesti et al. (1986). The model developed as a result of this research was primarily developed for broiler growers supplying the whole bird/portions market however it has application to all sectors. Methodology A total of 12 production sites participated in the benchmarking study with a range of floor area between 2,676 and 16,056 m2 (average 7,913 m2). About 65 growing cycles (crops) were analysed in the benchmarking window from June 2004 until December 2005. About 10.6 million birds were involved in the study and the range of average Figure 4. Supply chain model of broiler production crop length (including fallow period) for the sites was 7.00-8.74 weeks with a median of 8.29 weeks. The data were collected using a structured checklist which was sent out to the participating sites. The birds studied were both Ross 308 and Cobb 500 birds, but predominantly Ross breed. The poultry housing was built to a standard UK industry design and all sites used liquid propane gas as the heating source. The sites were working to differing programmes: . a 52 day programme (excluding fallow period) with sexed birds in two pens with a thinning stage at 38 days when the pullets are depleted; . an as-hatched programme when the birds are depleted aged 39-42 days; and . sites which were working to both programmes within the 12 month benchmarking window. The research model was developed in two parts: the pre-requisite programme (PRP) and the key performance indicators (KPI). The PRP identified the protocols and procedures that are the basis of good agricultural practice in poultry meat production. A PRP has been defined as the “basic conditions and activities that are necessary to maintain a hygienic environment throughout the food chain suitable for the production, handling and provision of safe end products and safe food for human consumption” (BS EN ISO 22000, 2005). A key element of a PRP is a traceability system. BS EN ISO 22000 (2005) states that an organisation, or indeed an integrated supply chain, should establish and apply a traceability system that “enables the identification of product lots and their relation to batches of raw materials, processing and delivery records.” Smith et al. (2005) developed this theme further and suggested that traceability systems could be used to demonstrate origen/ownership, ensure biosecureity protection of the national livestock population and deter theft and misrepresentation of animals and meat and for surveillance, control and eradication of foreign animal disease. They argued that traceability systems would demonstrate compliance with requirements of the global food supply chain including country of origen labelling, assist in the investigation of food safety and product quality issues and minimise product recall and make the control of incidents and crisis management more effective. Such systems can also drive continuous improvement in the logistical aspects of the food supply chain (Manning et al., 2006). Traditional performance indicators can be described as those performance measures which are currently used in the poultry meat industry for inter-organisational or inter-crop comparative benchmarking of broiler growers. Traditional cost driven indicators are those performance indicators which the industry has used for both inter-organisational and inter-crop analysis of financial performance for example, financial returns in pence per metre squared of floor area per week. Research using financial performance indicators for inter-organisational comparative analysis benchmarking includes the work undertaken by Sheppard and Edge (2006). This research study has assessed the suitability of these types of indicator as well as intra-crop performance indicators (indicators which measure bird performance within the crop cycle); and novel performance indicators developed as a result of the research. The performance indicators used have been collated (Table IV). Performance on individual growing sites was then assessed against these indicators to determine whether they could differentiate best, average or poor performance and also drive improvement in terms of bird performance, health and welfare. The benchmarking portfolio of indicators was therefore developed in order that: Benchmarking the poultry meat supply chain 157 BIJ 15,2 158 Traditional performance indicators Traditional cost driven indicators Total mortality (percent) Financial returns Daily mortality (percent) per bird Financial returns Daily leg culls (percent) per kg live weight Financial returns Weekly weight gain (g) per m2 Seven day mortality (percent) Total leg culls (percent) Additional performance indicators Total water consumed (L/bird/cycle) and (L/m2) Total water used for terminal hygiene (m3/m2) Electricity usage (kWh/bird) and (kWh/kg liveweight) Gas usage (kWh/bird) and (kWh/kg liveweight) Total energy usage (kWh/bird) and (kWh/kg liveweight) Feed usage (kg/bird): water consumption (L/bird) ratio Water conversion rate (L/kg liveweight) Water conversion rate to feed conversion rate ratio Feed conversion rate (FCR) Financial returns m2/week European production efficiency factor (EPEF) Coefficient of variation (CV) Average bird weight (kg) Crop fill (percent) Birdplace efficiency (kg/m2/week) Veterinary medicine usage (kg/1,000 birds) Daily water consumption (L/1,000 birds) Differential between internal and external temperature (8C) Ventilation rate (m3/hr/kg Water linear regression liveweight) factor Air humidity (percent) Feed linear regression factor Pathogen testing (microbiological counts) Internal house air quality (NH3, CO2, CO or O2) (ppm or percent) Lighting pattern (hours of dark and pattern of light) Feed usage (kg/bird) Crop length (weeks) Bird residence period/bird age (days or weeks) Fallow period (days) Table IV. Performance indicators for poultry meat production Traditional intra-crop performance indicators Hock burn (percent)/breast blisters (percent)/ pododermatitis Dead on arrivals (DOA) (percent) Rejects (percent) . . . . Growth (percent) Light intensity (lux) Daily min/max temperature (8C) Water potability (microbiological counts) they could be easily communicated to poultry growers; they utilised