Chapter I

Agribusiness Management: Scope, Function and Task

Overview

This chapter focuses on the management of food, fiber, and agribusiness

firms. Discussion of agribusiness management in this chapter provides information,
concept, processes, ideas and experiences that can contribute to the effectiveness in
performing the function and tasks of agribusiness management. This chapter covers
discussion on the scope, function and task of agricultural business management.

Objective

At the end of the chapter, the students can explain the scope, function and
task of agribusiness management.

Lesson I. The Business of Agribusiness

Pre-discussion

This lesson introduces the key functions of agribusiness management and

characteristics that make the food and agribusiness markets unique places to
practice the art and science of management. The ever-changing food and
agribusiness industries are then discussed. This also includes the scope and sectors
of agribusiness. It also tackles on the function of management in agribusiness.

What to expect?

At the end of this lesson, student can:

 describe the management’s role in agribusiness

 describe the size, scope, and importance of the agribusiness industries
 discuss the functional responsibilities of management
 discuss the types of firm involved in producing and distributing inputs to
production
Lesson Outline

What is Agribusiness?

Agribusiness is an area of commerce that involves the processing,

warehousing, distribution, marketing and retailing of the products used in agriculture.
Agribusiness was introduced in the Philippines in early 1966 when the University of
the Philippines offered an Agri-business Management programme at the under-
graduate level. According to John David and Goldberg, agribusiness is the sum total
of all operations involved in the manufacture and distribution of farm supplies,
production activities on the farm, storage, processing and distribution of farm
commodities and items made from them. Agribusiness aims at streamlining farming
operations so that the prices remain at equilibrium. It encompasses farm planning,
weather forecasting, research, soil management, seed production, machinery, plant
protection, crop nutrient management, harvesting, marketing of produce, storage,
supply chain operations, financing, food processing, retailing and much more. All the
activities ranging from farm planning to getting the food to the table are a part of
Agribusiness.

 Agribusiness management comprises of three distinct terms namely

Agriculture, Business, and Management.

 Agriculture comprises of crop production, fruits and vegetable cultivation

along with floriculture, livestock production, fisheries and agro-forestry.

 Business is human activities engaged in production and distribution of goods

and services for a price that includes those human activities relating to
production and distribution of goods with a view to earning profit.

 Management is a set of activities (planning, organizing, directing, controlling)

directed at an organization’s resources with the aim of achieving
organizational goals in an effective and efficient manner.
Three Sectors of Agribusiness

1. Input Sector. It deals with the supply of inputs required by the farmers for
raising crops, livestock and other allied enterprises. These inputs include
seed, feed, fertilizer, chemicals, machinery and fuel.

2. Commercial farm production or output sector. It produces crop and animal

products that are processed and distributed by the product sector to the final
consumer.

3. Product Sector. This sector is responsible for the transformation of the raw
farm output into a final consumer product at the retail level. It deals with the
various aspects like storage, processing, marketing and export of the finished
products so as to meet the dynamic needs of consumers.

Scope of Agribusiness

Agribusiness is combining the diverse commercial enterprises, using

heterogeneous combination of labor, materials, capital and technology. Business
establishment leads to strengthening of infrastructural facilities, expansion of credit;
raw materials supply agencies, adoption of modern technology in production and
marketing of agricultural products. It is a dynamic sector and continuously meets
current demands of consumers in domestic and world market. It generates potential
employment opportunities, adds value to products and thereby increases the net
profit and provides crucial forward and backward linkages.

Backward linkages include supply of inputs, credit, production technologies,

farm services, etc. while forward linkages includes storage, processing,
transportation and marketing.
Areas of Agribusiness

Type of Product Products for Agribusiness

Input These includes seeds of crop, fertilizers, chemicals,

machinery, post-harvest and processing, feeds,
medicines, vaccines, etc.

Output These includes crops (rice, corn, vegetables, fruits, etc.)

produced, meat, milk, poultry, eggs, canned fish, etc.

Service These includes agricultural credit facilities, information

and communication technology, treatment, servicing of
agricultural equipment and machinery, rental services,
etc.

Distinctive Features of Agribusiness Management

1. Variation in the kinds of business in agribusiness sector: basic producers,

wholesalers, transporters, etc.

