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Agribusiness Management W1 - W2
Agribusiness Management W1 - W2
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
I. COURSE DESCRIPTION
Fundamentals of managing agribusiness ventures. This course deals with the management
problems and opportunities of agribusiness firms and related industries concerned integrative
arrangements that relate to decisions and operations of agribusiness firms and major commodity
systems.
V. COURSE POLICIES
a. The mode of delivery for this subject will be a combination of offline (modules) and
online. The course package contains necessary information needed in this subject. To
enhance further your learning, there will be pre-recorded lectures uploaded in our
virtual classroom;
b. You must follow the study schedule set for this subject for you to be properly guided
and to maintain your progress;
c. You are allowed to have your own pacing in reading the module and other reading
materials but please be reminded that there are some activities that requires you to
meet deadlines and submit your home-based tasks on time;
d. You are free to utilize reading materials online or printed books to enhance your
learning;
e. You are advised to frequently check on the virtual classroom and to the group chat for
any update on learning activities given by the instructor;
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
c. STUDY GUIDE
To guide the learners to go along the course package, these icons were used to represent
learning activities that goes along the learning process:
this icon represents the references made used for the contents of this
course package;
this icon represents the set date for deadlines of submission for a
certain requirement;
this icon represents the learning objectives for the content/s of the
course package;
Information sheet 1:
LEARNING ACTIVITIES
1. Read and understand information sheet 1 containing the business of agribusiness
Agri-business as a concept was born in Harvard University in 1957 with the publication
of a book “A concept of Agri-business”, written by John Davand A. Gold Berg. It was introduced in
Philippines in early 1966, when the University of the Philippines offered an Agri-business
Management (ABM) program at the under-graduate level. In 1969, the first Advanced
Agribusiness Management seminar was held in Manila.
Definition of Agri-business:
“Agri-business 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” (John David and Gold Berg)
Agribusiness System
Agri-business involves three sectors:
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
1. Agricultural Input sector: It deals with the supply of inputs required by the farmers for
raising crops, livestock and other allied enterprises.
2. The production sector: It aims at producing crops, livestock and other products.
3. Product sector: It deals with various aspects like storage, processing and marketing
Importance of Agribusiness:
1. It deals with agricultural sector and also with the portion of industrial sector, which is the major
source of farm inputs like fertilizers, pesticides, machines, processing and post harvest
technologies.
2. It suggests and directs the government and private sectors for development of sub sectors.
3. It contributes a good part of the national economy.
Dimensions of Agribusiness
Agribusiness has various dimensions, such as follows:
• Agribusiness deals with different components of both agricultural and industrial sector,
their interdependence and influence of one sector on other.
• It deals with the decision-making process of farm, either private or government in relation to
production and selling aspects.
• It deals with strengths and weaknesses of a project and thereby their viability in competing
enterprises.
• Agribusiness is always market-oriented.
• Structure of Agribusiness is generally vertical and it comprises the following:
Government policies and programs regarding raising of crops or taking enterprises,
etc. Research and extension programs of the government.
Farm supplies or inputs
Agricultural production
Processing
Marketing of agricultural products
1. Marketing Management
2. Financial Management
3. Supply Chain Management
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Marketing Management
Marketing management involves understanding costumer 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. Marketing
management all focused on customer needs, wants and ultimately the quest for customer
satisfaction.
Financial Management
Profit is the driver for agribusiness as they work to generate the greatest possible
returns from their resources. Successful achievement of this objectives 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.
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 pressure to be more efficient in meeting
consumer demands are 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.
Operations management focuses on the direction and the control of the processes
used to produce the goods and services that we buy and use each day.
Logistic management involves the set of activities around storing and transporting
goods and services.
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- business do not succeed. When
combining efficient management of the marketing/finance/supply chain functions of the
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
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 resource 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.
