1 Management and Strategic planning of agribusiness systems: the case of livestock in Goiás Brazil Tássia Gerbasi USP / FEARP / MARKESTRAT - PhD Marcos Fava Neves USP / FEARP / MARKESTRAT Mairun Junqueira Alves Pinto USP / FEA / MARKESTRAT Rafael Bordonal Kalaki USP / FEARP / MARKESTRAT
2 AGENDA: Introduction Research Questions and Objectives Method Used Literature Review Results PEST Porter's Five Forces SWOT Objectives Strategy Vector Plans Conclusions and Managerial Implications Major References
3 Introduction The state of Goiás: 9,5% of all production of Brazilian bovine meat 5.5% of Brazilian chicken meat 5% of Brazilian pork Large availability of grains and high technology
4 Main objective: Objectives Adapt a method of strategic planning and management of supply chains for a state level with the involvement of class organizations. The specific objectives are: to apply the new method in chains of bovine meat and leather, pork and poultry in the state of Goiás Brazil; proposing strategic projects focused on improving the competitiveness of these agribusiness systems in Brazil and abroad
5 Literature Review There are different approaches that can be used for the chain study, but two traditional approaches are found in the literature, the one developed by Goldberg (1968) and the one proposed by Morvan (1985). Many authors have proposed ways to organize information in order to obtain a tool for strategic planning of organizations (Campomar (1982), Westwood (1995), Las Casas (1999), Jain (2000), Kotler (2000), Lambin (2000), Wright, Kroll and Parnell (2000), Gilligan and Wilson (2002) and Wood (2004)). Proposed by Neves (2005), GESis method consists of five steps that are detailed in the methodology of this work. It is worth mentioning that the proposed method has been applied to several agribusiness systems such as in AGS of orange (2004), wheat (2005) and Milk (2007), and more recently in AGSs of sugarcane (2009) cotton (2011) and bovine meat (2011), being improved with each application.
6 Application of the adapted GESis (Neves, 2005): Method Used Figure 1. The GESis method for strategic planning and management of food and bioenergy chains. Source: Neves (2005).
7 Method Used Application of the adapted GESis Step 4 (Neves, 2005): Figure 2. Project scope: fourteen steps for strategic planning of agribusiness systems of grains and sugarcane in the state of Goiás Source: Adapted from Neves (2005).
8 Results: PEST Opportunities Political-legal Economic-natural Socio-cultural Technological - Economic openness through international negotiations; - Traceability system in implementation ; - Presence of certification standards - Improved distribution of world income providing increased consumption of meat, leather, pork and chicken; - Global economic integration; -Growth of markets that value high volumes and low prices; -Large supply of grain in Midwest region which may impact the cost of production; - Growth in world population and urbanization, leading to increased consumption; - Growth in the education level; - Inclusion of women in the labor market. - New technologies for waste reduction; - Growth of investment in R & D, both public and private; - Technologies that reduce environmental impacts. Threats - Juridical uncertainties due to environmental legislation; - Tariff barriers and nontariff barriers in international markets; - Public policies to support the livestock are not sufficient for the size of the sector. - Negative impact of emissions of greenhouse gases by livestock; - Cycle appreciation of the national currency, damaging the competitiveness of Brazilian products; -Increase in the number of vegetarians - Concentration of large scale industries in the South. - Increased consumer demand for food safety; -Incompatibility between human factor and technological advances leading to inefficiency in the management process; -- Need for high technical and managerial control during the production process.
