Simplification of Quantified SWOT Analysis in the Example of the Intensive Breeding of Common Elands

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International Journal of Emerging Technology and Advanced Engineering

Website: www.ijetae.com (ISSN 2250-2459,ISO 9001:2008 Certified Journal, Volume 5, Issue 1, January 2015)

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Simplification of Quantified SWOT Analysis in the Example

of the Intensive Breeding of Common Elands

Lucie Ackermann Blazkova

1

Czech University of Life Sciences Prague, Faculty of Tropical AgriSciences, Kamycka 129, 165 21 Prague 6 Suchdol, Czech Republic

Abstract — The Czech University of Life Sciences Farm at Lany began farming common eland with the aim of achieving full economic self-sufficiency through animal production for breeding and meat. Alternative goals were to verify production technology for farming common eland in captivity and the utilization of this species as an alternative for meat production in mild climatic zones. The model farm was primarily designed to aid students of the University in completing their diploma theses. Stabling and paddock fencing required considerable investment with a very long period of return. With the increasing number of farmed animals, farming costs have also increased. The farm consumes a continually increasing amount of funds without tangible results or the opportunity for a return on investment. This trend could have a self-destructive effect on the farm in the future. Given that a large amount of funds have already been invested in the farm, together with the efforts of researchers and students conducting research and qualified work, it was felt to be worthwhile to prepare a plan for economic sustainability. The aim of this study is to highlight the strengths and weaknesses of antelope breeding using decision making tools. The results help decision making about the future continuation of university breeding programs.

Keywords — managerial decision making tools, university farm, common eland, marketing activities, main and by products, breeding evaluation

I. INTRODUCTION

The common eland is a relatively trainable animal. It is relatively undemanding, docile and trusting in captivity, which is why there have been efforts to domesticate this species. Antelope provide highly nutritious, tender meat, high quality hides and their milk has a higher protein and milk fat content than cow’s milk. Farming these animals could help enrich the diet in countries with insufficient animal protein. Meat from wild animals is still an important source of nutrients for people throughout Africa (Ndibalema and Songorwa, 2008). For this reason, the Food and Agriculture Organization (FAO) recommended

Taurotragus oryx as a species suitable for domestication in 2000 (Woodford, 2000).

This became a challenge for experts at the Czech University of Life Sciences Prague and the first five animals to establish the University’s own experimental breeding herd were acquired on the initiative of several employees from the Institute of Tropics and Subtropics (in the year 2013 renamed the Faculty of Tropical AgriSciences), with the support of University management. Common eland farming physically began at the Czech University of Life Sciences Farm in Lany (CULS Farm Lany) in 2006, following previous experience gained from abroad, from the Czech zoological gardens and from the private Scevlik family farm, Biotop Sidlov. The Institute of Tropics and Subtropics (ITS) of the Czech University of Life Sciences Prague (CULS) began working with this farm intensively and obtained 5 adult antelope in 2000. These were temporarily placed on a farm in Brezova near Kutna Hora in autumn 2002, under the auspices of the ITS CULS, where breeding and research commenced. The herd grew to 20 individuals, which were moved to the newly constructed breeding station at the CULS University Farm in Lany in 2006 (Ackermann Blazkova, 2012). In 2009, the farm reached the breeding facility’s maximum capacity of 40 animals (though not productive breeding animals) and the first animals were slaughtered that year (Ackermann Blazkova, 2014). The farm currently faces severe financial problems. Is it better to stop antelope breeding or are other its advantages and benefits of greater importance for the University? How to make the best decision?

II. MATERIAL AND METHODS

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In the case of common eland farming and realizing the sale of meat and live animals, these conditions form the basic limitations for the preparation of this study and proposed solutions for the given situation.

SWOT analysis is an important tool in the decision-making process. Normally it is used while analyzing the strategic position of a firm and for identifying the position of an entity from a point of view of internal and external factors. The internal factors are considered to be S (Strengths) and W (Weaknesses), the external factors are in the O (Opportunities) and T (Threats) groups. (Kajanus et al., 2004). Internal factors evaluate the internal environment in the firm from a point of view of management, process efficacy, research and development etc. Analysis of the external opportunities and threats assesses whether the organization is capable of exploiting opportunities and resisting the threats from the external environment of society. (Chang and Huang, 2006). The commonly used form of SWOT analysis has disadvantages for the managerial decision-making process. Very often, incommensurate criteria are set, the author focuses only on their enumeration, but the strength of the given criteria is not obvious. (Fedrizzi and Brunelli, 2010). For the needs of this study, a simplified quantified SWOT analysis will be implemented. Categories S and O are considered positive (i.e. Pluses); the separate coefficients will be positive. Categories W and T are negative factors (i.e. Minuses), the value of the resulting coefficient will be negative. The principle of quantified SWOT analysis for the case in question is the setting of ten relatively comparable criteria for each category S, W, O and T. Each separate criterion has three types of parameter:

Q(i) - identifies the volume of the impact of a criterion (in particular those that are financial-economic and structurally productive)

P(i) - probability of the criterion occurring at full strength W(i) - weight (degree of gravity) of the criterion.

