Here are answers to questions about on-farm peer groups
There is something almost magical that happens when producers form a peer group and assess one another’s farm and business skills. Mike Boehlje, Purdue University ag economist, and Danny Klinefelter, Texas A&M University ag economist and director of the The Executive Program for Agricultural Producers (TEPAP), agree that peer groups are one of the key steps to enhancing farm profitability and business management. With a combined experience of more than 60 years in farm management, Boehlje and Klinefelter answer a few concerns farmers often have about peer groups:
Boehlje: The key value of a peer group is to discuss and challenge your strategic positioning decisions with industry leaders who make similar decisions—to learn from your peers. The goal is to learn how to solve problems, not to get "the solution" to your problem.
Klinefelter: Even the most successful farmers don’t know how to handle everything that comes up. Mutual learning from a group of the best and having a sounding board of people with different skills and experiences can make anyone in business better. Most people waste too much time trying to reinvent the wheel, when someone else already has a solution.
Boehlje: The value depends on your willingness to be open and transparent in sharing information and your engagement in helping others solve problems. You learn a lot about how to respond to your own problems by helping others solve similar problems.
Klinefelter: Most farmers I know own an ATV, jet ski, snowmobile or motorcycle. Recreational horse trailers, RVs, boats and planes take it up a notch. It’s obviously not as much a matter of spending the money as whether continuous learning can have a more positive impact on your business than other places you choose to use the money.
Boehlje: Every business faces constraints and forces that shape their business climate. Successful businessmen are creative in how they respond to those forces; you have choices.
Klinefelter: Unforeseen externalities affect everyone. Too many attribute success to luck or hitting a home run. The truth is those wins account for a very small percentage of the most successful. For most, it’s the cumulative and compounding effect of continuously doing better than average across all the key performance areas of a business (production, marketing, personnel, finance, technology adoption) and adapting to and changing with the realities of the market.
- September 2013