Problem Detection and Definition - The Case of Farmers' Choice of Organic Milk Production

Little is known about problem detection and definition, despite that it starts the decision making process. Problem detection means becoming aware of a problem, i.e. of a difference between a desired and perceived situation. Problem definition is the process of specifying the problem, identifying decision options and choosing options to develop further through planning and analysis. The aim is to explain problem detection and definition using the case of farmers' choice of converting to organic milk production. Literature and case studies are used to generate a hypothetical model, which is estimated with survey data, path analysis, the Maximum Likelihood estimator and structural equation modeling. Different problems were identified, such as an ideological problem, a profitability problem or a production problem. Problem detection was affected by farm size, production intensity, dependency on milk production and the financial situation. The decision options included quitting farming, quitting milk production and starting alternative production. Perceived threats concerned 'rules and bureaucracy', 'economy' and 'labor and health situation'. Perceived future opportunities included 'less rigid rules', 'economy', 'way of competing', and 'environmental and personal experiences'. Lack of data about economy and rules probably contributed to the perceived risk.