The values of the parameters are expressed in quasi coefficients K(fi).

K(fi) – overall criteria effect of the i-criterion. (Svasta, 1983). The volume of impact of the criterion attains values from the closed interval <1; 9>, probability attains values from the interval <0.1; 0.9> and the degree of gravity of the criteria is estimated in values of the closed interval <1; 9>. The product of these separate parameters gives us something known as the criteria factor SWOT analysis coefficient K(fi). Setting the values of the parameters is performed empirically on the basis of a qualified expert estimate.

In each category, S, W, O and T, ten separate criteria factor coefficients will be calculated. By adding together the separate items, we gain an overall coefficient for each category, i.e. four categories of criteria factor coefficients, two positive and two negative. (K(fi)G group K(fi)) For the evaluation of the SWOT analysis we also add together K(fi)G for S, W, O and T. If we express the value of the aggregate criterion factor coefficient (K(fi)T total K(fi)) in percent (proportional to the maximum value), it is possible to establish the probability of success or failure of antelope farming in practice. The result of the quantified SWOT analysis strengthens or weakens the assumption of sustainability of antelope farming into the future and helps in the managerial decision-making process in the formulation and implementation of decisions. The maximum value of K(fi) is given by the product of the maximum values of separate parameters which a criterion can acquire, i.e. 9 x 0.9 x 9 = 72.9. (analogically also for the minimum values in the ―Negative‖). By summarizing this result for the categories we gain the maximum value of the criterion factor coefficient. K(fi)G . When using the ten criteria in the group, the maximum value K(fi)G equals 72.9 x 10, therefore 729. The maximum value of the SO category equals double the maximum K(fi)G , i.e. 2 x 729 = 1458. The minimum value of the category WT equals (minus) – 1458.

III. RESULTS AND DISCUSSION

A. Simplified PEST Analysis

PEST analysis is a strategic audit of macro-environmental factors affecting the ability to realize sales.

Political-legislative factors-1:

Restrictions on farming, slaughtering, disposal of animal products – basic regulations:

 Act No. 166/1999 Coll., on veterinary care and

amendments to related acts (Veterinary Act) (Czech Ministry of Agriculture 2011).

 Czech National Council Act No. 246/1992 Coll. on the protection of animals against cruelty, as amended by CNC Act No. 162/1993 Coll.

 Decree No. 373/2003 Coll., on veterinary inspections

when trading in animal products

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 Decree No. 289/2007 Coll., on veterinary and health requirements for animal products not governed by directly applicable European Community regulations

 Decree No. 382/2004 Coll., on the protection of farm

animals at the time of slaughter, killing or other forms of death

 Decree No. 128/2009 Coll., on the adaptation of veterinary and health requirements for certain companies handling animal products

And other amendments, Decrees and implementing regulations. This area is also governed by European Union regulations.

Summary: animals cannot be slaughtered at abattoirs. They are wild animals that would be stressed during transport and in view of their size and nature, the animals cannot be stunned using electricity, as in the case of cattle. Common eland from farm production can only be slaughtered at the farm. In view of the rigidity of the skull and its possible use for the preparation of trophies, antelope are slaughtered by a shot to the neck – breaking their neck against a ballistic wall. Antelope can currently be slaughtered by holders of C and D shooting licenses. A bolt gun, such as that used at abattoirs is not used for antelope, but instead a rifle is used. The use of this weapon must be reported to the Police of the Czech Republic. District Veterinary Administration must also be notified when animals are slaughtered. Shot animals must also be bled at the farm. Death occurs by exsanguination. Once bled, animals are eviscerated and transported to the abattoir in a refrigerated vehicle. The animal’s heart, liver and other viscera are also transported to the abattoir for veterinary control. The experimental abattoir in Uhrineves is currently used. Transport by refrigerated vehicle is very expensive and attempts have been made to find an abattoir willing to process meat closer to the farm. The problem is that only a small number of animals, i.e. 2-4 head are slaughtered. If more animals were slaughtered, it would not be possible to satisfy potential customers based on demand (we expect interest in the continuing supply of meat). Large capacity abattoirs cannot process such a small number of animals – to comply with hygiene regulations, sanitization would be required after antelope are processed, that would mean slaughtering could not continue for the whole day. This would cause the abattoir considerable losses. The location of the abattoir is also affected by the area in which demand was surveyed and contacts established with customers.

