Book Review

"Building Effective Farm Management Systems"

by R.L. (Dick) Wittman

Review by Darrell Dunteman, Editor, Ag Executive

I was happy to get the opportunity to spend some time with Dick Wittman at the 2004 TEPAP meeting in Austin, Texas last January. One of the highlights of the meeting for me was to be able to review a copy of Dick’s long time work in process titled Building Effective Farm Management Systems.

For those of you who aren’t familiar with Dick Wittman, you’ll find that Dick is a very competent instructor and consultant who has spent a lot of time as a lender and as the manager of a family owned operation in Idaho. His years of experience in the realm of agricultural finance and family business consulting led him to create a manual that no business operation with over one owner or over one employee should be without.

At first blush, you might think that $150.00 is a lot to pay for any book. However, the bottom line is that you should compare the purchase of this book with what you would pay for an hour of consultation with Dick. I think you will find that you will get several hours of “consultation”
from this book that is guaranteed to make you a better manager. This guidebook provides agricultural producers with a guide for implementing concepts that they have discovered at a number of major management training workshops throughout North America.

The book is divided into ten chapters with over 270 pages in a loose-leaf binder. Loose leaf is important because, as I discovered in talking with Dick, he views this publication as on on-going effort. Owners of the book will be able to update the manual for a nominal fee as new areas of interest emerge or as Dick improves some of the existing material.

What makes this book unique is that in addition to the actual book, you also receive a CD currently consisting of 23 Word and Excel files that will be tools that you can use to improve your own business. We are including a copy of the trend analysis worksheet that Dick created with this month’s copy of Ag Executive. Feel free to copy this worksheet for your own use as you evaluate your financial results for the future. This worksheet is also an excellent tool to “sell” your lender on the quality of your operation since it includes summaries from your balance sheet, your income statements, and a number of the common financial ratios lenders use to evaluate agricultural operations.

In Dick’s own words, the purpose of Building Effective Farm Management Systems, is to provide family farm business operations with an implementation path for building and maintaining a system of management that will:

1. Ensure effective business and personal relationships

2. Enable the business to achieve its intended mission, philosophy, and key objectives, and

3. Successfully pass the farm to the next generation.

Each chapter of the book consists of three components:

1. A general discussion addressing concepts and how they apply to family management

2. Sample documents to case studies illustrating how these concepts have been put into practice by actual farm operations, and

3. Worksheets or templates designed to enable the user to develop a specific application of this component appropriate for his or her agricultural operation. For example, the chapter on Farm Operating Policies has a complete set of policies in Word that you can use to construct your own policy manual.

You should have Word and Excel available on your computer system to make maximum use of this valuable guidebook.The chapters of the book are as follows:

1. Introduction to Management Systems

2. History and Key Business Trends

3. Mission, Vision and Core Values

4. Planning

5. Organization and Role Descriptions

6. Defining and Documenting Farm Operating Policies

7. Standard Operating Procedures

8. Communication and Coordination

9. Management Control Systems

10. Putting Concepts into Practice

My only criticism of the book is that I felt that business buyout agreements should not be covered under policies but have a separate section not normally shared with employees of the business. Future revisions of the handbook could address these concerns.

In addition to the material Dick has presented, he provides a listing of a number of other resources (including websites and templates from other sources) that a manager would find valuable.

Building Effective Farm Management Systems is available for $150.00 plus $5.50 shipping and handling from Ag Executive, 115 East Twyman, Bushnell, Illinois 61422. Illinois residents must also pay $10.13 sales tax. We guarantee your satisfaction or we will return your purchase price, less shipping and handling, upon receipt of the book in good condition. See our current list of recommended farm business resources at www.agexecutive.com.