As 2014 draws to a close, many of us are giving thought to our New Year’s resolutions and the goals we are setting for ourselves in 2015. As a farmer or rancher, having a set of goals provides the power to steer farm business activities in the same direction as hopes and intentions. Farm managers need to have a clear view of the future to create a business that is in line with their strategic goals. Here are some steps that can help in this planning process:
Know where you have been
The successes and failures of the past provide valuable knowledge to help plan the future. Many of us are not aware of the things we do right simply because we do not consistently evaluate past activities.
Know where you are
Good things have been done in the past to get the business where it is today. Knowing what strengths of your business are will help you to build on them and shape the way moving forward.
Know where you want to be – your business goals!
Take the time to look forward. Figure out what the business goal is. Is it to expand the business, change the focus, increase value-added activities, or make more money?
Know how to get there
Having an understanding of how the business is going to achieve its goals is as important as having the goal in the first place. Figure out what is known or can be seen, evaluate whether it is likely to be a success, start on the path towards this goal, build in flexibility, and re-evaluate as information about the path to the business goal becomes clear.
Know how to tell when you get there
It is entirely possible to pass business goals without knowing they have been achieved. Each goal must have at least one clear objective so that it can be recognized when and if it is a success. A business goal to improve efficiency is a good target, but without a defined objective such as reducing the number of labour hours per acre farmed from one hour per acre to half an hour per acre, there is no way to show how the goal was achieved. Look back only to ensure there are benchmarks and be aware of the business’s strengths and weaknesses. Otherwise, focus on those activities that take the business from where it is, towards the end that is in mind.
Business Strategy, sometimes referred to as strategic planning, is the building block for many other farm management practices. Implementing this farm management practice will lead to a farm or ranch business that has a vision and purpose. It should include a formal written business strategy that is reviewed annually. All members of the management team agree to the short and long-term goals for the farm business and those goals align with family goals. The farm’s day-to-day actions are directed by the agreed upon goals.
Setting (and meeting) goals in our personal lives as well as in business can be difficult. Through the Growing Forward 2 program, Farm Business Development Initiative (FBDI) funding is available to assist producers with the cost of training and consulting to improve farm business management.
