wheat

I Can Do It Alone…

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As entrepreneurs, we generally put our shoulder to the plough and find a way to power through the
work that lay ahead of us. Staunchly independent, we rarely ask for help. I believed that for quite some
time myself…I mean, it’s a pride thing right?

Then my mentor gave me 5 simple words, so impactful and so true, yet these are words we’d never
recognize until someone throws them in our face; “You can’t consult to yourself.”

I can’t build my business alone. I can’t be an expert at everything. There is no way I have enough days in
this lifetime to gather all the knowledge, experience, feedback, networking, and intellectual property to
“do it all myself.” I need help in areas where “I don’t know what I don’t know” and so I seek it out from
others who have proficiencies that I do not. I’ve hired a consultant, and I take part in some excellent
networking associations.

I belong to two ag focused advocacy groups: Saskatchewan Young Ag Entrepreneurs (SYA)
www.saskyoungag.ca and the Canadian Association of Farm Advisors (CAFA). www.cafanet.com These
are not lobby groups, or policy groups; they are not groups focused on any one commodity or sector.
They are channels for farmers and farm advisors to share successes and struggles, discuss challenges
overcome and opportunities lost. These are the places to learn what your peers are doing right, and to
learn from their mistakes. Neither increases my workload with committee obligations and the like. Both
groups are completely focused on improving the industry we are all so passionate about.

SYA is a young dynamic cross section of what the future of farming looks like in Saskatchewan. I describe
this group as “the movers and shakers; the future of our industry.” Typically under age 40, these
entrepreneurs vary from small acre grain and mixed farms, to large scale grain operations; from organic
farms to farm advisors/suppliers/retailers. Each member brings something unique to the table.

CAFA is a national organization that is meant to bring together the advisors that help farmers with the
complexities of operating such a diverse entity. This group includes everyone from bankers to lawyers,
agronomists to accountants, grain marketers to tax and financial advisors, management consultants to
farmers (yes, we have a few farmers involved and they all speak very highly of being a part of CAFA.)
This group helps me, as a management consultant, understand more about other opportunities to help
my clients in areas that I am not an expert. We all have the same goal: find new ways to make our
clients better off. I regularly engage my CAFA colleagues when I have a client with an issue that needs
more expertise than I have (like HR strategies, estate planning, etc.)

These 2 groups provide me with a terrific combination: one group helps me stay on top of what is
keeping farmers up at night by listening directly to a diverse collection of farmers face to face and not
hearsay or coffeeshop chatter; the other group helps me strengthen my skills and my network of
qualified peers who can help me help my clients. I value each of these groups equally, and work hard to
never miss a gathering.

CAFA has regional chapters that meet monthly. Always with a topical presentation from an industry
expert, it’s 1-2 hours once per month (usually over breakfast or lunch.) The annual provincial conference
(yes, each province has one) is scheduled in the winter.

SYA meets a handful of times each year, mostly because the membership is busy farming!
But their PreSeeding Social, their Provincial Farmer’s Golf Tournament, Field of Dreams Tour, and Winter Convention
are always informative but most importantly, FUN!

So if you’re still reading, you may be wondering why I have dedicated an entire article to these two
associations. It’s simple: both are agnostic in their focus (as long as it’s AG,) both are tremendously
beneficial to me and my business, and both have found themselves generally flying under the
radar…meaning neither gets much press in print or on TV/radio. Neither operates with a big budget to
afford more advertising, yet both need to have more attention paid to them because of what they bring
to the table.

Direct Questions

Who do you turn to for feedback, when you need a sounding board, or if you want to learn about
firsthand experience on a new topic, idea, or strategy?

Do you ever find yourself wishing you had a mentor, or someone who has been down the same road
you’re travelling?

Have you found yourself facing a situation or dilemma where you didn’t know what to do or who you
could call for help?

From The Home Quarter

It is funny how easily we can become an island, feeling alone in our own world with little opportunity to
change the situation. Social media is great, but it cannot ever replace human interaction. It doesn’t have
to be that way. There is always someone who has faced the same battle you are facing today. There is
always someone who has expertise in an area in which you feel overwhelmed. There is always someone
who knows someone who knows what you need to know (referrals go both ways!) Membership in
either of these associations is an investment in yourself and your business.

