Last we explored the benefits of developing Standard Operating Procedures (SOPs) for your family farm business.  Now, let’s spend some time helping you identify them, the consequences of deciding not to develop them and finally, some thoughts on how to help the senior generation of your family business stop micro-managing the team.

Job descriptions serve many functions and if this is new information for you…great!   If you’ve heard it before and never really implemented anything…well, shame on you.  Just kidding.  Seriously, this is all about continuous improvement.  So, back to job descriptions.

In our practice, the unofficial statistics reveal that less than half of our most modern agricultural producers have adopted this as part of their management practices.  How can this be?  After working with many family farm clients in this area we learned that a common roadblock was that they did not completely understand the need for job descriptions or how to go about implementing the idea.  Secondarily, we have also heard feedback that formalized job descriptions were more for non-family business employees and staff.  Let’s examine further…shall we?  Job descriptions help in daily operations as well as succession planning in a few key ways.

• Identifying responsibility and accountability for specific performance standards or decision-making for each member of your family business team is a key benefit.  

• Job descriptions help management determine whether there is an actual need when contemplating bringing someone into the business, specifically a family member, but it applies to everyone.  Instead of the traditional mindset that mirrors, “Hey, I’m family and I deserve a job.”, by matching specific duties with specific and required skill sets, that someone may or may not possess, this becomes the basis for adding or replacing staff.  This is a much more effective way at managing your team…and your profits.

• Performance appraisals and reviews are sometimes also lacking in a family business.  The sometimes awkward situation is eliminated when everyone is clear on what is expected.  No surprises.  Sure, it’s family…but it’s still a business.

• Job descriptions and designated areas of responsibility aid in succession planning by helping provide guidelines for what skills are needed so that the senior generation can “step-aside” for future management.  The gaps that exist between the job description, job performance, skill sets and decision-making capabilities of the successor generation and those of the senior generation become the basis for personal development plans and training for the successor generation.  It helps spell out what the successor generation needs to learn before being offered the opportunity to manage the entire operation.  It also helps develop a timeline for management transition for clarity and understanding by everyone involved.

So, the need for job descriptions for your family farm have been clearly stated.  Now what?  A seemingly difficult, but fairly simple task is to begin by documenting the various tasks and decision-making areas of your family business.  There are now two key tasks to perform and listed in the order of importance below…

• What qualifications and skills are needed for each task/decision?
  
• Who performs these tasks now and in the future?
  

Oftentimes, the least qualified person on the team is doing something they shouldn’t be, or is tasked with something that they really don’t have the skills to perform.  This happens for many different reasons.  By determining the qualifications and skills needed for the task ahead of time, it becomes less personal and more objective to assess who should perform what role in your family farm business.  Regardless of a transition plan or not, this exercise might help rearrange your team members to perform different roles that they are more qualified to perform.  You and your team might become more effective and happier.

This exercise also helps show where gaps may exist.  Oftentimes, no one is qualified to perform a certain task or area of decision making.  So, it needs to be outsourced, filled internally or someone needs to get the training necessary to fill that role.  As mentioned above, when looking toward the future and the “stepping aside” by senior management and the “stepping up” by a successor generation, presumably there are differences between the decision-making skills and areas of responsibility between the two generations, with the senior generation having much more responsibility and decision-making authority, along with the associated skills to do so.  The gap between the roles each performs today and what you have determined needs to be performed in the future becomes your management transition plan.  

For example, Uncle Joe and Dad make any land purchase decisions.  When Dad and Uncle Joe retire in 10 years, Billy and Susie are going to need to make those decisions.  What skills do Dad and Uncle Joe possess today that enable them to make good land purchase decisions (presumably) that Billy and Susie will need to learn to make good decisions in the future?  How are they going to learn them?  Do they want to learn them?  If not, who can they get to fill that role in the future?   Does that make sense?  Now, carry that line of thinking to all the roles and decision-making areas of the business. 

It’s just a matter of taking the time to determine the roles, gaps and timelines for gaining the necessary skills for continued success of your family business.  To best accomplish this, honest self-assessments, performance reviews, natural strengths and weaknesses and a system for helping flush this all out builds the basis for continuity in operations and accomplishes a formidable task of any succession planning. As you might imagine, we have some various forms and detailed exercise to help you with this specific task.  If you’d like a copy, please email me and we can get out to you right away.

Until next time, 

Let’s begin with a quick review of the foundational elements of your family business management system; its vision statement, mission statement and core values.  We explored the reason your family farm exists and your “BIG WHY” with your vision statement that is Simple, Clear and Stimulating (SCS link).  

There are two remaining areas to explore and to help you develop the foundation to a long lasting family business and your management system:  Mission Statement and Core Values.  Let's explore mission statements a little further.

It is essential to understand how you are going to realize your family business purpose and attain your vision.  This is the function of your Mission Statement.  Many times, mission statements and vision statements are used interchangeably.  These are two distinct statements that serve two different requirements for your family farm. The mission statement clarifies and explains what the members of the organization will actually do to achieve the purpose and vision.

Carrying out the mission statement on a consistent basis helps your business achieve the purpose and pursue its vision.  I know it might be a little confusing, but your purpose, vision statement and mission statements all build upon each another and point everyone in the same direction.  There is a great amount of synergy that results by giving your team a clear sense about the principal role that they play.

If your mission statement fails to describe these elements it can help create ambiguity about the basic purpose of your family business and what you hope to accomplish (vision).  Your company’s mission statement will most effective if it is written so your customers understand your purpose and how you provide value to them.

Your mission statement doesn’t have to look the same as everyone else’s.  Figure out what’s important to you and your clients and go from there.  Here are some examples of clear, concise and simple mission statements:

“At Chateau de Pahrump we grow grapes, make super-premium class wine and provide Northern Michigan hospitality with exemplary service from our one-of-a-kind site on Michigan’s Leelanau Peninsula.  As good stewards of resources, our goal is to operate a profitable and ethical business that utilizes new technology and provides enjoyable work conditions with opportunities for advancement and personal growth. “

“Our mission is to transform natural resources into high quality livestock for domestic and foreign customers in a way that will provide a fair rate of return to our owners, a safe and satisfying working environment and be capable of providing income for future generations.”

“Our mission is to help connect people who want to sell a business with people who want to buy a business. We provide business owners and brokers with flexible options for listing their business online. For buyers, we offer helpful tools such as our saved listings feature and customized email alerts to make finding the right business easier.”


After you have developed your family farm’s mission statement, you will be ready for the final part of the foundational elements for your family business, core values.