2. Management varies with several million of farmers who produce hundreds of

food and livestock products.

3. In agribusiness, even those that are industrial giants, are likely to be highly
seasonal in nature.

4. It is affected by natural calamities like drought, floods, insects, pest and

diseases.

5. Large number of different businesses is evolved from the producer to retailer.

6. Most of the agribusiness units are conservative and subsistence in nature and
family oriented and deals with business that is run by family members.

7. There is direct impact of government programmes on the production and

performance of agribusiness
 8. Product differentiation is common because of the brand and composition of
the products.

The key functions of management in agribusiness

The responsibilities of managers in agribusiness are highly varied and can

range from ordering inputs for the year ahead, to hiring and fi ring individuals, to
making the decision to sell a multi-billion dollar international subsidiary. A chief
executive officer, for instance, is responsible for the overall activities of a large,
diversified food or agribusiness firm. In such firms, teams of managers are likely
responsible for specialized areas within the fi rm. On a smaller farm business, one
individual may assume roles ranging from chief executive officer, to manager, to
laborer, managing multiple projects at different levels simultaneously.

To better understand the form and process by which managers perform the
tasks that are required to create and sustain a viable business, the practice of
management can be broken down into four key functions:

 Marketing management
 Financial management
 Supply chain management
 Human resource management

No matter how large or small the firm, managers have responsibilities in each
of these areas. These four functions of management are explored in some detail in
this book. However, it is important to have a basic understanding of each area as we
develop our understanding of agribusiness management.

Marketing management

Marketing management involves understanding customer needs and

effectively positioning and selling products and services in the marketplace. In
agribusiness, marketing management is a key function within each of the sectors of
agribusiness: the food sector, the production agriculture sector, and the input supply
sector. Marketing management represents an integration of several different
activities: selling, advertising, web page design, promotions, marketing research,
new-product development, customer service, and pricing— a all focused on customer
needs, wants, and, ultimately, the quest for customer satisfaction.

It is this function of management that is most closely focused on the end-user,

or the consumer/customer of the product or service produced. It is often argued that
without satisfied customers effectively reached through marketing and sales, no
business could successfully operate. Thus, marketing management plays a
fundamentally important role in most food and agribusiness fi rms. Marketing
management is focused on careful and planned execution of how, why, where, when
and who sells a product or service and to whom it is sold. Decisions here include
what products to produce, what services to offer, what information to provide, what
price to charge, how to promote the product, and how to distribute the product.

Financial management

Profit is the driver for agribusinesses as they work to generate the greatest
possible returns from their resources. Successful achievement of this objective
means making good decisions, and it means carefully managing the financial
resources of the firm. Financial management is involved in these areas and includes
generating the data needed to make good decisions, using the tools of finance to
make effective decisions, and managing the assets, liabilities, and owner’s
investment in the firm. Financial information allows managers to understand the
current “health” of the firm as well as to determine what actions the business might
take to improve or grow. Balance sheets and income statements can provide a
wealth of information useful in making decisions. Financial analysis provides
agribusiness managers with insights by which to better base decisions. The tools of
finance such as budgeting, ratio analysis, financial forecasting, and breakeven
analysis can be used by agribusiness managers to develop long-range plans and
make short-run operating decisions. Another way in which the financial agribusiness
scene continues to change is in the sourcing of funds.

Supply chain management

New technologies and concepts are rapidly hitting the workplace. This, in
turn, changes the way agribusinesses do what they do. The push for quality, the
drive for lower costs, changes in the supply chain, and general pressures to be more
efficient in meeting consumer demands is swiftly altering the production and
distribution activities of agribusiness. Supply chain management focuses on these
areas and provides the tools managers need to meet these operations and logistical
challenges. As a result, supply chain management has come to the forefront as a key
management function for the agribusiness manager

Human resources management

In the end, management is about people. Without the ability to manage the
human element — the resources each business has in its employees — businesses
do not succeed. When combining efficient management of the
marketing/finance/supply chain functions of the business, with the thoughtful
management of the human side of the business, managers are on the road to
successful implementation of their strategy.

Agribusiness managers who can manage people well can significantly impact
both productivity and financial success. Human resources management
encompasses managing two areas: the mechanics of the personnel administration,
and the finer points of motivating people to offer and contribute their maximum
potential. Decisions here include how to organize the firm, where to find people, how
to hire them, how to compensate them and how to evaluate them.