If you’d like help planning your farm for business and personal success, then call me or send an email.

Growing Farm FI

Farm Shows – Is Something Left Off the Table?

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Who doesn’t love to attend the farm shows that scatter the prairie? From the latest equipment
advancements to distinctive new tools to cutting-edge technology, the exhibitors’ wares are tantalizing.
This isn’t unique to farmers; it’s human nature. There are tech shows, auto shows, fashion shows…the
list is endless. But I challenge any other industry’s show to match the diversity that you find at a farm
show.

Last week was the 2015 edition of Canada’s Farm Progress Show in Regina. I typically invest time there
and at the Western Canadian Crop Production Show in Saskatoon. Both are elite events. Both generate
millions and millions of dollars in economic benefits from immediate sales and future trade. And both
are primarily focused on production. (This also applies to Farm Tech, Manitoba Ag Days, Agri-Trade, Ag
In Motion, etc.)

What if we held a 3-day show that focused on management of your business:

  • Would we get 50,000 people coming through the turnstiles?
  • Would we see 500 exhibitors?
  • Would attendees mark their calendar a year out to ensure they didn’t miss next year’s show?

I would suggest the answers are: hell no, not even close, and that’s about as likely as a snowman getting
a sun tan. We all know why: management is BORING! Production is sexy! Grain marketing can be a thrill
ride! Managing and evaluating data…? Yuck!

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Business cannot operate without strong management. Lenders will not offer credit to poor managers.
Vendors will become less interested in doing business with poor managers. Employees won’t want to
work for poor managers. Imagine trying to operate your business without those three critical
factors…never mind trying to GROW your business!

Some farm shows have a smattering of business management features in their schedules by offering a
part day to focused speakers and/or topics around management. There are a number of players at these
shows who offer, or specialize in providing, management advisory services to farm businesses.

Direct Questions

Would you attend a farm show that focused primarily on managing your business?
Do you put as much focus on management as you do on production or marketing? If not, why not?

From the Home Quarter

I’m not picking on the farm shows as they are. I’m just using them as an example to contrast between
what is and what isn’t drawing crowds. What I am doing here is challenging the perception of the
players in the industry to increase their interest and their efforts towards management, so that it might
one day get as much attention as production.
If you’d like help planning your farm for business and personal success, then call me or send an email.

farm

Accountant’s Work & Management Information

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In the last post, you read (again) about how important good accounting is to your business. If that wasn’t
enough, here’s more.

Do you ever find yourself tiring of all the financial hub-bub in the media? It seems like every 2 or 3
months the same banks, or automakers, or grocery chains are “reporting earnings.” Well, that’s because
they do. Every quarter, the publicly traded companies release an earnings report, financial statements
as it were, to the shareholders. The shareholders are the owners of the company, and they demand
information that is accurate and on time so they can make an informed decision about increasing their
investment, standing pat, or divesting. The company is in a constant state of flux, and owners want to
know by how much their risk profile has changed in the last 3 months. Accurate and timely information
is not only demanded by the shareholders, it is the law under securities regulations.

So why are farms OK to receive their info once per year, and often as late as 5-7 months past their year-end? If the answer is, “Because the owners (shareholders) aren’t demanding it,” then I have to ask,
“Why the ____ aren’t they?”

Does your lender put more emphasis on the timing and quality of your financial statements than you
do? If your answer is “Yes,” then please keep reading. Actually, print this off and read it weekly until
Christmas.

Quality accounting is more than just minimizing income tax and filing GST & Agri-Stability. Your
accountant should be tasked with generating precise and informative reports that give you, the owner, a
representation of the financial position of your business, and the changes year over year to your farm’s
overall financial health.

If the information in those reports is of little interest to you, or if you’re embarrassed to admit you don’t
understand what the contents really mean, please don’t fret. There are many people who are available
to help including your accountant, your lender, and your business advisor. All of them WANT to help, but
they won’t insult you by assuming you don’t know. For help, first you must ask.

