1

Alternative Courses of Action

To address the present dilemma of DS Bolong Farm Incorporated regarding to the

poor management practice of the farm in dairy cattle production, the following

alternative are hereby proposed for consideration of the management.

Alternative 1: Administer Reward System

Administered a reward system through money rewards to the caretakers if they

increase the milk yield per cow. In every increase of 1 kilogram of milk yield per cow 10

percent of the sale will add to the salary of the laborers which PhP. 260.00 per day.

Therefore if the present milk yield of the farm cow is 3.29 kilogram (Exhibit 5) and

increase this by at least 10 kilogram and per kilogram selling price is PhP. 60.00, the

caretakers has additional PhP.70.00 in there salary. With this system of management the

caretakers will more empowered to take task in most effort or take it the most quality and

quantity deed of work.

In the administration of this action first take a preparation plan for the given works

and impart to every employee the objective and the purposed of the plan. The benefit that

they can get if they do the task effectively and to set there minds and empowered them to

achieve the rewards.

But in the compliance in this reward laborer must first improve the given feed intake

by the animals, improve the quality of the water source for the intake of the animals and

the management of proper waste and sanitation. The others are, as proposed to required

by the management to take handled the put up of a water sprinkler to the outside free

stall area and ventilation inside the building to at least lessen up the stress heat
 2

experience by the animals and expansion of another free stall cubicle to required a proper

space for the animals. With all of this effort and work it probably quite up lift the milk

productivity of the animals for at least 10 kilogram of milk per cow per day from the 5

kilogram of milk per cow per day as the present.

Advantage:

Administering a reward system could improve the health and body condition of

the animals and gradually leads to a productive milk performance.

Empowering employees by giving a incentives could also motivate them to

perform accordingly.

Disadvantage:

This action will render additional expenses to the management as incurred

materials to the improvement of facilities, additional farm supply and the rewards for the

laborers.

If the all of the concern issue are settle down the reward system is stop by the

management with this caretakers could go back of being disobedience in work.

Alternative 2: Hiring an Animal Nutritionist

Animal nutritionist could address the major issue of the farm particularly the feeding

and nutrient requirement in recommend the proper supplement needed by the animals to

increase the milk production.

Moreover, hiring animals nutritionist can lead to much more productive dairy cattle

area because almost of the time their is the one who can supervise the laborers and with

this its not just addressed the concerns of farm production side but also the human
 3

resource where laborers that become disobedience to the work if any immediate

supervisors didn’t present in the farm can be much productive because they know their is

the one that supervised and checking their every work in farm.

For the hiring process of animal nutritionist it can be inquire to BMEG La union

for a more capable and good background applicant that regularly done in hiring process

for the needed employee for office works or can inquired a help to National Dairy

Authority besides most of the dairy cattle of the farm is under their cattle dispersal

program. For the improvement of the other concerns with the credit for the hired animal

nutritionist the management must impart to the employee the improvement objective and

program of the farm and remind them that they are frequently visit by the immediate

supervisor in their working area.

Advantage:

Hiring of Animal nutritionist will probably improved the concerns for the nutrient

deficiency to the animals that can lead to a much higher production rate of dairy milk.

The other issues about farm practices and management could be also improve.

Furthermore, not just improved the production side of the farm but also can addressed

the issue of human resource management where laborers are disobedience with the

presence of Animal nutritionist working activity of the laborers are frequently monitored.

Disadvantage:

Hiring of Animal nutritionist could render additional expense as incurring of budget

for the improvement of facilities, expense for the additional farm supply and salary for

the Animal nutritionist.

 4

Recommendation and Operationalization

Applying the previous set of decision criteria to the proposed action that cited

above for the improvement of management practice for dairy cattle production are rated

as fallows:

Criteria for evaluation Alternative 1 Alternative 2

(%) (%)
Timeliness 21 19
Cost effectiveness 18 22
Convenience of implementation 19 20
Management acceptability 18 20
Total

After evaluating the advantage and disadvantage of the two different proposed

alternatives the management of DS Bolong Farm Incorporated is proposed to take the

Alternative 2 which is “Hiring an Animal Nutritionist”.

To operationalized this recommendation management must first immediate take

an action in hiring an animals nutritionist were they could seek assistant from BMEG La

Union or through the help of National Dairy Authority were the dairy cattle of the farm

was under. Eventually, the management must impart to the new hired animal nutritionist

what the present situation encountered by the farm at the dairy cattle operation, to

formulate a proper plan to addressed all the issues. Take an assembly meeting for all the

workers that also involve in the improvement plan for the dairy production to impart to

the objectives of the work and the different concerns that must taken in action.

