Transcript Le temps des

REACHING BEYOND...
...TOGETHER !
Patrice Carle, Agronomist
Executive Director, CEGA
Thanks to my associates !
Claude, Claudine, Line, Nadia, Patrick, & Robert
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A little exercise to start…
6 sticks = 4 equilateral triangles?
Think outside the box !
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Plan of the presentation
 Overview : Centre d’expertise en gestion agricole
 What do we need to reach beyond ?
 Why reach beyond ?
 How do we reach beyond ?
 CEGA's game plan
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CEGA : an overview
The Centre d’expertise en gestion agricole
We are a second line organization.
Target audience
• Management professionals and professionnals in business
transfer, launch, recovery and consolidation.
• Professionals farmers : funding, accounting, manufacturing
process, agri-environment, veterinarians, development officers.
We work to promote and develop farm management practices for
all agricultural producers.
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CEGA : an overview
Fields of intervention
• Organization, training and promotion :
Lectures, day-long training
• Monitoring, research and analysis :
Current issues,
Bulletin de veille print : www.cega.net
• Methodology and working tools :
Improvement of processes and better integration of tools
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CEGA : an overview
Privileged partner
Partners of the PADEA program
CEGA was appointed lead of strategic priority # 4 of the Programme d’appui au développement des entreprises
agricoles.
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CEGA : an overview
Board of Directors
CENTRES OF
EXPERTISE
FINANCIAL
INSTITUTIONS
CEGA is an organization that brings together all stakeholders in the fields of farm
business and human ressources management.
SUCCESSION AND
PREPARATION
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REACHING BEYOND TOGETHER
What do we need to reach beyond ?
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WHAT DO WE NEED TO REACH BEYOND ?
Several studies, one conclusion !
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THE 20 %
Early
Innovators adopters
13.5 %
2.5 %
Early
majority
34 %
Early
majority
34 %
Refractory
16 %
Management programs and consulting services only
reach about 20 %of producers!
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REACHING BEYOND TOGETHER
Why reach beyond ?
Because of the
environment in which agriculture evolves !
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WHY REACH BEYOND ?
The global economy has been out of breath since 2008...
The effects are still very present, even in the agriculture industry !
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WHY REACH BEYOND ?
In the world of today, efficiency is no longer a choice...
 The global economy narrowly avoided the
collapse of its banking system.
 Saving the banks, along with the recession
that followed in 2009, reportedly cost the
US and Europe $4,600 billion and
40 million jobs.
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WHY REACH BEYOND ?
Any stimulation of the economy requires public consumption and
indebtedness : lower interest rates, buy now, pay later !
I spend,
you invest...
We owe too much money !
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WHY REACH BEYOND ?
Interest rates can only go up...
Animal welfare
standards: Horizon 2017
Source : Financial Market Update, Farm Credit Canada, May 2013
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WHY REACH BEYOND ?
 Investment funds are looking for business opportunities :
 The stock market is unstable, blue chips are becoming scarce
 The returns on savings and bond yields are very weak
 Agriculture is an interesting industry for investors !
 Food demand is sharply rising :
9 billion humans in 2050 !
 Land has become a gilt-edged
security... for some speculators
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WHY REACH BEYOND ?
Grain prices are high and unstable
Contracts of soybeans and corn in Chicago
Average monthly price in U.S. $ / bushel
8
18
16
7
14
6
12
Corn
10
5
8
Soybeans
4
6
4
3
2
2
0
2006
2007
2008
2009
2010
2011
2012
2013
Source : CME
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WHY REACH BEYOND ?
Land prices are higher than ever
Average increase in value of farmland per semester
20%
15%
Québec
Ontario
10%
Saskatchewan
5%
0%
Jul-06
Jul-07
Jul-08
Jul-09
Jul-10
Jul-11
Jul-12
Source : FCC, 2013
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WHY REACH BEYOND ?
Indebtedness is becoming an issue !
Farm Debt Rates
30%
25%
Québec
20%
ROC
15%
10%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Source : Farm Financial Survey, Statistics Canada
Source : Farm Financial Survey, Statistics Canada, 2013
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WHY REACH BEYOND ?
Indebtedness is becoming an issue !
