TEST CODE HERE

What would you do if your agronomist told you that planting your crop at 1,000 ft in elevation was a sure way to increase your yield by 5 bu/acre? You’d probably step back and wonder if you’re getting your money’s worth from your consultant. What if, instead, the benchmarking program you pay for told you that? For many farms, that is exactly the kind of results they’re spending money on.

Screen Shot 2016-06-01 at 10.18.19 AM
Example 1. Judging by the red “error bars”, this analysis suggests that someone is very confident that yield changes dramatically by changing elevation by 300 ft.
In the last few years, a lot of time and money has been spent publicizing the benefits of cross-farm comparisons and analyses. “Benchmarking” has claimed its spot in ag’s top buzzwords, and while a lot of benefit can come with understanding how your operation stacks up against peer farms, conclusions need to be drawn accurately and carefully. Poor benchmarking can encompass many problems, ranging from data quality (such as aggregating incomplete or mislabeled data) to inaccurate analysis. Many readers will probably be familiar with “as planted” files that have the wrong hybrid listed, but there are also many examples of incorrect analysis that are harder to catch.
Issues with analysis methodology and visualization are often the easiest to spot. Here are some more examples we’ve seen in the market – we’ve recreated the original data to preserve the anonymity of the companies involved:
Screen Shot 2016-06-01 at 10.20.25 AM
Example 2. This suggests that yield goes up at 130k and 170k seeds/acre, but somehow 160k seeds per acre is bad for your field.
Screen Shot 2016-06-01 at 10.20.34 AM
Example 3. This plot suggests that a) yields go down after you reach a soil productivity index of 0.3 and b) some people are farming ground that has a negative productivity index – something that doesn’t even exist in reality!
Most farmers looking at the charts above would realize this issues and not make a decision based on the visualization output. However, it is difficult or often impossible to judge the methodology or the data quality that went into the analysis. For example, one of the most common analyses published is a ranking of yield by variety, which typically shows up as a table like this:
Screen Shot 2016-06-01 at 10.20.46 AM
Example 4. Yield by Variety Analysis
In this example, the farmer typically has no way to tell if the data or analysis used to make the table was sound. They thus need to trust that the data they are are using is high quality data that has been analyzed properly…a trust that is sometimes misplaced. Here are some practical takeaways to keep in mind when you are looking at benchmarking data:
1. Find companies that you trust. Finding bad data is like finding a mouse: if you spot it once, there is probably a lot more that you haven’t noticed.
2. Make sure the results you see pass the “common sense” test: do the results make logical sense? Hint: several of the conclusions you could draw from the examples shown above don’t.
3. Understand the sample set and make sure you are looking at data that is representative and relevant for your particular operation. “Yield by variety” that includes irrigated land in Nebraska, for example, isn’t that helpful if you are a dryland farmer in Kansas.
4. Remember that the value of benchmarking can be positive or negative: making a poor decision from questionable analysis can be a lot more expensive than what you paid to subscribe to the benchmarking service
5. Correlation is not causation. Here is a simple example: people plant slower on hills. If yield is lower on steep slopes, an analysis of yield vs. planting speed will make it look like planting slower is bad for yield. Also, adding more farms to the sample won’t fix the problem, so don’t fall for the line “more farms average out potential errors”.
6. Make sure you understand why the company is providing you benchmarking: is their business based on providing accurate data, or do they have another way of making money? Good benchmarking takes a lot of work and focus – it shouldn’t be a company’s afterthought.
Despite the preceding examples, we think that benchmarking is here to stay, and that it can provide a lot of real value. There is a lot of well analyzed, useful benchmarking programs out there (you can read about some of our at work at Granular here and here). However, the quality of data in the marketplace currently varies tremendously, and benchmarking as a whole runs the risk of ending up with a bad reputation. Before you make important business decisions based on a benchmarking or cross-farm analytics program, look closely at where the data comes from and how it was analyzed – not just where you show up relative to others!

