Key performance indicators
Every farmer in every sector should know their KPIs
Understanding and comparing relative farm performance is seen as a powerful
management tool.
Yet only around 20% of farmers carry out some form of business bench marking
and even fewer measure and benchmark against key sustainability
metrics. There is significant scope to accelerate bench marking through the
adoption of simple key performance indicators (KIPs) that are ubiquitous across
the industry.This would deliver a step change in farm performance, increase the
resilience of the
industry and reduce environmental impacts.
Farming KPIs - where are we now?
In contrast to many other sectors of the economy, the application of KPIs in
farming is at a relatively low level.
There are, of course, differences across the farming sectors in terms of
uptake of bench marking related activity, but there remains significant scope
for
this to increase.
Using data to assess performance is not new to agriculture. There are many
industry initiatives looking at KPIs and a potential wealth of indicators and
metrics is available to farmers.
However, the concept of KPIs is complicated by a diversity of enterprises and
complex farm businesses. Other challenges include:
- Variation across the industry in the terms used to define what is measured
- The need to agree how benchmarks are set and who decides upon them
- The need to align expectations around what measurements can be captured
consistently across the industry
What is the APTF doing?
The priority of the Agricultural Productivity Task Force is to build on and
co-orindate the KPIs work that is already taking place to make measurement
consistent and easily accessible for farmers. The aim is that KPIs will become
commonplace in farming, for the benefit of individual businesses and the
industry as a
whole.
To tackle the complexity associated with KPIs, the intention is that indicators
should be broadly
categorised around the key headings of:
- Business i.e. financial performance
- Production i.e. physical indicators
- Environment – these may be measures that are a proxy for environmental
performance
Who is leading this work?
The APTF work on KPIs is Chaired by Phil Bicknell, AHDB Market Intelligence
Director, with wide input from farm business consultants, trade associations,
farmer representatives and industry specialists.
We would like to gain a level of consensus from farmers, growers and
industry around what the KPIs should be and how they should be calculated. Any
farmers or industry organisations who would like to be involved can contact
Phil at phil.bicknell@ahdb.org.uk
What can you do now?
AHDB has done some preliminary work looking at previous research, data readily
being captured by farmers and growers and existing KPIs in use.
This has led to a narrowed-down selection of indicators across business,
production and environment for a variety of enterprises and farm
businesses as a
whole.
Farmers' help is needed to add to this list of indicators and to help identify
which are the most important. Work will then take place to confirm how the KPIs
should be calculated.
AHDB's pilot KPI Express
tool
currently has dairy indicators and some beef and lamb KPIs, mainly focused
on
production. Farmers are invited to try them out.
Last reviewed: 11 Jan 2021