9 Results: Porter's Five Forces Swine and Poultry Countries or states that do not compete whit the meat but have been showing some competitive advantage Bovine meat and Leather -Meat caprine and ovine - New proteins as soy protein Swine and Poultry Input suppliers mostly deal whit large industries. Bovine meat and Leather -High competitiveness trand and bargaining power of suppliers of inputs. - Livestock producers whit little bargaining power due to spraiyng and pack of a centralizer organ. Power of suppliers Threat of new entrants Competitors Swine and Poultry Mato Grosso, Goiás, Austrália Bovine meat and Leather Market differentiation and higher production of US and UE Threat of substituts Swine and Poultry, Bovine meat and Leather Power of buyers Swine and Poultry -Retail: concentration; - International market: high bargaining power; - Industry: many integrated producers Bovine meat and Leather -Retail concentration of the commercialization channels by the increasing its bargaining power. - International market high bargaining power on the part of international buyers who are relatively undiversified. Other animal protein and vegetal proteins.
10 Results: SWOT Strengths - Production in pasture, characterized as highly sustainable; - Greater availability of grains for food supplementation; - Brazilian territorial extension; - Good health status; - Traceability system already structured; Opportunities - Recovery of degraded pastures for horizontal growth of production; - Expansion of feedlots to improve productivity; - Creating or strengthening of associations / cooperatives; - Technological development in the areas of genetics and nutrition; - Projects pioneered by agribusiness for mapping "water footprint." Strengths - Stable climate, vast territory, with good water availability, high grain production and low production costs; - High level of technological production; - Need for relatively small areas for production; - Strategic location of Goiás. Opportunities - Increase in class C contributing to the strengthening of the internal market; - Increase pluriactivity of rural property; - Possibility of activity growth through developing regions; - Demand for new products, differentiated and higher added value. Bovine meat and Bovine Leather Poultry and Swine Weaknesses - Lack of vertical integration between chain links; - Problems of logistics due to the condition of roads and few alternatives; - Lack of efforts and initiatives in marketing, especially in communication; - Concentration of slaughtering industry; - Extensive areas of degraded pastures. Threats - High prices and low standardization; - Pressure from environmental issues (greenhouse gas emissions); - Increased production costs and activities with greater profitability may decrease the number of farmers; - Not overcoming the logistical problems. Weaknesses - Stiffness of integration contract; - Logistics problems mainly due to the condition of roads; - Little bargaining power of producers; - Lack of a consolidated image of chains of poultry and pork; - High cost of manpower. Threats - Technological Obsolescence in some points of the chain; - Non-tariff barriers preventing the opening of new markets; - Unfavorable exchange for export; - Increase in price of inputs.
11 Objective and goals Results CHAINS OF BOVINE MEAT AND LEATHER Increase by 27% the production of bovine meat in the state; Increase by 5% the average slaughter weight of the state (productivity); Increase by 85% the number of animal feedlot; Achieve a 50% growth of the total of bovine meat exported by the state; Increase by 50% the total of leather benefited in the state; Performing internally tanning of finishing of 50% of the leather produced in the state. CHAINS OF SWINE AND POULTRY Increase production of chicken meat by 3.5% per year; Increase production of pork by 2.5% per year; Increase exports of poultry at 4% per year; Increase pork exports at 3.5% per year; Diversify the international markets for pork; Access the most demanding markets of pork; Maintain the status "free" from diseases of compulsory notification of International Office of Epizootics.
12 Dimensions and strategic projects Results Strategic Vectors 1. Production, products, research and innovation Strategic Actions Increase the practice of feedlots; Attract new industries to the state; Promote the approximation of the field with universities and research institutions. 2. Communication Strengthen the image of meat in Goiás in consumer markets; Create actions to maximize the quality of the leather of Goiás; Promote meeting events between producers. 3. Distribution, logistics and exports 4. Training/Human Resources 5. Coordination and adaptation to the institutional environment Improve conditions and do constant maintenance of roads; Create centers of storage and collective distribution of food; Develop a center of freights; Develop new markets. Provide training courses; Regulate all the work of the chains; Encourage digital inclusion of producers. Define a management group responsible for coordinating a system of governance of the chains; Assist in the preparation of investment projects aiming greater technical adequacy standards. 6. Sustainability Map the natural resources of the state; Recover degraded pastures; Invest in treating swine waste and poultry. 7. Micro and small enterprises Create cooperatives for small producers; Encourage joint purchases; Encourage credit cooperatives.
