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RSS By: Bob Milligan, Dairy Today

Bob Milligan, with Dairy Strategies, Inc., provides fool-proof techniques to optimize employee performance, satisfaction and longevity.

Leading a Successful Dairy Business in Turbulent Times

Apr 11, 2011

Four key responsibilities are necessities, including requiring excellence in operations, and establishing and implementing a winning business direction and strategy.

 

Recently, in discussing “Strategy in Turbulent Times,” I introduced: Embrace Change + True Urgency = Opportunity.

While teaching and reflecting on these ideas, I have thought about the broader issue of what must the owner of a farm business do to successfully lead a farm business in these turbulent times.  That is this month’s topic.

We look at four key responsibilities of those who own, lead and manage a farm or other family business. They are:

  1. Require excellence in operations.
  2. Establish and implement a winning business direction and strategy.
  3. Nurture and change the business culture as needed.
  4. Attract, develop and retain an exceptional workforce.

 

Require excellence in operations
As the other responsibilities increase in priority emphasis, the importance of excellence in day-to-day operations becomes no less critical. For a dairy farm, this means staying abreast of research and technology to ensure exceptional dairy and crop efficiency and productivity. Emphasis on implementing the best practices/processes, quality assurance to ensure consistency, and proactive problem solving continue to be essential. 

For any other business, the processes are different but excellence in those processes must be maintained. This responsibility has been the primary focus of most owners/leaders/managers in the past. In the future, its importance will not diminish; however, the leader or leaders may have to delegate more of this responsibility to enable the required time be spent on the other key responsibilities.

Establish and implement a winning business direction and strategy
A great strategy is the synergistic intersection of:
•  The unique and specific business direction of the business
•  The resources – physical and human – available to the business
•  The available markets for the business’ products and services

This description generates three key points about direction and strategy:

  1. The strategy must emerge from the direction of the farm business -- the mission and vision. This is one of the key linkages between the family and the business. The business strategy emerges from the vision and mission of the family or families that own the business. Unfortunately, we have often treated the farm as a way of life and the farm as a business as in conflict. They need not be in conflict when the strategy emerges from the vision and mission of the owners and their families.
  2. Each of the three synergistic components of strategy is becoming increasingly diverse.  This trend means that more than ever before, each farm business must have its own unique strategy.
  3. The strategist must increasingly be aware of the external world and how it impacts the business. It is becoming increasingly important for farm business owners to expand their knowledge of the local, national and global world around them and expand their network of acquaintances, mentors, teachers and trusted advisors.

 

Nurture and change as needed the farm business culture
Organizational culture is comprised of the norms and values of the business. Have you noticed characteristics of successful agribusinesses, restaurants and other businesses you frequent? These characteristics – friendliness, attentiveness, optimism, promptness -- represent the culture of those businesses. This is another key area of interaction between the family and the farm business.

I had cousins who lived only a couple miles from us when I was growing up. Every time I visited them, I heard their father complaining about how bad farming was. That was a part of the culture of that family and that farm business. It is no surprise that neither of my cousins chose careers in agriculture.

In a recent article, we talked about the importance today of a true urgency culture: a culture where the focus is on what is important (as determined by the direction and the strategy) and continuous improvement.

Your farm has a culture. Your challenge is to nurture the parts of that culture that support success in turbulent times and to change, consistent with your values, those parts that do not support success in turbulent times. To succeed in our turbulent times, you must alter your farm business culture to be more consistent with the true urgency we discussed last month and to embrace change.

Attract, develop and retain an exceptional workforce
The outstanding research by Jim Collins as reported in Good to Great has popularized the phrase “get the right people on the bus and in the right seats in the bus.” This is just as important for your family business as it was for the good-to-great companies Like Walgreens, Kroger and Wells Fargo Bank.  You must attract and hire the right people – partners, family members, employees. As or even more important are the responsibilities of each member of the business workforce including owners and family members. They each must be assigned responsibilities consistent with their strengths, interests and career goals.

Conclusion

Owning, leading and managing a farm or any other family business presents great challenges, opportunities and rewards. Success begins by clearly identifying your role in the success of your farm in these turbulent times. Next month we will address several key attitudes and perspectives required to excel in these responsibilities.

Bob Milligan, with Dairy Strategies, Inc., provides fool-proof techniques to optimize employee performance, satisfaction and longevity. Contact him at 651 647-0495 or rmilligan@trsmith.com.

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