Operational Management Of Australia Agricultural Company – Analysis And Evaluation

Description of the organization

Discuss about the Operational Management for Australia Agricultural Company.

Australia Agricultural Company (AACo) in Australia is a notable organization under Agricultural industry in Australia. The company was established in 1824 and based in Brisbane. AACo is a reputable organization that deals with cattle keeping and animal products. The firm, covers a very vast land of about 1000,000 acres which was basically set aside for cattle keeping. The major source of the firm’s revenue is from the Meat processing Company which has been very instrumental in enabling the company to register profitable income over a long period of time. From the financial records, it is explicit clear that the company has been performing well in its business. In 2015, the company registered a revenue that amounted to $561, 026, 000. This is a clear indicator that AACo is running a profitable business. However, it is important to accentuate that this firm has been experiencing stiff competition from, its immediate competitors from different parts of the country which produce the same product in the market. Ideally, under the firm leadership of the Chief Executive of Officer of AACo, it has been able to realize tremendous progress due to clear stipulated policies that are geared towards positive mobility of the organization. Mr. Jason Strong is the current CEO who works in tandem with the firms’ chairman Mr. Donald McGuchie.  Primarily, this work will delve on the evaluation of AACo firm in the view of determining its performance amid stiff competition (Dickinson, 2015). Moreover, different approaches and designs would be used to analyze the company’s performance and sustainability for efficacy of the performance and improvement of service delivery on the organization of that magnitude.    

Evaluating Performance

AACo has devised effective strategies for its business so as to meet the demands of their clients from diversified parts of the world. It is important to underscore that this firm  supplies its meat products it different state in the world and this puts the firm at a very demanding position since they have to ensure that the needs of  its clients  from different geographical  region are well taken care of.  Sarkis (2014) asserts that AACo has structured its functionality into three segments namely; Grassfed cattle, Grainfed cattle and Northern Beef for efficacy of their operation and realizing higher productivity due to clear divisions of operations. This company owns close to eighteen station that cumulatively accrues to 6.4 million hectares of land in total coverage. The CEO of this firm working closely with other executives decided to employ the means of dividing the firm’s operation into three distinctive features in order to improve on the quality of their products. This was also aimed at making work easier and reduce instances of loopholes such as delays in one sector. Under the leadership of Mr. Strong, the firm has set aside $ 911 million to establish an abattoir which would see to it that they meet the high demand of the clients in the market. This is also geared towards increasing on their sales beyond European and Asian countries to other continents. The three segments are under the supervision of Human Resource managers making the activities at those position to be heighted and this would ultimately heighten the performance in the organization in the provision of its services affectively. This is amongst those firms that makes the Australian export for meat products amount to 60% (Dickinson, 2015). Similarly, the government gains a lot from AACo due to their notable contribution in transforming the society in the activities in Australia. Being a reputable organization, it has employed a lot of people by creating job opportunities to most of the citizens.  This is a major breakthrough of the organization in creation of employment which serves a great deal for the nation. In 2016, the company realize a profit of tax of $67.8 million an incredible increase from the previous year where the net profit stood at 58.2million. It is important to state that the above net profit is arrive at after deduction of tax. Virtually, the company displays incredible performance due to their strong leadership. The CEO clearly knows what to initiate in the company for its growth. The same year the total kilogram of beef so went up to 96% with total sales revenue being hiked to 44.7% a positive deviation in respect to previous years (Heizer & Render, 2014). The increase in revenue is attributed by good strategies that has been laid down by the CEO with his other team members in the organization.  Dividing the operation of their firm in three distinctive areas has seen a great improvement in the organizations quality delivery a fact that makes the firm realize great profits. ‘This clear segmentation has allowed the company to obliterate volatility and fluctuations that used to be evident in their operations. Mr. Jason reiterates the satisfaction of the company’s performance. However, he explicitly state that   the firm is not complacent with that. This is the reason why each and every day they devise new strategies that would see to it that they stand a better chance to compete effectively and provide the best to its clients.