Summary

 Agribusiness is the sector that produced and distributes inputs to farmer,

marketing, processing and distributing farm product to final users. It includes
three important sectors: the input sector, the output and the product sector.
These sectors provide a tremendous variety of food and fiber products to
consumers. Agribusiness is combining the diverse commercial enterprises, using
heterogeneous combination of labor, materials, capital and technology. Business
establishment leads to strengthening of infrastructural facilities, expansion of
credit; raw materials supply agencies, adoption of modern technology in
production and marketing of agricultural products.

 In managing agribusiness, marketing, financial, supply chain and human

resource management are the key functions of management in agribusiness that
are required to create and sustain a viable business. Marketing focused on the
 process by which products flow from producer to consumer. Profit is the driver for
agribusiness as they work to generate the greatest possible return. Supply chain
management covers the operation and logistics management.

Assessment

1. List and define the four agribusiness management function.

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2. Discuss the management role in agribusiness

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3. Case study

We look at three key sectors of the food production and marketing system—
the food/product sector, the production agriculture sector, and the input
supply sector. For this case study, pick a specific product. Then, using the
library or the Internet, locate the name of one firm for each of the three
sectors of agribusiness that is involved in some way in the production and
distribution of your product. Example for pizza, this might be Pizza Hut (food
sector), a family-owned tomato grower/shipper (production agriculture), and
DowAgro Sciences (input supply sector). After you have identified your three
companies, answer each of the questions below
a. Briefly describe each of your fi rms. What markets do they serve? How large
are the firms? What products do they produce?
b. How are these firms linked to the product you chose to research?
c. What is similar about the firms you chose? What is different about the firms
you chose?
d. How are these firms related in the production and distribution of your
product? Is this an explicit link (do they share the same parent company, for
instance), or are they loosely related through open markets?
 Lesson 2
Managing the Agribusiness

Pre-discussion

Farm/agricultural management include making and implementing of

the decisions involved in organizing and operating a farm for maximum production
and profit. Farm management draws on agricultural economics for information on
prices, markets, agricultural policy, and economic institutions such as leasing and
credit. Managers who are leading today’s agribusiness are unique because of their
industry, commodity, location, employees, competitors and others. Given that people
and situations differ, a specific recipe for what it takes to be a successful manager is
challenging. This lesson explores the key tasks of agribusiness manager to provide a
foundation for further exploration of agribusiness management.

What to Expect?

At the end of this lesson, the student can:

1. explain the role of a manager

2. describe the four key tasks of agribusiness managers
3. explain the difference among policies, procedure and practices
4. discuss the steps in planning process
5. solve simple agribusiness problem

Lesson Outline

The Importance of Good Management

Recently, Dun & Bradstreet conducted a survey to determine the single most
prevalent cause of failure in business. After studying hundreds of cases, they
concluded that 88% of all business failures could be traced directly to ineffective
management. The manager’s concept of the management role of what managers are
and what they do, was the single most important factor in determining whether
managers were effective or ineffective in their roles.
 Thus, success or failure of any agribusiness rests primarily on its manager’s
effective or ineffective utilization of the organization’s resources. The ability to
manage does not surface as an inborn gift; rather, it is a skill that can and must be
learned. To some, management represents a land of mystery and games. To such
people the messages transmitted by the present inhabitants of the management
world often seem incoherent and vague. Only firsthand experience and exposure to
the management perspective can correct this impression.

Because people and situations differ, an individual management pattern may

be difficult to define. The myth that is possible to formulate a list of perfect traits or
styles of management has been dispelled once and for all by the realization that
although certain management skills and principles can be learned, they must be
adapted by each individual to fit the unique situation

