Businesseiise To Tackle Data Management Challenges
STATE COLLEGE (Centre Co.) Par
ticipating in a dairy business analysis and
benchmark program can shed consider
able light on how efficiently a business is
performing. However, the information one
gets back from participating in such pro
gram is only as good as the information
that is entered into it.
Transforming data into information is a
complex process that involves a number of
different steps. An important, but often
overlooked, step in information manage
ment is data organization, which provides
structure to the raw data so it can be pro
cessed, reported, and analyzed. Standardi
zation in data organization is critical to
developing uniform and useful bench
marks. Producers participating in the
Businessense Program learn how to imple-
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The lack of standardization in how data
is organized is particularly prevalent in the
dairy industry. While the national Dairy
Herd Improvement Association has done a
tremendous job in standardizing produc
tion records, financial records are another
story. The Farm Financial Standards
Council has done a sound job in develop
ing guidelines for processing and reporting
data for farming businesses in general.
However, it has not addressed standardi
zation of data organization for dairy busi
nesses. The chart of accounts in account
ing programs provides structure to the
financial data of a dairy business.
Developing a standardized chart of ac
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counts for dairy businesses is the initial
step in developing better benchmarks. A
prime example of the lack of standardiza
tion in financial records and how it can af
fect benchmarks is BST. Since its intro
duction in 1995, there has been little
consistency in classifying BST expenses.
Some producers classify it as feed ex
penses; others as vet expenses, and others
as supply expenses. Other producers have
set up a separate account for BST. When
used as approved, BST expenses will total
between $9O-$ 100 dollars per cow per
year. Vet expenses and supplies expenses
often account for similar figures as BST
expenses. So business owners who classify
BST as vet or supplies expenses might
look at a benchmark for these expenses
i|
o
Lancaster Farming, Saturday, December 28, 2002-A39
and wonder why they are spending twice
as much as other herds.
With the turn of a new year comes an
opportunity to review how data is organ
ized in your dairy accounting system. Al
though standardization should be ap
proached on a national level, individuals
at Penn State and Cornell Universities, in
consultation with leaders from the dairy
financial industry, have developed a stan
dardized chart of accounts tor dairy busi
nesses operating in the Northeast. The
standardized chart of accounts is available
in several formats, including a paper copy
that shows how to set the system up in any
accounting program. The standardized
chart of accounts is also available to users
of Quickßooks and Perception accounting
programs. The chart of accounts has al
ready been set up to operate correctly in
these programs. They are available on
disks that can be easily restored to your
computer. Paper copies and disks can be
obtained by sending an email to HYPER
LINK “mailto:bhilty@psu.edu” bhilty@p
su.edu or by calling (717) 948-6612.
Producers participating in Businessense
can learn how implementing better busi
ness and information management prac
tices can help improve business perform
ance. Businessense is a series of three
meetings designed to progressively build
the participants knowledge and use of best
management practices in information and
business management. Participants will
analyze their dairy business using the
Penn State/Cornell Dairy Farm Business
Summary and a systematic approach to
business analysis.
Program locations for this winter in
clude: Lancaster County for Lancaster and
surrounding counties; State College for
central counties; Carlisle-Chambersburg
area for Cumberland, Franklin, Adams
and surrounding counties; Meadville for
northwest counties; Troy for Tioga, Brad
ford, Sullivan and surrounding counties;
and Somerset/Bedford for Somerset, Bed
ford and surrounding counties.
The cost of the program is $2OO per pro
ducer. However, a grant from the North
east Center for Risk Management Educa
tion will cover 50 percent of the
registration fee. Additional people from
the same dairy business can attend for 35
per person. Participation is limited to the
first 15-16 producers who register at each
location.
For additional information about
Businessense, including dates and specific
locations, or to register for a session near
you, please call the Dairy Alliance Office
at (888) 373-PADA or e-mail HYPER
LINK “mailto:bhilty@psu.edu” bh.ity@p
su.edu.
Who buiil the new Farm Show? What did the Farm
Show look tike years ago? What happened along the
way? Find out about the glories of the past and the
new Farm Show to come when we look over 86 years
of Farm Show and its new construction in our Farm
Show "Showcase" Section in the Jan. 4 issue.
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