Australian Processing Potato Industry Strategic Plan

Transcription

1 Australian Processing Potato Industry Strategic Plan Prepared on behalf of: Horticulture Australia Limited & the Australian Processing Potato Industry HAL Project No. MT December 2006 Russell Cummings STRATEGIC BUSINESS DEVELOPMENT PO Box 8153 BARGARA QLD 4670 Phone: (07) Fax: (07) Web:

2 About Strategic Business Development Strategic Business Development Pty Ltd works with commercial, industry and government clients to add tangible value through rigorous process and quality people. We typically work on assignments involving strategic input that is commercially focused and results in sustainable change. We add value through rigorous processes and thinking that empower stakeholders to move from Strategy to Action HAL Project No.: MT06026 Project Team & Roles: Russell Cummings - Workshop Facilitation, Surveys & Reports Strategic Business Development Pty Ltd, PO Box 8153, Bargara QLD 4670 Ph: Fax: russell@sbdonline.com Simon Drum Horticulture Australia Ltd, Industry Services Manager: Vegetables - Consultation Disclaimer The information contained in this report has been compiled from information supplied by Horticulture Australia Limited, Ausveg Limited and other publicly available information. It does not contain legal advice. Every effort has been made to ensure the information presented and the conclusions reached are realistic and not misleading. However, Strategic Business Development makes no warranty as to the accuracy of the information contained in this report and will not accept responsibility or liability for any loss incurred by any person or entity relying on the information in this report. Processing Potato Industry Strategic Plan

3 Table of Contents Section 1. - Overview Background Information and the Summary Plan Section 2. - Situational Analysis Situational Analysis, Industry SWOT and Key Issues Section 3. - The Processing Potato Industry Future Vision, Mission and Strategic Imperatives Section 4. - Strategic Imperative #1: Improve consumer demand for Australian processed potatoes Section 5. - Strategic Imperative #2: Improve industry competitiveness Section 6. - Strategic Imperative #3: Improve industry communication and information systems Section 7. - Strategic Imperative #4: Improve leadership and management capability Section 8. - Strategic linkages to the VegVision 2020 Industry Strategic Plan Appendix A: References, interviews and workshop attendees Processing Potato Industry Strategic Plan

4 The Australian Processing Potato Industry Strategic Plan Section 1 The Overview Background Information and Summary Plan

5 Introduction The plan has been developed by industry with consultation throughout the supply chain. The Plan was developed in 4 phases to ensure it meets the needs of Industry. This strategic plan has a 5-year planning timeframe that outlines the strategic actions that are required for industry to achieve its 10-year vision. Overview The development of a industry strategic plan is essential for the Australian processing potato industry as it moves into a period of intense global competition, rising costs and declining world prices. The industry strategic plan will be used to guide the investment of industry levy funds and to focus leadership on the critical needs of industry in the future. This plan has been developed utilising the following 4 step process and is illustrated overpage: 1. Analysis: situation and environmental analysis 2. Synthesis: a workshop to develop a shared industry view and a draft industry plan 3. Consultation: discussions and feedback from industry on the draft industry plans 4. Review: a workshop to review the draft plan, establish key action plans for inclusion in the final industry plan The Plan has been constructed utilising three timeframes: 1. Far Horizon the industry vision has been set at a 10 year time frame, nominally Mid-ground the industry strategies have been set at a nominal five year timeframe. In effect, industry has posed the question if we are to achieve our 10 year vision, what strategies must we undertake in the next five years? 3. Short Term industry action plans and project plans are usually set at one to three year timeframes to facilitate ease of management and clarity of action. Linkages to the Australian Vegetable Industry Strategic Plan VegVision 2020 are outlined in Section 8. Processing Potato Industry Strategic Plan

6 Developing our Processing Potato Industry Strategic Plan Overview 14 Aug 06 Situational Analysis and Key Issues Paper Review of existing Plans, Studies, Reviews and Documentation Broad Industry Consultation Growers Supply Chain Government Direct Contact Phone Interviews 30 Aug 06 Industry Workshop 1 DRAFT Strategic Plan Direct Contact Phone Interviews Online Feedback Industry Consultation Industry Consultation 11 Oct 06 Industry Workshop 2 Dec 06 Industry Strategic Plan Processing Potato Industry Strategic Plan