As for all you wonderful accountants out there reading this, please note that I will be working with each
and every one of my clients to fully utilize the financial reports that you create. I will be helping each
farm CEO make informed decisions with help in part from your reports. That said we need reports that
are useful, readable, and easy to navigate. Combining several line items from client info into one line
item on the Review Engagement does not help management make informed decisions! For example, the
account we know as “repairs and maintenance” does not on its own distinguish between equipment
repairs or building repairs unless you break it down for us. When I work with clients to determine their
equipment cost per acre, we need to know just how much R&M is equipment and how much is
something else.

I encourage everyone to have a discussion with your accountant. It’s easy to just do what we do and not
take the time to talk about what we really want. Accountants need to know about your 3 year plan so
they can offer appropriate tax advice. They also need to know if the report they prepare for you is
meeting your expectations. Not everything is negotiable, but you don’t know unless you have the
conversation!

Direct Questions

How are you utilizing the financial reports that are prepared by your accountant?

Do you have questions when you’re exploring the contents, or do you even feel like you’re reading a
foreign language when reviewing your financial reports?

How do you make decisions about the future if you’re not taking the time to evaluate and understand
past performance?

Are you getting information to your accountant in a timely fashion?

From the Home Quarter

Management decisions, if they are to be informed decisions, need to be made with quality reporting and
realistic expectations; both are key components of a sound business plan. I recently witnessed a
financing deal go south because of the lack of quality information. The account manager aptly described
the financing request plan and supporting information as GIGO: garbage in, garbage out. Other factors
that are usually afforded consideration in a financing deal were never given a chance because the poor
quality information derailed the opportunity first.

It is up to you to work with your accountant, one of your key advisors, to put together the type and
quality of reporting that will not only serve you in making management decisions, but also support your
goals when seeking opportunities for growth.

If you’d like help planning your farm for business and personal success, then call me or send an email.

emotion

Emotional Decisions: Business’ Achilles Heel

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I bought a used truck last week. Since I am no longer actively farming, I decided that my beautiful ¾ ton
diesel was more truck than I needed. It took me 2 years of searching to find that truck, so some people
are astounded that I would be selling it. It was still a terrific truck, and had nothing wrong with it.

During my search for another truck, I learned bits of info here & there about the good, bad, and
otherwise regarding the models I was interested in. It’s always a challenge to sort through the noise of
those who are die-hard loyalists who cannot see anything adverse about their brand and of those who
are inherently negative and cannot find anything good to say. How does a person decide?

I wanted the replacement truck to be in the 2011-2013 range. I faced the same challenge we all face
when considering a major purchase: can I find what I want within my price range, do I accept less than
what I want to stay within my price range, or do I pay more than I planned to get what I want? In the
modern age of “instant gratification,” our society typically pays more than planned.

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While some options on my list were important, others weren’t. When considering the Ford F150, I was
firmly on the fence over engine options: 5.0L or EcoBoost? As mentioned earlier, there is a lot of noise
about these engine options. I found a consistent message between 2 salesmen and felt that was the
most honest feedback I have come across. When describing what I need out of this truck, and why I was
on the fence, one salesman replied, “Well you’re just taking the emotion right out of this decision, aren’t
you?”

Yes. Yes I am.

The fundamentals of what makes a good decision are often clouded by emotion. We get so caught up in
the “want” that we blow right past the “need.” And since we as a society will typically pay more than
planned to get what we want, it creates a perfect storm. This storm has eroded balance sheet equity for
many, and left others upside-down on vehicle & equipment loans, but always negatively impacts cash
flow.

Direct Questions

How often have you let emotion take over your decision making process?

Do you avoid making a business case for each decision because it will prove the emotional argument to
be the wrong one?

What impact are you feeling from past emotional decisions?

From the Home Quarter

Removing emotion from business decisions is a key benefit that my clients enjoy. It allows my clients to
experience greater confidence in their decisions by having me filter through their emotions. I am not on
your farm each day, so the emotion of why you’re making the decision is not felt by me, thus allowing
me to see through it and keep you on track.

