Family relationships are not easy. While there is nobody we’d rather spend relaxed evenings with, family members can be so irritated with each other that they sit on opposite sides of the funeral home, the church, and sadly, in some instances, opposite sides of the attorney’s office or courtroom.
Tom Verhoog and his son, Mike, didn’t want their family to destruct. Tom had been successful with his dairy, Sutom Holsteins in Ontario. He had valuable experience in his back pocket, had worked hard, had taken a few risks and managed some tough calls.
Mike was bright, energetic, a college graduate with experience working at other dairies, technologically savvy and a natural leader. They expected some friction in their relationship when Tom asked Mike to return to the home place, as they had very different management styles.
But instead of infighting during the decade of management transition, this family decided to proactively contact an ag mediator before problems developed.
Enter Mark Junkin , whose specialty is teaching farm families how to make decisions together. Junkin says, “Succession planners focus on the event of the transfer of assets.
Nobody has ever focused on the decade prior to this asset transfer, when parents and kids are awkwardly working together. How the senior generation grooms the next generation to make decisions and critically think affects long-term farm viability.”
Junkin didn’t need to teach Tom and Mike how to dairy or teach them how to manage a business; his goal was to help them clearly communicate their goals and help them put together a plan that would achieve them, then “hold their feet to the fire” as they worked the plan.
With Junkin working as mediator, Tom and Mike clearly identified some animal and production metrics to track – measurements they wanted to improve or at least watch.
Mike agreed to chart the numbers consistently and post them where his dad could see them, and Tom agreed not to constantly ask Mike about the numbers (which often felt like criticism to Mike). They agreed to sit down monthly and review the metrics together, some of which are:
- 60 days in milk – heifers (target and monthly report)
- Number of days to conception (average)
- Percentage of calves live to 2 months old
- Cost of production per liter of milk (quarterly)
- Purchased feed cost per cow (quarterly)
- Feed cost per liter (quarterly)
- Labor cost per cow per month
- Variable cost from birth to weaning (i.e., vaccinations)
After several months of using this system with the management meetings, Mike says he likes the arrangement and admits there are additional benefits other than just increased communication. He says, “When you write it down, you don’t have to keep it in your head.”
Each monthly review follows a regular agenda, determined at the outset by Tom and Mike and facilitated by the mediator. It includes a review of the metrics, but the discussion expands to cover multiple issues. Some of the agenda items are:
- Identify three low-lying metrics and devise a solution to turn these metrics into strengths over six months.
- Identify one way you can cut 10 minutes from daily chores per man or one way you can improve chore quality for each employee.
- Discuss personal education or developmental goals for the quarter.
- Give one compliment to each member of the family for something well done. Identify one pet peeve to be worked on by family members.
At a recent monthly review, Mike and Tom each gave input as the different agenda items were discussed, and Junkin helped them form action lists – identifying who, what and by when – and recorded their initiatives.
As Tom and Mike discussed ways to cut 10 minutes from chores (No. 2 on the agenda), the conversation strayed a bit.
While past improvement seemed to be helping, Mike talked about initiating a system whereby the milking crew would move from recording post-milking protocols on a whiteboard in the office to reporting on a paper form Mike would develop. He felt this would be a better method to identify potential problems.
During this discussion, Mike also proposed creating a “treated board” so employees could better monitor cows that had been treated for health issues. In addition, each employee would be required to identify at least one animal that may be developing a potential health issue.
Then each subsequent milking crew would be required to look over the previous milking group’s report and watch for these animals during the next shift.
They also discussed work orders and how to accomplish special projects beyond daily chores, like fixing the curtain in the barn. Tom was frustrated that the issue had been talked about several times but the curtain still hadn’t been fixed.
He saw it as a one-day project that could have been taken care of weeks ago. Mike related that there had been a problem ordering the clips, and when they came in, they were the wrong ones.
Then they both discussed the work order system Mike had designed, whereby special projects (like the curtain repair) would be entered onto a work order, employee would be assigned as lead, a time line given and a list identified for any parts needed.
Mike would review the parts lists whenever he went to town and would pick up or order whatever was needed. They were hopeful this would put an end to finger-pointing and delays. They both agreed it had to be better than the current system.
Item No. 3 on the agenda was tougher for both Mike and Tom to discuss, as cows and facilities are much different than talking about personal improvement. Tom had committed to attend a seminar later in the year that would challenge him to set goals.
He felt that was all he wanted to commit to at present. Mike had previously talked about taking a commodities course to improve financial strategies but admitted that his conflicting goal of spending more time with his family presented a problem.
Junkin pushed for more commitment from both when Tom finally said to Junkin, “Part of your job is to push people beyond their comfort zones. Sometimes it’s our job to push back.” They both agreed this agenda item would be tabled for the present.
When item No. 4 was discussed, the conversation was a little awkward. It’s not easy giving compliments or receiving them, and nobody likes hearing about things you need to improve. Tom started off with, “Mike works hard. He works very, very hard, but he needs to organize more, which is a challenge for both of us.”
Mike faced his dad and said, “I like that you’re working on goals. I’m happy to hear that.” He ended with, “Our communication isn’t good when we talk about spending money. I feel like he Dad doesn’t want to hear it. Maybe he does, but it feels to me like he doesn’t.”
Junkin believes succession planning can become an easy and natural process instead of a dramatic family event by improving how farm families make and implement decisions. He assists families in making tactical and operational decisions as well as dealing with “soft issues” that can become “hard issues,” like in-law relationships.
Junkin says, “For the two of them to have a time and place to work out differences in their approaches to management enables the rest of the month to be fun. It makes Mike a better manager, Tom a happy investor and the farm more profitable.”
Mike adds, “I learned it’s a lot easier to dairy with Dad than without him.”
While Tom has the experience that can add to Mike’s knowledge, his experience cannot add to Mike’s wisdom. Mike, like every other son, daughter or newcomer to agriculture, still has to gain wisdom on his own, but it will be so much easier with the experience, wisdom and advice from his mentor, his dad. PD
PHOTO: The father-and-son team of Tom and Mike Verhoog are taking a proactive approach to harmonizing their management styles while they transition the farm from one generation to the next. Photo by Lynn Jaynes.
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Lynn Jaynes
- Editor
- Progressive Dairyman
- Email Lynn Jaynes