7 The Processing Potato Industry One Page Plan The Current Reality Potatoes Australia s number one vegetable crop 20% of total vegetable production. Processing potatoes are 50% of production Domestic consumption is declining. Consumer understanding and knowledge is poor. Rising costs of production are impacting on our competitiveness and profitability. Leadership and succession are critical issues The Vision 2015 Our vision is that the Australian processing potato industry will be sustainable and globally competitive, driven by consumer needs. Improve consumer demand for Australian processed potatoes 1.1 Communicate the beneficial attributes of Australian processed potatoes to consumers. 1.2 Develop innovative processed potato products Our Strategic Imperatives Improve industry competitiveness 2.1 Use R&D to build better businesses 2.2 Encourage a focus on whole of chain productivity improvement 2.3 Enhance environmental sustainability 2.4 Improve our ability to respond to disease & pest threats Improve industry communication and information systems 3.1 Build collaboration within the supply chain 3.2 Deliver industry information requirements 3.3 Encourage the use of improved communication technologies Improve leadership and management capability 4.1 Improve industry management capabilities 4.2 Improve industry leadership and representation Processing Potato Industry Strategic Plan

8 The Australian Processing Potato Industry Strategic Plan Section 2 The Situational Analysis Situational Analysis, Key Issues and Industry SWOT

9 Processed Potatoes Australia s No 1 Vegetable Crop The Situational Analysis Tonnes National Production (millions) Area Planted v Yield Hectares (thousands) tonnes/hectare Area Planted Yield Potatoes are by far the largest vegetable crop in Australia accounting for approximately 20% of total production. In 2005, the gross value of the crop in 2004 was $480m - approximately 1.31 million tonnes with 56% of this is sold as processed potatoes (42% frozen and 14% crisping) with the remainder as fresh (36%) and seed (8%) Frozen processing in Australia is dominated by two large Companies: McCain Foods and Simplot Australia. Processing plants are located in Tasmania, South Australia and Victoria. Most potatoes used in frozen processing are grown under contract. In Crisping, the two major processing companies are Snack Foods Australia (Arnott s Biscuits) and Smiths Snackfood Company. Most potatoes are grown under contract and processing plants are located nationally. Domestic potato consumption is declining with estimates of around 63 kilograms per person per annum, although it appears that the proportion of processed potatoes consumed is rising at the expense of fresh products. The marketing function of the processing potato industry is predominantly driven by the processing companies. For the last 10 years, production costs have been rising and threats of low cost competition from other countries have been increasing. Processing Potato Industry Strategic Plan

10 Stakeholders - strategic priorities & values The Situational Analysis Levy Payers Industry Associations Horticulture Australia Ltd Processing Potato IAC Research Providers Processors Input Suppliers Retailers Consumers Lower costs, access to markets, access to timely and commercially valuable information, higher prices, less complexity and risk High public profile, status and visibility with growers, less bureaucracy, increased industry representation, increased income, lower costs, relevance to industry Measurable returns from investments, operational efficiency in service delivery, company reputation, growing revenue base Industry ownership of strategic plans, quality planning processes, appropriate expertise in planned development, strategic project investment, measurable outcomes for industry Security of funds for research projects, peer recognition, consistent direction for strategic research, opportunities to publish, outcomes for industry Consistent quality product, low reject percentage, competitive prices, spread of production, stable relationships, low labour costs, efficient processes, good margins, strong consumer demand Stable or growing industry, high input levels, high productivity, constant change, rapid adoption of new technology, good margins Products that meet consumer demands, high stock turns, low waste, minimal cost, good margins, consistent availability, stable relationships, guaranteed supply Confidence in safe, quality food, convenience, taste, variety, low prices, consistent supply, product information. Processing Potato Industry Strategic Plan