Dairy Farm Debt Rates
35%
30%
Québec
25%
ROC
20%
15%
2001
2002
2003
2004
2005
2006
Source : Farm Financial Survey, Statistics Canada
Source : Farm Financial Survey, Statistics Canada, 2013
2007
2008
2009
2010
2011
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REACHING BEYOND
TOGETHER
How
do we reach
beyond ?
There are at least two methods possible...
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HOW DO WE REACH BEYOND ?
1. THE TRADITIONAL ''RECIPE''
Focus on management consulting services
and traditional financial support.
 Group method
 Closure of accounting
 Benchmarking results
 Budgets
 Specific deliverables (2005)
 Business diagnostic / business plan &
budgets / succession plan
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HOW DO WE REACH BEYOND ?
1. THE TRADITIONAL ''RECIPE''
It's how things have been done in Quebec for the last 30
years...
 Global field presence of consulting services.
 Highest ratio of management counsellors per business in Canada
 Analysis are primarily focused on the past.
but...
After 30 years, we still have not reached beyond those
20 %... So why would it be any different today ?
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HOW DO WE REACH BEYOND ?
2. SWITCH ''RECIPE'' !
Like they say :
''Same recipe, same cake !''
To modify our approach, we need to know what consumers want...
We asked the other 80 %...
and here is what they told us !
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HOW DO WE REACH BEYOND ?
WHAT THE OTHER 80 % TOLD US...
Think of one of the major decisions you made during the last 3 years.
Have you sought information from...
A majority of producers answered :
'' I have not made an important decision
for the last 3 years. ''
Source : Survey of non-users of management consulting services, by AGÉCO, for CEGA, 2012
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HOW DO WE REACH BEYOND ?
WHAT THE OTHER 80 % TOLD US...
Here is what they have done...
71%
Purchase of machinery or equipment
56%
Made changes to reduce costs
39%
Important renovation, construction, expansion
30%
Increased size of the company
17%
Purchase of land
16%
Changes to production process
11%
Changes in marketing
0%
20%
40%
Source : Survey of non-users of management consulting services, by AGÉCO, for CEGA, 2012
60%
80%
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HOW DO WE REACH BEYOND ?
WHAT THE OTHER 80 % TOLD US...
Think of one of the major decisions you made during the last 3 years.
Have you sought information from...
63%
Accountant
51%
Producers
47%
Financial Institution Advisor
44%
Veteranarian
43%
Equipment Suppliers
42%
Business Consultants
20%
30%
40%
50%
Source : Survey of non-users of management consulting services, by AGÉCO, for CEGA, 2012
60%
70%
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HOW DO WE REACH BEYOND ?
WHAT THE OTHER 80 % TOLD US...
Think of one of the major decisions you made during the last 3 years.
Why have you not met with a management counsellor ?
100%
84%
80%
60%
40%
20%
6%
5%
Cost of service
Poor Past Experience
1%
5%
0%
No need / Unaware of
this option
Counsellor Not
Available
Source : Survey of non-users of management consulting services, by AGÉCO, for CEGA, 2012
No Response
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HOW DO WE REACH BEYOND ?
WHAT THE OTHER 80 % TOLD US...
Do you keep an annual budget? Is it on paper?
Yes
26%
No
''95% of business owners
keep budgets''*
*Source : Survey of financial institutions,
2011
74%
Source : Survey of non-users of management consulting services, by AGÉCO, for CEGA, 2012
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HOW DO WE REACH BEYOND ?
THE BOTTOM LINE :
→ THERE IS A GAP BETWEEN THE PERCEPTIONS OF ''MANAGEMENT''
For a management counsellor, management is...
o Data coming from ''good accounting''
o A balance sheet, a complete and up to date income statement, detailed budgets
o Comparables, credible references
o ''Rewarding'' and ''reasonable'' decisions
o Investing: a major decision
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HOW DO WE REACH BEYOND ?
...A GAP BETWEEN THE PERCEPTIONS OF WHAT ''MANAGEMENT'' IS
For 80 % of producers, management is...
o Paperwork (actual paper or virtual)
o Meeting requirements (regulations, standards, programs)
o Meeting the demands of financial backers (5 Year Business Plan...)
o Helpful when making major decisions : reversal transfer
o Investing is part of the routine !
o Technical performance = Economical performance
Source : Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012
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In management,
''The sky is the
limit!''
