CASE STUDY QUESTIONS:

1. Why is geographic location data so important to Land O'Lakes? What categories of geographic in- formation does Land O'Lakes use?

2. How did using GIS improve operations and decision making at Land O'Lakes?

3. Give examples of three decisions at Land O'Lakes that were improved by using GIS.

PLEASE READ BELOW TO ANSWER:

Land O'Lakes is a member-owned agricultural co- operative serving the dairy industry by working to improve the quality, consistency, marketing, and economies of its dairy products. It was founded in 1921 by 300 creameries and is based in Arden Hills, Minnesota. It is now one of the largest co-ops in the United States, with 3,667 members and nearly 10,000 employees. Land O'Lakes sales of dairy products, animal feed, and seed and crop protection products total $15 billion per year. In 2019, the co-op produced $187 million in returns for its members.

Land O'Lakes provides technical know-how, proprietary tools, and research-based solutions to help farmers become more productive and competitive. About seven years ago, the co-op formed a Strategic Asset Management (SAM) team to provide consulting services to its members. In the agricultural industry, efficiencies and profits are deeply affected by the distance between a farm and various assets, such as feed lots, grain elevators, or crop nutrient facilities. Existing storage facilities may be located in suboptimal areas for serving farms' current customers, and new facilities are not always built in the most strategic locations.

SAM often uses geographic information systems (GIS) when it consults about these issues. For ex- ample, GIS can show co-op members mapping and locational information about the trade areas for a projectwhere the trade area is located, where members' facilities are situated within the trade area, and where competitors are based. The GIS is able to show the geographic dynamics of the trade area analyzed by the SAM team and how they can be improved.

If Land O'Lakes has multiple facilities that are close together, the SAM team analyzes where the trade areas overlap. It also performs transportation analysis to determine how products are currently being delivered to Land O'Lakes customers and if there is a way to do so more efficiently. The SAM team can analyze the facilities customers are currently using compared to ones that are believed to be more appropriate for their use based on distance, functionality, and future growth. Sometimes GIS will be used for analyzing drive-time routes within specific trade territories as well as for route planning.

Additionally, the team uses GIS for field data col- lection. It frequently needs to analyze how co-op members are operating their facilities. What are the capabilities of those facilities? How old are they? Can we expand those facilities? The SAM team uses Survey123 for ArcGIS to capture a comprehensive and consistent set of data about the facilities so it can answer these questions.

ArcGIS is a suite of GIS software products developed by ESRI (Environmental Systems Research Institute), an international supplier of geographic information systems that operate on desktop, server, and mobile platforms. These tools integrate, store, edit, analyze, and display geographic information for informing decision making. Survey123 for ArcGIS is a software tool for creating, sharing, and analyzing surveys and supports data collection via web and mobile devices.

The agricultural industry is affected by the consolidation of existing facilities and the construction of new ones. These changes can create trade area over- laps, gaps, and redundancies, which will impact efficiency and profitability. It is important to understand how much capacity an operation has and how much is needed to service existing and future customers. Before a co-op member builds new facilities, the

SAM team evaluates the project based on the future needs of the marketplace and the potential return on investment. The assessment addresses factors such as the current feed business, customer needs, competitor capabilities, asset efficiency, financial performance, regulatory compliance, market trends, and project risk. GIS help the SAM team show co-op members the customer allocations for various facilities, such as two new mills.

The SAM team makes recommendations about how to change members' transportation or distribution models. Take, for instance, a member operating seven feed mills for hog producers. Two of the mills are old and are not worth spending money to improve them. With some investment, another mill could be operated for five more years before it needs to be replaced. The feed mill market is growing, so the mill owner should increase capacity as the market expands. The question is, where is the best place to put a new facility to replace the three that are out- dated, a facility that can manufacture feed in a way that's more efficient and safer for employees, and implement a tracking mechanism to meet today's consumer transparency demands? The SAM team will work to provide answers.

Land O'Lakes uses transportation studies to ex- amine operating expenses and future transportation costs as part of its financial analysis for capital in- vestment purposes. The SAM team will try to answer questions such as: How many miles do truck drivers have to travel today to reach distribution facilities? How many miles would they have to drive if a new transportation model were implemented to accommodate a different set of distribution facilities? Will the new transportation model produce cost savings, or will costs increase by building new facilities in different areas?

The SAM team's market analyses also examine the demand trends for Land O'Lakes products: Where is this demand coming from? How is that demand changing? What is driving the demand? How much growth has happened in the market historically? Where are the growth opportunities in the future? Who are the competitors and what is their impact on the market? The SAM team's work has benefited both day-to-day operations as well as long-term planning.