Bill Gates’ well-known comments about the state of business has direct application to primary agriculture. We all know that change in farming isn’t new.
There is an axiom that states that a business, including farms, will typically outgrow its management.
Growth can mean more acres or animals but also more complexity in terms of the number of people involved in ownership and management, generational transition and the diversity of the business enterprise mix.
Managerial development, and change, are required. Even if your farm has been relatively stable, business management must advance to maintain the status quo. Failing to do so runs the risk of slipping behind other farms in similar situations.
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I’ve come to understand that there are some things that are really challenging for farmers to do. I talk to farmers who have identified the need to make changes in how their farms are being managed. They have come up with ideas on what the changes might look like but will often express their frustration over the difficulty in their implementation.
There are a few reasons why I think this happens. One is procrastination.
There generally isn’t any real urgency to the adjustments, but pretty soon a month or two slips by with no action and soon a new production season is looming.
And that’s the second reason. The production season for farmers is critical, justifiably filled with urgency and stress.
In these situations, human nature causes people to revert to what’s worked in the past. When the production season ends, it’s back to the drawing board when it comes to making adjustments to those management plans.
There needs to be a plan, but the lack of a plan is a significant stumbling block to change. How simple or complex the plan is becomes a factor.
You can apply the SMART principle to determine the appropriateness of a plan that’s designed to change how a business is managed:
- S stands for specific. For example, deciding to have monthly management meetings.
- M stands for measurable. You can measure if the monthly meetings are happening.
- A stands for attainable. Having monthly management meetings is attainable.
- R is for realistic. Is it realistic to have monthly management meetings? Perhaps not in May or September and if so, then adjust the specific function to monthly meetings except for May and September.
- T relates to the time factor. We are going to start having monthly meetings next month.
Another stumbling block to changing management practices is related to the ownership and management structure of the farm business.
Management and ownership are almost always one and the same, so if the person who is responsible for making the changes in management isn’t getting the job done, who do they report to? Themselves? The lack of accountability can be a major issue and at the same time, one of the easiest to fix.
First, a plan is needed. Given that a plan exists, if you can make accountability work internally within the ownership and management group, that’s likely the preferred scenario. However, this isn’t a realistic option for most farm families.
External accountability can be effective. Engage someone who you trust and feel comfortable in talking to about your business.
The accountability factor lies in your commitment to do what you said you were going to do, when you said you would do it, and having to explain to the person why you didn’t get it done and what you’re going to do about it.
“Change is unavoidable. How you deal with it is what’s important. If you do not change direction, you may end up where you are heading.” — Lao Tzu
“This is a fantastic time to be entering (or be in) the business world, because business is going to change more in the next 10 years than it has in the last 50. We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next 10. Don’t let yourself be lulled into inaction.” — Bill Gates