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Kennedy and Coe, LLC—the nation’s largest food and agriculture consulting and accounting practice—and Granular, Inc., a leader in farm-management software and analytics to the production agriculture industry, announce a strategic alliance to develop integrated products and collaborate around joint clients. The companies are co-developing a benchmarking service and will connect their respective accounting-software and farm management systems designed for professional farm operations.

Ag industry leaders pair to develop new farm management and analytics solutions.

“Working with farmers for over 80 years, we’re intimately familiar with how much farm business sophistication has soared over the decades, and exponentially, it seems, in the last five to ten years. So has the thirst for better data to make informed decisions,” said Jeff Wald, Kennedy and Coe’s CEO. “We believe that Granular’s farm-management platform combined with our financial advisory services gives leaders of dynamic farm businesses exactly what they need to achieve their aggressive growth goals.”
Granular and Kennedy and Coe plan to collaborate regularly with production-ag operations who want to expand, bringing the full complement of their combined advisory services to facilitate a higher level of success.
“Granular serves agriculture businesses that are working hard to expand geographically and become more professional,” said Granular’s CEO, Sid Gorham. “In addition to better software, these producers are looking for financial, tax, and strategic advisors to take them to the next level. We look forward to partnering with Kennedy and Coe’s agriculture experts to deliver an integrated package of advice, services, and technology. “
Farm Benchmarking
Kennedy and Coe and Granular will jointly assess the current management practices on the largest and most professional farms in the US. This involves surveying each functional area in a farm business (i.e. planning, production, cost accounting, grain marketing, financial accounting, tax, and human resources) with the goal of assessing the different levels of organizational maturity in each area. Survey participants will receive a detailed comparison of their operations alongside those of their peers. Kennedy and Coe and Granular intend to share the summarized results of the annual survey with the industry broadly.
Integrating Granular with Kennedy and Coe’s Accounting Software
Another important area of focus is to integrate Granular’s software with cloud-based accounting software supported by Kennedy and Coe’s financial, tax, and management consulting services. This software integration will give producers end-to-end visibility of their business from production activity to their financial statements while minimizing data entry and bookkeeping work. This also permits access by producers to services ranging from day-to-day accounting through CFO-level services and C-suite management advice.

About Granular

Granular is a breakthrough software and analytics platform designed specifically for the professional farm. After launching commercially in July 2014, Granular is being adopted by producers nationwide who are investing to make their businesses more professional, efficient, and profitable. Granular helps these producers organize their operational, financial, and agronomic data into one system and use it to make better decisions. Granular is backed by leading venture investors, including Andreessen Horowitz, Google Ventures, and Khosla Ventures.

About Kennedy and Coe

Kennedy and Coe impacts businesses throughout the nation’s food-supply chain—from policy to plate—as the leading food and agriculture consulting and accounting firm in the US. In 2013, to round out its food and ag service offerings, Kennedy and Coe acquired Vela Environmental and AgKnowledge, companies that delivered proactive policy and legislative involvement, sustainability and resource planning, and detailed farm profit-margin management. Beyond production ag and food processing, the firm works in biofuels; ag-related manufacturing; equipment dealers; contracting, real estate, engineering, architecture, and technicians; and with rural community banks. Ranked among the 100 largest CPA firms in the US, Kennedy and Coe has offices in Kansas, Colorado, Mississippi, Wyoming, and Washington, DC.

Latest

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Karl Wozniak, Role
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  |  
September 11, 2017

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Karl Wozniak, Role
  |  
September 11, 2017

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Karl Wozniak, Role
  |  
September 11, 2017

Industry Insights

Three Ways to Run a Successful Harvest

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Events

Grow 2018

Granular's Annual Customer CEO Summit

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California Academy of Sciences, San Francisco, CA

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Industry Insights (6)
Granular Suite (12)
AcreValue (12)
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