Today’s Agribusiness Managers

Management is both an art and a science. Managers must efficiently combine

available human, financial, and physical assets to maximize the long-run profits of an
operation by profitably satisfying its customer’s demands. Management requires
individuals be technically knowledgeable about the organization’s product and/or
function. They must be good and effective communicators. The ability to motivate
people is also essential. They must be proficient in the technical skills of
management such as accounting, finance, forecasting, and so on. In addition to a
strong background in management, agribusiness managers need a strong
understanding of the biological and institutional factors surrounding the production of
food and fiber. In other words, not only must they excel at the normal concerns of
business management, agribusiness managers must also factor in the uncertainty of
the weather, the perishable nature of many of agriculture’s products, government
policies, and the rapidly changing technology employed in agriculture. They must
possess the ability to quickly adapt to changes in market conditions that result from
changes in these uncertain factors of weather, product perishability, government
policies, technology, etc. Managers must be able to mix each of these skills and
perspectives in the right proportion to deliver the greatest long-run net benefit for the
fi rm.
 Countries with farming industries face consistent pressures from global
competition. To remain competitive, agribusinesses must operate more efficiently,
which often requires investments in new technologies, new methods of fertilizing and
watering crops, and new ways of reaching the global market.

Another challenge agribusinesses face is changing consumer tastes, for

example, some consumers’ shift away from red meat or a change in popularity of
some fruits and vegetables. To be successful, agribusinesses must be able to predict
and adapt quickly to market changes.

Defining management in agribusiness

We define management in this text as the art and science of successfully

pursuing desired results with the resources available to the organization. Several key
words in this definition are italicized to stress the elements of successful
management. Art and science are the first two key words, and as mentioned above,
management is both an art and a science. Because management deals largely with
people, management principles must be viewed as imperfect, at best. Yet many
management principles and tools can help us make better decisions in an imperfect
world. Everyone cannot become the top manager for a firm, but everyone can use
management principles to foster continual growth and progress toward their personal
managerial potential. The third key word is successful. Whatever else good
management is, it must be successful in meeting desired and predetermined goals or
results. Managers must know where they are headed in order to achieve such
success.

Finally, consider the resources available. Each organization possesses or has

at its command a variety of resources — financial, human, facilities, equipment,
patents, and so on. Successful managers coax the highest potential returns from the
resources available. They recognize the difference between what should be and what
is. At the same time, they know how to expand the firm’s resource base when
resource constraints hamper potential. They use what they have to get what they
want and need, and deal in the realm of the possible.
 A manager can be defined as that person who provides the organization with
leadership and who acts as a catalyst for change. He or she is responsible for the
management of the organization. Good managers are most effective in an
environment that permits creative change. Such managers live to make things
happen. Success as a manager, then, necessitates the ability to understand and be
comfortable with the managerial role, to accept responsibility, and to provide
leadership for change.

The Four Key Tasks of Agribusiness Managers

The functions of management discussed in Lesson 1 address four key areas

(marketing, finance, supply chain management, and human resources) of the firm. All
effective agribusiness mangers execute four principle tasks in their work:

 Planning
 Organizing
 Directing
 Controlling

Planning
Planning can be defined as forward thinking about courses of action based on
a full understanding of all factors involved and directed at specific goals and
performance objectives.

Types of Planning

The planning task represents the preparation of the agribusiness firm for
future business conditions. Since the future can be defined to include various time
periods and it is uncertain, the planning task can take a number of forms. The three
types of planning discussed in this chapter are strategic, tactical, and contingency.

 Strategic planning is focused on developing courses of action for the longer

term. Long term may be two or three years for a very small agribusiness, while a
major corporate organization may be looking at a 20-year (or longer) time
horizon. Strategic plans tackle the broadest elements of an agribusiness firm’s
strategy:
 Any planning activity is focused on achieving some goal, on moving the fi rm in
some direction. Therefore, in many strategic planning situations, one of the fi rst
steps is the development of a mission statement or a statement of vision. A
mission statement helps to spell out this direction for a fi rm and describes the
destination. When developing a mission for a company or even for a department,
management must think strategically about the fi rm’s business in a future time
period. Briefl y stated in between one and three sentences, a mission statement
usually describes who the company is, what they do, and where they are headed.
In many cases, it has three parts:
 Key markets (who we serve)
 Contribution (what we do)
 Distinction (how we do it differently)

 Tactical planning involves short-term plans consistent with the strategic plan. As
such, tactical plans are a crucial part of implementing the agribusiness fi rm’s
strategic plan. While strategic planning is focused on what we do in three years
(or fi ve years, or 20 years), tactical planning is focused on what we do tomorrow
(or next month, or next year). For example, a chemical company’s strategic plan
could include a goal of increasing its market share by 20 percent in three years
by using a strategy of expanding its geographic market. The fi rm’s tactical plan
may focus on how to increase sales in the next quarter in specifi c geographic
regions that have less competition, and will likely include specifi c action steps for
getting this done.

