Seminar Synopsis

Business practices and relationship problems, not economic issues, are often the reason family operations dissolve business relationships.  This tragic conclusion generally stems from operators failing to run the farm like a business, rather than a family venture.  Farms with good production and financial footings still fail because they either don’t know the basic rules of conducting a business, or they know the rules, but don’t apply them to family farm operations.

This seminar tackles a number of sensitive issues that relate to managing family businesses.  It is presented from the viewpoint of a working family farm manager who has also provided family farm business transition consulting for over twenty years.  The seminar combines serious and humorous discussions of basic principles, actual farm problems and practical, successful solutions. 

The goal of this seminar is to change behavior by convincing participants:

2.  Organization and Division of Responsibility

• “What is my piece of the pie?”  Who will make the decisions and implement them?

• Techniques for defining specific roles and dividing responsibility

• Considerations in bringing new principals into the operation, or retiring others—ownership vs. responsibility

• Using job descriptions as a tool in transition situations

3.  Company Policies:  “The Hidden Land Mines”

• Establishing clear policy understandings: housing, room and board, insurance, compensation, division of earnings, buyout agreements, business benefit continuation, capital injections and withdrawals, inter-entity transactions, work days/hours/leave policies

• Common sins that violate good business practices—“…on the neighbor’s farm, of course!”

• Sample policies and guidelines for developing policy statements

• “What am I worth per hour to this business?”  Understanding the “Hidden Benefits”—How are non-cash benefits valued when structuring “Compensation Packages” for employees, partners or business principals?

• Should benefit come through the farm, or should each owner be personally responsible?  “Do I base policy on optimum tax and economic considerations…or political, personal or other criteria?”

4.  Planning

• Who gets to play in the game, provide input, implement and monitor the plan?

• Operational vs. Strategic Planning—what issues should be addressed and why are they important to document?

• Operating issues—production, marketing, financing, personnel, capital items…systems that work!

• Long Range/Strategic Issues—transfers of management and ownership; expansion; major improvements; enterprise shifts; manpower planning; business structuring… “Three reasons farmers avoid strategic planning”

• ”I know it’s important…just didn’t know where to start!” Strategies for making progress on strategic issues.

5.  Communication, Coordination and Control

• Business tools often ignored or abused—meetings, farm records, documentation of key business understandings… “Don’t let them know there is money in the bank!”… “We’ll remember what we agreed on!”…

• The “I can’t be fired…” family business syndrome.  Impact of unprofessional communication habits.

• Developing corporate climate of openness and professionalism…”How do mission and core value statements work?”

•  “You want to evaluate me?…you must  be kidding!”  Should family business partners/employees be evaluated?  How?

• What performance gauges do you watch?  Tractor gauges and monitors or your financial gauges?

6.  Summary:  The Basic Business Management Model Applies to Agriculture, Too!

• The family farm business… a constant transition of inheriting and passing on values…then letting go of the wheel!

• The FARM—Your Child’s “First Business School”…Are you teaching good business principles or bad habits?