In the action plan, first off improved the concerns that has a easy work load,

administer a proper sanitation and cleanliness in the farm area, cleaning water sources
 5

and put up a sprinkler in the outside free range area and ventilation inside the building to

at least lessen the heat stress of the cattle experience. Afterward focus in the

construction improving facilities. During this plan animal nutritionist must formulate a

proper feed ration from different maturity of the animals and impart this to the caretakers

of dairy cattle aside from supervising the laborers in their work area. Furthermore,

During and after the improvement in all of the concern area and impart the other

practices that must taken every single day in the everyday route by the management.

With this it gradually increase the milk production for at least almost in normal milk

production.

Potential Problem

Complain of the farm laborers to increase their salary

The farm laborers will be under the supervision of the animal nutritionist. They will

be obliged to work continuously than their regular time they used to. Since, there will be

additional labor for them, they might demand for salary increase.

Fallback Position

Provide incentives to the employees

Giving incentives to the farm laborers could motivated and empowered to

maximized their task.

Reward system can be done by setting up an employee of the month that can only

entitled to the reward. It can be way of money rewards or recognition.

6
 7

Annex 1

DS BOLONG INCORPORATED
Incremental Benefit Cost Analysis for Alternative 1

Incremental Sale
Milk Sale 2,736,000.00
Incremental cost
Farm Expense 51,896.57
Management Expense 943,910.21
Production Expense 228,000.00
Incremental Benefit 1,512,193.22

Annex 2

DS BOLONG INCORPORATED
Incremental Benefit Cost Analysis for Alternative 2

Incremental Sale
Milk Sale 3,384,000.00
Incremental cost
Farm Expense 51,896.57
Management Expense 943,910.21
Production Expense 282,000.00
Incremental Benefit 2,106,193.22
 Annex 3

DS BOLONG INCORPORATED
Forecasted Financial Statement for Alternative 1

MONTH
Particulars
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov
SALES: -Milk 126,000 360,000 378,000 324,000 306,000 270,000 252,000 216,000 198,000 162,000 144,000
LESS: cost of sales: -Milk 10,500 30,000 31,500 27,000 25,500 22,500 21,000 18,000 16,500 13,500 12,000
GROSS INCOME 115,500 330,000 346,500 297,000 280,500 247,500 231,000 198,000 181,500 148,500 132,000
LESS: Farm Expenses
Depreciation expense 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87
LESS: Management expenses
Building Expansion 100,000
Equipment and machinery 20,000
salaries and wages 2,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25
Fringe and Benefit 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06
feeds 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696
veterinary medicine 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Electric and water bill 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81
Gas and oil 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99
Total expenses 181,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98
NET INCOME -65,936.98 245,563.02 262,063.02 212,563.02 196,063.02 163,063.02 146,563.02 113,563.02 97,063.02 64,063.02 47,563.02

8
 9

Annex 4

DS BOLONG INCORPORATED
Assumption Made for the Forecasted Financial Statement for Alternative 1

Assumption Made :

1. Forecasted Sales of milk are accumulated from potential 5 th lactation period (Annex 9)

minus the margin of error (multiplied by the number milk days (30 days), multiplied by

the sales per liter which is PhP. 60.00 and multiplied by the 10 active milking cow.

2. Forecasted expense for the Building Expansion and the equipment and machinery’s are

comes from the allotted budget for the improvement of free stall cubicle and installation

of water sprinkler and ventilation

3. Forecasted expense for the salaries and wages are the average expense of the farm as

indicated in financial statement of the farm (Exhibit 6). and the additional Average of

Php.10.00 per day of reward system for the 10 laborers of the farm.

4. Forecasted expense for the, fringe and benefit, electric and water bill, feeds and the gas

and oil are comes from the average report in the financial statement of the farm for dairy

cattle (Exhibit 6).

5. Forecasted expense for the Veterinary and vaccination are comes from the price for

Vitamin ADE vaccine which is Php. 1000.00. a set of three Vitamin ADE can g

accommodate 10 cattle and farm had a total of 31 dairy cattle therefore farm need 10 set

of vaccine times the price its is Php. 10,000 per month

 Annex 5

DS BOLONG INCORPORATED
Forecasted Financial Statement for Alternative 2
MONTH
Particulars
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov
SALES: -Milk 198,000 432,000 432,000 414,000 378,000 342,000 306,000 270,000 234,000 198,000 180,000
LESS: cost of sales:
16,500 36,000 36,000 34,500 31,500 28,500 25,500 22,500 19,500 16,500 15,000
-Milk
GROSS INCOME 181,500 396,000 396,000 379,500 346,500 313,500 280,500 247,500 214,500 181,500 165,000
LESS: Farm Expenses
Depreciation expense 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87 4,717.87
LESS: Management
expenses
Building Expansion 100,000
Equipment and machinery 20,000
salaries and wages 2,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25 22,631.25
Fringe and Benefit 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06 1937.06
feeds 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696 33,696
veterinary medicine 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Electric and water bill 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81 2,377.81
Gas and oil 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99 6,076.99
Total expenses 181,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98 84,436.98
NET INCOME 63.02 311,563.02 311,563.02 295,063.02 262,063.02 229,063.02 196,063.02 163,063.02 130,063.02 97,063.02 80,563.02

