T.J. Schiff and his father, Jim, used to start each day on their Harrington, Del. Farm dispensing job assignments to each of their employees. Today they hold Monday morning meetings designed to share the week's objectives, not dictate duties. They even open the books for financial updates. Delegating more responsibility to employees boosted morale and motivated their labor force, says T.J. That one improvement alone, he adds, was worth the tuition to attend the Texas A&M Executive Program for Agricultural Producers (TEPAP). A midcareer management course for commercial farmers, TEPAP teaches growers to apply big business principles. Its sessions challenge farmer to raise the bar in finance, personnel management, negotiation, business organization and national and international marketing. Since 1991, 350 producers, representing 37 states, six Canadian provinces and Mexico, have graduated. Many have developed informal networks that can last a lifetime. Refocused. Alum Scott Mueller, a crop producers and cattle feeder from Platte Center, Neb., revamped his own operation after his TEPAP visit. "I realized I was trying to juggle too many enterprises," the solo owner says. Instead, he out-sourced more management duties to independent contractors and consultants. He also sold his entire machinery line and hired neighbors to contract farm his 1800 crop acres, allowing Mueller to concentrate energies on his cattle and commercial composting business. From the moment T.J. returned to Delaware the first year, the Schiffs began changing their operation. Along with 4,200 acres of crops, they run multiple enterprises, including a grain elevator, a soybean processing plant, a 5,000-head feedlot and a trucking division. |
"We had a pretty crude enterprise accounting system," says T.J. "Dad figured it on a legal pad with a pen and calculator most of the time. Now we're computerized, and we're cost accounting against each operation, putting a fair value on the exchange of products between divisions." That helps the Schiffs more accurately assess profit and loss for each for each enterprise as well as monitor the management abilities of each division foreman. The young farmer was so enthused about the program, he encouraged his father and brother to enroll. Says Jim, "T.J. told me I would spend a week with a classroom of people and nobody would talk about what seed you need to plant. And he was right. They talk about major issues that impact a business and will keep it profitable for the future." Pay off. TEPAP costs $2,750 for each session of the two-week program, split over two years. Many producers claim they get the tuition fee back with one idea. After TEPAP, the Schiffs told their employees that each had to be responsible for generating sales in some way. The Schiffs concluded that one employee, whose job it was to wash and wax equipment, could garner them $2,000 to $3,000 above book value per implement at trade-in time. "We told him how he could make money for us," says Jim. "And, lo and behold, it empowered him. When I went out to drive one of our new tractors, there were sheets all over the seats. He had put them there to keep them clean." By Joanne Spahr Welsh |