Dean Ross  |   October 24, 2011 resize text

The computerization of business and production records in the last decadehas revolutionized farm and agribusiness management. Computerization has allowed the integration and analysis of complex records with the aim of improving profitability.

Previously, farm business and production records were not much more than a history lesson of what had taken place. Computerization now allows the farm business to attempt to model or forecast future performance. Recordkeeping and the analysis of farm records now drive entire industries.

Consider, for example, how important farm records have become to the ag lending industry. Distribution of operating and capital loans requires excellent records pointing to promising business practices and a strong likelihood of repayment.  Computerized production records now help you to assess the impact of ongoing and previous management practices on plant and animal production, potentially pointing toward new options and management strategies.

The problem in relying on computerized records is what happens if all that data collected and stored on the office or home computer is destroyed or lost?

It is difficult to estimate the value of the business and production records. But the impact of data loss is well documented. Seventy percent of small firms that experience a major data loss go out of business within a year. The imaginable causes for the unintended destruction of farm and business records are somewhat obvious. 

Fire or natural disasters like flooding or tornados have the potential to completely obliterate these records leaving no way to retrieve them. Yes, the probability for such an event is not large, yet it should be ignored completely (note the impact of weather related disaster on rural areas throughout the U.S. this past year).  

Data loss is more common than most people usually think.  Here are some statistics on computer data loss:

• 32 percent of data loss is caused by human error.
• 31 percent of PC users have lost all of their PC files to events beyond their control.
• 25 percent of lost data is due to the failure of a portable drive.
• 44 percent of data loss caused by mechanical failures.
• 1 in 5 computers suffer a fatal hard drive crash during their lifetime.

The loss of farm business records can also occur when there is a malfunction or failure within the computer hard drive or other digital storage rendering the data in it un-retrievable. 

Computer industry sponsored research suggests that 70 percent of hard drive failures will be severe enough that data retrieval is not advisable.  And in those cases where data is retrievable, the cost can be significant. 

A better strategy than relying on fate to support your ag business is to save a copy of your important records by regularly creating a backup of your computer files. The Small Business Administration suggests that business owners “Make back-up copies of all tax, accounting, payroll and production records and customer data on computer hard drives, and store the records at an offsite location at least 100 miles away. Important documents should be saved in fireproof safe deposit boxes.”

Putting aside the 100 mile storage requirement, the logic of this statement is obvious.  But, computer backups have traditionally been a bone of contention with computer users. A Harris Interactive Survey done with 597 computer users found:

• Only 1 in 4 computer users frequently back up digital files, even when 85 percent of computer users say theyare very concerned about losing important digital data.
• 37 percent of the survey's respondents admitted to backing up their files less than once per month.
• 9 percent admitted they have never backed up their files.
• More than 22 percent said backing up information is on their to-do list, but they seldom do it.

So it seems as though the hurdles for the creation of backup files for most computer users and small business owners are large. But recent changes in computer product technology may be poised to make a dent in these figures.

In the past, making a backup copy of file required the computer user to manually create, transfer and store the backup filesin a portable format such as a CD disk, thumb drive or desk top data storage unit.  While this has certainly become less difficult, now that most new computers come with backup software pre-installed, the problem is that if the fire, flood, tornado, etc. is going to “get” your computer, then it will also “get” the backup that was stored next to the computer. 

More recently, the introduction and growth of secure online data storage has provided the opportunity to avoid some of the inherent problems with data backups. 

Where previously the onus for creating backups was on the computer owner, online data storage and the accompanying software simplify this task for busy farmers and agribusiness owners. All that is required is an internet connection. The software itself can schedule and complete the backup process automatically. You just need the computer to be running and connected to the internet. 

Product offerings like Carbonite, Mozy and Norton Online Backup and a variety of other vendors provide services to collect and securely store backup copies of file from your computer through the internet for a monthly or annual fee. Purchasing services like this can provide a much higher level of physical security for important computerized business records than simple self-storage plans. These companies business is to safely protect important files so you can focus on the important business of running your business.

Dean Ross is an Agrosecurity consultant based in Michigan.  He can be contacted at: deanross@cablespeed.com

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