Is Your Family Farm Professionalizing? Look For These Signs
By Lance Woodbury, 06.18.2015

A recent Granular blog post aptly mentions that most of today’s large farms “are complex organizations run by fathers, mothers and their relatives trying to leave the business in better shape than they received it.” This family stewardship ethic takes shape in the context of a progression of the business from “survival mode,” where owners were literally surviving from year to year, living almost hand-to-mouth, to a more stable and profitable business where the owners and managers are working to increase the professionalism of the organization.

Several indicators highlight the path to professionalism in the family farm. In the financial arena, people begin to see financial information not as a requirement to get a loan or file a tax return, but as a critical tool in understanding their business and measuring the results of their management efforts. Moving to accrual based accounting, determining the key financial ratios critical to success, engaging or hiring a CFO with specialized training in finance and accounting, and moving to a reviewed or audited financial statement are all signs that the business is moving to the next level in their organizational life cycle.

In the area of human resources, business owners and managers systematize their approach to recruiting, hiring and managing talent. They may use internships or take advantage of career placement services at agriculture colleges. They develop policies around compensation, they design bonus systems, they increase the frequency of feedback, they institute individual development plans, and they consider additional and unique benefits to reinforce their values and culture.

In production, family farmers becoming more professional see their role as a coordinator of resources and activities. They begin to plan one or two (or more) years ahead, knowing that a successful growing season involves solid agronomic intelligence, the right inventory of seed and other inputs, the appropriate equipment, an effective and growing staff, an articulated capital improvement and expenditure philosophy, and a system by which to capture, organize and use their production and financial information – which is where Granular can make a big difference.

The path to a more professional organization requires long-term perspective, a personal willingness to learn and grow, additional people and skills, and new technology platforms and tools. How do these elements factor in your plan for growth?

 

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