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July 2011 Archive for Leave a Legacy

RSS By: Kevin Spafford, Legacy Project

Kevin Spafford is Farm Journal’s succession planning expert for the Farm Journal Legacy Project.  He hosts the nationally-televised ‘Leave a Legacy’ TV, facilitates an ongoing series of workshops for farm families across the U.S., and is the author of Legacy by Design: Succession Planning for Agribusiness Owners.

Separating Business and Family

Jul 28, 2011

iStock A Barn with a ViewFrom Legacy Moment eNewsletter (07/22/2011)
Please join us for future issues, delivered via email each Friday. 

There are a few common business tools farm owners should use to separate operational decisions from family issues. Since family leadership and business management are two completely separate avocations, these tools allow owners to use pre-established rules and guidelines to manage the operation. A properly structured business will include an operating agreement that governs management decisions at the ownership level.
An operating agreement is a binding document owners agree to follow when making important decisions. When used in an LLC, the agreement is similar to the bylaws that govern a corporation or partnership.
While there are many benefits of an operating agreement, most are related to objectivity and control. An operating agreement:
1. spells out an owner’s rights, duties and obligations;
2. details decision-making authority, conditions and process;
3. ensures that the entity is distinct and separate from the owners of the operation;
4. keeps the government from settling disputes, dissolution issues, etc., which are governed by respective state statutes or default rules, if no agreement exists; and
5. removes subjectivity, ensures objective reasoning and informs owners, employees and applicable family.
A family-owned operation should also have a family employment policy, which pre-negotiates understanding of how, when and under what circumstances a family member may be eligible for employment.
Though it sounds a bit formal, a job description spells out the duties and responsibilities of each position in the operation. It also includes the method management will use to review employee performance.
Job descriptions and a family employment policy are components of an employee manual. This serves as a go-to source of information for all employees, management and employee candidates.
For more information, check back regularly to this Farm Journal Legacy Project website, or contact me.
News & Resources for You
Establishing a Family Employment Policy spells out the criteria and helps to create a business-like environment.
Our Job Description Template helps you fit the best candidate to each operational role and ensure that everyone involved is clear about the position's qualifications and expectations.
Reach into the Legacy Project Toolbox for other useful resources.
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Leave a Legacy TV

Jul 19, 2011

Leave a Legacy TV TitleFrom Legacy Moment eNewsletter (07/15/2011)
Please join us for future issues, delivered via email each Friday.

Have you seen “Leave a Legacy TV”? Every four weeks, I host a half-hour television program, which airs in place of “AgDay TV.” It’s designed to help America’s farm families learn more about succession planning. The show features agripreneurs who manage innovative operations. Frequently, I also visit with an adviser or planning professional who specializes in some facet of the succession planning process. Plus, in each episode we highlight an exemplary leader in the “Legend of Leadership” segment. These individuals exemplify the admirable traits shared by leaders in our agriculture communities.

In the “Family Features” segment, we’ve profiled dairy farmers, cattle ranchers, food processors, grain farms and, most recently, a horse feed pellet manufacturer. In previous episodes we have featured the largest cattle operation in the nation and the biggest dairy in Wisconsin. From time to time, we update our viewers on the Legacy Project case study families: the Dells of Maryland, the Esthers of Illinois, and the Moeses of South Dakota.
Prather Ranch   CompressedGuests on the show include experts like Barry Posner on leadership and Mike Walsten on real estate. We’ve hosted Ed Hoover, a family business consultant, and Aubrey Daniels, a behavioral scientist. We had a visit from USDA Deputy Secretary Kathleen Merrigan and soon we’ll broadcast my interview with Temple Grandin, a legend in the livestock industry. The show is about bringing you the expertise you need to grow the operation, plan for a successful transition, and prepare the next generation for leadership.
You can watch the show as it’s broadcast, or anytime online. Please don’t hesitate to let me know what you think of the show or how I can continue to serve your succession planning objectives.
News & Resources for You:
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Legacy Workshops Help You Plan Success

Jul 13, 2011

Ames, Iowa 02 2011From Legacy Moment eNewsletter (07/08/2011)
Please join us for future issues, delivered via email each Friday.

“Mark is the only farming (active) child in a very successful farming family. He works with his parents, John and Sue, on the family’s dairy operation. At a family gathering, about 18 months prior, his twin sister Janet expressed a sincere interest in joining the family business. At that time, Sovereignty Valley Dairy was just starting the construction phase in a long-anticipated expansion.

"The development was deemed both necessary and possible since Mark’s oldest son Bryce plans to work on the farm following his graduation from college. Mark has three other, inactive siblings…”
Does this situation sound even vaguely familiar? Do you have a plan for transition? Are you confident that your intentions will achieve your objectives?
If not, plan now to attend a Legacy Project Workshop. Upcoming events are scheduled in Illinois, Ohio, Missouri and Tennessee.
In the workshops, we use Mark’s situation as a case study to explore the succession planning process.
Columbia MODuring the session you’ll learn:

• The keys to planning success
• Which resources are available to help the family
• What a comprehensive planning process includes
• Who should be included in planning
• How to get started
If you have questions or need additional information, please don’t hesitate to contact us. We are dedicated to ‘Cultivating Multigenerational Success in the Agricultural Community.’
News & Resources for You
To sign up or learn more about Legacy Project Workshops, visit the Legacy Project Events page(Or call 800-482-7203.) 
Will a buy-sell agreement be part of your succession solution?
How will your family farm evolve? 
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Leadership Matters

Jul 05, 2011

iStock Farmers HandshakeFrom Legacy Moment eNewsletter (07/01/2011)
Please join us for future issues, delivered via email each Friday.

Leadership matters. Three things you should consider:

1. Family farms have different goals than more conventional businesses and publicly owned companies. Family operations are oriented to serve a broad set of objectives that include the demands of the family, the needs of the operation and the expectations of the community.

2. Family operations have a greater potential for long-term conflict. People are inherently emotional beings. The atmosphere of a family business causes some to respond inappropriately to disagreement and conflict. Conversely, the connections within a family business may inspire others to respond with more commitment and understanding.

3. Leadership succession is far more important for family farms than nonfamily farms, because what is at risk may be absolute survival. Due to the personal nature of the endeavor and the breadth of family that may be actively involved, failure can be devastating—especially when you consider that most family operations comprise an overwhelming majority of the family’s net worth.

Leadership matters. With so much at stake, don’t leave it to chance.

News & Resources for You
Leadership development may be the single biggest gap in any succession plan. Our Leadership Skills Inventory can help.
The important role of parents—both in the family and on the farm. Fathers and the Family Farm, courtesy of Case IH.
The key qualities of leadership: Fearless, visionary, industrious. (Kevin Spafford for Farm Journal, March 2009)
Leadership begets leadership, so Lead On! (Jeanne Bernick for Top Producer, October 2009) 
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