Editor’s note: This is the final step in the three-part “DAD” process.

Many U.S. Farmers aren’t in a position to develop leadership in their operation’s next generation. 

Why? Because they haven’t picked who will do that. 

Consider the numbers: 68% of farmers have no children who farm. And just over half of U.S. farmers have not identified a successor. The average age of those farmers is 58, and 85% of farmland is owned by people who are 55 or older. 

While nearly every farmer dreams of seeing the operation continue into another generation, the majority haven’t set it as a goal. 

Moving farm succession from a dream to a goal demands action on two fronts. Davon Cook, a family business consultant at Pinion, separates farm transition into estate planning, which is the ownership component, and succession planning, which is the leadership side. 

“In addition to transitioning the farm and assets, there’s a responsibility to pass the torch on leadership and management to keep this moving forward,” says Mike Downey, a farm transition coach at Uncommon Farms. “The future of agriculture is dependent on how well it transitions to the next generation.” 

On the leadership side, that starts with deciding who will be the next farm leader, or leaders, and continues with transferring responsibility and authority. That can be a tough transition for the exiting generation. 

Related:Take next step to achieve a thriving farm succession

It wasn’t for Rex Clements of Lynn, Ind., largely because he could follow in his father’s footsteps. He started with turning over tech decisions to son-in-law Wade Miller. 

“It was so easy for him and a struggle for me,” Clements says. “And so, I just wanted to turn that over to him when he came back full time. … My dad did that to me. He wanted me to do all the decision-making. He wanted to not have that extra stress. So that’s why it was easy for me to turn it over, and Wade was willing to do it. And that’s kind of how it started.” 

Since that time, Clements says he has given nearly all of the decision-making to Miller. Those close to the farmers, however, note the two talk over nearly every decision.  

Communication is key, says Mississippi farmer Willard Jack. His family created an advisory board for the businesses as Willard and wife Laura Lee moved into retirement, and son Jeremy and daughter Stacie Koger moved into leadership.  

The leadership team, including the elder Jacks, are on the board, which meets monthly and operates under written business policies, which farm management consultant Dick Wittman helped write. 

Related:3 steps to succession success

“We took it from one farmer running the operation to multiple stockholders,” Jeremy says. “It limits the opportunity to micromanage.” 

Putting a solid business plan in place takes a lot of work, commitment, and willingness to revise and shift to meet the business and leadership needs. 

The goal, however, is to shepherd the family farm into the next generation. And the silver lining for the exiting generation is seeing that come to fruition. 

“It’s a joy,” Willard says. “Pure joy.”  

3-part process 

Here’s a refresher on the three steps to transition: 

D. Define farm goals for off-farm and farming heirs. 

A. Align financial structure to support the farm, define fairness and forgo as much tax as possible. 

D. Develop next leaders so they have the experience and corporate knowledge needed for success.