Klinefelter: By the Numbers

Peer Advisory Groups: I Took Too Much for Granted

Members need to take ownership of their peer groups, to offer honest constructive criticism, and to learn from others' mistakes and successes. (DTN file photo)

For much of the last decade, I've advised top-flight farm operators to copy other small-business owners and form peer advisory groups. Car dealers, insurance brokers and elder lawyers, for example, might meet on a regular basis with six to eight peers from across the country and a professional facilitator to discuss self improvement and coax changes to their business.

I have focused so much on their potential advantages and success in other industries, that I assumed business-oriented producers would know what it takes to make peer advisory groups work. That was a mistake, and for that reason, too many are no more than farmer discussion groups.

In order to be successful, members need to take ownership of the group, determine its objective and decide what their specific priorities are. Besides taking ownership, members need to look at participation from the standpoint of an investment in continuous management improvement rather than as a cost of time and money. Peer groups are a joint venture and everyone needs to contribute and pull their weight in order to make them successful. They are a participatory, not a passive, investment. If members are open and honest, there is much to learn from each other's mistakes and successes.

P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]

The facilitator isn't there to be a teacher or subject matter expert. The facilitator's role is to make sure the agenda is put together and distributed well ahead of the meeting. He/she needs to keep the meeting flowing, to make sure no one dominates the discussion, to pull in non-participating members and read the people to spot developing personality related issues. If there is a host operation, they need to work with the host ahead of time to make sure there is a plan for the visit to assure the critical areas are covered.

The facilitators also need to be sure information about what is going to be discussed gets distributed far enough ahead of time for members to have time to think about their questions and comments. If outside experts are to be invited, the facilitator needs to handle the logistics and make sure the speaker focuses on the needs of the members. At times, they may need to speak to individual members privately to diffuse what may be developing problems. Finally, they need to follow up with the members on the take-aways and the commitments made during the meeting.

Peer groups where both the CEO and the successor participate can be one of the best successor development programs available, while also allowing the CEO to learn ways he/she can be more effective in the successor's development.

Between meetings, members of peer groups also need to use their group's list serve or chat room more frequently. They need to share information or insights they feel would be of interest to the group, or they could share an issue or opportunity they are facing or considering. They should also share their perspective and options (alternatives) they are considering.

The three main reasons I see farm businesses struggle with mediocrity are "because we've always done it that way," "if it ain't broke, don't fix it," and "being so closed and secretive, they don't learn from the experiences of others." Tom Peters, in his book "Thriving on Chaos," said if something doesn't appear broke, you probably haven't looked hard enough. Everything can be improved. Everyone has strengths and weaknesses. One of the purposes of a peer group is to help all the members discover what those are and help each other overcome or improve on them. A friend of mine, who has met with his peer group every month for the last 20 years, told me that at every meeting he hears something he doesn't like to hear but needs to hear. That's where much of the real benefit comes from. One of the problems I've seen is where opportunities to learn and improve are derailed by pride, because it means admitting that there are things they could and should do better.

Sam Walton was known for spending more time in his competitor's stores than their CEO did. He was often accompanied by his successor. After each visit, his successor said he would come away thinking how much better they were doing and what the competitor was doing poorly. Sam, on the other hand, always came away having spotted one or two things where the competitor was doing better and would take them back and implement improvements in his own stores. Dave Kohl often says the real winners work at doing many things 1% better on an on-going basis rather than just looking for things that could improve their operations significantly. Although in tough times there is a natural tendency to cut any cost possible, it is also then that peer advisory groups and continuous management improvement are most critical.

Remember, the rate management needs to improve for a business to be successful and continue on to the next generation is set by the leading edge of your competition and not by your own comfort zone.

EDITOR'S NOTE: Danny Klinefelter is a professor and extension economist with Texas AgriLIFE Extension and Texas A&M University where he teaches a beginning farmer program. He also is the founder of The Executive Program for Agricultural Producers, a mid-career management course for farm producers held each January, and its alumni association, AAPEX. For information on TEPAP and DTN's scholarship program, go to http://tepap.tamu.edu

(BAS)

P[] D[728x170] M[320x75] OOP[F] ADUNIT[] T[]
P[L2] D[728x90] M[320x50] OOP[F] ADUNIT[] T[]
P[R1] D[300x250] M[300x250] OOP[F] ADUNIT[] T[]
P[R2] D[300x250] M[320x50] OOP[F] ADUNIT[] T[]
DIM[1x3] LBL[article-box] SEL[] IDX[] TMPL[standalone] T[]
P[R3] D[300x250] M[0x0] OOP[F] ADUNIT[] T[]