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"World Class" Not Good Enough?
Today, all serious crop and livestock producers understand and pursueproduction goals such as yield per acre, average daily gain and feed conversion. A much more select group incorporates costs andmargins in their analysis and benchmarks. But only an elite cadre of managers intentionally focuses on achieving these goals through best practices in their business processes.
Quoting from Wikipedia, "Best practices are generally-accepted, informally-standardized techniques, methods or processes that have proven themselves over time to accomplish given tasks. Often based upon common sense, these practices are commonly used where no specific formal methodology is in place or the existing methodology does not sufficiently address the issue."
The Extension Service, private consultants and farm media widely disseminate best production practices which make American agriculture the world standard for efficiency and productivity.
However, being a world-class producer is no longer adequate. You must apply best practices principles to business processes as well as production activities.
In production agriculture, business processes include accounting, purchasing, sales and marketing, and manufacturing (production).
But defining and emulating "best" business processes in production agriculture can be particularly challenging:
- You're already out-manned and out-gunned by some formidable competitors with sufficient scale to justify specialized support staff and technology.
- Many business processes-such as accounting-requireradically different skill sets than raising crops or livestock.
- Most producers live in a knowledge "vacuum" regarding business processes.
- Unlike production practices, it's difficult to acquire "nuts and bolts" guidance with business processes through traditional information sources.
- Every operation represents a unique mix of business relationships, experience levels, constraints and goals, making "one-size-fits all" impractical (unlike "plug-and-play" production practices like "stacked genetics" or "biosecurity.")
That's why FBS's expertise extends beyond software to include adapting business process automation to production agriculture. Our recommendations combine the "best practices" from other industries along with the innovations pioneered by our most progressive clients. One of the key benefits of being an FBS user is that you're connected to a network of the most innovative managers in the world.
Here's how you can benefit from applying best practices to your business processes:
1. Effectiveness. Bad practices lead to frustration. Tested and refined best practices lead to desired outcomes with fewer problems and unforeseen complications. And "best" practices often evolve to "better" practices.
2. Efficiency. It's rarely efficient to develop systems from scratch when you can leverage existing knowledge and technology. Polly S. Traylor of InfoWorld recommends, "Buy when you need to automatecommodity business processes; build when you're dealing with the core processes that differentiate your company." Best practices also leads to Standard Operating Procedures which facilitate replication and growth.
3. Internal control. With best practices your business processes will be unified and accountable rather than fragmented and haphazard.
4. Compliance to various statutes and policies. Best practice business processes not only enhances the effectiveness, efficiency and control of employees and management but also simultaneously satisfy your accountant, lender and various government regulators.
We'll be drilling into specific best practices at the upcomingPORK$HOP seminar on June 7th and the FBS User Conference in August as well future articles in FarmSmart. Please send us your questions about or examples of best practices either to norm@fbssystems.com or our blogsite.
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