“If you can measure it you can manage it.” This is an old adage but it is a true one. While it is great that many farmers are measuring various aspects of their business and gauging their progress, it is surprising to note that there are still many who don’t do any monitoring at all. With a multi-million dollar business at stake, why wouldn’t you?
Perhaps it is apathy or it is seen as a hassle - a focus on the negatives will usually result in lack of action. Why would you measure progress? Because you want to improve some aspect of your business or achieve something important! As farming is a business full of variables and challenging influences, measuring is crucial. But what should you measure? Only you can answer that but for a start think about measuring something that has a direct and major effect on the result you want to achieve. Let’s look at an example.
If I was a new GrowFARM Client I may want to actually generate some spare cash because there has previously been very little at the end of each year left over for myself and my family to do what is important to us. I would look at why this was happening. With the GrowFARM ProfitLIVE System I might discover that my profit/kg Dry Matter eaten (p/kg DMe) was running at 3c/kg DMe. From masterminding with other GrowFARM clients I might find that a profit of 10c/kg DMe was very do-able. This is over 3 times my current profit! On further analysis I might admit to myself that I actually have no idea on what the livestock market values do through the year so my decisions have been reliant on luck and tradition. No wonder I have no profit – my decisions are 50/50 at best!
So, I need to monitor market trends and values so I can get good at making decisions that cause the profit equation work well for my business i.e I need to define what to measure and have a meaningful reason to do so.
Next I need to set a meaningful goal. I would want to record weekly market value data for certain stock classes from a Rural Market Information provider along with certain conditions occurring in that week. These may be kill space, weather conditions, pasture growth and exchange rate (among others).
My measurement points/times would be every Friday once the main data was received in my inbox.
I need to record this data to monitor it and I need to use it! I would set up a MS Excel spreadsheet file with each Friday’s date down the left hand side with particular stock classes and conditions along the top. I would keep myself accountable to doing this by having my wife follow up with me weekly.
Once I am measuring I need to review the data and take the lessons from the monitoring. This is something I would mastermind with my coach and my fellow GrowFARM clients about. My business results would be easy to measure and review, live at any time because ProfitLIVE is available 24 / 7. Personally, I need to keep reviewing, and my accountability people would help me to keep on track. I would constantly know that my knowledge was building based on my confidence in decision making and comfort levels in being able to respond to market changes as they happen or before they happen.
With this regular review and focus I would learn a lot. Why? Because I have a strong reason and a definite goal. I really want the result! If I didn’t have these I wouldn’t follow through!
To make the measuring exercise worthwhile, I would need to apply the lessons in my decision making as I go along. There is nothing like learning by doing!
In summary, measuring is not just about starting to measure - there must be some solid planning first to get the most benefit from it. Once again, it is about doing what it takes. Will you?