 Contingency planning is the development of alternative plans for various

possible business conditions. It is part of the strategic and tactical planning
process for a fi rm. A contingency plan provides guidance when something
unexpected happens. Some contingency planning is conducted to prepare for
potential crises that may occur.

The Planning Process

Six steps in the planning process provide structure to the process and are
designed to provide management with as much information as is available when
developing the strategic or tactical plan. These six steps follow:

1. Gather facts and information that have a bearing on the situation.

2. Analyze what the situation is and what problems are involved.
 3. Forecast future developments.
4. Set performance objectives, the benchmarks for achieving strategic goals.
5. Develop alternative courses of action and select those that are most suitable.
6. Develop a means of evaluating progress, and readjust the plan as the
process unfolds.

 Gathering facts and information is the first step of the planning process.
Although it should be noted that information gathering is a recurring part of the
process. Its place as a first step is easily justified, since adequate information
must be available to formulate or synthesize a problem or opportunity. Fact
gathering is subdivided into two parts: gathering sufficient information to identify
the need for a plan in the first place and systematic gathering of specific facts
needed to make the plan work once it has been developed.
 The groundwork for developing a sound plan is provided during the process of
analyzing facts. This process answers such questions as “Where are we?” and
“How did we get here?” It helps pinpoint existing problems and opportunities, and
provides the framework upon which to base successful decisions. An analysis of
facts will prevent mistakes and allow for the most efficient use of the
organization’s resources.
 Forecasting change is the third key element of good planning. The ability to
determine what the future holds may be the highest form of management skill. As
managers ascend the organizational ladder, the demands on their abilities in this
area steadily increase. Forecasting becomes more difficult as the situation
becomes broader, more complex, or for a longer time horizon. Forecasting is
interrelated with the other five steps and it is a logical extension of analysis into a
future time setting.
 The development of goals and/or performance objectives is the next step in the
planning process. Goals are the specific quantitative or qualitative aims of the
company or business group that provide direction and standards one can use to
measure performance. Top management, boards of directors, and/or chief
executives often develop these goals to help bring focus and specificity to the
organization’s mission
 After the performance objectives have been set, agribusiness managers must
explore different ways of getting wherever they want to go by developing
alternative courses of action. Here again the relationship between performance
objectives and results can be seen. The results achieved depend upon the
 alternative activities selected to meet the objectives. Alternatives must be
weighed, evaluated, and tested in the light of the agribusiness’ resources.
 Management specialists have found monitoring progress to be a high priority in
planning. Carefully reviewing, assessing, or evaluating results shows whether
the plan is on course and allows both the analysis of new information and the
discovery of new opportunities. Evaluation cannot be left to chance. It must be
incorporated into the planning process, since a plan is only good so long as the
situation remains unchanged. An evaluation also reveals whether results met
performance objectives or where the results fell short or overshot objectives.

Organizing
People working effectively towards accomplishing the company’s goals; these
are objectives of every manager — no matter what industry, function, or organization.
There must be a structure in place to make it possible for people to work effectively
toward accomplishing goals. The management task of organizing provides that
structure or framework in which to operate. Organizing represents the systematic
classification and grouping of human and other resources in a manner consistent
with the firm’s goals. The organizing process is important at each level of a company
or fi rm. And, it is the manager’s challenge to design an organizational structure that
allow employees both to accomplish their own work, while simultaneously reaching
the goals and objectives of the organization. Organizing involves:

 Setting up the organizational structure

 Determining the jobs to be done
 Defining lines of authority and responsibility
 Establishing relationships within the organization

An organizational structure is the framework of a company. It provides the

beams, braces, and supports to which the appropriate “building materials” are
attached. Different jobs are connected to different parts of the whole framework. It is
the formal framework by which jobs are grouped, coordinated, and further defined.
Whether they are called groups, departments, or teams, coordinated communication
and cooperation among work groups is essential.
An organizational chart shows the formal organizational structure of a
company. It helps capture some important ideas including division of labor, chain of
command, bureaucracy, and organizational design.
Directing
Directing is guiding the efforts of others toward achieving a common goal. It
is accomplished by:
• Selecting, allocating, and training personnel
• Staffing positions
• Assigning duties and responsibilities
• Establishing the results to be achieved
• Creating the desire for success
• Seeing that the job is done and done properly

Directing involves leading, supervising, motivating, delegating, and evaluating

those whom you manage. Managers are directing when they see to it that the efforts
of each individual are focused on accomplishing the common goals of the
organization. Leading is at the very heart of the management process and is founded
on a good organizational plan or structure that provides for responsibility, authority,
and evaluation.

