Essay About Chicken Farm Owner Ronald Olson And Primary Alternative

Optical Distortion, Inc. Case Study
Optical Distortion, Inc. was formed after their founder, Daniel Garrison, created vision distorting contact lenses for chickens while collaborating with chicken farm owner Ronald Olson. The technology is used to decrease the number of cannibalistic mortalities amongst chickens provoked by defence of a chicken’s superiority in the “pecking order”, by distorting the chicken’s depth perception.ODI’s key strength as a company is that the technology is patented and exclusively manufactured for ODI by New World Plastics, giving ODI a first-mover’s advantage. The lenses are a more effective, humane and overall less costly option for chicken farmers wanting to reduce the occurrences of chicken cannibalism amongst their flocks. Many factors are in favour of ODI’s lenses, but some are working against them. ODI’s team is small and relatively inexperienced at operating a business, which will be a challenge for scaling in the future.  The team is also completely dependent on its lone supplier. A disruptive technology like the ODI lenses will require a behavior change by farmers who are already sceptical of new technologies and being on the receiving end of a bad deal. In addition, this is currently ODI’s only product and it has limited capital of $200k, so there is a lot of pressure on this product being a success.  Debeaking is the primary alternative to ODI’s lenses, however debeaking results in chicken food waste and is less effective at reducing cannibalization amongst chicken flocks than the lenses.  Further down the road, it is believed that large agricultural companies, who already have established relations with farmers, will be able to enter the market working around the exclusive patent. They would then have a distinct advantage in ability to scale.  Other possible cultural competitors are PETA and animal rights groups that could reduce the expansion rate of close quarter chicken coop farming, which is the type of farming that would require the ODI lenses.ODI’s customer base consists of independent-minded poultry farmers and their poultry farms in the United States; these farms can be segmented into three sections based on their size: small, medium, and large farms.         The small farms represent farms that are family-operated farms that house fewer than 10,000 birds. These farms make up about 97% of all farms, yet only 27.9% of all the chickens in the U.S. by volume. Not only do they have fewer resources, the small farms’ operations are also typically at a smaller scale as they sell their eggs to small retailers. These kinds of farms have been declining at a rate of 25% per year, due to an overall trend of farm consolidation. Family farms are reluctant to invest in new technologies due to their lack of human and financial resources. This group resembles risk averse imitators. Their primary reason for adopting ODI’s technology would be a more humane alternative to debeaking because these farmers would have a more personal relation with their chickens.