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Seek Other Winners

March 6, 2009
By: Danny Klinefelter, Top Producer Guest Editor
 
 


The best managers recognize that however successful their business is, someone, somewhere, does it better. The best place to look for ways to improve may be with people who are going through the same experiences as you. Groups of successful people like yourself can learn and grow together.

Peer advisory groups are a cost-effective way for farm CEOs and successors to find new perspectives and ideas and hone management skills.

Groups must be made up of the right people. Chemistry and trust are critical, and openness and candor are essential to maximize benefits. People who can't accept constructive criticism, or can't admit they are wrong, are not good candidates. Members of groups I work with tell me they hear things they don't like but need to hear. That is where much of the value occurs. People who are there to take away and not give back are not good candidates, nor are people who try to dominate the conversation.

Challenge yourself. It's critical to seek other winners. Successful people challenge you and force you to think differently; they cause you to consider alternatives, and they inspire.

Flying with eagles and not scratching with turkeys is an issue in any business. Losers do not yield stimulation, motivation or personal growth. They tend to be victims and tradition-bound, and may drag you down to their level.

Structure. Typically, the dynamics are best with five to 10 members. Meetings are usually monthly or quarterly. Some groups use professional facilitators; others rotate the discussion leadership among members.

Membership is by invitation and, from the start, groups must define the basis for removing members when the right fit doesn't exist. Having everyone's agreement up front is critical for amicable separations.

There also needs to be a confidentiality agreement so all members, even those who leave, understand that what is said stays private.

Although I work in Extension, I don't believe that continuing education programs or on-the-job experience provide everything producers need to achieve success or remain on top. Peer groups afford personalized and ongoing management development opportunities.

There are two situations where peer groups can make a critical difference. The first is good times, when it is too easy to become complacent. The second is bad times, when the margin for error and window of opportunity are very small.



Peer Group Advantages

New thinking. In closely held businesses, the CEO and other members of the management team frequently view issues from the same vantage point. This tends to create blind spots and limit objectivity. Peer groups provide a way to overcome that problem.

Sounding board. Have the CEO and his or her successors missed anything? Are there alternatives they haven't considered, or implementation issues that may not have occurred to them? Peer-group discussions can provide feedback on plans and ideas, explore what-if questions and allow members to draw on the experience of others, thereby providing greater insight and objectivity.

Brainstorming. The group is an informal board of directors, providing members an opportunity to bounce ideas off their peers. Each member brings a wealth of personal and business experience to the table, making for an atmosphere of synergistic creativity. This may provide the encouragement needed to try a new idea or see a project through to completion.

Sum of the parts. Within the group, a variety of skills and interests will be represented. Peer groups can offset weaknesses, complement strengths and reduce the need to try to be good at all things as a manager.

Vision and insight. Peer groups can help turn the focus away from day-to-day issues and make you look at the bigger picture, improving your odds of success.

Psychological support. Friends and family may not understand the issues you face. Fellow members of a peer group likely have the same sense of isolation and can offer support and understanding in a way that no one else can. They can also help you cope with periods of stress or financial hardship.

Development. An expanded circle of contacts can help you identify new markets, supply sources, potential employees and business opportunities.

Benchmarking. The coordination of production field trials and development of databases and benchmarks for marketing results, production and comparative financial information can multiply the availability and usefulness of information, while reducing acquisition time and costs.

Needs-based training. Assume that several producers de-cide they need training in some area of personnel management, succession planning, process improvement techniques, financial analysis, options strategies, etc. The type of program and level of expertise they need might require anywhere from one to three days, and a quality presenter might charge $3,000 to $5,000 a day, plus expenses. Shared by five to 10 producers, the cost could be reasonable. In addition, the questions and perspectives of multiple participants will likely open up some possibilities and issues that wouldn't otherwise be discussed.

A safe haven. Peer groups provide a safe, confidential environment in which business owners or successors can tell the truth about what is going on in their personal and business lives and get real answers to the challenges they face on an ongoing and daily basis.

Prepare for succession. Frequently, successors in closely held businesses either won't or can't effectively challenge the ideas of the CEO because they fear that doing so would lead to conflicts that might have spillover effects on their business and/or personal relationships. A successor peer group can provide advance feedback on their point of view.

Enabling. It is incredibly easy for business owners to stay within their comfort zone. A peer group allows emerging and seasoned business owners to stretch beyond their current situation, setting higher goals and reaching them faster than they would on their own.

Accountability. One of the biggest challenges many business owners face is that there is no one to answer to. There is no boss or supervisor looking over their shoulder, making sure that they have completed all of their tasks. There is also no one pushing them to set higher goals and take action to attain those goals. A peer advisory group can provide the accountability needed to assure follow-through on business commitments.



Danny Klinefelter is an economics professor with Texas AgriLife Extension, Texas A&M University.



Top Producer, March 2009

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FEATURED IN: Top Producer - MARCH 2009

 
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