Due to the lack of a standardized establishment, it is not possible to sell meat in individual butcher’s cuts. Cooperation with a butcher would mean an additional financial burden, in which case farming becomes unsustainable.

Main product: meat on the bone, in half and quarter carcasses, sold directly from the abattoir in Uhrineves.

Economic factors-2:

 The number of patrons at restaurants is still affected by the economic crisis

 Greatest buying power is anticipated in Prague.

 Fewer foreigners at restaurants

 Growing price of energy

Summary: there will be pressure to reduce prices: cautious customers. On the other hand, organization costs will increase.

Socio–cultural factors-3:

 Czech consumers prefer ―traditional‖ types of food. However, there are also those types of consumers who like to try new products.

 The ―healthy‖ lifestyle trend is increasingly in vogue (zero cholesterol product).

 Poor knowledge of the animal and its morphology excludes a large group of people, who have an aversion to eating antelope meat (comparing it to gazelles).

Technical and technological factors-4:

 linked to legislative restrictions in this case. Farming products can be divided as follows in terms of their sale:

 Live animals

 Meat

 Taxidermy (heads and hides)

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With planned changes in the Veterinary Act, new opportunities for the sale of older antelope for trophies may arise. However, this is not relevant as yet, and we need to focus on resolving the unsustainable financial situation under current conditions.

B. Quantified SWOT analysis

The usual form of SWOT analysis provides only a list of strong and weak aspects of antelope farming, the opportunities and threats from the external environment. Without thorough knowledge of the matter and orientation in combined agriculture, it is impossible to evaluate or simply gauge the results of a common form of SWOT analysis. The methodical starting point for supporting decisions in the managerial decision-making process is the use of quantified SWOT analysis and the calculation of the aggregate criterion factor coefficient (Zaerpour et al., 2008). SWOT analysis is the basic tool for our strategy formulation. (David, 1998; Chang and Huang 2006).

Calculation according to the methodology is shown in following Tables 1 – 5 and Scheme 1.

TABLEI

QUANTIFIED STRENGTHS

Order Criteria description Q(i) P(i) W(i) K(fi)

1. Own breeding herd 9 0.9 7 56.7

2. Uniqueness of the product 9 0.8 7 50.4

3.

Uniqueness of intensive common eland farming in the Czech Republic, the European Union and in the

world 9 0.9 9 72.9

4.

―Implicit‖ revenues – funds allocated by the University for points from publication and the completion of

students’ qualification work 7 0.6 8 33.6

5. Own land 7 0.6 8 33.6

6.

Quality of veterinary and

breeding conditions 7 0.5 8 28

7. Required quality of feed base 9 0.9 9 72.9

8.

Availibility of certified

slaughterhouse 8 0.7 7 39.2

9.

Existence of authorised

standard realization 7 0.6 8 33.6 10. Price setting adaptability 9 0.7 6 37.8

Sum of value of criteria K(fi) G

458.7

TABLEII

QUANTIFIED OPPORTUNITIES

Order Criteria description Q(i) P(i) W(i) K(fi)

1.

Sale of material for

taxidermy 6 0.5 9 27

2.

Expected change in the Veterinary Act, permitting

trophy shooting 9 0.9 7 56.7

3.

Finding or creating a strategic partner for sales and

marketing activities 6 0.5 8 24 4. Inter-faculty cooperation 7 0.8 8 44.8

5.

Cooperation in the area of science and research on an

international level 4 0.5 6 12

6.

Increased publication activity, potential for better organisation in the completion of students’

qualification work 3 0.6 7 12.6

7.

Acquisition of research

grants 9 0.3 9 24.3

8.

Finding subsidy programmes from the European Union or the state budget (antelope

also help maintain pastures) 6 0.4 6 14.4

9.

Cooperation with farmers, ability to send students outside university companies

for work experience 8 0.4 7 22.4

10.

High quality meat with low cholesterol – opportunity for promotion in magazines devoted to healthy nutrition

and diets 8 0.5 6 24

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TABLEIII

QUANTIFIED WEAKNESSES

Order Criteria description Q(i) P(i) W(i) K(fi)

1.

Absence of marketing

activities 6 0.9 7 -37.8

2.

Lack of information among potential customers – no

demand 8 0.7 9 -50.4

3.

Unclearly defined competencies and responsibilities of

workplaces 9 0.6 4 -21.6

4.

