Ottawa, Canada – Farm Management Canada in partnership with Agri-Food Management Excellence Inc. is pleased to announce the release of a new research report, titled “The Relationship Between Strategic Management and Farm Success.” This comprehensive study delves deep into the pivotal connection between business management practices and farm success to foster a transformative shift in the industry by catalyzing the widespread adoption of strategic management techniques among farmers.
In today's dynamic landscape, where conventional industries evolve at a relentless pace, most professionals, across sectors, mandate business degrees as a prerequisite for managerial roles. Yet, within agriculture, a stark contrast emerges.
Many dedicated farm operators initially embark on this journey driven by a passion for agriculture, not the intricacies of business management. Consequently, a wide spectrum of attitudes and varying levels of knowledge pertaining to the benefits of strategic management has emerged, painting a diverse canvas across the agricultural landscape.
Larry Martin, Principal of Agri-Food Management Excellence Inc. authored the report. Martin conducted an extensive literature review and interviewed business management experts.
Results reveal three key findings:
- improving strategic management can lead to a 100% return on investment
- strategic managers tend to be consistently more successful regardless of size, location or type of enterprise
- definitions of farm success go beyond profitability
Strategic management refers to having a process in which measurable goals are established, a plan is put in place to achieve those goals, management continuously measures and evaluates performance against the goals and changes in the business environment, and the plan is revised to mitigate new risks that surface and/or to take advantage of new opportunities on the horizon.
“Our work proves a modest investment to improve managerial skills can have a significant impact on farm profitability and personal performance,” says Martin. “In actual fact, the results of this study are more modest than the real-world results we routinely see working with farmers across Canada.”
Most academic literature defines farm success by profits, which makes sense because profitability is easy to measure. In reality, farmers have many goals including work/life balance, improved family relationships, positive mental health and contributions to the community and environment. However, personal or non-economic goals are more easily achieved when a business is not under financial pressure - e. g. farmer mental health is more vulnerable when there is not enough income to service debt.
“Already, we see a number of Canadian farmers benefiting greatly from adopting strategic management processes, and hope these numbers will grow,” says Heather Watson, Executive Director of Farm Management Canada. “We are grateful for the work of Larry Martin in providing evidence-based research that further demonstrates the relationship between investing in business practices and farm success. This research further validates our belief that in an increasingly competitive and volatile business environment, farmers must think and act strategically to remain resilient and competitive.”
To read the Full Report, visit www.fmc-gac.com or www.agrifoodtraining.com Click here to see more...