Clean Objectives
Determination of objectives is one of the most essential pre-requisite for the success of
business. The objectives set forth should be realistic and clearly defined. Finally, all the business
efforts should be geared to achieve the set objectives. In a way, objectives are destination points for
an agribusiness. As a traveler one must know where he/ she has to reach, i.e., destination. Similarly,
business also must set objectives.
Planning
In simple words, planning is a pre-determined line of action. The accomplishment of
objectives set, to a great extent, depends upon planning itself. It is said that it does not take time to
do something but it takes time to decide what and how to do. Planning is a proposal based on past
experience and present trends for future actions. In other words, it is an analysis of a problem and
finding out the solutions to solve them with reference to the objective of the farm.
Sound Organization
An organization is the art or science of building up a systematical whole by a number of, but
related parts. Just as human frame is build up by various body parts like heart, liver, brain, legs, etc.
Similarly, organization of business is a harmonious combination of men, machine, material, money
management, etc., so that all these could work jointly as one unit, i.e., “business” and “the
agribusiness”. Organization is, thus such a systematic combination of various related parts for
achieving a defined objective in an effective manner.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Research
As indicated earlier, today the agricultural production philosophy is “produce what the
consumer wants”. “Consumers’ behavior" is influenced by variety of factors like cultural, social,
personal and psychological factors. The business needs to know and appreciate these factors and
then function accordingly. The knowledge of these factors is acquired through market research.
Research is a systematic search for new knowledge. Market research enables a business in finding
out new methods of production, improving the quality of product and developing new products as
per the changing tastes and wants of the consumers.
Finance
Finance is said to be the life-blood of business enterprise. It brings together the land, labor,
machine and raw materials into production. Agribusiness should estimate its financial
requirements adequately, so that it may keep the business wheel on moving. Therefore, proper
arrangements should be made for securing the required finance for the enterprise.
Efficient Management
One of the reasons for failure of business often attributed to as their poor management or
inefficient management. The one man, i.e., the proprietor may not be equally good in all areas of the
business. Efficient businessman can make proper use of available resources for achieving the
objectives set for the business.
Scope of Agribusiness
It was already indicated that agribusiness is a complex, system of input sector, production
sector, processing manufacturing sector and transport and marketing sector. Therefore, it is directly
related to industry, commerce and trade. Industry is concerned with the production of commodities
and materials, while commerce and trade are concerned with their distribution.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Industry
Industry refers to the processes of extraction and production of goods meant for final
consumption or use by an individual or by another industry for its production. Thus, goods used by
the final or ultimate consumers are called “consumer goods”, such as edible oils, fruit jams, papaya,
pickles, etc.
Types of industries
According to nature, the industries are broadly classified into following types:
• Extractive industries: These industries are concerned with the extraction; and utilization of
natural resources. Examples, fishing, fruit gathering, agro-based industries, forestation, etc.
• Genetic industries: These industries include breeding of plants, seeds, cattle breeding farm,
fish hatcheries, and poultry farms. Of course, factors like nature, climate and environment
play a dominant role in these industries, yet human skill involved in their production cannot
be ignored. For example, intensive agriculture is possible with greater amount of capital and larger
number of workers.
• Manufacturing industries: These industries are engaged in the conversion of raw material
or semi-finished goods produced in the extractive industries. Some prominent examples are
cotton textile industry, spinning and weaving mills, etc.
Manufacturing industries can further be classified into five types:
• Analytical industry
• Processing industry
• Synthetic industry
• Service industry
• Assembly industry
Structure of Agribusiness
Agribusiness sector provides crucial backward and forward linkages. It involves the following two
important sectors.
• Farm input sector: It deals with agro-based industries providing seeds, fertilizers, feed,
chemicals, etc. The industries supplying machinery or equipment, implements and
petroleum, etc., are also important in this regard.
• Farm product sector: It deals with production and distribution of farm commodities.