Policies, Procedures, and Practices

As managers complete the directing task, they typically develop guidelines or
policies for how tasks should be completed. Policies are used to guide the thinking
process during planning and decision-making. A policy sets the boundaries within
which an agribusiness employee can exert individual creativity. Policies make it
unnecessary for subordinates to constantly get approval for plans and decisions with
top management. For example, one farm equipment dealer instituted a policy that the
general manager must approve all purchases that totaled $500 or more. The purpose
of this policy was to protect the business against unexpected large cash outlays. At
the same time, it gave the employee the discretion to use their judgment.

Policies are best adapted to recurring problems in areas that are vital to
achieving the long-range goals of the agribusiness. Although policies are closely tied
to goals, they are not goals. Because they are not goals, policies should never be
used to restrict managers as they make decisions about long-range, complex
problem situations.

A procedure is a step-by-step guide to implement a policy for a specifi c

activity or function. In many cases, there is a defi nite need to defi ne a precise
course of action. A procedure should not, in most cases, be applied to complex tasks
of a long-range nature.
When the a farm equipment dealer sought to implement its new purchasing
policy, the procedure involved called for an employee to fi ll out a requisition form,
submit it to the general manager for approval, and then send it to the purchasing
director. Procedures work best when they are applied to routine and recurring tasks
of a relatively simple nature that require control. Both policies and procedures are of
tremendous value to the new or newly promoted employee who is learning on the
job. They also ensure uniform performance by all employees and prevent
unauthorized actions.

Practices represent what is actually done in the agribusiness, and they may
conflict with policies and procedures. Managers have to be sure that policies make
sense, are relevant, and are enforced, in order for them to become widespread
practices. If employees of the farm equipment dealer routinely ignore the policy and
procedure regarding the limits on spending, the store may fi nd itself in a serious
cash bind. A course of action established on a recurring basis can become a practice
by tradition or habit more than anything else. The status of routine practices can
become as important as that of either formal policies or procedures, and even more
difficult to change, so the agribusiness manager must ensure that practices coincide
with policies and procedures.

Controlling

The controlling task represents the monitoring and evaluation of activities. To

evaluate activities, managers should measure performance and compare it against
the standards and expectations they set. In essence, the controlling task assesses
whether the goals and performance objectives developed within the planning task are
achieved.

Control in management includes an information system that monitors plans

and processes to ensure that they are meeting predetermined goals, and sounds a
warning when necessary so that remedial action can be taken. If all people were
perfect and their work without fl aw, there would be no need for controls. Everything
would come out according to plan. But what actually happens may not be what was
expected. All people make mistakes; they forget, they fail to take action, they lose
their tempers, and they behave, in short, like normal human beings. In addition, even
when people do exactly what they are supposed to do, the market, the competition,
the weather, the equipment, etc. may not cooperate.

Control is complementary to the other three tasks of management. It

compensates for the misjudgments, the unexpected, and the impact of change.
Proper controls offer the organization the necessary information and time to correct
programs and plans that have gone astray. They should also indicate the means of
correcting deficiencies. Control requires meaningful information and knowledge, and
not that which is outmoded or not germane to meeting organizational goals. Much
valuable time can be squandered or wasted by a control program unless a careful
check of its real value is made periodically.

Major Areas of Management Responsibilities

Each of the key tasks of management — planning, organizing, directing, and

controlling — is used in managing the four major functions of an agribusiness. The
management functions are implemented through the use of the various skills,
principles, and tools that have become part of the professional agribusiness
manager’s knowledge and ability. To be successful, the agribusiness manager must
be able to execute the four tasks for each of the four basic functions of the
agribusiness; that is, financial management and planning, marketing and selling,
supply chain management, and personnel or human resources management. It is
important to note that managing the financial function of an agribusiness involves
planning, organizing, directing, and controlling. The same holds for the other three
functions. The balance of this book is built around the four basic functions of the
agribusiness, and is designed to help students acquire the know-how of the
professional agribusiness manager.

