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0709PD: Strategic planning: Keep it simple – do it well

Chuck Schwartau Published on 24 April 2009

The current economy has many business managers on the edge of their seats. Sometimes it is difficult to know what to do, and even once a course of action has been determined, there is hesitance to act when there are so many unknowns, often outside their control.

Farm managers are no exception. Visits with agricultural lenders and advisers reveal a common theme among their farmer-clients trying to deal with the uncertainties. That theme is having a plan and executing the plan.

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Farmers put a good deal of thought and effort into relatively short-term planning – that is, planning for the immediate season. Strategic planning, longer range planning, is more difficult to accomplish. This difficulty is not limited to dairy farmers, or other types of farmers, in the U.S. A specific program for dairy farmers in Australia saw the same need and developed a highly adaptable program to encourage and carry out strategic planning.

The Australian program is Countdown Downunder, designed to lower the somatic cell count (SCC) in dairy herds of the state of Victoria, Australia. Their steps are quite similar to many other planning outlines, but sometimes it helps to approach the task from a different perspective.

Recognize there is opportunity to do better on the farm and identify the motivation necessary to carry it out. We all know more than we practice. The value of a good, consistent milking routine has been demonstrated time and again. The trouble is operators tend to get a bit “sloppy” or lazy and waver from the prescribed routine. If, however, we remember the dollar returns to low SCC in the milk check, and think about what could be done with the extra income, the motivation to do a better job is more likely to yield results in the parlor. The extra dollars provide a motivation.

Access clear, current information for making the best decisions. The sources of information today can be overwhelming. The key is to analyze your sources and determine which are valid. Look for verifiable and repeatable research. Use sources that have established reputations for quality and accuracy.

Ask trusted associates about information sources they use and satisfaction with them. Determine from these sources what are likely to be the best practices available to address your situation.

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Commit to closing the gap between current practices on your farm and the best practices determined. Information without action has little value. The information that is turned into corrective action has the greatest value. Until the farm commits to practicing what it knows, there can be no progress. It also takes commitment to make a practice last. Repetition over time makes a practice a habit. Just be sure what becomes a habit is the best practice possible.

A lack of commitment to follow the plan may be the weakest link in many strategic plans. If the plan is put on the shelf and never implemented, or is too easily abandoned, it will not make the intended difference on the farm, and may lead to further frustration.

Use skilled advisers to support the action plans. One recommended practice for dairy farms today is the use of an advisory committee or a dairy profitability team. This team of supportive dairy professionals can help identify the needs and possible practices as well as reinforce the farmer putting the practice to work. A farm with coaches that keep the program focused on its goals stands a much better chance of success. Without a coach, it is easy to stray from a goal toward issues of greater personal interest, but less positive impact on the farm business.

Monitor progress and act on triggers. Monitoring progress means results must also be measured. Tools must be in place to measure and record the results of any action taken. Results need to be reviewed at relevant intervals, and a determination be made whether the action is still on course, or it needs to be adjusted to meet the goal. If the data is of a technical nature, or is not well understood by the farmer/manager, have it reviewed by appropriate professionals who are part of the advisory team. Someone with full understanding of the data will see more quickly if things are on or off track. If the results appear to not be making adequate progress toward the goal, they can more readily suggest corrective actions than someone who doesn’t understand the data well.

Review and update plans on a regular basis. Circumstances and opportunities change with time. As markets, costs, margins, staffing, weather and a multitude of other factors on the farm change, you need to check the impact on your farm plan and determine whether the goal is still appropriate and whether the action plan is still correct. You need to be ready to modify a plan, but that should be done only when there is a clear and sustained trend emerging that warrants the change. Changing the plan every time there is a short-term change in the situation might be worse than no plan at all.

Keep it simple. Do it well. Some people like the KISS method of planning their work. “Keep It Simple, Stupid!” This also applies to your strategic planning process. Don’t try to address too many issues at one time. It will be more difficult to determine what is really making a difference in the operation and resources to carry out the plan may be diluted to the point they lose their effectiveness.

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This is just one of many strategic planning models available. If this doesn’t fit your way of working, find one that does. The take-home message is that a map helps you get where you want to go. A well-thought-out strategic plan should be your map to a solid future. PD

Chuck Schwartau
Extension agent
University of Minnesota

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