Six steps to ag success
What will it take to succeed in agriculture in the next decade? David Kohl outlines six management philosophies top producers should adopt.
Picture this setting. Combine the Green Bay Packers Training Camp including players and coaches with a group of highly motivated ag professionals. It was such an occasion that provided me with an arena to discuss how management philosophies of the farm and ranch business will evolve over the next 10 years. Here are six philosophies to consider:
Passion
Peak performers of the industry will have to demonstrate a passion for their business, industry and life in general. Like a championship quarterback, the executive manager will be a charismatic leader who has the vision to guide strategy within a wide range of competitive environments and scenarios. The manager must be persistent but show patience and be polite enough to thank and remember the people who guided him or her along the way.
Sustainable lifestyle
One agri-lender indicated that the business equation will be turned upside down. Instead of business operations and profit driving lifestyle, a sustainable lifestyle will drive business motivations.
Historically, farm and ranch families were willing to sacrifice income or standard of living and personal enjoyments for the good of the business. Today, with more choices of activities and interests outside the business, a fine balance will have to be maintained. In the future, if the business does not provide a standard of living within desired social obligations and outside interests of partners, spouses, and children, the long-term legacy of the business and family will be in doubt.
A recent visit to a 1,600-cow dairy confirmed this philosophy. Financing and building plans were approved and permits were granted to expand the operation to 4,000 cows. However, the expansion plan was called off. One spouse of a partner raised the concern that they would not be able to spend enough time with their children because of the size and complexity of the business. Despite being a profitable opportunity, time was deemed more important than money.
Traceability
The ag professionals I met with expressed concern that 2010 agriculture is going to be consumer-driven and we need a management philosophy to reflect this. Traceability from the seed or embryo to the plate will be critical for everyone from lifestyle producers to large commercial operations.
A management system must be in place to comply with food safety and environmental standards. The results will be increased value-added revenue and accountability throughout the food chain.
Public interface
Where are we going to farm and ranch in the future? Wherever people want us to! But whether it is close to major cities or in the great expanse of the plains, property and development water rights and odour issues must be agenda items on the schedule of the successful agri-manager.
The 2010 manager will have to become networked with neighbours and be able to present the overall benefits of agri-business and industry. Trust will have to be earned. If violated, it negates the overall relationship.
Benchmarking
An important philosophy is benchmarking to improve performance. A coach analyzes game statistics to develop strategies for the next game. The peak-performing manager must also analyze financial ratios, yield responses, labour and marketing efficiencies against peer size and type of enterprise to use as a guide in developing the next game plan.
Episodic vs. lifecycle planning
When observing the Packer coaches in training camp, you sense that they are constantly grooming the backup and planning for any given situation. Granted, there are always surprises but a good manager, like a good coach, is always planning for the overall cycle. Too many emotional seat-of-the-pants decisions are made because of an episodic event, which drives managers to emotional, unplanned decision-making.
Though not new, these management philosophies are becoming more of a priority for agri-managers. They can take a lesson from the current Packer staff who draw on the teaching and experience of Vince Lombardi but create their own management philosophy based on their current situations. It's all a matter of perspective.
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