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Medium Emissions Reduction Operations Optimization Environmental Sustainability

COWBON EMISSIONS

#Agriculture #Sustainability #Operations
ProHub Comment

This case tests candidates' ability to structure a complex environmental challenge with multiple levers across the value chain. The case guides candidates toward the critical insight that cow emissions represent 63% of total GHG, making breeding replacement the primary opportunity. It combines market sizing (estimating herd size), financial optimization (allocation of fixed budget), and strategic prioritization skills.

Estimated Time 15 minutes
Difficulty Medium
Source IESE
50 / 100
Our client is a major milk producer in New Cowland, Milking it Co., MIC. New Cowland has recently introduced a law that means MIC has to reduce its GHG emissions by 45% of 2019 levels within the next five years or face being shut down or heavily fined. They currently produce 20% of New Cowland’s GHG emissions. The CSO has hired us to figure out a way to reach this target.

Clarifying Information

  1. MIC produces approximately 100% of New Cowland’s milk supply
  2. Does not have plans for expansion but reducing volumes is not an option
  3. Their only product is milk and have no plan to diversify
  4. Budget for this project is $750m/year for the next five years (for perspective, current revenues are $15 billion)
  5. MIC owns the entire production chain – from farms, production and transport, they sell to a variety of clients
  6. 5% of their market is local, the rest is foreign
  7. Only need to reduce GHG directly produced by MIC