An environmental scanning indicator proposed for strategic agribusiness management

Adapting to change is critical to surviving in agribusiness. Adaptive strategic plan development depends on the use of meaningful information from the external business environment. We propose the ratio of livestock (including poultry) to crop farm receipts (L/C) as an environmental scanning indicator. The spatial patterns of this ratio within three states, Iowa, North Carolina, and Pennsylvania over the last 50 years illustrate the directions and magnitudes of change in this indicator. The L/C for Iowa decreased from 2.1 to 1.2 but increased in both North Carolina and Pennsylvania from 0.2 to 1.6 and 3.6 to 8.4, respectively. Change was not uniformly distributed in any of the three states as some areas changed more than others. Because changes in production emphasis are often associated with changes in ecological or community issues, policies emerge to address these new circumstances. Agribusiness should be aware of the trajectory of change and associated policy actions in their immediate area, their state and nationally, because these dynamics can have significant implications for their strategic management opportunities. Progressive businesses, commodity groups, or other interest groups could scan changes in L/C and use the information as an environmental indicator for effective strategic management or distribute it for use in managing change.