Few grain growers would liken running their farm to the level of planning demanded by, say, a large military exercise.
But a former senior Australian Army officer turned logistics and planning expert, Stephen MacPherson, wishes more primary producers thought exactly this way.
Mr MacPherson, chief executive of his own Western Australia-based company Supply Chain Services Australia, has turned around several large Australian companies in the food services, transport and logistics areas since leaving the Army – taking them from floundering loss-makers to fast-growing profitable businesses. He believes the secret to success, whether in farming or the corporate world, lies with better understanding the principles of project planning and operations management.
Taking part in a recent GRDC Farm Business Update webinar, Mr MacPherson outlined the way he would like more growers to think and approach their businesses, with the likely consequences for better yield outcomes, business efficiencies and profits.
The GRDC webinar, also addressed by Mallee grain grower Tim McClelland, tackled how the understanding and utilisation of key project planning techniques could help growers improve their skills in planning and managing key farming operations – such as sowing and harvesting – to ensure they are timely and well-executed.
If you are managing well, your daily focus shouldn’t be on today.
Mr MacPherson said good planning, backed by judgement, knowledge, experience and accurate information, was pivotal to improved efficiencies, desired outcomes and successful results. “As the old saying goes, a failure to plan is a plan to fail,” he told the forum.
First, Mr MacPherson says, it is critical that the owners and operators of mid to large-scale farming enterprises understand the different levels of management oversight, and their roles and responsibilities, even if only one person is fulfilling all of them.
He outlined how senior management is about setting the business’ overall objectives, strategy and direction, looking ahead months and even years.
Mid-level managers are planning for what is happening in the next few days and weeks, while junior managers are focused on the daily tasks filling the next few hours.
“A key tip is that your daily focus should not be primarily occupied with what needs to happen on the farm today, but on what isn’t happening as planned, what risks or unforeseen events may arise, being ready and planning to deal with them, and planning for what comes next.
“If you are managing well, your daily focus shouldn’t be on today.”
Mr MacPherson says there are two different types of management. Strategic management is about taking a long-term view – such as planning to expand and double business size – while practical management has a more immediate aspect, such as planning for the harvest ahead.
However, for both types of management, the same fundamental objectives and project planning principles apply: what resources – in the form of people, finances, machinery, and fertilisers etc – do you need to put in place to achieve optimal performance and to complete the project?
“Successful managers are able to think like that, and achieve that, at a level of detail that less-successful or experienced managers struggle with,” he says.
He says another key factor is understanding that management is all about introducing change. To achieve this, it is also necessary to grasp that management is a process, with four activity stages:
- the first must be a formal plan of what is to be achieved and how, within set budgets and timeframes;
- the second activity is to implement the plan, allocating resources to achieve the desired outcome;
- the third is to monitor how the plan’s implementation is going, to be alert for unforeseen events, delays or outcomes not being met or achieved, and recording results along the way; and
- the fourth is to have plans for alternative or remedial actions, to control the practical roll-out of the plan so any aberrant events and consequences do not become major problems. This is followed by a review of how it all went, to improve the process next time.
To be a manager who makes good decisions, Mr MacPherson says the key requirements are:
- access to relevant, up-to-date and accurate information, which for farming might be the latest science on soil types, crop varieties, sowing techniques or benchmark grower studies;
- the sharing or “visibility” of this information with other levels of family, decision-makers, stakeholders or farm employees;
- clarity of “effective control” so all understand you have the authority and mechanisms to be making these decisions; and
- sound personal judgement, based on knowledge and experience.
He said it was vital growers used the latest tools and technologies available to them, such as precision agricultural machinery, automated data capture, web-based farm management systems or satellite biomass recorders, to measure change that is happening as a consequence of project planning and decision-making.
“If you can’t measure it, you can’t manage it; simple as that. And as with any information gathered, it needs to be timely and it needs to be accurate.”
From principles to practice
Birchip grain grower Tim McClelland said his family’s 6500-hectare grain farm in Victoria’s Mallee utilised many of the key management principles recommended by Mr MacPherson.
For example, the business holds regular strategic and operational management meetings at three levels to ensure all decision-making is shared.
Every Monday morning, all farm staff meet with Mr McClelland to discuss plans for the week ahead. Every two months, a farm board meeting is held involving all family members actively involved in the farm’s operations (Mr McClelland, his wife, his father and aunt) to discuss farm budgets and key decisions for the next two to six months.
And, twice a year, the family council – involving all family members with a financial interest in the property and farm business – meets to discuss long-term strategies, directions and key decisions ahead over the next year.
Mr McClelland says he employs project management skills and multiple spreadsheets when planning sowing and harvesting.
Paddock sowing guides
He prepares a sowing guide for each paddock – crop variety, sowing rates, ideal sowing date and fertiliser regime – which is discussed with staff so all know the plan to be followed. “But it has to be flexible enough to change on the run,” he says.
A key piece of project management is logistics at sowing time to ensure enough fertiliser of the right mixes is available when needed. “We don’t have enough storage for all of the fertiliser we need to get through the whole of sowing, so it takes a lot of planning to work out how we will get that fertiliser on-farm in a timely fashion.
“I have a spreadsheet that outlines where all the fertiliser is stored and when it will arrive; but when you are dealing with truck drivers, trucks that break down and fertiliser distribution centres, the best plans can go out the window. You have to be ready to deal with that and adapt.”
Mr MacPherson offered several “golden observations” he has learnt over the years in military and corporate logistics planning and management.
- Volume cures all ills: “Pursuing volume, either through expanding production or grouping purchasing requirements, like through a grower co-op, to negotiate better prices, (is the way to go). If you get volume, you are much more efficient and productive.”
- Variation is the enemy of logistics efficiency: “If you get a sustained run at tackling the same task, your staff will become more efficient and consistent.”
- Successful logistics planning has common characteristics and principles:
- the simpler the plan, the more likely it is to succeed;
- the need for cooperation between all parties and stakeholders;
- the pursuit of economy at all stages and in all activities; and
- the achievement of flexibility and foresight, to help anticipate the future.
View the Farm Business Update webinar.