Focus on researching growth

potential and ethology only 5 0.5 3 -7.5

5.

High financial demands of farming – especially energy consumption (extensive farm

area, need to cart feed daily) 7 0.4 5 -14

6.

Valuation method for animals and therefore gains and calves based on cattle – not adapted for antelope and

ongoing feed/growth

experiments 4 0.3 6 -7.2

7.

Pricelist of meat does not reflect the situation on the

market 3 0.6 5 -9

8.

Animals slaughtered without

pre-arranged sales 5 0.4 3 -6

9.

Meat production in storage – high storage costs at freezing

plants and subsequent

disposal at rendering plants! 7 0.5 5 -17.5

10.

Declining animal welfare with continually increasing

numbers 6 0.7 4 -16.8

Sum of value of criteria K(fi)G

-187.8

TABLEIV

QUANTIFIED THREATS

Order Criteria description Q(i) P(i) W(i) K(fi)

1.

Animal disease and

epidemics 7 0.3 9 -18.9

2. Stricter legislation 3 0.2 9 -5.4

3.

Increase in the price of feed

and energy 8 0.4 4 -12.8

4.

Suspension of existing subsidy of EUR 18,500 per

annum 6 0.7 8 -33.6

5. Rejection by customers 6 0.4 7 -16.8

6.

Rejected cooperation by all involved (hitherto on a verbal basis, personal

relationships from the past) 4 0.3 3 -3.6

7.

Poor economic situation of

demand 8 0.5 5 -20

8. Genetic-breeding failure 9 0.1 6 -5.4

9.

Critical violations of input

sources (hyperacidity) 4 0.4 7 -11.2

10.

Loss of scientific and

research interest 8 0.3 9 -21.6

Sum of value of criteria K(fi)G

-149.3

SCHEMEI

CALCULATION OF THE AGGREGATE CRITERION FACTOR

COEFFICIENT K(FI)T

pluses minuses

SO WT

S 458.7 -187.8 W

O 262.2 -149.3 T

Total 720.9 -337.1

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TABLEV

PERCENTAGE MEASUREMENT OF RESULT

max value of partial criteria 72.9

max value of sum 729

max value of pluses 1,458.00

min value of minuses -1,458.00

percentage measurement of result: 26.32

The resulting value of the total criterion factor in the case of the evaluation of the strong and weak aspects of common eland farming is the positive number 383.8. Expressed in a percentage this is 26.32 %.

This result can be considered favorable. The result can be interpreted as a 26.32 percentage assumption of success of the plan – common eland farming at the Czech University of Life Sciences Farm in Lany. It can be seen in the quantified SWOT analysis result that antelope farming has the potential for sustainability also in the future.

IV. CONCLUSIONS

The nature of financing is determined by a ―compromise marketing strategy‖ – a requirement for implementation of research projects increases the input costs in the area of the antelope farming economy. The research must be conducted concurrently with the realization of the output product (meat) for reasonable, comparable prices within the market system of meat prices in the Czech Republic. While keeping in mind the condition of the essentiality of the sale of antelope meat and the lack of knowledge of comparisons of quality with price, it is essential to set a price according to the price level of beef and game. Realization of meat sales appears to be a complicated process because it involves a structure of market innovation on the meat market to which the Czech market is not adapted as a consequence of the economic recession. The key problem is the evolution of potential and normative customers. This involves a very peculiar example of marketing analysis which is not comparable with classic marketing analyses. Due to the uniqueness of antelope farming and the product, this method has proven to be the most effective. In the case of common eland farming at the university, it is not appropriate to assess it according to classic principles. The main benefit of antelope farming and also the reason for starting breeding domesticated animals in the university environment are the research activities and their results. According to theoretical approaches, breeding can be assessed as potentially successful.

An equally significant factor supporting the continuation of common eland breeding on the current scale and the effort of maximizing the production of animals per year is also its uniqueness. The Czech University of Life Sciences Prague holds a unique asset in this herd. It also represents potential further possibilities for international cooperation in the near future.

Breeding common eland on such a scale and at unusual temperate latitudes helps the reputation of the research and pedagogical department. As early as 1892, the first attempts at domestication of this species were conducted in the Ukrainian reserve, Askania Nova (Zejdova, 2009). Currently negotiations are underway with staff of this organization on the possibilities of exchanging breeding stock for the revitalization of the bloodline. From a point of view of international prestige in the area of research, this promises success.

Acknowledgements

This article was written with support from the Internal Grant Agency of Institute of Tropics and Subtropics, grant number 51140/1312/3126 Marketing plan for the common eland breeding.

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