What are you managing towards? – by Terry Betker

What are you managing towards?

Here’s an interesting question. What is your vision for management on your farm? There is certainly value to be gleaned from having a farm’s vision written down and shared within the ownership and management group. A strong statement of a business’s vision provides purpose and energy to those working in and on the business, leading to desired outcomes. Lack of a clear vision often will result in ‘drift’ associated with people doing what they think is best, but where the actions of the people involved might not necessarily be aligned.

While there is an abundance of information and resources pertaining to a farm’s business vision, there’s not so much written about a vision for management. In other words, resources to help a farm family determine what it is there are managing towards. I’m talking about management structure. Who manages what / who does what. The illustration that captures this structure is an organizational chart. I think there is an activity that could help farm families better understand the tactical application of the organizational chart.

The table inserted below is a narrow band of a farm’s overall management activities.

The management functions are usually organized as operations, marketing, human resources and finance. Each of these areas will have management sub-functions. A management sub-function is really the management task that is associated with each specific management function. It is not about who does the work but who is responsible for managing the work.

The next step in the exercise is to identify the management personnel involved in each of these management sub-functions. Ideally, the goal should be to have just one person responsible for a management function. This is very often difficult on a farm due to historic multi-tasking on management. Management structure on a farm is an outcome of how things have been done in the past and evolved over time to end up with the current situation. As opposed to critically examining how things have been done / are being done and how that might be adjusted. Management is one of the most difficult things to change on a farm and understandably so given the nature of the business. However, my observation is that paradigms around management structure are often growth and performance limiting.

I’ll refer to just a couple of the management examples in the illustration above.

• Budgeting / Cashflow / Projected
  – This activity is currently being done on the farm so ‘Y’ is entered.
  – Tim and Dave are both managing the function and doing the work.
  – In the future, the goal is to have only one person responsible (Tim).
• Recordkeeping/Accountant
  – This activity is currently being done on the farm so ‘Y’ is entered.
  – Walter (soon-to-be-retiring father) is both managing the function and doing the work.
  – The 3 year plan is to transition this management responsibility to Sue and to have Sue and Dave doing the work.

Transition Application

The management activities resource is a step towards a defined management structure. From this resource, a farm family can identify what areas the retiring and next generation currently manage, what the management activities are, and what transitions need to take place. An accompanying professional development program can be designed to help with next generation skill set development.

The management activities is not difficult to work through. Start with what your CURRENT management structure looks like and then determine what you would ideally like to see in place at a point in the future. The chart above suggests 3 years but it could 1 year or 5 years. Whatever the future timeline, that horizon should align with the business vision for the farm.

1. Add categories for finance, human resources, operations and marketing. You can also add categories such as technology and/or safety for example.
2. For each Main Management Function, fill in the information according to the following column headings, as is relevant for your farm.
   1. Management Area
      1. The main categories where management tasks take place within each Main Management Function.
   2. Management Sub-Function
      1. The management tasks that are involved within each Management Area.
   3. Current
      1. Record whether or not activity is currently done on the farm.
   4. Manages it
      1. Record who currently is responsible for making sure it gets done and gets done correctly.
   5. Who does it
      1. Record who actually does the work associated with the activity.

The resource I’ve described above is not my original work. I came across a version of the resource when working with a Manitoba farm family several years ago. I have added detail to the activity over the years. I get very positive comments from farm families who see and work with the resource. It is a great resource to work through and then review every year or so as circumstances change.

If you would like to speak to one of our consultants about this topic contact us.