Evaluating Performance

Fundamentally, the firm has fully employed the three basic dichotomies of Sustainability performance. These are enumerated below as follows; economic, social and environmental performance. Analysis from Australia Stock Exchange clearly indicates the noble role that agribusiness has played in the economy of Australia. Agriculture has undergone different metamorphosis for the last few years. This has seen tremendous growth at higher rate making agriculture to be the most booming business to invest in.  From the reports and researches that was conducted on different agricultural firm, it was evident that approximately 375 000 people have been employed in this sector a fact that raises the country’s GDP to 4%. This has led to stability of the economy and improvement of one’s lifestyle as they are able to source something from this notable industry (Dickinson, 2015).  Much of the products from AACo are exported to USA and some parts of Asia. Virtually, the market for agricultural products has greatly increased in Asian nations. This has made AACo to concentrate on its market to this country by supplying beef product to this particular region.  

According to Makovsek, Benezech & Perkins (2015) the company employs a well-qualified personnel in their organization. Moreover, this personnel are taken for a rigorous training and induction course so as to be well acquainted with what ought to take place in the organization to avoid entropy and improve on productivity. Notably, the organization forms an avenue or for a where all the requisite stakeholders come and assess the progress of the firm. This enables the firm to easily identify their areas of weakness in order for corrective measures to be initiated for good working relationship and increase on the sale for the organization. The company provides friendly environment to work in so as take workability easier and heightens the spirit of the employees. The table below shows comparison of the Australian companies with that of AACo (Vveinhardt & Dabravalskyte, 2015). From the comparison below, it is clearly well that the firm is on a better platform in respect to other agricultural companies.

Peer Comparison Source: ((Stevenson, 2015)

Company	Mkt Cap	EPS Growth (%)	P/E (%)	Dividend Yield (%)
2016 A	2017 F	2018 F	2016 A	2017 F	2018 F	2016 A	2017 F	2018 F
The a2 Milk Company (A2M)	$1,274M	0.0000	0.9757	0.2771	43.3090	21.9212	17.1649	0.00%	0.00%	0.00%
Australian Agricultural Co (AAC)	$893M	5.4088	0.0000	0.0000	14.4397	0.0000	176.3158	0.00%	0.00%	0.00%
Bellamy’s Australia (BAL)	$1,182M	2.5510	0.8394	0.3099	31.6839	17.2254	13.1505	0.97%	1.72%	2.70%
Bega Cheese (BGA)	$996M	1.3089	0.2993	0.2258	35.0887	27.0058	22.0310	1.45%	1.76%	2.30%
Freedom Foods Group (FNP)	$786M	-0.6224	-0.3188	0.3000	29.4959	43.3000	33.3077	0.92%	0.92%	1.15%

Company’s leadership style

AACo’s executive employs multifaceted styles of leadership that makes the company to nourish and flourish in its operation. The different managerial skills has seen this company improve from the past three years under the new management of Mr.  Strong.  Moreover, this organization has clearly defined managerial structure that makes the functionality and coordination in the firm. Since the time the current CEO took over the leadership, much has been experienced in the firm. This includes increase in sales and proper service delivery (Stevenson, 2015). He is a transformative leader who has initiated different approaches and employed for administrative so as to integrate different personalities in the organization. It is important to underscore that the CEO has a clear understanding of its staff. As such, he is able to carry out his activities well since he knows well the needs of their employees. Similarly, this CEO inspires its staff in the view of enhancing good working relationship so as to maintain its reputation. Another notable success of the firm is the idea of establishing a new abattoir. This abattoir is estimated to cost $91 million. This shows how vast is going to be so as to meet the growing needs of the clients from Asian countries and other parts of America where they heavily rely on beef products from this company.

