The fifth of twelve most common mistakes that agribusiness owners repeat:

Kenny Chesney sings this warning very well, and the lyrics should become an affirmation for busy achievers:

“Don’t blink.  You’re six years old and you take a nap.
 And you wake up and you’re twenty-five…
 Trust me friend, [the years] go faster than you think.”

How many times have you heard it?  “Don’t wish your life away.  Time moves too fast.”  Yet we still can’t wait for Friday, or we put off until ‘whenever’.  Human nature is to hesitate on the important while we address the urgent. 

 __________ (Continued from Leave a Legacy on AgWeb) __________

Time is our most precious resource.  There are a finite number of hours in the day, days in the year and years in a lifetime.  Time must be managed judiciously for the achievement of our goals.

Most of the elements in a comprehensive succession plan take time to fully implement.  A viable plan for leadership development may require five years of increasing responsibility, formal classroom training, and expanding exposure to new ideas and industry leaders.

An effective and seamless ownership transition should be initiated over an extended period of time to allow for growing maturity, learning responsibility and to minimize transfer obligations.

The options available for a retirement design are definitely time sensitive.  The magic of compounding interest and regular savings are the key to accumulating a pool of wealth that will fund a life of leisure, or the next endeavor in one’s vocational life.

With enough time, we can accomplish anything.

The fourth of twelve most common mistakes that agribusiness owners repeat:

They enthusiastically participated in the succession planning consultation.  For this middle-aged couple it was a first visit.  We discussed their succession intentions and talked about the family legacy.  We talked about the future and their two children.  Sarah, now 27, had attended a very reputable Ag school, graduated with honors and was almost to her fifth anniversary working full-time in the family operation.  Craig, their 23 year old son, was a different story.

He was obviously the apple of Dad’s eye, football hero in high school, a 4-H all-star, currently attending community college and working ’sometimes’ on the family farm.  Though Craig didn’t show an apparent interest in the business side of things, dad assured me, “He’s young.  You know how boys are - he’ll come around.  He wants to do this.  Besides, he’s always talked about running the place.”

Parents and their children, families and motion, are the purpose of succession planning, they’re also the reason most families need objective assistance.  Succession planning is simply about positioning the farm and preparing the family for generational transition.  But the blessings of emotion to prompt action can be a curse of misapplied decision…

__________ (Continued from Leave a Legacy on AgWeb) __________

Though emotions prompt action, using them to judge the appropriateness of a business decision will not yield the right result for you, the family or the operation.  Emotions are not a sound judgment guide.  On the other hand, non-emotional, objective decisions promote rational, consistent and fair outcomes.  Emotion as a motivator is necessary, but it must be tempered with rational thought.

Emotionally inspired decisions made with sound logic and clear objectives are the foundation of a family business endeavor.  Using the positive aspects of emotions is critical to success.  Parents must throw out preconceived ideas, past history and proud desires; utilize objective measures such as tools, real life experiences and outside influences to make rational decisions.

To minimize emotion and made rational decisions regarding succession:

1. Clearly define your objective.
2. Elicit the desires of active family members.
3. Use objective tools of measure.
4. Test theories, desires, preconceived ideas, etc. with actions.
5. Enlist the services of outside advisors and consultants. 

The third of twelve most common mistakes that agribusiness owners repeat:

In most families, there is a near-superstitious taboo about discussing personal, private, adult or parental matters.  Kids are taught that it is impolite to ask parents or elders certain delicate questions.  They’re not supposed to ask about income or financial issues related to business.  In these families, questions about inheritance or plans regarding estate distributions may be considered disrespectful and inappropriate.

Just to make it perfectly clear, I don’t condone meddling in the affairs of others.  But I do believe that adult children, working in and dependent on the family business, have a right to know. 

 __________ (Continued from Leave a Legacy on AgWeb) __________

Privacy is a right, and most people would do well to mind their own business.  But I do suggest, in fact entirely support, and adult child’s ‘need to know’ when the subject may affect their individual family’s long-term financial security.

Parents (a patriarch or matriarch) may feel uncomfortable with this right to know.  Yet, if we use the corporate world as a model, an employee is informed about wage levels; salary or cost of living increases; available benefits; promotions and retirement options.  Communication on the farm is a completely different story.  On the farm, an adult child or relative may be working for a less-than-market wage.  They may be subjected to seasonal variations in pay and/or may not be kept in the loop on major decisions.

There is a multitude of tripping points on the road to multigenerational success.  Farm owners must encourage adult children to discuss concerns.  Check out Legacy by Design’s Succession Planning Self-Assessment; it may help trigger some of the important topics that should be discussed with all active family members.  It is critical for their long term financial health, their loyalty to the business and their dedication to the current generation - you.

The second of twelve most common mistakes that agribusiness owners repeat: 

Agribusiness owners ride a rollercoaster of seasonal, daily, hourly, and even momentary demands.  The ebb and flow of business decisions, seasonal variables, time constraints, labor resources and environmental pressures all combine to tax a producer’s abilities to focus on what should be.

A busy farm owner is often distracted by decisions of the moment that cause him to ignore simple, yet critically important, questions, such as:

__________ (Continued from Leave a Legacy on AgWeb) __________

     - What is the big-picture long-term objective?
     - What accomplishments define success?
     - What should the operation become as it grows into the future?
     - What steps should be taken now to achieve those heartfelt goals?
     - Do current activities support long-term desires?

We’re all guilty of getting caught up in the urgent at the cost of the important.  Business planning, marketing programs and special projects are no exception.  Every one of us allows our day-to-day existence to be redirected by the crisis of the moment.  The real cost of management by crisis is the enduring value of the business.

Farming is a business, and each decision to do something is a choice not to do something else.