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Woodbury-Farm Family Business 09/05 05:56

   Learning Your Way to Succession

   Crafting a vision for the future, projecting financials, managing employees, 
acting with humility and making timely decisions are talents that will ease a 
farm's transition.  

By Lance Woodbury
DTN Farm Business Adviser

   Family business members transitioning the enterprise often tell me that 
letting go is really difficult. The act of turning over a task or decision to 
someone else, when you've been doing it a particular way for many years and 
know the details and likely outcomes, requires not just patience but the 
ability to watch it done differently -- what might even be considered "wrong." 

   Almost every area of the farm or ranch is affected by the unique way the 
senior generation has approached the process of problem solving. An 
individual's personality, knowledge, ability, risk tolerance and communication 
skills combine to form "their way" of getting things done.

   The generation taking over the business has a lot to learn. At least three 
things come to mind. They must learn to know themselves better and especially 
their impact on others; they must have an appropriate amount of technical 
knowledge about the issue at hand; and they must have the leadership and 
management skills required to chart the course for the business and positively 
influence others in the company.

   UNDERSTANDING YOURSELF

   We often think of succession as involving only the senior generation and the 
up-and-coming successor. The reality is that many other people on the periphery 
affect the transition. Spouses can help or hurt the transition process by being 
supportive or negative. Key employees and vendors, by choosing their "go-to" 
person, also influence how quickly the transition occurs.

   A key question to answer for those who want to be successful is, "Am I the 
kind of person people enjoy interacting with and with whom they like to work?" 
If you are, the succession process will probably be easier, as family members 
and co-workers will be more honest with their concerns during the transition. 
On the other hand, if people fear you, perhaps because you are demeaning in 
your responses to them, you withhold crucial information from them, or you 
ignore their ideas, the process can be frustrating. Give honest and serious 
thought -- and get feedback if necessary -- to the impact you have on others. 
If you are not having an impact conducive to truthful sharing and continual 
feedback, the succession process will be more difficult.

   KNOWING ENOUGH

   Farming and ranching involve significant expertise in many areas. Of course, 
one can't be an expert in every area, but two principles emerge around 
technical knowledge and succession planning. One is that a successor has 
strength in some relevant business function, even if it differs from the strong 
suit of the preceding generation. It might be working with equipment or 
livestock, communicating with the public, understanding technology, negotiating 
with vendors, accounting or some other forte giving him or her credibility as a 
contributing team member.

   A successor should also know when to ask for help when they don't know the 
answer to a question. Understanding when to get others involved solves problems 
more efficiently and reinforces the judgment of the successor in the eyes of 
those around him, contributing to a smoother process.

   INFLUENCING OTHERS

   Running a business in light of today's agricultural challenges requires 
various leadership skills. Crafting a vision for the future, projecting income 
and expenses, communicating with employees, neighbors and the public, managing 
employees, acting with humility and making timely decisions are talents every 
bit as important as deep technical knowledge about farming.

   The succession process benefits when those taking over the enterprise 
understand, practice and develop these skills. They not only ensure a continued 
business enterprise, but they inspire confidence in yourself and those 
surrounding you.

   As your children and grandchildren head to school to learn new skills and 
perspectives this fall, consider how you might approach a new season of 
learning around succession in your family business. Make a plan to understand 
your impact on others and develop your technical and leadership skills.

   Editor's Note: Lance Woodbury writes for both DTN and our sister 
publication, The Progressive Farmer. He is a Garden City, Kan., author, 
consultant and professional mediator specializing in agriculture and 
closely-held businesses. Over his two-decade career, he has guided many 
families through inter-generational farm transfers as well as mentored 
successors. Contact him at lance@lancewoodbury.com

   


(MZT/AG)

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