Regional marketing proves a real winner for grain producers.

Getting people to ask for help has always been pretty tough.

However, getting people to PAY for help is virtually non-existent (given the current sentiment); unless you have a business model that is really strong on delivering actual outcomes for the client and maximising their spend i.e. more bang for their buck.

Consequently, when starting a new business as an independent professional it is always a joy and a compliment to be approached by people and told that my help is needed.

Of course, the MBA student in me says Aha!  Why are people seeking me out in such a tough market?  What are their unmet needs?

What I am seeing is an increase in the number of grain producers that want to change the way they do business in a deregulated industry; but are completely starved of any information as to how to go about this.

This trend reflects the philosophy of a growing number of grain producers that getting closer to destination markets using (producer-owned) farm-direct business models and vertically-integrated regional marketing techniques, is essential for their continued sustainability.

These grain producers represent a new generation of young agriculturalists that want more than conventional production and grain selling information in order to improve their business development and marketing skills.  Their goal is to increase their downstream investment (beyond the farm gate) in opportunities that lead to their own direct relationships with export customers – not the growing number of mid-market participants offering ‘marketing’ products and (fee for) selling services.

Typically, grain producers will come together as a regional cluster to achieve this goal.  Some groups have already successfully linked to niche export markets and have positioned themselves as the real innovators of the industry.  Some have just started the journey.  Others are watching closely.

It is very exciting to see some of the businesses that are developing.

Whilst information that improves productivity and scale in the paddock will always remain important, the cost of consuming the inputs (and other) required to manage these advanced farming systems on land that is well-above its (variable) productive value is prohibitive for some and many grain producers now see value in other business activities and a better utilisation of their cash and equity position that is more sustainable.

Don’t get me wrong – like any industry, the greater majority just want to grow it and sell it to the next person in the pipeline; but the focus and role of some industry help has to change to meet the emerging needs of others.

Don't fight the war for talent head-on.  Outflank it.

Outflank (verb): to get the better of, to outmanoeuvre, and to bypass.

I read an article the other day that left me really exasperated.  It wasn’t the article’s fault on its own.  It had more to do with the fact that it was just one more of so many other commentaries I’ve seen about winning the war for talent in a tight recruitment market.

I think I’m suffering from ‘skills shortage’ headline fatigue; like so many other people I talk to.  We can all see the opportunities; but the businesses that desperately need help can’t (or are being told otherwise).

It concerns me to read of small and medium businesses whose strategy for obtaining and retaining their staffing requirements, is to continue to fight for a shrinking pool of permanent staff by throwing more money out there.

One of the more immediate negative impacts of this type of strategy, is the high number of business-critical positions that are being left vacant for damaging periods of time, because businesses are trying to find THE perfect candidate to get maximum value from the package and the high cost of traditional recruitment methods.

Who is telling these owners and operators that permanency and the big package are the weapons of choice for finding experienced skilled management?  It will be a noble and gallant battle fought with old muskets.

As businesses focus on expanding again and using a conventional approach to recruitment, this strategy will unmask a talent mismatch and under-employment that will only continue to challenge and distract small and medium businesses during critical stages of new growth.

To address the shortage of experience and skills, many businesses are approaching their management workforce with new ideas about flexibility.  What they have found is a veritable army of educated, experienced and skilled independent management professionals that form a peripheral workforce to industry.

These flexible managers are able to hit the ground running, delivering services that are fast, compact, and affordable; providing instant outcomes and a high return on investment.
 

Diverging from the conventional approach to recruitment has been an illuminating and rewarding experience for these businesses.

More and more small and medium businesses have changed their approach to resourcing their people-needs and with the help of some creative thinking, have discovered that the market for available talent was not as tight or as expensive after all.

If you want to win the war for talent, keep flexibility in your arsenal.

Short on Skills?  Start up-skilling your people.

What was once considered a luxury (non-strategic) spend for many small and medium agribusinesses, investing in management up-skilling is now a minimum requirement just to survive.

Let’s be honest.  Virtually every business says that people are its most important asset; but too few are actually doing anything about it.  We’ve all been there as employees.  People are treated as a cost not an asset (investment).

So as the industry calls for more innovation out in the ‘paddock’, a silent epidemic is hurting productivity back at the office.  Regrettably, the office or the boardroom is rarely (if at all) considered when the industry talks about increasing productivity.  There is no doubt that the biggest source of profit is an organisations ability to be productive.  The critical, yet often neglected, success factor for this, is its management and leadership capability.

So what is capability?

Capability is an all-round human quality, an integration of knowledge, skills, personal qualities and understanding used appropriately and effectively- not just in familiar and highly focused specialist contexts but in response to new and changing circumstances. (Stephenson 2002)

If there was ever a statement that sums up what is needed to support the agricultural production and agribusiness industry this is it.

We’re all now aware of the facts.  Too many people have exited or chosen not to begin a career in the industry.  As generations go by, this has created a shortage of educated young professionals moving up the ranks from within.

Consequently attracting, developing and retaining skilled talent has become the biggest priority for many operators in the industry.

A skills vacuum within an organisation can also result in existing people taking on managerial, business development and leadership roles without the skills to do it.  These people may have a fantastic technical skill set; but what they find themselves doing is not what they were trained to do.

Unless money is invested in helping people develop their managerial and leadership skills, it makes sense that you would need to be asking what will be the result of the types of decisions these people will be making on behalf of the organisation.

 

Responsibility rests with those in charge of governing the business, to ensure that technical skills are being augmented with management and leadership capability.

The implications of this situation are negative.  Many organisations are going to miss the chance of truly maximising the opportunities of the food and fibre boom, because they couldn’t mobilise the internal team required to take it on, in an increasingly sophisticated and complex domestic and global business environment.

