When many farmers think about improving their operation in some way, they might first think about particular improvements they could make to individual fields, or to the equipment line, or to some other aspect like bin set-up or farm buildings.
These are good things to think about when it comes to making improvements on the farm. They often come to mind first because they are essential to daily operations and to the process of producing a crop.
Gain the advantage
However, physical aspects aren’t the only areas to consider when you think about improving your operation. Sometimes, the business and financial management side of running a farm can even fly under the radar a bit when we think about improving the farm – plus, it’s tougher to measure and see tangible improvement.
When you’re setting goals about what you’d like to improve in your operation, thinking beyond the improvements other farmers might think about first can be a way to increase your farm’s competitive advantage. Working to take your farm to the next level in these areas is one way to set your operation apart.
Here are three aspects to start thinking about.
- Efficiency. This one cuts across all aspects of the operation – and it’s very important especially in a commodity business like farming. To become the lowest cost per unit producer, the farm leader has to consider efficiency – and how to improve it – in pretty much every operation happening on the farm. This includes areas that might come to mind right away like being efficient with inputs but also things like creating and using an efficient decision-making process for financial decisions that must be made. It’s important to consult and keep track of the numbers to watch for progress along the way, too.
- Communication. The different people and different types of communication that are required for a successful farm operation are key. First think about the different people involved with your farm – both inside and outside – and the communication skills that you, as the leader, can work on to help improve those relationships. There’s your family members involved in the operation, your employees, landlords, lenders, vendors and advisors. And then there are people in the surrounding community and in the wider world who aren’t directly involved with your operation, but might be aware of it or of farming in some way. Investing in improving your communication skills and that of others in the operation is a very smart way to give your operation an advantage because relationships are critical to the farm’s success.
- Leadership skills. As the leader of the operation, you might be finding yourself spending much more time on different aspects of the farm than you did when you were just starting your farming career. Much of the role of the farm CEO requires leadership skills that are different from what made you successful when you weren’t yet in a leadership role. Working to improve your leadership game by learning new skills is a way to improve your operation through investing in yourself. You might consider attending a conference like the upcoming Farm Futures Business Summit June 16 & 17 – where I’ll be presenting a session on open book management.
Want to save 20% on the 2021 Farm Futures Summit? When you register at farmfuturessummit.com use the promo code FFLIVE.
One area farmers often say they would like to be more strategic in is the creation of marketing plans and making marketing decisions. Our market advisors come alongside farmers in that process – you can get in touch with us for more information or get a free trial of our marketing information service at www.waterstreetconsulting.com.