Most pig producers think about feed costs, disease rates and average-daily-gain rates as the keys to profitability in hog farming.
While those measures are important, the correct organization of human labour can be equally essential, said Minnesota hog network organizer Barry Kerkaert.
That applies from the organizational structure of the company to the work inside the barn, he told the Manitoba Swine Symposium last week.
Appropriate decisions and hog production efficiency are determined by good organization, Kerkaert said.
“If you have the right number of people for the farm, everybody has to do their job or it doesn’t get done,” said Kerkaert, a partner with the 100,000-sow Pipestone System. He has found that overstaffing barns leads to lower overall production rates and that fewer staff can often produce more per barn. This paradoxical situation can be explained by humans’ natural buck-passing tendencies.
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“It comes down to accountability and responsibility,” said Kerkaert in an interview.
“The more people you have, the less accountability you have, the less responsibility you feel for anything, because ‘if I don’t do it you’ll do it.’ “
Kerkaert said his company, which produces weanlings that are sent to independent producer networks of feeder barns, started with 11 or 12 workers in many of their barns, but is now getting better results with eight workers.
The key to productive barn workers, Kerkaert said, is to pay them well and treat them well.
“Our goal is to pay our people well and get the job done with the right number of people,” said Kerkaert.
“If you have the right people there, you can get it done with one less person.”
Organizing the decision-makers at the top is equally crucial, Kerkaert said. His company supplies weanlings for many different types of feeder barn networks including co-operatives, partnerships and corporations with boards of directors.
The clear winner has been the partnership model, in which a general partner is given the ability to make decisions and act on them quickly, said Kerkaert.
Co-ops involve many people and if decisions have to be approved at member meetings, it can take a long time with no guarantee that wise business decisions will be made.
“In our experience, co-operatives in which everyone gets to vote just don’t work,” said Kerkaert.
“Everything slows down. People won’t agree. You spend time arguing about things that aren’t going to make any money, and they make a lot of decisions based on emotion.”
The corporate structure with a board can bring rewards because “if you’ve got the right directors you have a lot of sharp guys giving input,” he said.
But the same problem with slow decision-making applies.
“You can’t have decisions until you have meetings. And usually decisions aren’t made at meetings because everyone needs to investigate it themselves,” said Kerkaert.
“It consumes a lot of everyone’s time.”
Partnerships work well as long as the general partner is a good and wise business manager and so long as his partners trust him.
“And you have to find someone who’s willing to become the general partner. That person carries a huge liability, because if that company fails, you could get sued.”