11 Global supply chains compete with growers and processors The Australian industry is a relatively high cost producer selling to a low-cost, high value demanding consumer. Australian supermarkets are moving to 30% private label products with many products sourced from overseas suppliers. The industry is at the crossroads of global competition and must make significant changes in order to remain viable in the long term. The Situational Analysis It is a noted trend that as markets become increasingly global, inefficient and high cost industries will need to become efficient and differentiate or they will decline. Australian companies, with inherently higher cost structures, are competing in global markets and our Australian market is now open to low cost competitor countries. The Australian potato processing industry is at the crossroads of global competition. The industry is a high cost producer (by global standards) selling to a low cost/high value demanding consumer. The food consumer predominately buys pre-prepared potato products from major supermarket chains and the food service sector, who both buy from multinational processors. Both processors and retailers are in a market of cost down and value pricing to the ultimate consumer. A high cost industry cannot be sustained in this environment. Private label products are often processed in other countries, for example: Woolworths Home Brand tinned potatoes (as at the date of this report) were processed and packed in Belgium, while all Woolworths Select brand frozen chips, fries, wedges are from the Netherlands and in the case of frozen mash Belgium. With the two big Australian supermarket chains pushing for upwards of 30% private label sales, and the local versus imported issue in consumer s minds becoming less important to quality and value, the future of the processing potato industry in Australia, including both growers and processors, is becoming increasingly fragile. Processing Potato Industry Strategic Plan

12 The Situational Analysis Rising costs of production are impacting our competitiveness Industry costs are rising while returns to growers are declining. The industry must focus on increasing value chain productivity. Labour, water and compliance costs are all reducing the competitiveness of Australian horticulture. The industry must improve collaboration through the value chain in order to significantly improve productivity. The industry must focus on reducing costs and increasing productivity to combat changing market dynamics. In a global market, Australian value chains are competing with global value chains for market share. The emphasis must be on improving efficiencies and productivity through the entire value chain. Initiatives such as: benchmarking, Lean Production, industry consolidation, clustering and Product Centres of Excellence are all options that can be explored to improve value chain productivity. Access to quality low-cost labour is a horticulture-wide issue that has significant implications for the processing potato industry. Water is becoming an increasingly important issue in terms of access and cost. The potato industry, as a relatively efficient user of water, may be able to use this to its advantage. Compliance and regulation have significantly increased the operating costs for horticultural producers in Australia. Many of these costs are not borne by our global competitors. There may be niche opportunities to develop premium quality products to address the needs of specific niche markets in Australia and overseas. The industry can look at collaboration throughout the value chain in order to improve productivity across all sectors to ensure our processing potato value chain is globally competitive. Processing Potato Industry Strategic Plan

13 The Situational Analysis Leadership and Succession Industry perceptions are that it is fragmented and lacks cohesion, profile and a single voice. With multiple industry organisations, there is duplication of effort and inefficient use of scarce, industry resources. The industry faces major restructuring as poor grower returns, farm succession and access to labour issues combine. Industry perceptions are that the processing potato Industry lacks cohesion, profile and a single voice. The industry is perceived to have an ill-defined image with consumers. The industry is fragmented with a number of organisations representing industry at national and state levels. Given the relatively small size of the Australian industry there appears to be duplication of effort and inefficient use of scarce, industry resources. Industry leaders need to ensure that appropriate and relevant skills and expertise is engaged to assist Industry Bodies, Boards and Committees in future decision making. Farm succession is a key issue facing the industry. The average age of the traditional grower is increasing. Over the next 5 to 10 years, as this group ages, it will want to hand over the farm, however, the next generation are less willing to take over the reigns. There are also generational implications for the industry with Australian born generation X and Y workers shying away from the repetitive and labour intensive work to more softer industries of IT, finance, management, marketing and human resources. As the twin forces of labour shortage and lack of grower succession combine with declining returns, it is apparent that the industry will face some major re-structuring over the next few years with a decline in the number of farms. Processing Potato Industry Strategic Plan

14 The Situational Analysis The Processing Potato Industry SWOT Analysis Strengths Weaknesses Good people experience, knowledge, skills Great product well known, good demand, high quality, established consumption habits. Good R&D&E program and skills Relatively good infrastructure and facilities Australia has a good growing environment for potatoes Opportunities New technologies in production, processing, packaging, transport and IT Consumer focus on convenience, health & well being and the emergence of functional foods Positive image of Australia in overseas markets Improved communication technology and access Alignment with global supply chains Reliance on old cultivars Poor health image of potatoes and processed foods Fragmented industry: lack of a leadership group poor Agri-political process: no targeted approach High costs and regulation relative to competitors Poor collaboration and communication through the value chain Limited industry consumer knowledge Threats Bio-security breach disease incursion Imported products from low cost competitors Gen Y farmers & succession Rising business costs, regulation and compliance Consumer attitudes to potatoes, processed products and GM foods Consolidation of global supply chains Closure of Australian plants change in investment focus for multinationals Processing Potato Industry Strategic Plan