The truck I sold was rare because of its features and options. It had incredibly low kilometers for its age,
and needed nothing (I’d been through it front to back over the last 2 years.) What I felt for this vehicle
was almost on the verge of love (although I have never “loved” or “named” any of my vehicles, ever.)
And while it held a special place with me, it’s a truck, a tool, an inanimate object and completely
replaceable. I sold it when I did because I knew I could get maximum value for it now. A year from now
would be significantly less. It was advertised on Friday afternoon, it was sold by Saturday, and picked up
Monday. I found the truck I wanted the Thursday before, and picked it up a week later. I took the
emotion out of the equation.

Allowing emotion to influence your decision making is like putting on blinders: all that can be seen is
what you “think” you need and no other options appear available. Let’s take the blinders off, remove
emotion from the equation, and see if we can make a business case that offers an appropriate ROI.

If you’d like help removing emotion from the decisions you make for business and personal success,
then call me or send an email.

roi

New Tech and its ROI

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“It wasn’t until 1954 that tractors finally outnumbered horses on prairie farms.”

I learned this interesting factoid from Steve Leibel from FCC’s Management Software division when he
spoke to our local CAFA chapter in Regina earlier this spring. The presentation was on technology, not
economics, so we didn’t examine why it took so long.

Maybe that wasn’t a long time for farmers to adopt the technology of mechanized horsepower versus
literal horse power, but I think it was.

Today, it’s a little different; we adopt technology almost as fast as it can be released. I find that even my
head sometimes spins at the advances of new technology, so I can’t imagine what my grandfather, who
broke land behind a team of oxen, might think.

Much of this technology provides an incredible economic benefit. Others only provide marginal
economic benefit. Who has done the math before investing?

Shouldn’t any investment provide positive return to your farm? Of course it should, but not only should
it provide a positive return, there should be a threshold for that return to meet as well. Surely anything
that provides less than 2% ROI is better off staying on the shelf in favour of a risk free investment. This,
of course, is an extreme example notwithstanding those investment that provide negative ROI.

This winter I listened to Lance Stockbrugger say, “I love technology as much as anyone, but if it doesn’t
make me more money, what’s the point?” How much money do you need to make to invest in new
tech?

For some, there is no concern to the economic benefit of new technology; they just need to have it! For
skeptics, any proof of economic benefit is cast aside as nothing more than salesmanship.

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ROI is a useful starting point for any investment. ROI is important to know because it not only indicates

the net benefit it will also offer insight into how long payback will take. Technology that offers 100% ROI
in the first year would “pay for itself”. Technology that offers an ROI greater than 100% in the first year
would pay for itself and provide positive cash flow above what would have been realized otherwise.
Technology with a 20% ROI would take 5 years to pay back your investment.

So let’s ask again, “How much money do you need to make to invest in new tech?” This also applies to
land, equipment, people, and professional services.

Direct Questions

How do you determine if an investment of your capital is worthwhile?

What is an appropriate ROI for different investment options?

How do you measure the success or failure of your decisions of how & where to invest your capital?

From the Home Quarter

Land investors want 3-7% annual ROI on their investment. Employees should be able to return 200% ROI
(their wage or salary times two) to their employer. What about iron, gizmos, gadgets, etc? Some of this
can be hard to measure: what was the ROI on hopper bins when they first came to market? While it can
be done, it’s not easy to put a financial value on efficiency, safety, and convenience, but those factors
certainly provide an intangible ROI.

I enjoy seeing the increase in confidence that my clients enjoy after we go through an ROI exercise as
they determine how to invest their capital. Reviewing realistic numbers to project the financial benefit
takes the emotion out of the decision.

I bet that early 20th century farmers didn’t do an ROI calculation on having a tractor on their farm versus
horses because if they did, I’d say that tractors would have outnumbered horses a lot earlier.

If you’d like help determining ROI opportunities on your farm, then call me or send an email.

assets

Avoiding Assumptions About Assets

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“If you’ve inherited an asset, you should act more like the custodian, not the consumer, of that asset.”
I was having coffee with Bill Allen, a Sun Life advisor and friend of mine that I met through CAFA
(Canadian Association of Farm Advisors; great organization, check them out www.cafanet.com) and as
we were discussing business, he used that statement above to illustrate his personal values as they
relate to estate planning. I asked Bill if I could write my next article around this statement, and he
consented.