10
 11

Annex 6

DS BOLONG INCORPORATED
Assumption Made for the Forecasted Financial Statement for Alternative 2

Assumption Made:

1. Forecasted Sales of milk are accumulated from potential 5 th lactation period (Annex 9)

(multiplied by the number milk days (30 days), multiplied by the sales per liter which is

PhP. 60.00 and multiplied by the 10 active milking cow.

2. Forecasted expense for the Building Expansion and the equipment and machinery’s are

comes from the allotted budget for the improvement of free stall cubicle and installation

of water sprinkler and ventilation

3. Forecasted expense for the fringe and benefit, electric and water bill and the gas and oil

are comes from the average report in the financial statement of the farm for dairy cattle

(Exhibit 6).

4. Forecasted expense for the Veterinary and vaccination are comes from the price for

Vitamin ADE vaccine which is Php. 1000.00. a set of three Vitamin ADE can g

accommodate 10 cattle and farm had a total of 31 dairy cattle therefore farm need 10 set

of vaccine times the price its is Php. 10,000 per month.

5. Forecasted expense for the Salaries and wages are comes from the average salaries and

wages of caretaker of dairy cattle in the financial statement of the farm for dairy cattle

(Exhibit 6) and the allotted salary for the hired animal nutritionist per month.

6. Forecasted expense for the feeds are comes from the allocated budget for animal feed

per day per head which is Php.50.00 multiply to the number of farm cow which is 31

head times the number of days of a month.

 Annex 7

DS BOLONG INCORPORATED
Benefit Cost Ratio for Alternative 1 and 2

Assumption: incremental benefit and cost are based on the expense and total sales to the
forecasted financial statement of alternative 1 and 2

Alternative 1 Alternative 2
Incremental Benefits Incremental Benefits
2,736,000.00 3,384,000.00
Incremental Cost Incremental Cost
1,223,806.78 1,277,806.78

Note: BCR ≥ 1 accept

BCR < 1 don’t accept

Formula: Benefit Cost Ratio = B/C

Computation:
2,736,000.00
For alternative 1: BCR = 1,223,806.78 = 2.24 Acceptable

3,384,000.00
For alternative 2: BCR = 1,277,806.78 = 2.65 Acceptable

Therefore the two alternatives are acceptable but alternative two a much higher

acceptance but it not probably said this is choosing the alternative with much higher

acceptability because their is a different flow of amount of money in the different

alternatives so for more confirmation of which the two alternatives has more acceptable

use the “Incremental Analysis”.

 Annex 8

DS BOLONG INCORPORATED
Incremental analysis for Alternative 1 and 2

Alternative 1 Alternative 2 Increment

Incremental Benefits Incremental Benefits Alt. 2 minus Alt.1
2,736,000.00 3,384,000.00 648,000.00
Incremental Cost Incremental Cost Alt. 2 minus Alt.1
1,223,806.78 1,277,806.78 54,000.00

Note:

1. Take the higher first cost alternative and minus to the lower first cost.

2. If incremental BCR > 1 choose the higher first cost alternative.

3. If incremental BCR < 1 choose the lower first cost alternative.

4. If incremental BCR = 1 the two alternative has the same acceptability.

Computation:

648,000.00
BCR = 54,000.00 = 12

Therefore management must accept alternative 2 over alternative 1.

 Annex 9

DS BOLONG INCORPORATED
Potential and actual 5th lactation

Days in Milk
30 60 90 120 150 180 210 240 270 300 330
11.3 +/- 24.6 +/- 24.9 +/- 23.0 +/- 21.4 +/- 19.3 +/- 17.7 +/- 15.8 +/- 13.6 +/- 11.4 +/- 10.0 +/-
Potential 5th Lactation 3.6 4.7 4.3 4.9 4.1 4.3 3.1 3.3 2.6 2.1 1.9
Cattle Farm 5th
2.3 4 3.6 3.5 3.5 3.3 3.1 2.7 - - -
Lactation

Assumption:
* Potential 5th lactation (Exhibit 17 and 18)
** Cattle Farm 5th Lactation (Exhibit 4 and 5)
***+/- margin of error

14
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