7 Differentiators of a successful farm business, Part 1

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In our business we have the chance to observe many farming operations from the inside and get an understanding of what builds success in this business of agriculture. Based on our company’s experience in working with farmers across the Midwest since 1994, I’ve been able to identify a list of seven differentiators for building a successful farming business.

Differentiator 1: Use Core Values to drive the business decisions
The best decision-makers use clearly defined values to guide their decisions. They have taken the time to identify their personal and professional values, and turn them into action. Core Values are the cornerstones to everything that we do in our lives.

In agriculture, values are quite visible and in the forefront—but here’s the challenge with something that’s so apparent: Values are like electricity. How many people think about electricity and are amazed by it every time they turn the lights on? On the contrary, we generally think about electricity when the power goes out.

Our values may be so ingrained us that we need to stop occasionally and do some digging. We should step back, reflect on them and specifically identify them. Once we identify our values and apply them to the decisions in life, many things come into focus—such as who we will do business with. This behavior is what I have observed in farmers who are more at peace, less caught up in the details and less frustrated. They know their values.

To work on your values, schedule a time by yourself, with your spouse, or with your partner in the operation. Ask these questions to begin your thought process: “What are the things that we’re passionate about?” “What are the things that are important to us?” The list could be three to five things. Don’t come up with too many or you will lose focus.

Differentiator 2: A clear vision for the business
Farmers who can paint a mental picture of their vision for the future—and share that picture with others—are the most successful farmers. I could bet that just about every farmer who reads this post has a vision of their future, but I would offer two challenges: a) Can you write it down; and b) Can you paint that picture so other people can see it clearly? A true vision is something that you are going to recognize when you get there. Conversely, a vision without any plans or actions is merely a daydream.

Keep the vision simple. One of our clients was recently talking about the future of his farm. He is in his 30’s. He has many years ahead of him in his farming operation. Typically when we think about the future of our farm, the focus is on size. That is because it is easy to measure progress: the change in size between today and the size we become in the future. A vision isn’t only about size.

This client has invested much of his energy into planning the environment that his farm is going to have. He thought about the relationships his workers should have with each other. He considered how to turn them in to planners, equipping them so that every day on the farm doesn’t have to be a fire drill. He envisions a well-oiled machine, and he continues to work with his employees towards that type of environment.

As an executive in your operation, you have three responsibilities. The first is to set the direction. The second responsibility is the environment—setting the culture of your farm. Make it a part of your vision.

The third thing you’re responsible for is the execution. Turning the vision into reality takes action and holding people accountable for getting things done. Your responsibility is to be certain that things are done in a way that moves you towards your vision.

Where do you start? Reflect about what you see the future of your farm looking like. Consider the culture, the size, the level of profitability, the amount of debt, how much you own. Think of every detail because the power is in the details. Write your vision down and start sharing it with people, recognizing that a vision of the future is not a static thing. This is a living, breathing target that’s evolving every year.

Stay tuned, as I will continue this discussion with the third differentiator—right here, very soon.

 

UPDATE: Click to jump to part 2