The farm land that is expected to change hands over the next decade is projected to be somewhere
north of $50 billion (that’s >$50,000,000,000.) Much of the land will be sold (enter the farm land
ownership fray) but much of it will be handed down to the next generation. To the chagrin of farming
children, some of that land might get passed down to their non-farming siblings (enter the farm
succession fray.)

To those who inherit land, think about Bill’s statement above.

If You’re a Farmer…

There is blood in that land; the blood of your ancestors who risked it all to come west for a chance at a
new life. To think that it’s yours to do with as you please is…well, I’ll let you fill in the blank. Now land
that you acquired on your own with your own business savvy, hard work, and some good luck…you can
have at ‘er! It’s mighty short sighted to mortgage your “heritage” land for “personal wants.” What about
your legacy? What about your kids?

If You’re Not a Farmer…

The expectation of a financial windfall from the passing of your parents is simply unacceptable,
especially if you’ve been bequeathed the land that was passed down for generations. It is not yours to
sell to the highest bidder; it is an heirloom that must be cherished and made available for the next
generation again.

When my grandmother immigrated to Canada as a child, some of her older siblings stayed back in the
old country. Their descendants are distant cousins who we had kept in touch with many years ago. I
recall that the “flat” in which they lived was not owned, but was still passed down through generations.
Ownership of their own home, something which we take for granted in Canada, was not realistic for
them at that time in history. And yet what they had, despite unowned, was bequeathed.

When I began farming I promised my dad, who was a recent widower at the time, that I would never
allow the original land to be jeopardized for expansion or otherwise. Now that I’m no longer actively
farming, I can only hope that my siblings who are carrying on will stick to that.

There is a way to minimize the risk of inherited land being sold off: complete a succession plan.
Call it whatever you like: transition plan, continuity plan, longevity plan, whatever! No matter what you
call it, just get started. Getting started is the hardest part, and there is help available to get you started.
You will eventually secede from the farm, and the activity of planning for it will force you to talk to your
family about what they want.

Direct Questions

Does your entire family know what happens to the farm if you were to pass away tomorrow? Ask them.
If their answer doesn’t match yours, then you haven’t done a good job of this.

Do your non-farming children even want to own land? If they don’t, why burden them with it? If your
assumption is “Why wouldn’t they want land,” then talk to them…now.

Can you afford to hand down the land without needing the food bank in retirement?

From the Home Quarter

When I was a kid, the standing joke was “I can’t give my kids the farm; I’ll get charged with child abuse!”
Today, land is a hot and sensitive topic. Over a century of blood, sweat, and tears is awash in homestead
land and to trade it for a fat cheque seems an indescribable tragedy when something as simple as a
conversation with family could circumvent such heartbreak.

Succession isn’t easy. It forces us to consider a future that we may not be ready to face. But ready or
not, the future is near, so it’s best to be prepared.

Whoever said it, this rightly applies: “We do not inherit the earth from our ancestors; we borrow it from
our children.” Sounds like they were having coffee with Bill too.

If you’d like help planning your farm for business and personal success, then call me or send an email.

excellence

Seeking Excellence

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This is a verbatim copy of Seth Godin’s daily blog from April 22, 2015:

Demand higher standards.

On a long flight a little while ago, I saw two couples watch movies while they let their six kids
run around like maniacs from take off to touchdown. A seven-year old actually punched me. (I didn’t return the punch).

A few days later, I saw the now-typical sight of kids in a decent restaurant eating french fries
and chicken fingers while watching a movie on a tablet.

And it’s entirely possible you have a boss that lets you do mediocre work, precisely whenever you feel like it.

I wish those kids had said, “Mom, Dad, raise your standards for me. I deserve it.”
And the sooner you find a boss who pushes you right to the edge of your ability to be excellent, the better.

Even if the boss is you.

I couldn’t help being captivated by this simple and direct message (Seth is famous for them.) In
agriculture on the Canadian Prairies, we’ve generally been just fine by being somewhere south of
excellent. We haven’t needed to be better in business because we use excellent production practices;
Canadian farmers are arguably the best producers in the world. We haven’t needed to be better in
business because money is cheap and easy to acquire; interest rates have never been lower and lending
terms continue to be very favorable. We’ve gotten away with being mediocre, or somewhere south of
excellent, in our business skills because “the average was just fine.”