13 Modification in the method (GESis) Conclusions: - Were made the insertion of Porter's Five Forces and Porter s Diamond model analysis - The fourth step of the method was focused on defining the strategic objectives to be achieved in New vectors of projects were proposed sustainability, micro and small enterprises, and strengthening the weak or nonexistent links. Article s goal -The article presented the results from the application of the method to the beef, leather, pork and poultry production chain, reaching its goal. - This material serves as a stimulus to decision making in the public and private sectors. - The work brought tools and subsidies for strategic decision made by organizations belonging to chains and their agents
14 Major References BELLAVER, C.; BELLAVER, I.H. Livestock production and quality of societies life in transtition economies. Livestock Production Science, Amsterdam, v.59, p , FARINA, E. M. M. Q. competitividade e coordenação de sistemas agroindustriais: um ensaio conceitual. Revista Gestão & Produção, v. 6, n. 3, p , dez Disponível em: <http://www.fia.com.br/pensa/home.htm>. Accessed in Dec 14, GILLIGAN, C.; WILSON, R.M.S. Strategic marketing planning. Linacre House: Butterworth-Heinemann, p. GOLBERG, R. A Agribusiness coordination. Boston: Harvard University. GRANT, R. M. Contemporary strategy analysis: concepts, techniques and applications. 4. ed. Oxford: Blackwell Business, p. INFORMA ECONOMICS FNP. Anualpec Anuário da Pecuária Brasileira, São Paulo: INFORMA ECONOMICS, KOTLER, P. Administração de marketing análise, planejamento, implementação e controle. São Paulo: Prentice Hall, p. LAMBIN, J.J. Marketing estratégico. 4.ed. United Kingdom: Palgrave Macmillan, p. LAS CASAS, A.L. Plano de marketing para micro e pequena empresa. São Paulo: Atlas, p. MORVAN, Y Filière de Production, in fondaments d economie industrielle. Econômica. pp NEVES, M. F.; MACHADO FILHO, P. C.; CARVALHO DE T. D.; CASTRO E, T. L.; Redes agroalimentares & marketing da carne bovina em In: IV Congresso Brasileiro das Raças Zebuínas. Uberaba, NEVES, M. F. Planejamento e Gestão Estratégia de Marketing. São Paulo: Editora Atlas, p NEVES, M. F. Método para planejamento e gestão estratégica de sistemas agroindustriais (GESIS). Revista USP. São Paulo, v.43, n.4, p PORTER, M. E. Competitive strategy: techniques for analyzing industries and competitors. New York: The Free Press, PORTER, M.E. A vantagem competitiva das nações. 7a Ed., Campus, Rio de Janeiro PORTER, M. E. Estratégia competitiva: técnicas para análise de indústrias e da concorrência. 7. ed. Rio de Janeiro: Campus, SAAB, M.S.; NEVES, M.F.; CLÁUDIO, L.D.C. O desafio da coordenação e seus impactos sobre a competitividade de cadeias e sistemas agroindustriais. Revista Brasileira de Zootecnia, v.38, p , WESTWOOD, J.O. Plano de marketing. São Paulo: Makron Books, p. WOOD, M.B. Marketing planning: principles into practice. Harlow: Prentice Hall, p. WRIGHT, P.; KROLL, M.K.; PARNELL, J. Administração estratégica: conceitos. Tradução: Celso A. Rimoli e Lenita R. Esteves. São Paulo: Atlas, p. ZYLBERNSZTAJN, D. Estruturas de governança e coordenação do agribusiness: uma aplicação da nova economia das instituições. 238p. Tese (Livre-Docência) Departamento de Administração, Faculdade de Economia, Administração e Contabilidade, Universidade de São Paulo, São Paulo, 1995
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