In a world full of threats to our livelihood, what do you consider the biggest danger we face in 2019? A continued trade war with China? More low prices? Issues with implementation of the new farm bill? All are concerning, yes, but I’ll argue that while these external threats loom, the most concerning threat to farm businesses I see is actually internal. One word: complacency.
Complacency—that tendency toward thinking deep issues will go away. Complacency is what happens to our operations when we are simply too busy working to work on the business.
Don’t think it’s that serious? Consider the impending break up of General Electric (GE), the company that powered the world, until it didn’t.
Many of us have owned stock in GE, which in its heyday of around 2000, was worth about $600 billon. GE was considered a safe bet, a blue chip as they say, until it was removed from the Dow this June, after being listed since 1907.
“Complacency is what happens to our operations when we are simply too busy working to work on the business.”
GE had been a charter member of the index. Now, for the first time in company history, a non-GE trained executive, Larry Culp, has become CEO. His task: break up the company, which is down 90% from its top valuation. I’m not trying to launch 2019 on a sour note. Instead I’m suggesting large, long-enduring industrial companies with loyal employees actually have similarities to farming organizations. So, let’s take a look at three lessons that can apply to agriculture for 2019.
Lesson No. 1: Hire right.
Former GE CEO, Jack Welch, said he gave himself an A in leading the company but an F at hiring his successor. That bold statement shows both self-confidence and self-deprecation. It’s also honest. Have you taken an honest look at how you are building your bench for the future? How far are you from retirement? What’s your farm’s hiring strategy? While many top farmers don’t enjoy the process of hiring and firing, avoiding it earns an F grade, too. Make 2019 the year you hire right.
Lesson No. 2: Solve the problem (even if you inherited it).
I’ve heard many times from second- or third-generation producers that they just have to live with some problems because they inherited them. But you can’t just ignore baggage from generations past. Complacency takes root with the attitude of, “Well, I didn’t create this mess, why should I clean it up?” Instead, look at ways to become proactive and take the necessary steps to rectify long-term problems. Or, simply do what every mother of toddlers already does automatically—clean up the spilled milk. Mothers of toddlers don’t ask why, they don’t have the time! Rather, they are adept at anticipating land mines with a keen eye. Even then, they know they cannot prevent all the mishaps, so they are also always ready to clean up the mess as quickly as possible and tweak the solution for next time. What aspect of your business is messy and requires the necessary clean up this year?
Lesson No. 3: Build anew.
Another adage credited to Welch was the phrase “fix it, close it or sell it.” That goes in direct opposition to the oft-used phrase in agriculture of “if it ain’t broke, don’t fix it.” Is it time for radical change in your operations? Do you need to increase investment in some areas while closing out of some aspects of the business? During 2018, I was working as an executive coach to a grower who told me the model for profitability in agriculture has changed and it was time to get his business model to change too. What has shifted in your marketplace that you haven’t yet shifted with? Where are you regarded as a market leader, and where is your operation lagging? Make 2019 the year you clearly evaluate the aspects of your business that need one of Welch’s three “its”—fixed, closed or sold.
Meet and learn from Sarah Beth Aubrey at the 2019 Top Producer Summit, which happens Jan. 14-17 in Chicago. Learn more and register at tpsummit.com.
Sarah Beth Aubrey’s mission is to enhance success and profitability in agriculture by building capacity in people. She strives to foster that potential through one-on-one executive coaching, facilitating peer groups and leading boards through change-based planning initiatives. Visit her at SarahBethAubrey.com.