We would be happy if every year we got average rainfall, average heat units, average weed pressure,
average yields, average prices, average input costs, etc. It would be easy to farm if everything was just
average.

But it’s not.

And if you’re average in your management of your business and all its risks, it is pretty tough to expect
excellent results. We’ve enjoyed a 7 year bull run on yields and prices which has permitted “average” to
disguise itself as “excellence.” Are we still comfy thinking that recent history is our new normal? I
listened to Dr David Kohl in person 4 years ago and he said then that these highs in yield and price are a
black swan, and not the new normal. “Normal” is “the average” and since the average has managed to
disguise itself as excellence over the last several years, what will happen when this black swan migrates
out of here?

When the black swan flies away and “normal” returns, “average” will not be sufficient. We will still be
excellent in production; we may still have cheap and easy access to money. As you read in Growing Farm
Profits Weekly on April 14, 2015, farming is a lot more than just production. And easy money is
dangerous when in the wrong hands. If there are no guarantees that Mother Nature will offer a growing
season to facilitate excellent production, it will take the excellent production practices for which we are
famous to just be average. That is “average” without its disguise.

As Seth wrote, the sooner you find a boss that pushes you to edge of your ability to be excellent, the
better. If you are your own boss, like you, like me, like all entrepreneurs, we must find a way to be
excellent.

Direct Questions

In what areas of your business is your proficiency less than excellent?

Have you greatly shifted the parameters of what you call “average?”

Considering all the risk you face each year as a farmer, can you afford to be anything less than excellent?

From the Home Quarter

The message here is not to suggest that anyone has intentionally done a poor job of running their farm.
What is being suggested is that the recent ag environment has permitted great success without
requiring excellence across all aspects of the business. I am supremely confident that will change, and
anything less than excellence through your entire farm will offer disappointing results.

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*The Innovation Adoption Curve www.b2binternational.com

Excellence is a choice. Have your competitors already chosen excellence? When it comes to employing
excellence in business proficiency, you want to be on the left side of the curve above. I have a mentor
who helps me to be and stay excellent. My mentor has a mentor who does the same for him. It’s not
easy, but it’s worth it. As I’ve said, and will continue to say, “Do what you do best, and get help for the
rest.”

If you want more than average, call me. The Department of Excellence is open for business!

sustainability

Sustainability

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I very briefly got into a Twitter discussion on Sunday with a few farmers when the question was posed
about sustainability, specifically if the ag industry in western Canada is actually advocating for
sustainability or just preserving the status quo. I waded in because “what is sustainability?”

My tweet was a question: How do you define sustainability? Is it agronomic, environmental, financial,
family? There are many factors to consider on the farm.

Sustainability means different things to different people. Kind of like the term “organic.” Neither are
clearly defined anywhere in a way that is unanimously accepted. Both then are open to individual
interpretation. I’m not treading into the organic/conventional battle here; I’m talking about
sustainability.

The responses to my tweeted question were all about soil and how if soil health is the primary focus,
everything else *should* fall in line. I respectfully disagreed. Good soil stewardship + poor financial
management ≠ sustainability. I was not trying to discount soil health, just hoping to expand their line of
thinking. I left the conversation at that point. The parties continued to banter about tillage, irrigation,
crop rotations, etc. I just wish we could see that there is more to farming than production.

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Agronomic Sustainability

If you don’t know what Cation Exchange Capacity is, what your C:N ratio means, or how to calculate
SBU, then hire an agronomist (of which I am not one.) Agronomic sustainability is as much an art as it is
a science, and if you’re not well versed in the art, or the science, of agronomy then being sustainable
might be a stretch.

Environmental Sustainability

This is a slippery slope with a whole lot of noise out there. Who should you listen to? I’m not touching it
with a 12’ pole. But all farmers know that the environment is critical to our success. ‘Nuff said.

Financial Sustainability

I could write a book on this. From cash management to proper use of leverage; from strategy to
operational efficiency; from knowing your numbers to management process, the pages would flow!
Same can be said here as for agronomy: if you’re not well versed, hire an expert!

