Technology + Family Farm Succession
Succession in a family business is hard work — perhaps harder than the normal, daily work within the business itself. Transferring the senior generation’s years of experience and knowledge, and developing skills and strengths in the next generation, all while managing the emotional dynamics of family members working together, is flat-out overwhelming. Add to that the transfer of ownership among on and off-farm heirs, the consolidation of the industry, and the current economic climate, and more than a few families wonder if the effort is worth the reward, particularly when all of the aforementioned areas are littered with potential land mines in the form of disagreement, miscommunication and conflict.
For those who choose to continue the business legacy through engaging in succession planning, technology offers a host of benefits. I’ve listed a few for your consideration:
· Modeling likely business scenarios as a way to evaluate decisions. With all of the systems that capture data, it is becoming easier to take last season’s financial, market, agronomic, labor and weather data to create models, budgets and scenarios of how future years might look. While agriculture is an unpredictable endeavor, you can more easily review and project assumptions about future years, which begins to add a sense of certainty into the process. Based on what has actually happened in years past, you can develop scenario plans for certain crop, market and financial outcomes. This offers a glimpse into how different generations might try to solve problems or take advantage of opportunities, leading ultimately to greater confidence and a sense of direction in the business transition process.
· Analyzing data to understand the factors that really drive performance. In prior decades, knowledge of what drives performance was often handed down from prior generations as a set of guidelines or best practices. But with the vast amounts of data captured by new technology systems, one can glean additional and specific information about soil health, seed performance, fertilizer and chemical application, water usage, equipment patterns, conservation impacts, harvest trends and other factors. In many ways, the data helps to institutionalize — or sometimes refute — knowledge handed down from parents and grandparents. Analyzing the data together formalizes and furthers the goal of getting knowledge in the senior generation’s head into the minds of future generations.
· Communicating across geographies to gather input and keep people on the same page. When you consider the people who have an interest in your farm, the numbers add up quickly. Family members, employees, land owners, vendors, and advisors all have an interest in knowing what’s going on. Through constantly evolving communication platforms, it becomes easier to share news and updates, crop progress, instructions, market issues, repair advice, and financial information. A robust communication process leads to a more seamless transfer of knowledge between parties, which in turn smoothes the succession process.
In the world of family business succession and planning, to “facilitate” means “to make easier.” Technology, while not always easy to adopt, can be a tremendous facilitator once implemented. Consider how you might use new technologies to advance succession in your agriculture family business.