Many of us have been caught up in discussions on social media which sometimes turn into nasty mud flinging and other nonsense. Religious issues with many gurus often offers answers which are confusing and double-minded at best. Livestock grazing, soil regeneration (regenerative is the goal; sustainable is out, and rightly so, since many of us have denigrated soil resources; sustaining that is ridiculous), wildlife enhancement, water quality, breed of cattle (or other livestock) are promoted with such fervor and worship to qualify as religions.
Yet, the reality of our fallen world and its natural processes, is so complex, that one size fits all does not work. In the words of my friend Jim Gerrish, “it depends.” And indeed it does. Sure, there are some principles, ideas, and theories which are basic and we can learn from these. However, the key must be to identify our own goals, resources, restrictions, and, as Allan Nation coined, ‘unfair advantages.’
You can search and find a myriad of experts ready to guide you on goal setting. Read through them, many will help fertilize your own thoughts. Here are a few thoughts to get you started.
Grazing livestock management schemes are confusing and challenging – like a lot of fields (excuse the pun). When you throw in that one guru says do this and another says do the opposite, how is a newcomer to make decisions? It is tough, for sure, but read a lot, go to a few conferences by tried and true teachers, for example guys and gals who are or have been graziers themselves. Networking with other producers will really help, but avoid meaningless quarrels.
Just like knowing the difference between economic (is the endeavor worth doing?) and financial (can i afford to do it?) decisions, knowing the difference between goal setting and planning is essential. You may have great goals, but can actual plans be made to reach the goals? And beyond that, you must ask yourself, am i motivated enough to see it through? Don’t start a task if you don’t count the cost in advance. These costs are beyond money – they include relationships which may be lost, declining health, spiritual or mental stress.
Change is inevitable, goals change, plans change, plans change because the goals change, goals change because of many, many factors, including age, time, priorities. Don’t get bogged down with thinking you cannot change goals or plans, but keeping meaningful, timely, and accurate records is a must!
I always chuckle a bit when i type out ‘ranching for profit’ because it’s almost an oxymoron! Yet, David Pratt, owner of Ranch Management Consultants and Ranching for Profit instructor, contends that there is such a beast if we ranchers use sound financial and economic principles.
Mr Pratt’s most recent blog discusses using debt properly. Now, okay, my mind goes immediately to the song, ‘Neither a borrower, nor a lender be. Do not forget, stay out of debt.’ Which then led me to wonder where that came from. I knew it was from Shakespeare’s ‘Hamlet’ (Polonius counsels his son, Laertes in Act-I, Scene-III of William Shakespeare’s play, Hamlet by saying, “Neither a borrower nor a lender be; / For loan oft loses both itself and friend.” But what about the tune?
Completely surprised when i discovered that it was created and made famous on the TV sitcom, Gilligan’s Island, which i watched religiously when i was young. SO FUNNY! It is sung to the tune of the Toreador Song in Bizet’s Carmen.
The Bible also has advice on debt and teaches us to guard against being in debt, likening it to slavery and bondage. However, debt does not seem to be a sin, but a tool to earn money wisely, but counting the cost before taking on the burden.
Most people blame things beyond our control like the weather, government regulation, low commodity prices and increasing costs for their failure to make a healthy profit. These are the things most often discussed at producer meetings and in the coffee shop. These are also things we can do little about. Making them the scapegoats for poor performance makes it easy to absolve ourselves of responsibility. But if prices, costs, weather and regulation really determine profit or loss, why do some businesses survive, even thrive, in these conditions while others fail? Depressed markets are a crisis for some but a profitable opportunity for others. It is not the situation, but the decisions we make that determine success or failure.
According to the US Small Business Administration, most new businesses fail. Fewer than 10% survive to see their 10th year. In his best-selling book, The E-myth Revisited, Michael Gerber points to an exception. He says that 97% of new franchises survive beyond 10 years. Why the difference? Simply put, franchises have a clear-cut blueprint on how to run a business. McDonalds doesn’t succeed because they make the best hamburgers or because they hire the smartest, talented people to work behind the counter. Over the years they have achieved economies of scale and have a lot of clout when it comes to negotiating lower costs with their suppliers. But they wouldn’t have been in the position to do that if they hadn’t built a business that actually works. They didn’t grow first and then figure it out. They figured it out and then they grew.
As Gerber puts it, they worked on the business (WOTB) to build a business that actually works. We are so busy working in the businesses (WITB) doing $10/hour jobs that we often don’t ever get around to working on our businesses (the $100/hour work). This is the work that determines the winners and the losers in any business…including yours. More than genetics, prices, weather or any other factor, it is this issue that separates the men (and women) from the boys
(and girls) in ranching.
Our ranches suffer economically, financially and ecologically when WOTB takes a back seat to WITB. Our failure to effectively work on our businesses is the single biggest reason that most ranches aren’t profitable and that most ranches don’t survive generational succession with their land or family intact.
It doesn’t have to be this way. Ranching can make a healthy profit, thrive ecologically, stay in the family indefinitely and be the stimulus for revitalizing rural communities. You put your ranch on the path to achieve these results when you put the shovel down and pick up the pencil … when you start working on it, not just in it.
I’ve heard some complain that they don’t like working on their business. I wonder if the real problem is that they don’t know how to work on it. Previous generations may have been able to get by without WOTB when land values were cheaper and their ranch had only been split once by a generational transfer. But times and conditions have changed. What passed for management then, doesn’t pass muster now.
Score yourself to see how effectively you are working on your business:
Scoring: 0 = I have not addressed this issue
5 = I have addressed the issue but have more work to do
10 = This describes my business.
If you scored more than 70, congratulations! You probably have a healthy business with a promising future. If you scored 40 to 70, you’ll be feeling the pinch but will probably continue to get by with off-farm income subsidizing the place … at least until it comes time to pass the ranch on to the next generation. If you scored less than 40, you might want to think about going to work as a cowboy for someone else. If you want a good job, I suggest you hire on with someone who scored more than 60. He’s the one who’s Ranching For Profit.