15 The Australian Processing Potato Industry Strategic Plan Section 3 The Processing Potato Industry Future The Vision, Mission and Strategic Imperatives

16 Linking the Vision to Outcomes The Structure of the Plan The Strategic Plan recognises the need to move from Vision to Action by utilising the following planning structure to highlight the linkages between elements of the Strategic Plan: Vision and Mission The Industry s primary focus Strategic Imperatives The key actions that industry must take to achieve the vision Strategies Broad strategic directions for achieving the imperatives Strategic Goals High level goals and actions for delivering the strategies Project Action Plans The project plans required to deliver elements of the strategic plan. The project plans will be the specific responsibility of industry organisations and stakeholders Processing Potato IAC, Ausveg, Processing Potato Association of Australia (PPAA), HAL, commercial entities, etc. The details of these project plans will not form part of the industry strategic plan. Processing Potato Industry Strategic Plan

17 The Industry Strategic Imperatives The Processing Potato Industry Future The Vision and Mission of the 2015 processing potato Industry future will be achieved by industry delivering on the following four strategic imperatives in the period 2006 to 2011: The Vision 2015 Our vision is that the Australia processing potato industry will be sustainable and globally competitive, driven by consumer needs. Our Mission The Australian processing potato industry delivers innovative products which are actively sought by consumers. 1. Improve consumer demand for Australian processed potatoes 2. Increase industry competitiveness 3. Improve industry communication and information systems 4. Improve leadership and management capability Processing Potato Industry Strategic Plan

18 The Processing Potato Industry Future Strategy to Action Each strategic imperative is supported by a series of strategies. These are outlined below. Strategic imperatives, strategies and strategic goals are detailed in the following sections of this report. Strategic Imperative 1. Improve consumer demand for Australian processed potatoes 2. Improve industry competitiveness 3. Improve industry communication and information systems 4. Improve leadership and management capability Strategies 1.1 Communicate the beneficial attributes of Australian processed potatoes to consumers 1.2 Develop innovative processed potato products 2.1 Use R&D to build better businesses 2.2 Encourage a focus on whole of chain productivity improvement 2.3 Enhance environmental sustainability 2.4 Improve our ability to respond to disease and pest threats 3.1 Build collaboration within the supply chain 3.2 Deliver industry information requirements 3.3 Encourage the use of improved communication technologies 4.1 Improve industry management capabilities 4.2 Improve industry leadership and representation Processing Potato Industry Strategic Plan

19 The Australian Processing Potato Industry Strategic Plan Section 4 Strategic Imperative #1 Increase consumer demand for Australian processed potatoes Strategic Outcomes: 1. To expand sustainable domestic and export markets for Australian processed potato products 2. To improve the image of processed potatoes with consumers and increase demand

20 SI #1: Improve consumer demand for Australian processed potatoes Strategy: 1.1 Communicate the beneficial attributes Australian processed potatoes to consumers Business Case/Rationale: To facilitate volume and margin growth in the domestic market, an increase in consumer demand is required. Consumer demand for processed potato products has gradually increased to a plateau. This is due in part to changing dietary habits and increased public debate on community health. Key Assumptions: Industry communication and marketing programs can change consumer perceptions and beliefs Communication of health benefits/attributes will improve demand Australia maintains a fresh and natural image with superior product quality Increased demand will improve the industry sustainability Significant Risks: Consumers do not respond to communication and consumption does not increase Insufficient funds are available to change perceptions Continuing negative media impact on consumption Inability to achieve co-operation between supply chain partners Key Performance Indicators: 1. Increasingly positive consumer attitudes and awareness towards Australian processed potatoes 2. Increasing processed potato consumption Strategic Goals: Understand consumer perceptions, needs and uses for Australian processing potatoes to guide marketing and promotion campaigns Identify the health and nutritional benefits of potato consumption to create positive health messages for potato consumers Understand consumer perceptions about GM foods and Australian products to ensure that industry has the knowledge to take advantage of the GM and fresh and natural food debates Develop and implement a comprehensive domestic Processing Potato Marketing and Promotion Plan and ensure promotional efforts are coordinated with the fresh potato industry Processing Potato Industry Strategic Plan