Large cooperative bodies also exist in agribusiness, but they are few in number, whereas
small scaled agro industries are large in number. The vertical integration of a farm is
very common in poultry, fruit and vegetable farms.
The important distinctive features or the principle characteristics of agribusiness are as follows:
1. Management varies from business to business depending on the kind and type of business. It varies
from basic producer to brokers, wholesalers, processors, packagers, manufacturers, storage
proprietors, transporters, retailers etc.,
2. Agri-business is very large and evolved to handle the products through various marketing
channels from producers to consumers.
3. Management varies with several million of farmers who produce hundreds of food and livestock
products.
4. There is very large variation in the size of agri-business; some are very large, while many other are
one person or one family organization.
5. Most of the Agri-business units are conservative and subsistence in nature and family oriented and
deal with business that is run by family members.
6. The production of Agri-business is seasonal and depends on farm production. They deal with
vagaries of nature.
7. Agri-business is always market oriented.
DISCUSSION FORUM: for the benefit of interacting with your fellow classmates, a
discussion board has been created in our virtual classroom with guide questions where
you are required to comment your insight regarding the topic. Please refer to the attached
discussion forum guide at the end of this module for the complete instruction and how you will be
evaluated.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Information sheet 2
Managing the Agribusiness
LEARNING ACTIVITIES
1. Read and understand information sheet 2 containing Managing Agribusiness
2. Watch the pre-recorded video/audio lecture regarding Managing Agribusiness
Introduction
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 costumer’s demands. Management requires individual to 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.
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 management of the organization.
• Planning
• Organizing
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
• Directing
• Controlling
Each of these tasks plays a part in the agribusiness manager’s overall role in managing the
people and events within his or her power to generate the best possible outcome for the
organization. Each task deals with a specific aspect
The figure below illustrates this task-oriented concept of management as a wheel. The four
tasks of management are the spokes connect the manager with the goals, objectives and results
desired by the organization. Its only through planning, organizing, directing and controlling that
the firm’s (and manager’s) goals are achieved. Overall, management can be no stronger than the
weakest spoke in this wheel. Now add motivation as the torque, or speed, or effectiveness, with
which the task are accomplished. Motivation provides the motion by which the wheel either moves
forward or reverses, but it is not another task. Strong motivation results in speedy, efficient,
successful and forward moving management. On the other hand, a lack of motivation can result in
a discouraging reversal. The axel on which the entire wheel of management turns is communication.
Again, this is not another task, but without effective and timely communication, the wheel of
management soon begins to wobble and squeak.
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. 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. The long
term may be two or three years for a very small agribusiness, while a major corporate organization
may be looking at a 20 years (or longer) time horizon. Strategic plans tackle the broadest elements of
an agribusiness firm’s strategy; what countries will we operate in; what business will we be in; what
plants will we build; what technologies will be developed?
Any planning activity is focused on achieving some goal, on moving the firm in some direction.
Therefore, in many strategic planning situations, one of the first steps is the development of mission
statement or a statement of vision. A mission statement helps to spell out this direction for a firm
and describes the destination. When developing a mission for a company or even for a department,
management must think strategically about firm’s business in a future time period. In many cases,
the statement has three parts:
• Key markets (who we serve)
• Contribution (what we do)
• Distinction (how we do it differently)
Tactical Planning is the drawing up of short-term plans consistent with the strategic plan. As
much, tactical plans are a crucial part of implementing the agribusiness firm’s strategic plan. While
strategic planning is focused on what we do in three years (or five years, or 20 years), tactical
planning is focused on what we do tomorrow (or next month, or next year).
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 firm. A contingency planning
provides guidance when something unexpected happens. Some contingency planning is conducted
to prepare for potential crises that may occur.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Organizing
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 firm. It is the manager’s challenge to design an organizational structure that
allows employees both to accomplish their own work and simultaneously to reach 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.
