Construct resiliency into farm administration plans – AgriNews


PLATTEVILLE, Wisconsin – Resilience is a forgotten part of management for some farmers.

“The need for resilience is usually not immediate, it’s important, but it’s not something that needs urgent attention now,” said Kevin Bernhardt, professor and specialist in farm management at the University of Wisconsin-Platteville.

Resilience may be on the list of things to do for farmers, but they haven’t, and that’s a problem, Bernhardt said during a presentation at the Driftless Region Beef Conference held by the University of Illinois Extension, Iowa State University Extension and the Iowa State University Extension has organized outreach and extension to the University of Wisconsin-Madison.

“Resilience is like risk management, but it’s more comprehensive,” he said. “It is the power or ability to return to normal business operations and profitability after a risk arises.”

Bernhardt divides the viability of agriculture into three parts.

“You need enough capacity on a farm so that with normal production you get enough throughput for the income you need, enough acres to support your cows, and enough economic activity,” he said during the virtual event.

The second part is economic performance and profitability.

“You need enough return on investment to keep the business going, pay the bills, cover family life, replace capital assets, and build the company’s wealth,” said Bernhardt.

Resilience is the final part, which is the farm’s ability to perform a field.

“In 2020 we learned our company’s ability to take a hit,” said Bernhardt. “Last year was an unusual situation, but it’s not unusual for something to happen. Something always comes up to strengthen the resilience of our business. “

There is great variability in the farm and family goals of the farm.

“Some people say the farm’s viability is raising their families on the farm and instilling values ​​in their children,” said Bernhardt. “And they could have another job to make an income.”

However, other farmers may have different goals.

“They may be trying not only to create a good standard of living, but also to strengthen the operation’s ability to offer their children the same,” Bernhardt said.

Very often, fields delivered to farms are due to the agricultural cycle.

“Our prices tend to move, which has been the case for decades, and I don’t see it going away,” said Bernhardt.

There are emotions associated with this cycle, said Bernhardt.

“When we get out of a period of low profitability we build up a certain optimism that adds to the excitement, and when we get into highly profitable years, euphoria,” he said. “Then the cycle turns, too much is produced, we deny it for a while, we get anxious, then panic, followed by depression.”

Bernhardt spoke of a failsafe wheel as a management process to integrate failsafe performance into a farm, with the spokes of the wheel representing areas of management.

These areas include legal risk, third party risk, manufacturing, finance, marketing, human resources, new technology, self improvement, and networking with others.

“You want the wheel to be round because it’s not good enough to take a legal risk if you never pay attention to finances,” said Bernhardt.

The elasticity wheel should not only be round, but also large.

“It’s not just good enough to consider every area that could affect your business. You also have to pay enough attention to each area in order to increase the reliability, ”said Bernhardt.

Farmers need ongoing training to improve marketing or improve productivity. Bernhardt encourages farmers to take part in meetings and conferences and to deal with associations.

The process starts with a plan that needs to be implemented.

“I call it a plan, do, check and act process,” said Bernhardt.

“Start with a plan to identify the needs you have, set the goals you want to achieve, and then do that by buying insurance, going to a conference, or learning a new technique” , he said. “Next, check that it worked because not every idea we have is a good one. That’s why we always want to check our results.”

“Then act, find the causes of the problem, adjust and go back,” said Bernhardt. “Don’t do this just once – keep it up.”