21 SI #1: Increase consumer demand for Australian processed potatoes Strategy: 1.2 Develop innovative processed potato products Business Case/Rationale: To facilitate volume and margin growth in potato markets, an increase in consumer demand is required. New products are one mechanism for increasing consumer demand and growing the market. A significant proportion of the potato crop is wasted and unsuitable to current markets. Finding alternative uses has potential to add significant value to the Australian crop. Key Assumptions: Innovation in products will lead to increased demand Innovation will improve the industry sustainability and lead to higher prices Significant Risks: Australia will not allocate appropriate investment to research at both international and national levels Australian cost structures are not internationally competitive New products do not increase demand and will result in increase competition Key Performance Indicators: 1. Increasing processing potato consumption and growth in market volume and value, by sector 2. Changing qualitative market image indicators Strategic Goals: Develop innovative processed potato products to meet consumer needs Develop innovative cultivars that meet supply chain and consumer requirements Develop innovative alternative uses for the entire potato crop, including current industry waste products Processing Potato Industry Strategic Plan

22 The Australian Processing Potato Industry Strategic Plan Section 5 Strategic Imperative #2 Improve industry competitiveness Strategic Outcomes: 1. To underpin the viability of the Australian processing potato industry

23 SI #2: Improve industry competitiveness Strategy: 2.1 Use R&D to build better businesses Business Case/Rationale: R&D can be used to develop platform technologies to underpin the efficient and productive use of resources while improving the profitability and sustainability of the industry. These technologies may have been developed in the international arena. There is existing R&D that has been poorly adopted by some sectors of industry and also R&D from other industry sectors that is not traditionally applied in agribusiness supply chains. There is a need to review and re-evaluate existing R&D from all sectors. Key Assumptions: R&D is able to provide the answers to industry, when required. Outcomes from R&D will be readily adopted by industry in a timely manner Industry will have ready access to the technology and/or capabilities. Research will be targeted to industry needs through industry/research partnerships. Significant Risks: Insufficient funding to identify and access appropriate technology accelerators Resistance to change and an inability to predict changing landscapes and priorities Over reliance on external providers Key Performance Indicators: 1. Improvements in key industry benchmarks for profitability and sustainability 2. Increasing rates of adoption of R&D outcomes Strategic Goals: Develop an applied R&D Investment Plan that targets improved value chain productivity and efficiency Establish linkages and networks to review and evaluate Australian and international R&D and explore trends that are important for the Australian processing potato industry Processing Potato Industry Strategic Plan

24 SI #2: Improve industry competitiveness Strategy: 2.2 Encourage a focus on whole-of-chain productivity improvement Business Case/Rationale: The Australian processing potato value chain is competing against other global value chains for market share. Productivity improvement gains are often greatest when viewed across the value chain from paddock to consumer. The industry has a number of growers and supply chain partners that may benefit from the development of commercial alliances, cooperatives and partnerships to increase scale and reliably deliver longer lines of consistent quality product at lower costs. Australian labour costs are significantly higher than our competitors. Key Assumptions: Growers and whole of chain partners are willing to engage in collaborative action and benchmarking analysis and that increasing scale will increase profitability. Significant Risks: Ability to achieve cooperation with supply chain partners. Some businesses will feel increasingly disenfranchised as the technical complexity of production and marketing increases. Key Performance Indicators: 1. Increasing levels of satisfaction for growers and supply chain partners 2. Increasing productivity improvement measures Strategic Goals: Develop and participate in farm, industry, supply chain and business process benchmarking studies at national and international levels Encourage the adoption of sound business principles to underpin all transactions and alliances Foster initiatives to develop industry awareness of global competitors, innovation and markets to keep Australia at the forefront of global competition Develop a policy framework to focus resources on minimising the impact of government and industry compliance costs on the potato industry Processing Potato Industry Strategic Plan

