Rancher Top Ten Skills for Success, Part 2
In May, I started the David Letterman-style top 10 list of skills for a rancher to possess that would facilitate success in the ranching business. We made the distinction between cowboy skills and rancher skills, identifying a rancher as a person who owns or manages a business that raises livestock and the cowboy as the person who works in a business that raises livestock. The rancher needs good cowboys and may even be a good cowboy themselves, but the skills required as a business owner are very different from the skills required from someone that works in the business.
From the article in May the top three are:
Financial and Economic skills
Become a Grass Whisperer
If you want the details on these three the full article is posted at PlatteCountyExtension.com and wylr.net.
Moving on to numbers four through six, ranchers should understand their system, wage a war on costs and be a constant learner.
Understand the system
The fourth skill for a rancher is understanding of the system. Ranching is a complex business with many interconnected parts. If you pull on one part, the ripple effects of that change will be felt throughout the business, and the results may be distant in time.
For example, if you change your cow nutrition program mid-gestation, the calf crop that was in the belly of the cows may perform different when they are being finished in the feedlot that may be more than a year later. It might be easy to point to some immediate change in the feeding program of the calves as the cause. It is more difficult to look deeper into the system for the answer.
Perhaps you have changed your calving season. This will likely change your winter feeding program, your marketing plan, your grazing plan and may change the timing of your cash flow, along with many other things.
An effective rancher will always seek to understand the interconnectedness of the system and analyze potential effects of management changes, or lack of change, on the system. The most effective ranchers understand that this will take more than one mind to figure out and will involve others in thoughtful deliberations.
War on costs
The ability to wage a war on costs is the fifth necessary ranching skill.
Burke Teichert coined this phrase to describe the constant attention to keeping costs low. This has become especially important during this extended period of high cattle prices. Available cash always creates a temptation to acquire new gizmos and gadgets that will ease our burdens but almost always increase our cost of production.
Does anyone really think that today’s high prices will be with us three to five years from now? Make sure your cost of production stays below the long-run prices so you can remain profitable during the lower side of the cattle cycle that is sure to come.
Coming in at number six, being a constant learner is important. Too many producers sit back content with business as usual. As long as the checks clear and the bank doesn’t come knocking, we keep chugging along doing things largely the same way as they have been done.
The best ranchers are not content with complacency. They are knowledge seekers, are willing to challenge the status quo and are able to evaluate alternatives with candor and rigor.
Think of the great business managers you know of. How many days a year do they spend on professional improvement? How do they treat their top managers? Do they send them to training opportunities?
Most of the ranches that can support a family are businesses that are managing multi-million dollar assets. Shouldn’t the owners of this asset expect professional management that produces a comparable return on their investment? If you are the owner, shouldn’t you expect that from your management?
I encourage your ranch management team to decide on a professional improvement plan. It should recognize current and future positions in the business and encourage those involved to identify, obtain and share professional improvement opportunities. Be ruthless with scrutinizing what you will invest your time in. Just like other investments the ranch makes, professional improvement should produce a positive return on investment.
Funny isn’t it that we are more than half way through the list and have yet to come to a skill that requires knowledge of the critter? I welcome your feedback and suggestions for items that will make up the last four key rancher skills.