Peer Comparison

Prather (2015) accentuates that company has been realizing great profits due to good managerial and leadership of the organization.  The major breakthrough of AACo is having good leadership and ability to maintain consistency for such a long period of time.  It is common knowledge that most of the client are moved to purchase a given product due to the way the firm’s way of relating to their clients.  The financial records of the firm suggests that the organization is operating and performing well amid different challenges such as stiff competition in the market.  As prior said the CEO of AACo is Mr. Jason is very innovative and is willing to transform the image of the firm.  This present CEO utilizes great authority style that has made the firm to be extremely focused and above all have the capacity to perform well. Taking a closer look at the accomplishments of Mr. Jason, it is expressly clear that the individual utilizes diverse administrative systems which is equipped towards enhancing the execution of AACo and acknowledges great benefits (Rohlander, (2014). AACo has all around organized administration beginning from CEO to human asset administrators who are accountable for various fragments for adequacy in the organization.

Stevenson (2015) affirms that Australian Beef Industry Foundation (ABIF) recognizes the fanatical exertion that was made by Mr. Jason in changing the face of AACo. Remarkably, ABIF met him with the Life enrollment for his praiseworthy execution in the organization considering the way that he has worked in various capacities in the organization. The CEO of AACo utilizes transformative sort of administration. A transformational pioneer is the person who might wish to see new changes have been influenced in the framework for better usefulness and development of the business. A decent sign of his transformative style of authority is confirmed where the structure of the firm is fragmented into three distinctive areas under the new arrangement postulated by Mr. Jason (Rohlander, (2014). Initially, the organization was working under the two sections that is cattle and land which ended up not being effective. Another noteworthy in management is that $ 91 million has been put aside to extend this business by growing abattoir. In that capacity, the organization would be able to address the issues of the developing number of customers inside Australia and all inclusive. Additionally, it is essential to express that Mr. Jason is inviting opinion from different personalities and in this way concurs the representative opportunity to air their perspectives with a specific end goal to help the organization understand its mishaps for restorative measures to be set up. This methodology is seen to be the best and results to endless accomplishment to the organization that utilizes such strategy in its initiative (Prather, 2015). A decent administration style is the one that is synchronized with some hypothetical system of initiative. Taking a closer look at the initiative of Mr. Jason, one can undoubtedly reason a component of Path Goal hypothesis approach. Under the previously mentioned hypothesis, the pioneer is focused to accomplish something for the advantage of the organization. This exertion is adapted towards understanding the center objective of the association. Correspondingly, the authority of Mr. Jason might be distinguished using administrative framework.

The management ought to conduct regular assessment in order to see what they ought to initiate in their organization. Similarly, there is need to consider the welfare of all its staff for efficacy of the organization. Thorough understanding of the market is another aspect that the company should take into consideration. Once they understand its market, it becomes easier for them to know how best they ought to serve their customer. This will enable the firm to devise new approaches different from its competitor in order to win trust its client.  AACo needs to review their strategic plan and be ready to accept any positive change in the system to remain relevant in the global market. There is also need for the company to diversify its production.  AACo is only known for beef meat, they may diversify their products by rearing dairy cattle in order to heighten their produce by having variety of animal produce to the market.

Reference

DICKINSON, K. (2015). Financial market operations management. https://www.books24x7.com/marc.asp?bookid=80779.

HEIZER, J., & RENDER, B. (2014). Operations management: sustainability and supply chain management.

MAKOVSEK, D., BENEZECH, V., & PERKINS, S. (2015). Efficiency in Railway Operations and Infrastructure Management.

PRATHER, C. D. (2015). Airport management.

ROHLANDER, D. (2014). Management skills.

SARKIS, J. (2014). Green supply chain management. https://dx.doi.org/10.1115/1.860281.

STEVENSON, W. J. (2015). Operations management.

VVEINHARDT, J., & DABRAVALSKYTE, J. (2015). Integration of intercultural competence in the processes of enterprise internationalization: possibilities of the adaptation of the model in the operation of small and medium enterprises. Dynamic Relationships Management Journal. 4, 35-46.