3. Business Intelligence and Analytics
Optimization What’s the best that can
happen?
Predictive Modeling What will happen next?
Forecasting/Extrapolation What if these trends continue?
Statistical Analysis Why is this happening?
Alerts What actions are needed?
Query/Drill Down What exactly is the problem?
Ad hoc Reports How many, how often, where?
Standard Reports What happened?
CompetitiveAdvantage
Degree of Intelligence
SAS, Competing on Analytics, Davenport, Harris
4. Data Opportunity
Losing ground compared to other
businesses
Often limited to creating production
tables, attention lists, and working
schedules
Generally retrospective
Diagnostic capabilities remain largely
untapped
5. Mastitis is Perfect
Application
One of the most common and costly
diseases on a dairy farm
Massive amount of data
Subclinical mastitis also costly
o Determined by somatic cell count
14. Animal Health
Economics
• Quantifying the financial effects
of disease
• Developing methods for
optimizing decisions when
individual animals, herds, or
populations are affected
• Determining costs and benefits
of disease control measures
15. Mastitis Cost
Cost type First lactation
Second and later
lactations
Lost milk $ 131.41 $ 133.46
Vet and drug $ 77.74 $ 77.74
Discarded milk $ 54.55 $ 65.44
Labor $ 11.53 $ 11.53
Death $ 12.05 $ 12.82
Culling $ 10.26 $ 10.32
Days open $-1.54 $ 86.16
Total $ 352.75 $426.50
Liang et al., 2017, Journal of Dairy Science , Volume 100 , Issue 2 , 1472 - 1486
16. Definitions
C = L + E
Costs (C): represent all economic
effects of disease
Loss (L): benefit is taken away
(discarded or unrealized milk,
feelings/stress from death)
Expenditure (E): extra inputs into
production (drug costs,
preventative measures)
McInerney et al., 1992, Prev. Vet. Med, 13:137-154
17. The Loss Expenditure Frontier
McInerney et al., 1992, Prev. Vet. Med, 13:137-154
Maximum
Loss
Technical
Limit
Technical
Optimum
Minimum Level of Losses
Attainable for Given
Expenditure
Economic
Optimum
18. Cost of Culling
Oversimplified methodology: difference between
slaughter value and cost of replacement
Better methodology: retention pay-off
Retention pay-off is the difference between:
The predicted future income of the animal in question
The predicted future income of her potential
replacement
Requires the use of simulation and/or dynamic
programming
19. Decision Support Tools
Allows producers to enter their own farm
information
Result is specific to the information that the
producer enters
o Economic
o Decision
Important to be as realistic and accurate as
possible