Milking Center Management Parlor cost control

June 10, 2009 07:00 PM

Mark Wustenberg
*Extended comments highlighted in blue

During stressful economic times, it is sometimes hard for dairy producers to stay focused on the details necessary to consistently keep day-to-day expenses under control and achieve milk-quality premiums.

It is tempting in times like these to cut back on our preventive maintenance programs as well as attempt to reduce expenditures for supplies and chemicals. Often, we will also reduce the investments we make to ensure that our employees can properly carry out their responsibilities.

The trick is to keep your input costs to the bare minimum without significantly raising the risk of bad things happening as a result. It is helpful to have a strategy for how you approach this.

There is a concept used in the manufacturing environment that is termed "cost of quality.” It is simply a way of organizing activities to give a more complete picture of the cost of quality-related activities. Typically this cost is bucketed into three categories: cost of failure, prevention cost and appraisal cost.

Failure cost is further broken down into internal and external failure. Internal failures are those that are caught before the product leaves your control, while external failures are those that are discovered by your customer. An example of an internal failure is a tank of milk that you have to dump because you realize you milked a hot cow into the tank. An external failure might be shipping milk with a high bacteria count that ends up costing you a quality premium.

Prevention cost examples would include employee training and your preventive maintenance program.

Appraisal costs are the costs of monitoring. These might include regularly auditing your equipment washup and chemical usage or auditing milking time performance.

When you go through the exercise of analyzing cost into the different groups, it is rare that the costs of poor quality or failures in the system are less than the costs of prevention and appraisal.

If you start from the assumption that your equipment meets all the specifications for its intended use and has been installed properly, there are three basic questions that encompass everything that needs to be under control in your parlor.

Each question can be judged according to a general framework that starts with defining your requirements, then defining how you will consistently meet those requirements and finally designing a verification system to ensure that the requirements are consistently being met.

For example, liners are designed to be used for a certain number of milkings. We can meet this requirement by having the milkers change the liners at proper intervals. Finally, we verify by checking to make sure it's actually getting done.

Another example might involve milking routine. First, we define the routine. We then train to these specifications and finally monitor by auditing milking time practices as well as milk quality parameters.

Apply this framework and ask the following three questions:

How do I know my equipment is working properly? How do I know my equipment is cleaning properly? How do I know my employees are doing what I expect?

When you do this, you can build a system that effectively anticipates unplanned failures and minimizes the costs associated with them. You can also do a much better job of controlling costs by more closely monitoring inputs like chemical or teat dip usage.

Bonus content:

The extended comments are highlighted in blue and the cost of quality chart can be found at the bottom of this article/page.

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