Organizational structure
An organizational structure exists in all business. An organizational structure clarifies who reports
to whom, and who in turn is responsible for the performance evaluations. It helps clarifies who has
responsibilities for specific tasks. An organizational structure also helps clarify who has authority
for specific decisions. Finally, for new employees, an organizational chart can point to potential
career paths within the company.
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.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
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.
Controlling
The controlling task represents the monitoring and evaluation of activities. To
evaluate activities managers should measure performances and compare it against the standard
and expectations they set. In essence, the controlling task assess the goals and performance
objective developed within the planning task are achieved.
LEARNING ACTIVITIES
DISCUSSION FORUM: for the benefit of interacting with your fellow classmates, a
discussion board has been created in our virtual classroom with guide questions where
you are required to comment your insight regarding the topic. Please refer to the attached
discussion forum guide at the end of this module for the complete instruction and how you will be
evaluated
IX.ACTIVITY GUIDE
(Instructions/guidelines/procedures in performing each learning activity intended to
assess learning of all students are completely explained in this area)
1. DISCUSSION FORUM GUIDE
GUIDELINES
Discussion forum is an electronic message boards for asynchronous communication regarding the
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
concepts being tackled in our class. You are expected to post your thoughts in a conversational
tone.
i. I will be posting guide questions for discussion in our virtual classroom.
You are expected to post at least twice to thrice on each forum. Your first
post will an answer for the guide question, and you are also encouraged to
respond or react to the postings of your classmates;
ii. Discussion forums are intended for conversations about our topic, you are
expected to be at your modest when interacting with each other. Postings
that are out of the topics gives the learner a deduction point;
iii. Remember that when you post your comments/reactions, you must respect
the opinions of your classmates and to always have proper netiquette when
conversing with each other;
iv. Please refrain from copy-pasting works of others. You can use them as your
reference then summarize the idea/thought but make sure to properly cite
your sources;
v. Be guided by the rubric to be uploaded in the virtual classroom for the
assessment of your participation.
RUBRICS:
CRITERIA 4 3 2 1
3. ACTIVITY GUIDE
i. Your activity/assessment test on this chapter will be uploaded at our
google classroom
ii. The activity/assessment test will be posted at google classroom 2
days before the end of your scheduled time of chapter discussion
and reading (ex. The chapter will be 2 weeks scheduled (sep. 27-oct.
8) the activity/assessment test
iii. will be posted on oct. 7 at 8:00 am and it will be scheduled to closed
automatically at oct 8 at 11:59 PM.
RUBRICS:
CRITERIA 4 3 2 1
X. ASSESSMENT GUIDE
(Performance of learners will be graded as the following assessment percentage
presented below)
LECTURE CLASS STANDING 60%
Discussion forum
Journal
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870
Narrative report
GRADING SYSTEM:
a. MIDTERM GRADE:
Class standings = 60%
Major Exam = 40%
I. REFERENCES
(the following materials are used as references in creating the content of these course
package)
TEXTBOOKS Barnard, F.L.(2016). Agribusiness Business Fifth Edition. Routledge
Textbooks in environmental and Agricultural economics.
EBOOKS
WEB/INTERNET SITE
YOUTUBE VIDEO
II. THE INSTRUCTOR
The instructor was born in Sto. Domingo Ilocos sur. She finished Bachelor of Science in Business
Administration major in Financial Management, she also took up units in Bachelor of Secondary Education
major in Social Science, and at present she is taking her Master of Arts in Education major in Educational
Management at University of Northern Philippines. She is also a License Professional Teacher and now
currently working as an Instructor and SHS Teacher in Ilocos Sur Community College.
ILOCOS SUR COMMUNITY COLLEGE
Quirino Stadium, Zone V, Bantay, Ilocos Sur, Philippines 2727 ISCC Barangay Demo Farm Campus
Tel. No. (077) 604-0285 Barangay Labnig, San Juan, Ilocos Sur
e-mail address: isccbantay@yahoo.com Tel. No. (077) 722-5870