The biggest difference I see between a typical ranching enterprise and another business is the way information is reported.
Every one of us has experienced those moments with a spouse, kids, employees or friends when we’ve tried to communicate one thing, and they heard something else entirely. Let me tell you something you likely already know: effective communication is the key to any successful business, business partnership or personal interaction.
The stereotype of a typical rancher includes a strong work ethic, independent nature, etc. It’s a long list of admirable qualities for sure, but few, if any of them, relate to being an effective communicator. In fact, ranchers are famous for minimizing the use of words.
How often have you heard an entire year’s calf crop described in less than 30 words? Even though the check for those calves might be $500,000 or more, it’s not uncommon for a producer to not even know the individual who bought them. In fact, I know ranchers who have sold their calves to the same buyer for 15 years and never talked to them in person even once over that period of time.
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There are very few areas where I can unequivocally claim that I’m an expert, but communication is one. Lest readers roll their eyes at that proclamation, let me add that I’m an expert because I’m absolutely terrible at it. I think I’ve made every mistake in the book, and I’m probably not alone.
I think one of the reasons ranchers tend not to be great communicators is that their partners and business associates tend to be friends or family, and there isn’t the structure that accompanies a normal business venture. Ranchers also tend to shy from weekly planning meetings. Admittedly, printed agendas and sitting around a conference table can seem to be tremendous wastes of time, but it is a mistake to assume the impromptu 6 a.m. meeting in front of the feed truck or at the dinner table offer the structure required for effective communication, either.
The biggest difference I see between a typical ranching enterprise and another business is the way information is reported. I’ve worked for other businesses, which have more employees, larger management teams, and even shareholders. One of their primary functions becomes the reporting of information, financial and otherwise.
The first thing we do at many board meetings I attend is to review the budget and financials. Go to work for a manufacturing or sales-oriented business and the numbers tell the story. Ranching, on the other hand, has so many metrics that information is harder to interpret; and usually the very small management teams are so intimately involved in the business that they don’t spend time putting together the information in a more typical reporting format.
We talk about economies of scale a lot, but the largest difference I see with large cow-calf operations vs. small to mid-size operations is access to good information and the reporting systems in place to create them. Most ranchers are focused on genetics, management, marketing, resource management, and financial performance, but communication and information collection and reporting probably should be added to that list.
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