Farm Progress

What to do about springtime uncertainty

Know farm’s numbers, stay focused on what’s most important.

Darren Frye, CEO

March 13, 2017

3 Min Read
NolanBerg11/ThinkstockPhotos

As a farm leader, you’re always facing decisions for your operation, regardless of what time of year or what part of the growing season you’re in. Those decisions can feel like a ton of weight on your back.

Often, the choices you’re making depend quite a bit on the time of year, or the opportunities that are or aren’t available. Think about the agronomic decisions you make for your farm. You’re presented with certain choice points that are connected to where you’re at in the growing season.

At different times of year, you’re making decisions about seed varieties or how much fertilizer to purchase. Other times, you’re deciding when and if to apply fertilizer, fungicide or insecticide. There’s also non-agronomic business decisions, like whether to purchase or rent additional acres or if you’re going to buy a combine or repair your current machine.

Emotion: The wild card
The factor that can rear its head around any of these decisions is emotion. These emotions often range from feelings like fear, uncertainty and greed to anxiety or regret. What the decision is about, its relative importance to the farm’s success, and what time of year it is can combine to generate even more intense levels of emotion, especially when uncertainty is high about the upcoming crop year.

Emotion feels like a wild card has just been played on us, and it can really come in and hijack our decision-making process, if we continue to let it. That’s why it can be so helpful to use an approach that incorporates the right data and information about the farm operation into decision-making.

The way we respond to and process decisions for our farm also has quite a bit to do with our unique personality. Some farmers might gather all of the data and information they can, but then become paralyzed by uncertainty and unable to make a decision. For others, their conviction and belief about the right direction guides them. Others may tend to act, sometimes impulsively, solely off of a ‘gut feeling’ and nothing else.

None of these reactions and habitual responses to decision-making are necessarily right or wrong. But they’re all still vulnerable to hostile takeovers by the emotions of the particular time of year.

Avoid the pitfalls
Being able to reduce or even eliminate emotional factors like uncertainty and fear from the decision-making process can be a huge asset to you as a farm leader. Avoiding the pitfalls that come along with some of the emotional decisions farmers must make can help bring more focus on what matters most for your unique operation.

What can help when emotions and uncertainty are running high in decision-making?

  • Know your farm’s numbers – including your breakeven – inside and out.

  • Stay focused on what’s most important and maintain a ‘big picture’ view of your operation.

  • Understand your own personality and how it plays into the way you make decisions.

  • Have a trusted advisor to turn to, such as an ag finance advisor, who can help analyze and interpret your farm’s numbers and show you the impact of the decisions you’re considering.

Read the current issue of the Smart Series publication, bringing business ideas for today’s farm leader. This issue includes perspectives on what to do when a landlord asks for higher rent, how to find the right new employee, a farm business checklist for the spring season, and more. Get your free online issue here.

The opinions of the author are not necessarily those of Farm Futures or Penton Agriculture.

Frye is president and CEO of Water Street Solutions. Email questions to [email protected]. All questions and responses will be printed or published online as anonymous

About the Author(s)

Darren Frye

CEO, Water Street Solutions

Darren Frye grew up on an innovative, integrated Illinois farm. He began trading commodities in 1982 and started his first business in 1987, specializing in fertilizer distribution and crop consulting. In 1994 he started a consulting business, Water Street Solutions to help Midwest farmers become more successful through financial analysis, crop insurance, marketing consulting and legacy planning. The mission of Finance First is to get you to look at spreadsheets and see opportunity, to see your business for what it can be, and to help you build your agricultural legacy.

Visit Water Street Solutions

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