25 SI #2: Improve industry competitiveness Strategy: 2.3 Enhance environmental sustainability Business Case/Rationale: Environmental matters are of rising significance for consumers and governments, particularly in developed economies that are prepared to pay a premium for quality produce. Australia s fresh and natural image will be enhanced by improvements in environmental sustainability. Costs are increasing and limitations on access to water for agricultural purposes are likely to increase. Key Assumptions: Environment remains a non-trade concern. fresh and natural image is valued by consumers. Significant Risks: Lobbying by environmental activists results in more government regulation. Duplication of environmental standards and codes across the processing potato industry. Costs of compliance with environmental sustainability makes the Australian industry uncompetitive Key Performance Indicators: 1. Increasing levels of grower satisfaction 2. Positive consumer attitude to the processing potato industry 3. Increasing grower uptake of sustainable management practices Strategic Goals: Improve water use efficiency by encouraging the adoption of proven technologies Ensure industry policies maintain a fresh and natural national image for use in marketing premium quality Australian products Develop natural resource management policies for the processing potato industry Processing Potato Industry Strategic Plan

26 Strategy: 2.4 Improve our ability to respond to disease and pest threats Business Case/Rationale: Biosecurity measures are critical to reducing the impact of disease and pest incursions that can severely impact the productivity, viability and fresh and natural image of Australia s processing potato industry. Biosecurity controls are expensive to maintain and have the potential to be traded off during trade negotiations. Key Assumptions: Biosecurity controls can significantly reduce the risk of pest and disease incursions Differing agencies and organisations are prepared to work together Significant Risks: Biosecurity controls are not adequate to prevent a significant disease or pest incursion Biosecurity controls are traded during trade negotiations. States do not cooperate in addressing domestic quarantine issues. Key Performance Indicators: 1. Reductions in the volume and impact of disease and pest incursions SI #2: Improve industry competitiveness Strategic Goals: Focused R&D on building our capacity to respond to disease and pests threats Develop a Potato Biosecurity Plan that includes comprehensive understanding of the likelihood and financial impact of specific pest and disease incursions Develop integrated and practical pest and disease management strategies with clear protocols for managing biosecurity issues including existing and exotic pests. Processing Potato Industry Strategic Plan

27 The Australian Processing Potato Industry Strategic Plan Section 6 Strategic Imperative #3 Improve industry communication and information systems Strategic Outcomes: 1. To enhance through-chain communication and decision-making 2. To improve the collection, analysis, management and dissemination of commercially valuable industry information

28 SI #3: Improve Industry Communication and Information Systems Strategy: 3.1 Build collaboration within the supply chain Business Case/Rationale: Improved communication and collaboration across the supply chain is important to identify common issues and priorities that will benefit the entire processing potato industry. Key Assumptions: Industry partners are willing and able to communicate Collaboration will provide tangible benefits for industry partners Significant Risks: Poor communication with some sectors of the supply chain Individual organisations will take advantage of shared information Key Performance Indicators: 1. Increasing participation at industry organised and sponsored events 2. Increasing satisfaction levels of supply chain Strategic Goals: Review existing industry collaboration mechanisms and recommend improvements Establish regular industry forums to facilitate discussion of key issues with the processing potato value chain Conduct regular industry conferences and symposiums Processing Potato Industry Strategic Plan

29 SI #3: Improve Industry Communication and Information Systems Strategy: 3.2 Deliver industry information requirements Business Case/Rationale: Industry must maintain and develop industry communication tools in order to meet information requirements of the supply chain. This is important to keep industry informed of competitive opportunities and to encourage collaborative action, where appropriate. This information must be conveyed concisely and cost effectively. Key Assumptions: Information is relevant and practical to the target audience. Information on global markets and trends will assist industry in making informed decisions Significant Risks: Credibility of the information Information overload by providing too much information Information is not accessible or provided in a commercially useful form Key Performance Indicators: 1. Increasing grower and supply chain partner satisfaction 2. Increasing utilisation levels of available information Strategic Goals: Update and refine the Processing Potato Industry Communication Plan to improve the effective dissemination of information to industry Maintain and develop appropriate industry information systems and databases to meet the identified needs of the value chain Establish services to ensure access to industry information, possibly in association with other industry sectors Processing Potato Industry Strategic Plan

