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Decisions4Dairy - Taking control of your own destiny

The recent upturn in milk prices has given cause for optimism. The journey to get there, in contrast, has been long and painful for many. Often in adversity, we learn a lot about ourselves and our businesses, emerging both stronger and more efficient as a result. This resilient mind-set can be quickly forgotten as the sun emerges over the horizon. It’s important to heed the lessons learned if we want to be successful in the longer term.

During the financial crisis, politicians have had to choose between investing and cutting back on spending. Growth versus austerity. Expansion against contraction. Dairy farmers too have faced difficult choices when dealing with a falling milk price. While many have focused on controlling their costs some have taken the opportunity to innovate, diversify or pursue something different altogether.

Farmers’ attitudes and motivations about what they want to achieve (their ambition) can be very different. Research by AHDB Dairy has uncovered five different mind-sets that prevail among dairy farmers:

•          39% want to build a healthy sustainable business to pass on to the next generation

•          18% aim to maximise financial return through exploiting new technology or new ways of working or expansion

•          17% will carry on as currently, with as little change as possible to preserve their way of life

•          11% intend to diversify the business in order to reduce reliance on the main enterprise

•          8% plan to leave agricultural production as soon as it is practical to do so.

Delivering any of these requires a plan. Without this, you are rudderless and at the whim of outside events rather than in control of your own destiny. This is the basis of good business management.

First of all, you need to work out where you are now. What, about your business, works and what doesn’t (financially and technically), map out the external environment you are operating in and know your personal and business strengths and weaknesses. This will involve asking yourself some tough, honest, adult questions and will help you identify areas for improvement and opportunities that are present.

We should all ask ourselves why we do what we do and the way we do. Is it the best way to achieve our purpose and ambition?

Is dairy farming the best way to enable you to hand down a sustainable business to the next generation and/or deliver the return on the investment you make in both capital and time?

In a lot of cases the answer will be yes but for some the answer may not be so clear cut. The upturn in milk price should not allow you to become forgetful of the impacts that a cyclical market has had on your well-being, as well as your business. Look to build a strategy that works for you short, medium and long term; not just when prices are in your favour.

A vision and a plan are essential, but the delivery will make it live or die. Share your plan with your family and farm team so that you can all work together to achieve it. Hardship may not be the preferred backdrop on which to make decisions; yet it does focus the mind.

Don’t forget, as Henry Ford once said, “When everything seems to be going against you, remember that the airplane takes off against the wind, not with it”.

This is one of a series of articles on mindset.  Read more on this and Decisions4Dairy – an industry-wide initiative to support farmers in challenging times so they can become more robust for the longer term at dairy.ahdb.org.uk/d4d.

 

 

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