Your typical family farming operation of today isn’t what it was 20 years ago. There have been significant advances and evolution in farming systems, technology and agronomic understanding over this timeframe. These changes and industry innovations have supported productivity growth but also made managing and operating a farming business more challenging and complex.
Being a farm business manager requires decision making which involves the following areas of expertise:
Some of these areas will require the advice of professionals from outside the business to support management. A key trait of a high performing farm business manager is they seek out advice to share the burden of running an ever growing, complex business and making timely and efficient decisions.
|Feeling overwhelmed can cause stress and if left unchecked can affect your bottom line but more importantly, could affect your mental health!
When people start second-guessing themselves, they tend to become inefficient and get a sense that they will forever be pushing uphill instead of skiing down!
Why have an advisory board?
One of the key purposes of installing an advisory board into your business management framework is to provide additional independent expertise and guidance in the strategic management of the farm business.
|Advisory boards aim to keep the business accountable to itself and will help monitor and measure key decisions and actions that have been put in place. Advisory boards assist with implementing business objectives in a systematic way and are responsible for monitoring the milestones of planned projects.|
The board will give you the ability to reduce the emotion in the decision-making process through accessing guidance and knowledge from a group of trusted advisers. These could include your farm business adviser, accountant, agronomist, grain marketer, banker and vested stakeholders (family members) who all will have critical input over the season.
ORM provides the independent chairperson and executive support role for several advisory boards. The boards should meet at a regular interval, at least every quarter is recommended, plus one additional annual review meeting. In the case of larger businesses or those with highly diversified enterprises, monthly meetings are recommended as the business environment can change rapidly.
Operational, tactical & strategic planning?
|From the outset you will outline your shared objectives for the farm business with the advisory board, ultimately; how you hope to envision the structure and prosperity of your business in the future.|
Short term planning: Will focus on utilising operational and tactical decision types, related to week-to-week activities all the way through to overall annual/seasonal planning and decision making.
Medium term planning: Will focus more on tactical and some strategic decisions and actions, normally derived and actioned by the key decision makers of the business. The main farm manager will have a major input into this section and will appreciate the outside help provided by the advisory board when deadlines are close.
Long-term planning: This is where an advisory board structure is very beneficial. The three to five year outlook may require many different contributors to help shape and achieve the vision and goals that can seem intangible and beyond your current horizon. All of these contributors having input at the same time, can provide a very methodical and efficient approach when outlining and setting goals and objectives.
Figure 1 shows the role of the advisory board is generally to make strategic direction and decisions through the input of owners, advisers and other growers or businesses.
Contact ORM to discuss the potential relevance and purpose of an advisory board in your business.