Summary

 Management is the process of achieving desired results with the resources

available. A key to successful management is accepting responsibility for
leadership and making business decisions through the skillful application of
management principles. Management of the agricultural business is unique
because of the biological nature of production, the importance of food to people,
the seasonality of food and agricultural markets, and the perishability of
agricultural products, among other reasons.
 The management process is often divided into four tasks: planning, organizing,
directing, and controlling. Planning is determining a course of action to
accomplish stated goals; organizing is fitting people and resources together in the
most effective way; directing pertains to supervising and motivating people; and
the controlling task monitors performance and makes adjustments to stay on
purpose. Each of these is a necessary ingredient for accomplishing the
established organizational goals.

Assessment

1. Discuss comprehensively the term “management”.

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2. Explain the difference among policies, procedure and practices

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3. What are the most important components of the agribusiness manager’s role
as director?
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4. How and why planning changes as one moves up the organizational ladder?
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5. Facing the pandemic today, have you observe some of the agribusiness
opportunities you can engage with? Explain your answer
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 6. Search for the organizational structure of a specific firm and explain.

Case analysis

1. Suppose you owned a manufacturing firm that operates for almost 10 years.
For the past years, your firm earning a high return before the pandemic had
happened. In the recent time, you cannot undertake normal distribution of
goods nor do other business transaction as far as pandemic is concerned.
Applying the steps in planning process, how can you overcome this problem?

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2. Hart Cherry Cooperative

The Hart Cherry Cooperative was organized two years ago to pit and freeze member
farmers’ cherries. The cooperative is experiencing difficulty in keeping grower-
members’ cherries separate. Most of the cherries are harvested mechanically by
shaking them from the trees. They are placed in pallet tanks by the grower and
brought into the plant for processing. The cooperative owns all the pallet tanks. When
the grower unloads the pallet tanks on the concrete pad, the cherries have to be
cooled with running cold water until they are ready for processing. There is
considerable variation in quality among the loads of cherries brought in by
members. Some loads have large quantities of small twigs and leaves in
them, some are rotten or soft, and some have other undesirable qualities.

This is the first year that the cooperative has owned all the pallet tanks. The
cooperative board decided that it was best for the cooperative to own them, since
growers had been continually taking other growers’ pallet tanks whenever their own
were unavailable. The policy of the cooperative board and management is that each
grower’s cherries must be identified so that growers can be paid separately, on the
basis of the quantity and quality of their product.

The practice as it had developed this year was for the members to unload their
pallets onto the pad. Each member was then supposed to put a name card on each
pallet. The problem was that sometimes the growers’ new, inexperienced, or
uncaring truck drivers were failing to put cards on, cards were falling off, or
sometimes two or more cards were on the same pallet.

Questions 1

1. Develop a procedure that will help solve the problem by ensuring that each
grower’s cherries are properly identified.
2. Develop a plan to ensure the procedure you develop will be carried out in
practice. Include in your plan how the procedure will be communicated to both
employees and grower-members. Include in your plan steps to receive feedback on
the procedure from both employees and grower-members.

References

Barnard, F, Akridge, J., Dooley, F., Foltz, J, Yeager, E., Agribusiness Management,
2016. Fifth edition. Routledge, 2 Park Square, Milton Park, Abingdon, Oxaon
Downey, W.D., Trocke, J. Agribusiness Management, McGraw-Hill, Inc., USA
https://whatis.techtarget.com/definition/agribusiness
https://www.britannica.com/topic/farm-management
https://www.educationworld.in/career-scope-of-agribusiness-management/
https://www.slideshare.net/akmgolamkausarkanchan/lecture-1-62098342
https://www.slideshare.net/teshale/distinctive-features-of-agribusiness-management-
and-the-importance-of-good-management-29481118
Inigo, Conrado, Jr., PhD, Management for Filipinos (Principle and Application)
Ricketts,Kristian G. Ricketts, Agribusiness Fundamentals and Application