Many operators are frustrated.  They are asking about the ‘food and fibre boom’ headlines they saw and why it has actually resulted in making less money than ever before.  Many agribusinesses will not survive at all.

There is an opportunity for non-award Management and Executive Education to play a significant role in providing a solution to the Australian agricultural production and agribusiness industry.  In other countries, it is a requirement of your role as an agribusiness manager that you will be sent to some form of post-grad management education EVERY year.  Companies will not let you progress without it.

It’s true that developing the competency based skills of those within an organisation provides a fundamental foundation for the business to collectively meet the expectations of its markets and customers i.e. capture the food and fibre boom.  However, raising the core skills of existing workers is now just the minimum requirement for a business to exist in the future, let alone be a source of competitive advantage.

Whilst doing things right will always remain important, true value will be created by a succession of managers and leaders having the vision to ask if we are in fact doing the right things.

The successful agribusinesses of the future are today investing in the development of their people and upgrading their skill base from transactional managers to transformational leaders.  That is the productive value of investing in up-skilling.

The role that University based Executive Education can play is to develop innovative, thinking leaders with an understanding of core managerial capabilities. University non award programs provide the flexibility, speed and experiential learning opportunities needed to develop an increasingly important source of competitive advantage and a succession of future-focused leaders.

This blog includes extracts from The SOS Group and the Execution Education Unit of The University of Adelaide submission to the Senate Enquiry into higher education and skills training to support future demand in agriculture and agribusiness in Australia.

Word Cloud

Agriculture agricultural industry agribusiness farming farmers primary production skills shortage foreign investment farmer land food and fibre boom food security supply chain value chain value chain innovation grain grains wheat barley peas beans canola lentils vertical integration farmers markets strategy strategic planning marketing management performance management interim management export exports Asia containers logistics container strategic direction marketing plan business plan business model food production regional produce regional branding local produce provenance appellation logo equity partnership agribusiness management development program skills training succession planning productivity terms of trade cropping crops crop inputs grain marketing futures contracts grain trade grain trading brokerage broker fresh produce shipping logistics economy economic interim manager recruitment advisory panel sales consulting food products food industry food marketing small and medium business small and medium agribusiness food industry deregulation innovation generation grain growers ag communication business solutions workforce capacity workforce productivity workforce capability shipping food sa farm gate paddock to plate traceable safe safety non GMO natural pure premium quality exporters healthy Australian grain Australia country The SOS Group Jeremy Lomman rural and regional Australia rural and regional communities agribusiness manager leadership development holistic marketing solutions  leadership and management development tool agribusiness consulting agriculture consulting feedback survey post graduate agribusiness food safety quality assurance human capital talent management farm online South Australia Mid North hub commodity consumers supermarkets sustainability natural resource management value chain analysis human capital marketing management human resources horticulture viticulture wine aquaculture merchandise merchandising reseller retail chemical grain trader agribusiness careers agribusiness recruitment funding export grants export plan export marketing plan family farm family business innovative niche market ready SA food industry South Australian food industry rural and regional support services global globalisation Agriculture agribusiness higher education skills shortage skills training VET vocational education and training senate enquiry national food plan productivity post graduate skills development agriculture research climate change food security export terms of trade supply chain value chain primary production regional economy human capital upskilling food supply labour shortage skilled labour entry level worker skilled workers labour supply food sector

The neglected element of your company's performance: PEOPLE

A serious gap in workforce productivity is now holding back the growth of the Australian economy.

 

In PwC’s recently published study Key Trends in Human Capital 2012, Australia was ranked second to last for productivity growth.

As we all know, the Australian agribusiness and agricultural production industry has been suffering from a steady decline in the productive capacity of its workforce for some time now.  It is an issue that is hotly discussed around kitchen tables and boardrooms alike every day.

What the PwC report reveals is that overall productivity of the Westernised workforce has fallen dramatically in the last period.  There has been a systemic cutting back on drawing new skills in (recruiting new talent) and the ongoing professional (post graduate) development of the existing workforce.

Sound familiar?  These global trends are consistent with local trends that have emerged in Australia’s agribusiness sector.

So whilst we all may be asking ‘where are all the graduates?’ - as an industry what have we actually been doing to attract (draw in) new skills and effectively increase (up-skill) the output of the existing workforce?

For many businesses the answer is absolutely nothing.  Why?  It is not the conventional way of thinking in our industry.

The implication of doing nothing is to receive a very low return on the most important investment your company will ever make; the investment in your people (workforce – or Human Capital as it is commonly referred to now).  A poor return at a time when many are already struggling to generate external growth.

Imagine the possibilities of increasing the return on the investment in your people.  Having an effective process for monitoring the ongoing performance of people can make a huge difference to their productivity and generate external growth for your business.

One of the key ways that you can achieve this is to develop a suitable performance management system that will ensure the people of your business are consistently delivering value.  

A quick and compact approach to measuring workforce performance is a 360° Feedback Survey.

For the purpose of performance management, the performance of people at work can be divided into two broad components:

-          - Functional Performance

-         -  Behavioural Performance

360° feedback is used for the behavioural aspects and gives people an insight into the way others perceive their performance based on their workplace behaviours.  Research shows that behavioural aspects of performance are as important as the functional aspects of performance.

If you want to increase the return on investment in your people then you should have a performance management system that includes both.

At SOS we specialise in helping small and medium agribusiness located in the regions and now offer a 360° feedback service to start looking into and solving some of the productivity issues owners and operators are encountering.

If anyone would like an information copy of our 360° surveys or the PwC global study into human capital trends please contact us.