“In agriculture and in life, it’s a marathon and not a sprint,” offers Nick Luchsinger, loan production officer with Dakota Mac.

Luchsinger is not your typical ag lender. His initial education included degrees in criminal justice and psychology, and his early career was as a high-risk probation officer. Those experiences have served him well at Dakota Mac, as he works to steer some customers out of high-stress scenarios and onto a more stable, profitable path.

Oftentimes, that journey requires some sort of strategic plan. Davon Cook, principal with Pinion, is all too aware of this reality, as she has spent the past decade guiding farmers through these processes.

“It’s essential to get beyond the daily firefighting mode and think bigger picture,” she says. “Time for reflection is important.”

That reflection is the first critical step for any solid strategic plan, says Cook, who also provides business advice at her FarmFutures.com blog, Family Farm Success. But beyond that, additional universal truths may be harder to come by — after all, every farming operation is unique, and therefore, the strategic planning process should be individually tailored to some degree. That said, consider the following 10-step process as a firm foundation to build a successful blueprint.

The recipe

What are the hallmarks of a successful longer-term strategic plan? Consider this path forward:

Questions?

A strategic planning quest really boils down to a handful of questions that need to be answered. Cook gives these examples:

Where are we now?

Where are we going?

How do we get there?

How are we progressing?

“The bulk of the work is in that third point,” Cook says. “That’s where you have to set up specific goals and timelines.”

Cook has seen many strategic plans over the years and can attest they vary widely by operation. Some fit on a single sheet of paper; others warrant dozens of PowerPoint slides.

The bottom line: Right-size the plan for your one-of-a-kind needs. “A strategic plan can be elaborate, as long as you’re going to use it,” she says. “Otherwise, don’t get too complicated.”

Cook considers a few other attitudes and actions as best practices. First, focus on progress, rather than perfection. “Your plan should change some,” she says. “It’s a living document, and life changes.”

It also may be prudent to assign yourself an accountability partner away from the farm, whether that’s a lender, consultant or simply a friend. Schedule time to talk with them periodically. That helps put the plan front of mind and will keep you more open-minded to any changes that may need to be made.

A meetup doesn’t have to be super-formal, either. The occasional brainstorming lunch could be a perfect fit for many.

Timing issues also must be considered when involving outside parties. Some operations prefer to work up a first draft and use colleagues as a sounding board, while others like to involve them from the start.

“Either way has value,” Cook says. “It depends on your personal style.”

Get smart

As for other best practices, Cook advises not to reinvent the wheel. Businesses across all industries have been fine-tuning strategic planning processes for decades. Use their past efforts to your advantage.

One example is developing SMART objectives, Cook says:

“The more you can measure, the better,” she says.

For example, are you interested in increasing profitability? Make a goal of increasing return on assets by 2 percentage points, which you will achieve by doing more custom work. Or maybe you want to shorten your planting window by an average of two days by purchasing a bigger planter or working on a new multi-shift labor rotation.

The point is, if goals are too “squishy,” they are effectively impossible to track. They have to be specific enough that you can determine their success — or failure.

Relevancy will be a huge factor heading into 2023, Luchsinger says.

“You’ll want to address needs, not wants,” he says. “When I get a customer in the door, I try to analyze and manage their risk. Our hope is they’re doing that as well. You have to know your numbers and understand your cash flow. If the numbers work, they work. If they don’t work, it’s time to go back to the drawing board.”

Red flags 

The world of strategic planning tends to be heavily filled with jargon. But don’t let words trip you up, advises Wesley Tucker, University of Missouri Extension field specialist.

“There is a lot of crossover or confusion about what some people label ‘business planning’ or ‘strategic planning’ or ‘operational planning,’ ” he says. “Many terms get used interchangeably. Some will say it’s writing your mission and vision statements. Others will focus on defining your core values and goals. For some, it may be SWOT analysis” — strengths, weaknesses, opportunities and threats.

Like Cook, Tucker recommends identifying where your farm business is today, where you want it in the future and how to get there.

How far into the future? Tucker says most experts consider a three- to five-year planning window. However, some suggest stretching that to a 10-year window with short and midrange milestones throughout.

The biggest red flag, Tucker says, is treating the plan as a “one and done” process. “In agriculture, the landscape is constantly changing,” he says. “Consider the volatile changes we’ve experienced in commodity, input and land prices since the beginning of the pandemic. As the world around us changes, it’s important to revisit the process regularly to make needed adjustments. This should be a living, breathing document that helps direct your business. The long-term goals may shift or adjust over time as the landscape around us changes, but we view the process as a success if it is moving us in the right direction and improving our operation.”

A farmer's perspective

In late 2022, Mogler Farms — a diversified, multigenerational operation in Iowa — completed its first three-year strategic plan, using a tool called Vivid Vision, developed by Entrepreneurial Operating System.

“We’re a lot like other farm businesses,” says Janae Metzger, a partner-operator at a 4,400-head sow unit at Pig Hill, a part of Mogler Farms. “We’re very good at our day-to-day operations but wanted to be more forward-thinking.”

In 2019, Mogler Farms ultimately settled on a series of goals that included specific production metrics for each area of the farm, plus additional items regarding farm transition and succession planning. The plan even addressed company culture and community outreach.

At the end of those initial meetings, Mogler Farms had a five-page document developed by the management team, which it then shared with the rest of the employees. After that, the plan was revisited periodically. Some parts were reviewed quarterly, while others were yearly.

Like others who have gone through similar strategic planning, Metzger says the three- to five-year window seems to hit a sweet spot. Shorter plans would have to be addressed too often, and you might feel like you’re always planning and never doing, she says. And while 10-year plans are popular, they run the risk of becoming too vague.

“The three-year plan feels more tangible,” she says. “You have time to work through things, and everything doesn’t have to happen right away. We just mapped it out and kept plugging away.”

Read up and do all the research that you can, but at the end of the day, there’s no singular template for a successful strategic plan.

“It’s really a matter of your business and your business dynamics,” Metzger says. “How many moving parts do you have? How many entities do you have? How many employees? All of those factors will make everybody’s plan much different. I don’t think there’s really a right or wrong answer.”

Don'ts to dodge

Plenty of ingredients go into a successful strategic planning “recipe.” But here are five attitudes and actions to avoid:

1. Don’t make assumptions or base your plan on incomplete and outdated information.

2. Don’t try to do everything at once or overextend your resources.

3. Don’t leave out key stakeholders in the planning process.

4. Don’t forget to regularly review and update your plan.

5. Don’t be afraid to seek outside advice or support.

Got balance? 

The balanced scorecard can help with your strategic planning. The BSC is designed to help organizations balance the various aspects of their business, from financial performance to internal processes. It does this by using key performance indicators (KPIs) that measure performance in each given area.

BSC can track different aspects of your business, identify areas where you’re doing well or not so well, and take action when needed.

Here are some tips from business consultant Jeroen de Flander.

Communicate process before content. Proactive, no-nonsense communication creates buy-in from the start.

Know what you want to achieve. Prioritize goals and stick to you choices once you make them.

Avoid common pitfalls. Typical mistakes include making unrealistic goals, spending too much time in development and not earning enough buy-in from your team.

Adapt your size. You don’t need a cannon to kill a fly. Smaller units don’t have the resources to handle a complex scorecard.

Teach team to debate strategy. Reacting to something that has already happened demands different skills than debating things that have not happened.