There Are No Secrets on This Farm

August 1, 2009 02:37 PM

Quick Facts

> Location: Colby, Kan.
> Owner: Lon Frahm
> Partners: Bryan Frahm (brother) and Wendy Weishaar (sister)
> Education: Frahm has bachelor's degrees in business and ag economics from Kansas State University (KSU) and is an alum of the KSU Masters of Agribusiness program.
> Crops: Irrigated corn, dryland corn, dryland wheat, milo and soybeans
> Size: 16,000 acres

The meeting begins each morning at 7:30 in the farm conference room. Lon Frahm takes his usual perch at the table between Dewey and Dave, his longest-tenured employees.

Jason has ideas for upgrades to their precision technology. Dave updates them on expansion plans for grain storage. Dewey fills them in on the nearly completed state-of-the-art shop. These guys act like they own the place. They don't, but Frahm won't have it any other way.

"There's not one boss; everyone takes care of their own section of the farm," says Dave Denneler, Frahm Farmland's crop specialist. "We treat it like we own it. If something needs to be done, we do it."

Because Frahm focuses on what he does best—management, analysis and building rock-solid marketing plans—Frahm Farmland has prospered and Frahm was chosen 2009 Top Producer of the Year in the contest sponsored by Challenger.

Finding himself on a management island in 1986 when his father suddenly passed away of a heart attack, the then-28-year-old Frahm was thrust into maintaining the farm, managing his father's estate and keeping the farm together through probate. Two of the farm's employees remain with him today and he is quick to give his entire crew credit for his astounding success.

"The Boys," as he calls them, are empowered to make all production decisions, including hybrid and variety selection, crop rotations, fertilizer choices, applications and timing. They shop for new equipment and other inputs and they bring the deals to Frahm for a final decision. They always know the financial status of the business.

"It doesn't bother me to share that information," Frahm says. "The only thing I haven't shown the crew is the actual tax returns. It creates a lot of engagement and a sense of ownership they wouldn't have otherwise. Secrets are a lot of work."

Frahm is usually at his office in downtown Colby working on finance, record keeping and marketing. "The crew decides their hours and what they do on a daily basis.

I really don't know what they do when I'm not there," he laughs. "And I guess I really don't care."

"They're good people and they know what they're doing," says Frahm's close friend Mark Wingert, senior vice president of Farm Credit of Western Kansas. "Lon's willing to delegate. He knows he can't be an expert at everything and he doesn't need to micromanage. The big decisions fall back to Lon."

Family Trips. One of the things that keeps his employees happy and motivated is the annual company trip. They have visited Hawaii, California, Arizona, Mexico and, several times, the Caribbean.

"You know how it is when you're on a big farm, or any farm—you don't take the time to do it," Denneler says. "My wife and I weren't going anywhere except to see family. Now we have something to look forward to every year."

This year, the company gets a two-fer. Immediately following the Top Producer Seminar last January, Frahm met the crew and their families in the Caribbean. In September, they have a seven-day Alaskan cruise, something the crew didn't want to do just ahead of harvest, but Frahm insisted upon. They'll go into harvest more ready for the extra hours.

An Economist.
Interestingly, Frahm is doing the last thing he ever wanted to do as a youngster, though he says he enjoys life and is happy. Just don't call him a farmer.

"I happen to be an economist who runs a farm. An economist is somebody who allocates resources or makes decisions. The resources and decisions that I have to make are related to agriculture."

As the owner's son, he grew up, as tradition dictates, driving the combine during harvest. However, he quickly learned that his mind was better used in town.

"In the early days of PIK and LDP payments, I figured out I could ‘earn' untold thousands of dollars per hour to be in the FSA office during fall harvest between the market close at 1:30 p.m. and the office close at 4 p.m. During that time, I had the opportunity for 20/20 hindsight in making loan redemption decisions based on the previous day's posted county price. I demoted myself from combine operator to part-time truck driver ever since."

Growth Goals. Frahm has grown his business from 5,000 acres in 1986 to 16,000 today­. Even with the ability to water a sizable percentage of his crops from the Ogallala Aquifer, he finds that weather continually creates challenges for his operation. But this has also created opportunities for him to grow his business rapidly in the past decade.

Hailstorms in the 1990s, followed by a long-term regional drought beginning in 2000, forced many area farmers to exit the business. This, Frahm says, allowed him to expand rapidly. Between 2000 and 2004, he doubled his acreage.

"I don't want to grow for growth's sake, but I believe you have to be ready to leap when an opportunity shows up," he says. "I know that I always have to be ready to grow because break-evens, margins and minimum economies of scale are always changing."

His outlook for growth and what will make it possible seem to tug at Frahm. In a moment of looking back, he considers what led him to a life he never wanted.

"My father died suddenly when I was 28, so all of a sudden a lot of choices were made for me," he says. "I was here in 1986, stuck in the middle of the ag depression, and I was kind of thrust into the ag role.

"Not that it wasn't a good time, not that it isn't a good life, but I was the kid who was never going to be a farmer. Now, out of all the kids in my high school class, I'm the only one who is."

About Frahm Farmland

Mission: To be the premier agricultural operation in the region—improving lives, the environment and communities.

Committed to No-Till: "Look over there," Lon Frahm says, as he drives from his office in Colby to his farm headquarters after a rare 4" May rainfall. "There's no standing water; it's all in the soil. That's an important benefit of no-till."

Intern Program: One or two foreign interns come to Frahm Farmland each year through a program with The Ohio State University. Currently in the 10th year of the program, Frahm has had visitors from Africa, Europe and South America. One, Mike Brocklehurst from Zimbabwe, still works on the farm. His brother Skip, also a former intern, whom Frahm helped get his pilot's license, is now a commercial helicopter pilot in Texas. The Mugabe government in Zimbabwe forced the two brothers from their farm at gunpoint. They are now working toward U.S. citizenship.

Helping Employees: Frahm has helped one of his employees purchase his own farmland, and he has made the same offer to all of his employees.

Favorite Quotation: "We should all learn to find opportunities in our difficulties, rather than find difficulties in our challenges." —Eleanor Roosevelt. "Everything that I considered a difficulty was really an opportunity in disguise," Frahm says. "It just takes some distance or time to realize that."

Dedication to Service

Lon Frahm was always taught to give back. His grandmother, whom he calls the most influential person in his life, pushed him to serve others.

"A quote I use is from my grandmother: ‘Service is the rent we pay for space we occupy while we're on the earth.' I think it's critical to give back to communities and to others. That's what makes the world go around, really," he says. Frahm serves on multiple boards and much of his service is long-term.

That dedication, however, also helps Frahm excel in management. "Serving on the utility board, I learned how they trade and update equipment, including trucks and pickups. I looked at that and said ‘OK, how can we apply that to the farm?'"

He also adopted many of the lessons he's learned about insurance, compensation and employee benefits. "There's just no end to the benefits of the cross-fertilization of ideas and practices from one industry to another."

Community service is one of the criteria in choosing the Top Producer of the Year.

> As Top Producer of the Year, Lon Frahm will receive a six-month or 200-hour lease of a Challenger tractor. Applications for the 2010 award are due Sept. 30, 2009. Click here for more information.

Top Producer, Summer 2009

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