Not that long ago, farmers were expected to be able to do everything on their farms.
Their broad skill sets and abilities were directly connected to their strong sense of independence.
Things are changing, however, and while the foundation of multiple management skills still exists, it is far less common. There is a truism in business that applies to farming – a business typically outgrows its management.
The prevailing wisdom now is that commercial-scale farmers cannot be all things to all aspects of managing their business.
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For most of us, it is difficult to change the way we manage. It is even more challenging for farmers because of seasonal production pressures. Stress such as weather, finance and family pressures farmers to revert to long-held management patterns. It takes a lot of discipline to adopt new management practices.
Another obstacle to changing management behaviour lies in the subtleness of growth. It may be fairly obvious, but a farmer should not try to manage a 10,000 acre farm the same way he managed a 1,000 acre farm.
There is no manual that tells farmers, when they move from 4,999 to 5,000 acres, that they must do this or that. The requirement to introduce new management practices is more specific to the individual than it is to increasing acreage.
Ideally, management upgrades should be aligned with the demands associated with growth. So, what should you do?
First, determine the areas of your business that could be better managed and commit to doing something about it. Make a list of management resources now used, such as accountants, lawyers, lenders and production advisers.
Some resources, such as the
accountant, will be in place because of external reporting requirements. Other resources will be more ad hoc.
Next, assess your own management strengths and weaknesses. Your management resources can help you do this. Self-assessment tools are also available.
A helpful tip is to break down management of the farm into
four main areas: operations
(production), marketing (suppliers and consumers), human resource management and finance.
Within each of those areas, make a detailed list of the management activities that are happening and/or should be happening on the farm.
There will likely be a gap between what you are doing, what needs to be done and what could be done better.
Examining the gaps will help you focus on what external management resources are needed and what personal skills need to be developed.
There is no single correct approach for filling the required resources. You’ll already have some resources, but some of them might not be used effectively.
Your relationships with resources may vary from casual, one-off interactions to regular and periodic. Management advisers can help identify and select appropriate resources.
Introducing accountability into the relationships will result in better outcomes because it brings discipline, which is vital to effect changes in management behaviour.
The accountability can be in the form of:
n A written contract.
n An exchange of money for services received.
n Formal meetings.
When structuring your management resources, it is important to think beyond traditional measures. What resources do you need, or will you need, as your business grows or changes?
Perhaps you can share resources, as did a small group of farmers who together hired an agricultural economist. The economist, among other things, provides them with information on domestic and global economies, government policy and the financial sector, which is all information that farmers use when making management decisions.
An appropriately designed and functional resource team will help farm families realize goals, increase the likelihood of success and minimize stress.
