April 16, 2021

Frye: How to evaluate opportunities, make decisions for your operation

The best farm leaders are always on the lookout for new opportunities for their operation, in many different areas and forms. Opportunity can be found in anything from evaluating a piece of land that comes up for sale to learning new marketing and merchandising tools to trying out a new production method to determine whether it’s right for the operation.

Here’s what happens when farm leaders aren’t on the lookout for opportunities to improve their operation: the operation tends to falter and can be in danger of not continuing for another generation. Maybe today you’re even farming some of the land of those who took the “but we’ve never done it that way before” mindset.

Three Tips

1. Always be on the lookout. If you don’t have your eyes open for possible new opportunities, they probably aren’t going to present themselves to you. Talk with others in your area who have their eyes out for the same types of things, or read or listen to news about new advancements that could be applied to farming. You could talk with others who have operations you admire — doesn’t need to be in your geographical area — to ask about new things they’ve recently tried or are trying out.

2. Make sure it fits. There are any number of new ideas and approaches out there when it comes to nearly every aspect of farming. But the process of evaluating those new things is critical. It has to be right for your operation, not just for the other farmer down the road. This starts with having a clear handle on your farm’s future vision, mission and major goals for the near term. The opportunity you’re evaluating needs to be a clear fit within each of those categories.

3. Implement as a trial, then evaluate again. If the new opportunity is something that can be implemented in your operation on some sort of trial basis, this can be a good chance to get an idea of whether something truly works for you before going all in. Some opportunities, such as land purchases, simply don’t lend themselves to a trial period, so spending time to do feasibility studies on that potential purchase is important. Many other new ideas can be brought into your operation on a trial basis first.

Decisions, Decisions

As the farm’s leader, there are always decisions to be made for the operation and you’re the one who often makes the final call on most of them. The decisions can range from mundane, day-to-day decisions, to major decisions with wide-ranging impacts, which can bring up uncertainty or anxiety.

Is there a happy medium between too much data and getting “stuck” and too little data and ending up regretting a decision that wasn’t thought through? I think there can be.

While it’s especially important to have the right information about major decisions that heavily impact the farm, it’s also key to be able to make decisions in a timely manner.

Do These Two

• Know yourself. The farm leaders who have been successful with helping themselves make the best possible decisions are self-aware of their own personality and tendencies around decision-making. Take time to determine how you tend to act when there’s a major decision you need to make for your operation. Knowing how you tend to react can help you keep that in mind as you work.

• Create a process and use it. Having a formal process for certain decisions can be helpful. You can define which types of decisions need to go through your process. Maybe it’s a certain dollar amount threshold, or level of complexity. Outline each step, who needs to be involved, and how the actual decision should be made. What information and data needs to be sought out? What advisers should be consulted? Who has the final say? Create timelines for each decision category as well, to help keep from getting “stuck.”

One major area of decision-making on the farm is around the markets and every farm leader has their own decision-making personality when it comes to marketing. You can get in touch with our market advisers or get a free trial of our marketing solutions on our website at www.waterstreetconsulting.com.

Darren Frye

Darren Frye is president and CEO of Water Street Solutions.