by Bob Campbell, Senior Vice President
Producers are operating in a complex and volatile business environment. Unprecedented technology developments have increased the pace of change. Global markets, trade issues, politics and weather seem to introduce new risks at every turn.
I recently was asked to speak about what we, at Frontier Farm Credit, see producers doing to succeed in this challenging environment. The insights I collected from teammates and others as I prepared for my talk are worth sharing because they set top producers apart in every economic cycle, good and bad.
We often define success in agriculture in terms of an operation’s size, the experience level (or age) of the operator or some other outward measurement. But success really is about accomplishing what you set out to do, whether that is growing your operation to make room for the next generation or staying small and focused on producing a quality product with your own labor.
Successful producers have many things in common, and they tend to be behavioral, all of which can be learned and honed. My list of behaviors is fairly long and the descriptors aren’t necessarily the same that you would use. But no matter the words, they all point to a strategic mindset – the ability to think about where your operation is going and how it will get there.
Agricultural operations are complicated enterprises. And even when they are run by just one or two people, successful operations incorporate the thinking of a CEO (the visionary and final decision maker), a chief financial officer (the numbers person who knows where the operation stands financially at any given time) and a chief operations officer (the person with day-to-day responsibility for getting an operation from Point A to B). I also would argue that today’s world increasingly requires the mindset of a chief technology officer who identifies emerging technologies that make an operation better and more efficient.
This is a lot of hats to wear and too much expertise for one person to possess. Which brings me to another key characteristic of successful producers: They know what they are good at (which often is what they most enjoy doing) and rely on the expertise of others to fill the gaps in their knowledge and ability. I have worked with large operations in which everyone is good at production but nobody has the mindset of a CFO, and they have not filled that gap. These are not financially viable operations long term because the operators don’t understand their cost of production and how that fits in today’s economic conditions. On the flip side, I have worked with husband-and-wife teams in which one focuses solely on production and the other on finances. These often are among the most successful operations because each partner has a delineated duty. Just as importantly, they own responsibility for executing on their individual duties.
We all know that a strategy is only as good as its execution. And today, successful producers are focused on executing in those areas that they control – their costs of production, the marketing of their grain or livestock, the performance of their operation on key financial indicators.
I challenge each of you to think about the behaviors you see in the successful producers you know. Then ask yourself: Do I have the behaviors and mindset of a successful producer?