How do you measure performance on your farm?

[AgVisionTV]

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[farmers_son]

What a crock....

OK...performance measures are somewhat useful. But what do they really tell you that most producers would not already know?

Our farm has experienced a long string of weather extremes, either drought or excess moisture. Even with insurance and government handouts our profits have not been what they otherwise would have been with normal weather. I can look at performance measure until I am blue in the face but they will not tell me what the weather is going to be this coming year. And that is the critical factor for our farm, weather.

I would tend to think you would expect farm managers to make more use of performance measures in farm sectors that are not largely dependent upon the weather, like hogs, chicken or milk.

But if you are in cattle or grain there are other critical success factors that are more relevant. And the performance measures I look to are:

The sky each morning to see what the weather is like
getting the bull out on time.
wathcing to make darm sure he is going the job
calving percentage
percentage open cows.
timely cropping operations, seeding dates, spraying dates, harvest dates. It is my responsibility to try and get the work done on time but I cannot control the weather although I can decide what work to do today based on my assumptions about what the weather will be.

In some operations (like mine) the most important thing is you get off your butt and get the work done. I get the work done, I try to manage my risk, I have a responsible amount of debt. That is the most important performance measure on my farm and most farms.

I can crank out the numbers these guys are talking about but they not tell me what the weather is going to be or what the price of the commodities we raise will be in 2011 and on.

You can spend too much looking in the rear view mirror.

[farmers_son]

If anyone is interested there is info on performance measures at:

http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/econ2198

You may have gathered I am not a huge fan of using these "gauges" in a farm context. True, business uses them all the time and your bank may be keeping track of these numbers on your farm without your knowledge. So you may want to gather the numbers yourself just so you know how you look to the banker.

I always tend to believe that farmers have already figured out most of the real best management practices and if farm managers are not using the performance measures mentioned in the video on a regular basis then maybe there is a good reason for that.

It may be like this….Keep in mind these performance measures or as Dick Whitman describes “gauges” are nothing more than one number divided by another. Typically they will only be used in the context of the last financial year and maybe two of three years back. In other words they are relatively short term indicators of your farms performance.

We need to be very careful when using short term performance measures to make long term decisions on the farm. Our farms are very long term investments, often investments that have lasted for generations, and changing course based on one two or three years of performance measures could be a mistake. And farm managers intuitively know that.

It would be nice to live in a sure crop country and be able to set yield goals. The truth is that much of Canada’s agriculture persists in areas with considerable environmental challenges that really make much of what the guys in the video are talking about little more than intellectual nonsense. Perhaps it is more politically correct to call it intellectual nonsense than “what a crock”. I have met these people in the video and they are sharp but maybe their words apply to supply managed operations or even to growing corn in the best corn growing regions of the world but it does not necessarily apply to where I farm. I need to keep looking ahead because if I made all my decisions based on what happened last year I would be wrong most of the time. Every year is different.

I need to keep looking ahead. And sure what happened last year and the last few years makes a difference to what I can do in 2011. But like the story about Gretsky who skates to where the puck is going to be not where it is now the best farm managers (the men and women who are actually on the land right now) are using skill sets that are way above and beyond what the so called “experts” in the video are talking about. The fact of the matter is, and I am 100% sure about this… if those guys in the video were to come and try to manage my farm they would fall flat on their face because it is a lot harder here.

Like the story goes if it were easy anyone could do it.