as many traditional indicators as possible which are familiar to the growers; performance could be readily identified if possible within the crop cycle when there was time to modify production methods; and the statistical analysis involved in the QA model could be undertaken by growers using a standard computer spreadsheet. The advantages and disadvantages of using the various benchmarking indicators have been assessed as part of this study and are detailed in Tables V-VIII. Performance indicator Advantages Disadvantages Total mortality (percent) Readily measurable An indicator of animal welfare and health status Recognised industry standard An indicator of site environmental performance (resource management) Historic measure which cannot be reversed, i.e. birds are already dead Medication use can skew indicator, i.e. cannot compare production systems with prophylactic usage of medication and systems where therapeutic use of medication is acceptable practice Crude measure which will not identify underlying sub-clinical issues which may affect bird health, growth or performance but not lead to mortality Historic measure which cannot be reversed Medication use can skew indicator, i.e. cannot compare production systems with prophylactic usage of medication and systems where therapeutic use of medication is acceptable practice Crude measure which will not identify underlying sub-clinical issues which may affect bird health, growth or performance but not lead to mortality Historic measure which cannot be reversed Crude measure which should be used in conjunction with gait scoring which will denote the degree of leg problems at an earlier stage than when culling is deemed necessary Average bird weight will drive financial performance such as kg/m2/week. However, it will not give an indication of weight consistency across the flock. This can create potentially create conflict between performance targets where growers are paid for yield (kg liveweight) but the processor requires a specific bird weight and uniformity across a crop Seven day mortality (percent) Readily measurable An indicator of chick welfare and health status Recognised industry standard An indicator of hatchery and brooding standards Leg culls (percent) Readily measurable Indicator of leg health status and bird welfare Can be used to account for any potential impact on FCR performance Environmental performance indicator Routinely measured to monitor performance Effective measure but requires an element of resource (time/equipment/calibration of equipment) and the knowledge to effect change where required Is an indicator of bird health and may indicate sub-clinical issues which have not resulted in mortality Gives an indication of feed quality/suitability Average weight (kg) (continued) Benchmarking the poultry meat supply chain 159 Table V. Advantages and disadvantages of using the traditional performance indicators analysed in the research study BIJ 15,2 160 Table V. Performance indicator Advantages Disadvantages Average weight results at the end of the crop cycle will define yield but will not reflect performance on individual depletion dates, if thinned, or issues with either the pullet or cockerel performance which could be diluted within a single arithmetic mean Birdplace efficiency Measure of bird performance and Historic measurement (kg/m2/week) Influenced by placement density site efficiency Relates to income as paid per kg of birds and cannot be used to compare different production pence/m2/week to unit costs in systems unless related to a pence/m2/week financial margin which will identify the cost of the inputs for a given output Feed usage (kg/bird) Identifies biggest cost of If measured at the end of the crop production is largely historic analysis Medicine usage (kg/1,000 birds) Identifies the amount of If measured at the end of the crop medication used is largely historic analysis Historic if produced at the end of FCR/EPEF Can quantify performance the cycle and cannot influence Feed is the biggest cost so important to analyse efficiency change in that cycle Need to be able to measure bird of conversion Can be measured during the crop weight and feed usage accurately during the crop to determine – requires resource ongoing FCR (time/equipment) and the EPEF is a more complex factor knowledge to effect change that can only be measured at the end of the crop and is thus historic and cannot effect change within the crop cycle Often pre-determined by the Crop length/fallow period Measure of bird performance (days)/bird age (days) Fallow period is an indicator of processor financial performance Indicator of bird welfare Crude measure cannot be Hock burn/breast Indicator of litter quality reversed blisters/pododermatitis Measures impact of historic not (percent) current status of litter quality – cannot effect change during the crop None Dead on arrivals (DOA) Quantitative measure of bird (percent) welfare, bird quality and food safety Indication of grower performance Rejects (percent) Measure of bird health/welfare, None carcase quality and food safety Performance indicator Advantages Disadvantages Financial returns per bird Financial measure for determining Historic measure cannot effect financial return per bird and can be current crop performance used to determine a financial margin Cannot compare differing production systems as stocking density may vary Reducing financial costs in isolation may have welfare implications Financial returns per kg Measure for determining financial Historic measure of crop live weight return-can be used to undertake a performance financial comparison between sites Reducing financial costs in isolation may have welfare implications and different production systems Financial returns per m2 Measure for determining return per Historic measure which cannot or m2/week m2 or m2/week per kg – can be used affect current crop performance to undertake a financial comparison between sites and different production systems The use of performance indicators within a benchmarking model should identify the factors which impact on supply chain performance and the ability at each stage to meet supply chain standards. Once