Oracle helps make Land O'Lakes more efficient

  • Article by: NEAL ST. ANTHONY , Star Tribune
  • Updated: November 3, 2013 - 8:41 PM

Land O’Lakes has prospered by using technology to bolster its three core businesses; sales have doubled in the past eight years.

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Last week, Oracle showcased its technology partnership with Land O’Lakes for about 250 Oracle customers and employees on Land O’Lakes’ Arden Hills campus.

“We are one of their more successful partnerships,” said eight-year CEO Chris Policinski of Land O’Lakes. “We’ve taken a lot of the cost out of the business through less inventory and we run factories at greater capacity because our forecasting is so much better. More importantly, it has transformed the way we think about our business.”

Under Policinski, Land O’Lakes shed peripheral business and beefed up on its three cornerstone businesses of farm services, animal nutrition, including its Purina acquisition, and consumer dairy foods. The farmer-owned cooperative started by committing $95 million over several years, including adding about 40 tech­nology hires. It also partnered with Deloitte Consulting and built out a systemwide enterprise resource plan that helped it better manage, distribute and market products. Land O’Lakes integrated better online logistics, business intelligence, customer relationship management, and added FarmFacts, sort of a Google for their co-op dealers and farmer members.

Sales have doubled to about $14 billion and profitability and dividend payments to farmers rose more than 100 percent over the last eight years. Employment has less than doubled to about 10,000 people. Land O’Lakes’ truck fleet is down 15 or 20 percent. But it’s hauling a lot more product thanks to better computer-based forecasting and logistics.

Bottom line, Policinski says better technological applications help Land O’Lakes and help farmers produce more food with less fertilizer, energy and water.

“We’re all about increased productivity in an [environmentally] sustainable way,” he said.

Coal plant upgrade underway

A big upgrade to a large coal-burning power plant just got underway in northern Minnesota.

Minnesota Power, the Duluth-based electric utility whose customers include the power-intensive iron ore industry, on Thursday officially launched its $430 million, three-year environmental-control retrofit of Unit 4 at the Boswell power plant in Cohasset, Minn.

The generator, which is 20 percent owned by a Wisconsin municipal power supplier, will get new mercury and other emissions controls in a project that will employ 500 workers at its peak, the utility said.

To pay for its share of the project, Minnesota Power residential customers can expect a rate increase of 5.9 percent by 2017, with a bigger increase for industrial ratepayers, according to a regulatory document.

David Shaffer


Who’s No. 1 in Minnesota SBA Lending?

U.S. Bank was the No. 1 U.S. Small Business Administration lender in loans to Minnesota companies for the federal fiscal year ended Sept. 30. The 188 SBA loans, totaling $28 million in Minnesota, approved by U.S. Bank in Minnesota represent a 23 percent increase over last year.

Craig Veurink, regional small-business banking manager for U.S. Bank, which employs 11,000 Minnesotans, said SBA loans, which provide taxpayer insurance of up to 90 percent of value, have helped owners “invest in their businesses by purchasing new equipment or freeing up cash flow to hire that extra employee and keep up with demand.”

Meanwhile, Wells Fargo, which employs 20,000 Minnesotans, says it is the No. 1 Minnesota lender in terms of volume with $56 million in local SBA loans, up 13 percent from 2012. Wells Fargo is also the largest national SBA lender in terms of dollar volume.

For the second time in three years, Wells Fargo was named SBA large-bank lender of the year by dollar volume, in ceremonies last June presided over by SBA Administrator Karen Mills.

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