Family Sustainability

This hits me directly right now. Since I made the decision to retire from active farming to focus 100% on
my consultancy business, the family dynamic has changed drastically. Looking back I can identify things I
should have done differently, but those choices were not apparent at the time. One choice that was
apparent was to set expectations very clearly on Day 1. It is safe to surmise that didn’t happen. Whoever
said “It’s never a problem until it’s a problem” is very correct in their vagueness. We all took for granted
that the family will work together and get along, a gross miscalculation as it turns out.

Direct Questions

When you hear the word “sustainability,” do you cringe expecting an environmental sermon?
How many distinct ways can you identify opportunities to improve or incorporate sustainability in your
business?

Are you putting in adequate effort to prepare for the unexpected so as to remain sustainable in all
aspects of your business?

From the Home Quarter

I fear for those who don’t recognize that their farm is about more than just production. I’m not
suggesting that production take a back seat because is it critical to success, but we must expand our
perspectives beyond the crop and the field to the markets, to the balance sheet, to macro-economic
forces, to family dynamics and HR issues, etc. This list could be endless, and everything on it must be
“sustainable.”

None of this is new news; we all know that we must be sustainable in all facets of our business to
survive. But I ask if we are all able to recognize the opportunities and threats to our sustainability in a
way, or in time, to do something proactive about it.

If you’d like help planning your farm for business and personal success, then call me or send an email.

planning

Decision Making with Incomplete Information

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“We rob ourselves when we make decisions in the moment with no thought of how those decisions will
impact our futures.” – Andy Stanley

It’s easy to look back at decisions we have made and say we could have done better. Are you ready to
head down “Metaphor Avenue”? Hind-sight is 20/20, so don’t beat yourself up; next time you’ll knock it
out of the park!

Why can you say that you could have done better in making past decisions? It is likely because you were
working with incomplete information. However, considering the vast availability of information today
let’s also suggest that too much information contributes greatly to incomplete information. There is a lot
of noise out there, and sorting through it all can be overwhelming.

So how does one make better decisions when working with incomplete information? It’s difficult, and
risky, especially considering the financial repercussions each decision can hold. Yet these decisions get
made regularly often based on emotion, a hunch, or some gossip.

Stick with your Strategic Plan

The strategy you have established for your business should rule when attempting to make decisions
with incomplete information. Any option that leads you to deviate from your strategy should be quickly
discarded. If a decision takes you away from your original strategy then either there are extenuating
circumstances or business has changed and your strategy wasn’t changed with it. Either way, you’ve got
some more work to do.

Follow your Tactical Plan

Strategy is what you want to accomplish and why. Tactics are how you will get it done. These 2 plans
should be closely aligned. Don’t get caught using justification that is “tactical” in nature to permit a
decision that goes against your strategic plan. To paraphrase the quote above, how will this decision
affect your future?

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Get Advice from Trusted Sources

Ideally, a trusted source has no vested interest in one decisive outcome over another. Although, a
trusted source can be someone who may have a vested interest, but whose integrity is above any
question you may have about his/her judgement. When information is incomplete or confusing, seek
out someone who has expertise and knowledge to help you sort through the noise and clear your focus.
A naturopath will always have a miracle product that can cure anything that ails you; a surgeon’s advice
will always insist that surgery is the best option. Vested interests….get a second (or third) opinion.

Direct Questions

Do you make business decisions without adequate information, basing your choice on emotion, a hunch,
or gossip?

Do your major decisions reflect your strategic plan? (Do you have a strategic plan?)

Do you have trusted advisors who you can call on for help?

Are you contributing to incomplete information from your own habits of improper data management?

From the Home Quarter

If we waited for perfect information before making every decision, we’d never make any decision. We
have always had to proceed with the best information we had at the time. And the fact is information is
never perfect. But don’t let that fact be an excuse to allow yourself to not manage your own business
information adequately. You have a responsibility to ensure that you provide yourself with information
that is as complete as you can make it. Business moves at the speed of the internet, so we must be in a
constant state of information management. Advisors can bring immeasurable benefit to your decision
making by either removing emotion or by providing insight from a position of unique expertise. And at
the end of the day, your best allies in decision making are planning and discipline.

If you’d like help planning your farm for business and personal success, then call me or send an email.