HeartBeat Fall 2018 | Page 10

DOLLARS & CENTS Views From the Road Dr. David Kohl energizes agricultural lenders, producers and business professionals with his keen insight into the agricultural industry through extensive travel, research, and networking around the globe. He is a Professor Emeritus of Agricultural Finance and Small Business Management and Entrepreneurship at Virginia Tech, Blacksburg, VA. Dr. Kohl has traveled over 8 million miles in his career and conducted over 6,000 workshops and seminars for a variety of agricultural audiences. Additionally, Dr. Kohl’s personal involvement with agriculture provides a unique perspective into the future trends of the agricultural industry and economy. 10 HEARTBEAT | FALL 2018 My intense travel schedule conducting meetings and conferences with producers, lenders, and agribusiness and government leaders provides a treasure chest of perspectives, observations, and actions. Agriculture is in major transition as a result of the six-year economic reset. Given this backdrop, let’s examine a few observations from the road that may influence strategies and tactics as the agriculture industry knocks on the door of the third decade of the 21st century. During my recent visits to agricultural businesses, farms, and ranches, I saw firsthand the power of technology and information. Typical managers use technology and automation to replace labor; however, better managers use the information to drive efficiency and align with the marketplace. For example, I visited a family owned greenhouse and vegetable processing plant that uses robotics. The investment was used to replace labor. However, it also improved uniformity and the ability to trace specific items that were sold to wholesale and retail markets. This technology allowed the company to differentiate and gain an advantage in market alignment. Interestingly, much of the automation technology adopted by agribusinesses originated in Europe. This type of automation has been in place for nearly half a decade. However, the recent tariff and trade disruptions are playing havoc on both the cost of the investment and the ability to access the new technology. One of the major challenges faced by the agriculture industry is the ability to attract and retain workers. To combat this issue, some organizations and farms are offering flexible hours, where appropriate. Other companies have found ways to energize their workforce by establishing job descriptions, roles, and accountability with transparency. One observation noticed amongst the elite farms and agribusinesses was the hands-on approach and the family like business culture as a means of motivation. These businesses are able to maintain their culture, while still striving to improve the bottom line. In addition, I noticed that there was compassion and engagement with the people at all levels in the organization. They were able to strike a balance between the head, which represents the numbers, and the heart, which represents passion for the business. One business that I encountered hired and fired their employees based upon their alignment with the company’s core values. Two longtime senior managers were dismissed because of their lack of integrity and alignment with the core values. These employees were destroying the culture of the workplace. In one case, the dismissed employee was a family member.