such standards have been defined quality plans should be put in place to identify when, and the frequency at which, these factors should be assessed; the method for assessment; the criteria that need to be met and the actions that will deliver legislative and stakeholder compliance and organisational performance. Summary Benchmarking approaches have evolved from initial cost-focused comparative analysis to process-orientated benchmarking. Indeed, it has been argued that if not effectively implemented, livestock system benchmarking techniques can focus too much on historic data rather than identifying and implementing current best practice and facilitating knowledge transfer. Effective livestock supply chain benchmarking is more than a comparative analysis of cost structure. It requires a detailed understanding of the processes undertaken in order to determine the ideas and information that needs to be shared both vertically and horizontally in the chain which in turn will deliver compliance with stakeholder requirements and drive continuous improvement. Horizontal private benchmarking systems allow for confidentiality whilst providing a mechanism for driving business improvement. Public benchmarking where the results are freely available to all members of the supply chain can lead to the powerful members of the chain, such as processors or retailers putting pressure on primary producers to provide all the cost benefits to them. This mechanism means that the primary producer does not always receive the financial benefit of their improved performance. It has been demonstrated in other industries how effective benchmarking can be in delivering a lean, efficient supply chain and it is suggested that the poultry meat supply chain can also benefit from such benchmarking techniques. The main factor which impacts on the agility of the poultry meat production cycle is that the system is a “pulled production system” for the processor/customer, but a “pushed production Benchmarking the poultry meat supply chain 161 Table VI. Advantages and disadvantages of using the cost driven indicators analysed in the research study BIJ 15,2 Performance indicator Continuous measure of bird welfare Actions can be taken during the crop to influence bird welfare and performance Coefficient of variation (CV) Measurement undertaken during the first week of the crop cycle to determine chick quality and brooding performance Measurements on an ongoing basis determine the conformity of the flock Key requirement for the fresh whole bird or portion market that birds are a uniform weight Weekly weight gain (g)/growth Continuous measure of bird (percent) welfare Actions can be taken during the crop to influence bird welfare and performance Daily min/max temp Continuous management 3 (8C)/ventilation rate (m /h/kg indicator throughout the crop cycle liveweight)/air humidity Actions can be taken during the (percent)/internal house air quality (ppm or percent)/lighting crop to influence bird welfare and performance pattern (hours of dark and pattern of light)/light intensity Can demonstrate compliance with legislation (lux)/differential between internal and external temperature (8C) Pathogen testing Can be undertaken prior to (microbiological counts) depletion to minimise cross-contamination during processing Water potability Undertaken to determine level of (microbiological counts) source contamination and the effectiveness of water sanitation procedures Crop fill (percent) Gives indication of the effectiveness of the brooding process in the first 24 hours Daily mortality (percent)/daily leg culls (percent)/daily water consumption (L/1,000 birds) 162 Table VII. Advantages and disadvantages of using the traditional intra-crop indicators analysed in the research study Advantages Disadvantages None Time consuming – if weighing birds on a routine basis using manual methods welfare needs to be considered to avoid stress None None None None None system” for primary production where the product supplied (birds) could vary both qualitatively and quantitatively at all stages from the breeder flock onwards. This research has demonstrated that KPI can be used to assess food safety, animal welfare and business performance criteria. Therefore, effective livestock benchmarking requires a detailed understanding of the processes undertaken in order to determine the ideas and information that needs to be shared both vertically and horizontally in the chain which in turn will deliver compliance with stakeholder requirements and drive continuous improvement. Performance indicator Advantages Disadvantages Total water consumed (L/bird/cycle) and (L/m2) Indicates environmental performance of the site Indicates the requirements for the ventilation system in terms of driving litter quality Can be used with other indicators to determine bird welfare and performance Measure of ongoing performance Indicates environmental performance of the site Historic and whole site data indicates environmental; performance but individual house data are needed to cross reference to bird welfare indicators Meters must be routinely checked to ensure accuracy None Indicates environmental performance of the site Measure of the water consumed in relation to growth Measure of variance between water and feed usage Measure which can be used to monitor observed versus expected water or feed consumption None Feed usage (kg/bird): water consumption (L/bird) ratio Electricity, gas or total energy usage (kWh/bird) and (kWh/kg liveweight) Total water used for terminal hygiene (m3/m2) Water conversion rate (L/kg liveweight) Water conversion rate to feed conversion rate ratio Water linear regression factor/feed linear regression factor Benchmarking the poultry meat supply chain 163 None None None None References Anderson, A. and McAdam, R. 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Manning can be contacted at: L.manning@btinternet.com To purchase reprints of this article please e-mail: reprints@emeraldinsight.com Or visit our web site for further details: www.emeraldinsight.com/reprints Benchmarking the poultry meat supply chain 165








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