New technology investment doesn’t have to be risky
Risk is a great board game to play for those who have a few hours to spare and dream of one day conquering the world. But that time is better spent on risk management, especially when it comes to buying new equipment or technology for the dairy.
Cinnamon Ridge Dairy in Donahue, Iowa, is a great example of a farm that has implemented many different risk-management techniques to help in the selection of new equipment and technology.
Co-owner John Maxwell led the charge when he was looking to make some updates to his 220-cow Jersey dairy a few years ago after his daughter graduated from Iowa State University. Maxwell hoped robotic milkers were going to play a role in those changes.
"The No. 1 thing that pushed us in that direction was that our daughter, Amy, wanted to come back," says Maxwell. "We first saw the robots at World Dairy Expo several years ago, and we did some more research on it from there." During the research stage, Maxwell visited approximately 30 dairies during a two-year period.
"In the beginning, I don’t know if I had a concept of what I wanted the barn to look like. It was ‘let’s see what other people have done and see how that fits us’," Maxwell says. He took lots of photos and kept diligent notes in a folder that was taken to each farm.
"I had specific questions that I asked every time we visited: What would you do differently? What things would you change? What do you like about it? What’s your favorite thing about it?" Maxwell says.
"Many times on a visit you learn what not to do, and that’s just as important as learning what to do. You take bits and pieces of everything before you get your plan together as to what you want."
During this process, Maxwell’s daughter, Amy, worked three to six months each on four different dairies. At two of them, Amy got hands-on experience with different robotic units. "That helped in the decision immensely," Maxwell says. "When the robots were ready to go and the cows were ready to go, Amy hit the ground running because she knew what was going on."
The new barn construction started in March 2012. Cows started going through the robots on Nov. 8, 2012.
Maxwell has been happy with the transition to robotic milking, especially because of his concerns surrounding labor in the dairy industry.
"Labor’s a big issue, and to take that off the plate is very huge in the decision making and the ability to save money down the road," Maxwell says.
Local Extension educators can help producers with risk-management decisions. Stan Moore, a dairy Extension educator with Michigan State University (MSU) Extension, specializes in the service.
"I think one of the most critical things dairy producers can do when they are looking at adopting new changes is spending what most of them would see as an exorbitant amount of time looking into the new technology or practice that they are going to adopt. That is a form of risk management," Moore says.
That time researching can be done on the computer, learning through company websites about a particular piece of equipment, or attending a trade show.
Moore recommends that producers visit a lot of dairies that are using the technologies or equipment of interest.
"I think the more producers do that, the wiser the investment they make," Moore adds. "It’s not just buying that piece of equipment. It’s how do you put it in the barn; how do you space things; what’s that going to do to cow flow."
Dennis Stein, district farm management educator with MSU Extension, has also helped dairy farmers plan for new additions to the operation.
Learning what not to do may be as important as learning what to do when examining new technology, says Iowa dairy producer John Maxwell.
One of the things that has to go into the analysis, of course, is how you justify the capital cost of the new technology, Stein says.
"Realistically, it has to be that the technology is utilized to its fullest capacity to make it an economically feasible initiative," he says.
Part of this process is having a properly trained workforce to apply the new technology or equipment when it is added to the operation.
Many of the monitoring type units are at the level that need a slightly higher level of training or skilled workforce to utilize the information, Stein says. Equipment maintenance and problem recognition also might require a higher skill set.
Moore echoed those thoughts: "Once you’ve got everything put together, part of the risk is in implementation. If you’re not managing your employees well, that’s going to be a potential area for it to fall apart," Moore says.
Stein and Moore both recommend getting farm workers onto other dairies that utilize the same kind of equipment so they have the opportunity to learn about all of the equipment’s features.
Including employees in the decision-making process is critical to the success of any new purchase. Don’t be afraid to ask employees what they think, Moore adds.