30 SI #3: Improve Industry Communication and Information Systems Strategy: 3.3 Encourage the use of improved communications technologies Business Case/Rationale: It is important that industry investigates and embraces new technologies to reduce costs and improve communication across the supply chain. Communications and IT technologies are changing rapidly driven by lower costs, improved access and ease-of-use. Key Assumptions: Improved technology is available, accessible and is used to the best of its capacity Significant Risks: Low uptake and acceptance by industry Extensive range of available products is confusing and limits uptake Key Performance Indicators: 1. Increased stakeholder registration and the use of industry web sites 2. Improved participation rates across the supply chain in industry sponsored events and courses Strategic Goals: Develop appropriate training and support services Establish policy frameworks to actively pursue government for better access and support to new technologies in regional areas Develop strategic alliances with technology providers to improve access and reduce costs Processing Potato Industry Strategic Plan

31 The Australian Processing Potato Industry Strategic Plan Section 7 Strategic Imperative #4 Improve leadership and management capability Strategic Outcomes: 1. To improve our international competitiveness by improving management, leadership, representation and industry direction.

32 SI #4: Improve leadership and management capability Strategy: 4.1 Improve industry management capabilities Business Case/Rationale: To remain competitive in a global marketplace, the Australian processed potato industry requires skilled managers to initiate, maintain and expand businesses throughout the supply chain. Key Assumptions: The general level of management skills are perceived as low. There are existing training and development programs. Significant Risks: The overall level of skills in the industry will not change - only widening the gap between good and poor performers. Key Performance Indicators: 1. Improving industry participation in training programs 2. Changing age distribution in industry management structures Strategic Goals: Develop education and training programs to improve business skills throughout the processing potato value chain utilising existing resources and programs Utilise improving communications technologies to enhance access to education and training programs Develop case studies of best management practices and communicate to broader industry Develop formal Industry Management Mentoring Programs Processing Potato Industry Strategic Plan

33 SI #4: Improve leadership and management capability Strategy: 4.2 Improve industry leadership and representation Business Case/Rationale: There is a need within the processing potato industry to identify and build leadership skills within our industry organisations to champion change and to deliver on the industry vision and mission. Skills and capability across industry are variable. There are a range of industry issues in common with other horticultural and agricultural sectors. Key Assumptions: Leaders and potential leaders exist in the industry. The industry wants and needs leaders - Change will happen industry needs to lead it Education and training is required to enhance skills Significant Risks: Identifying the wrong leaders wastes resources and causes setbacks Leaders cannot lead a non responsive group Good leaders will be lost from the industry. Key Performance Indicators: 1. Increasing industry growth and profitability 2. Improvements in key industry benchmarks for profitability, growth and sustainability Strategic Goals: Develop programs to identify new and existing leaders and provide appropriate training and development Establish formal, Industry Leadership Mentoring Programs Develop strategic policy initiatives with other horticultural industry bodies to address issues of joint concern Processing Potato Industry Strategic Plan

34 The Australian Processing Potato Industry Strategic Plan Section 8 Linkages to VegVision 2020 Strategic Linkages to the Australian Vegetable Industry Strategic Plan

35 Strategic Linkages to VegVision 2020 In September 2006, the Australian Vegetable Industry Vegetable Group ( AVIDG ) launched the Australian vegetable Industry Strategic Plan VegVision The table below presents the Processing Potato Industry Strategies cross matched to the four VegVision 2020 Strategic Imperatives indicating strong linkages to the National Plan. Processing Potato Strategic Imperatives --- VegVision 2020 Strategic Imperatives. PP1. Improve consumer demand for Australian processing potatoes PP2. Improve industry competitiveness PP3. Improve industry communication and collaboration PP4. Improve leadership and management capability V1. Delivering changing consumer preferences and increasing demand Strategy 1.1 V2. Market recognition for Australian quality, safety, reliable supply and innovation in products and services Strategy 1.2 Strategy 2.3 Strategy 2.4 V3. Internationally competitive Australian vegetable supply chains Strategy 2.1 Strategy 2.2 Strategy 3.1 Strategy 4.1 Strategy 4.2 V4. Advanced industry data and information systems to meet future needs Strategy 3.2 Strategy 3.3 Processing Potato Industry Strategic Plan