The traditional approach :
''Let's do some real
management!''
Gap between perceptions
''I'm tired of this;
I don't have time
anymore; I quit!''
Management; is it a matter of altitude ?
...or attitude ?
80 % of producers :
''I'm crushed under
paperwork!''
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HOW DO WE REACH BEYOND ?
We must adapt to the customers we cannot reach !
Segmentation of producers based
on business planning/management
Skeptics
17%
Independents
20%
At the moment, our message
primarily reaches planners !
How can we reach all other
groups ?
Developers
19%
Sunsetters
22%
Planners
22%
Source : Baseline Study on Farm Business Management Planning, Agricultural Management Institute, 2011
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HOW DO WE REACH BEYOND ?
We must adapt to the customers we cannot reach !
Understand what is stopping them!!!
• The quantity of time spent sorting paperwork!
• The amount of details required to ''manage''!
• The amount of tasks that need to be done!
• The lack of qualified labour!
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HOW DO WE REACH BEYOND ?
Organized businesses are leading the way...
CEO
Finances
Human
Ressources
Marketing
and
Distribution
Taxation
Succession
and Training
Transport
New
techniques
Inputs
Accounting
Staff
Market
position
New
products
Tasks
Profitability
Retirement
Market
analysis
Research and
Development
Production
Maintenance
and Purchases
Environment
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HOW DO WE REACH BEYOND ?
Less organized businesses run out of time...
''Management'' ranks very low on priority lists... far behind paperwork !
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HOW DO WE REACH BEYOND ?
We must adapt to the customers we cannot reach !
Understand what interests them !
Get started, even if modestly ; but get
started !
• Track the main points of income/expenditure ?
• Provide assistance in human ressources
management ?
• Track the line of credit?
• Provide assistance towards marketing efforts?
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REACHING BEYOND TOGETHER
CEGA'S GAME PLAN
Our 4 strategic priorities
and
The project under development
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CEGA'S GAME PLAN
Our 4 strategic priorities
1. Promote and use management information in decisionmaking for all businesses
2. Develop core knowledge in the field of management for all
counsellors and focus on :
 networking
 interprofessionality
 economical screening
 referencing customers
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CEGA'S GAME PLAN
Our 4 strategic priorities
3. Promote the adoption of best management practices and
entrepreneurial mindsets to future farmers
4. Develop management knowledge, new approaches and new
concepts
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CEGA'S GAME PLAN
The project under development
 The vision
''Management tools that use the accounting, financial and
production data of a farm business, that offer basic functionalities...
to all producers who wish to improve the day-to-day management of their
business...
...that promote interaction between accounting and agricultural
counsellors in Quebec, that improve their consulting capacity, and that
standardize data analysis and reporting methods...
...in order to improve profitability and competitiveness of farm
businesses in Quebec.''
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CEGA'S GAME PLAN
The project under development
 Overview
 Simplify management processes
 Help producers manage and categorize their information.
 Link the information (technical, accounting, human ressources) of
the business.
 Quickly make that information usable.
 Involve producers in management processes
 Tools available to producers
 Tools tailored to their needs
 A unique work platform
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CEGA'S GAME PLAN
The project under development
 Overview
 Facilitate business tracking
 Supply producers with a portrait of their business that is as close to
real-time as possible.
 Make the short term advantages of management tangible.
 Common workplace for stakeholders
 Facilitate communications between professionals involved in the
business.
 Improve the quality of recommendations.
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CEGA'S GAME PLAN
In conclusion...
 From coast to coast, our challenges are the same !
 Management programs and consulting services only reach about 20%
of producers;
 The ''traditional'' approach does not meet the needs of the other
producers.
 In order to reach as many as possible, we need to modify our
approach !
 Understand the concerns of producers that are part of the 80 % ;
 Leave paradigms behind ;
 Adjust services to the real needs of producers.
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REACHING BEYOND TOGETHER
We face the same challenges !
Let's work together !
TO REACH BEYOND THE 20 %,
WE HAVE TO PULL TOGETHER !
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Agriculture is...
''the planet's life insurance''...
And management is ''the life insurance to a family farm business''
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