One way a farm can gauge whether it has a long-term competitive advantage is to identify resources unique to the farm. To survive in the short run, farms must be able to exploit key resources. To survive in the end, farms must be able to explore and take advantage of new opportunities. One of the key unique resources on many farms is managerial experience.
Farm managers need to be able to share their experiences with younger family members and employees. Unfortunately, training younger family members and employees is often complicated by the tacit nature of a farm manager’s experiential knowledge.
Tacit knowledge, as opposed to explicit knowledge, is difficult to transfer to another person through writing or verbalizing. Tacit knowledge is often related to the rules of language, innovation and leadership. Tacit knowledge is important because it’s extremely difficult for other farms to use your unique knowledge. For example, if a farm has a vast amount of experience in producing a specialty crop, it’s difficult for another farm to obtain the knowledge related to this experience, because it’s not written down or readily available.
Train and learn
Many of us remember stories and experiences shared with older family members. I personally have fond memories of discussing agricultural issues with my father and grandfathers, and have them to thank for my passion. However, if members of a farm want to take advantage of each other’s experience, it needs to go beyond this sharing.
Cross-training or learning about tasks for which different family members are responsible is also important. For example, if one of the older family members is primarily responsible for keeping and analyzing records and discussing debt needs with lenders, it is important that other family members at least have some sense of what this responsibility entails.
The discussion so far has focused on sharing knowledge with family members. I should also stress the importance of communicating with other farm employees. Most employees want to know how they fit into the operation, and are interested in how transitions in management or responsibilities will affect their future.
How does a farm make sure that tacit knowledge it being fully utilized? One way is to have periodic farm meetings. Another way is to take time to explain to younger family members and employees important farm tasks and processes.
It’s important to discuss both how and why the farm performs a task or process in a specific way.
Utilizing tacit knowledge is a key first step in exploring and taking advantage of new opportunities. The reason is simple: If a farm doesn’t fully understand the experiential knowledge of each family member and employee, it’s difficult to determine strategic direction.
Langemeier is associate director of Purdue University’s Center for Commercial Agriculture.