36 The Australian Processing Potato Industry Strategic Plan Appendix A References, Interviews and Workshop Attendees

37 9.1 References The Australian Processing Potato Industry Strategic Plan The following references have been utilised in the preparation of this strategic plan: 1. Higgins, D Potato Industry Trends in the UK. Higgins Agriculture Ltd. 2. Harris,D What s Hot and What s Not What Consumers Are Saying. Market Equity 3. Horticulture Australia Ltd The Australian Horticulture Statistics Handbook 2004 Potatoes 4. Supply Chain STO Final Report: Potato Value Chain Analysis PT Horticulture Australia Ltd 5. Market Equity Propriety Ltd. February Developing a Marketing Strategy for the Australian Potato Industry Horticulture Australia Ltd. 6. Ausveg. January Commodity Spotlight Potatoes 7. Supply Chain STO. December Final report: Generic Promotion and Category Management Investigation for Fresh Potatoes PT Horticulture Australia Ltd 8. PIRSA. December State of Play in the South Australian Potato Industry 9. Peterson, J.R,. Et al. August Alternative approaches to the supply of applied research and consultancy services to the Australian potato industries Horticulture Australia Ltd. 10. Socom Pty Ltd. December Potato Industry Communication Strategy. Horticulture Australia Ltd. Updated January Processing Potato Industry Strategic Plan

38 9.1 References continued: The Australian Processing Potato Industry Strategic Plan The following references have been utilised in the preparation of this strategic plan: 11. Horticulture Australia Ltd. October Ensuring a profitable and sustainable agriculture and food sector in Australia White Paper. 12. Processing Potato R&D Plan July 2004 to June Kiri-ganai Research Pty Ltd. November The Australian Vegetable Industry: Taking Stock and Setting Directions. Australian Vegetable Industry Partnership. 14. Hassall & Associates Pty Ltd. September The Significance of the Horticulture Industry to the Australian Economy. Econtech Pty Ltd. 15. McKinna, D. June The Australian Vegetable Industry at the Crossroads presentation. Reference: Horticulture Australia Ltd. June Potato Germplasm and Genetics Investigation Brief Project Number: PT Vegetable Industry Task Force. November Report to the Premier and President of the TFGA. 18. Kiri-ganai Research Pty Ltd. November Foundation Projects Australian Vegetable Industry Partnership. 19. Diversity Arrays Technology Pty Ltd Global Germplasm and Genetics Investigation Report Project Number: PT Horticulture Australia Ltd. 20. Synovate Pty Ltd Global trends in food and drink Processing Potato Industry Strategic Plan

39 The Australian Processing Potato Industry Strategic Plan 9.2 Interviews The following people were interviewed during the preparation of this strategic plan: Darryl Lohrey, Philip Beswick, Philip Richardson, Neil Armstrong, David Addison, Andrew and Kevin Langmaid, Ted Forsyt, Micheal Coote, Peter Bettie, Gary Bendotti, Paul Tempra, Frank Rovers, Ken Labbett, John Doyle, Paul Frost, Chris Russell, Graham Ramsay and Allan Smith Processing Potato Industry Strategic Plan

40 9.3 Workshop Attendees The Australian Processing Potato Industry Strategic Plan The following people attended industry workshops during the development if this strategic plan: Workshop #1: 30 August 2006 Stephen Welsh, Dennis Leonard, Kathy Ophel- Keller, David Addison, Allan Smith, Darryl Lohrey, David Antrobus, Garry O Neil, Paul Frost, Kan Morthy, Tony Slater, Euan Laird, Geoff Moar, Ken Labbett, Leigh Sparrow, Nigel Crump, John Gallagher, Toni Davies, Frank Rovers, Callum Wilson, Phillip Brown, Lisa Maguire Workshop #2: 11 October 2006 Dinesh D sa, Derrin Johnson, Nikhal Tandon, Tom Rafferty, Jim Overton, Iain Kirkwood, Tony Ford, Stephen Welsh, Dennis Leonard, David Addison, Allan Smith, David Antrobus, Paul Frost, Kan Morthy, Tony Slater, Euan Laird, Geoff Moar, Ken Labbett, Nigel Crump, John Gallagher, Toni Davies, Frank Rovers, Callum Wilson, Phillip Brown, Lisa Maguire Processing Potato Industry Strategic Plan