Have you ever thought of yourself as a navigator? The Webster’s Dictionary definition I will use for navigator is, “To operate or control the course of” (i.e., your dairy). The waters rise and fall with the tide, so how safe is your boat to sail in low tide?
It seems as if we have entered into uncharted territory in the financial world where navigational skills need to be the basics. What are the basics? Understanding input costs and managing them, making the best of marketing tools available and working with a trusted management team are a few key considerations.
As a farmer myself, I am well aware of what has happened to input costs. Putting a pencil to the paper and doing the math to determine the per-unit-volume costs has never been more important. If you just continue to do what you have always done regarding your inputs, your cost of production is definitely higher than ever.
Not knowing your costs is like sailing a ship in the fog. It has never been more necessary to know the cost of production. A good navigator wants the latest tools to make the trip as safe as possible. If your cost of production is higher than the income produced, it won’t take long to dig a deep hole, so an alternative will be necessary.
In dairy we like to know our cost per hundredweight of milk produced. This seems to fluctuate with every 100 pounds. It’s a moving target. But it needs to be known so decisions can be made with confidence. A couple of major areas to focus on are feed costs and labor, although there are many other inputs to be concerned with as well. Any hole in the dike is a catastrophe waiting to happen and should the dam break, the ship will be grounded and navigation impossible. Here is where the word “control” in Webster’s definition is important. In other words, one who is in control of the situation has taken the time to put the pencil on the paper to find the best option given the present financial climate.
In times past, I might have said we need a paradigm shift to move from where we are to where we need to be to stay financially solvent. Now I am just going to say, “sink or swim.” On today’s dairy, a good navigator needs to have an attitude of understanding the urgency of good management. An important first step in shifting to this attitude is looking at time management. What do you do with each minute, each hour and each day? Good management needs to have dedicated time and should be done at a time when you are at your best mentally. Know when that is and spend it thinking, organizing, planning, calculating and whatever else is necessary to make good decisions as they come along.
You can lead a cow to water and you can also lead a dairy manager to the desk; however, you cannot always make the animal drink and the farmer cannot be made to sit and do his homework, but it is this time and attitude that does make a big difference.
Any ship (dairy) that is still afloat today has come through some storms that make for good campfire stories. The latest financial challenges in our country are reason enough to cause one to spend more time managing than ever before. Good management also needs to be shared by all concerned parties on the dairy (ship). Communication is a key here, but more than that, there needs to be a written protocol to ensure that all messages sent are received, understood and put into practice correctly.
There is a “getting a job done” attitude and then there is an attitude of “accomplishing your purpose and fulfilling your mission of producing quality milk.” Using all resources at your disposal as efficiently as possible is in everyone’s best interest.
Yes, it is within your managerial right to make the decision to be a great navigator and manage your ship so it continues to sail or to just maintain status quo. If you love to dairy, have the passion to put your heart and time into your management and your labor, then it will sustain you all the days you choose to dairy. PD
—Excerpts from University of Minnesota Dairy Connection, Oct. 2008
Tim Dolan
Extension Educator
University of Minnesota
dolan008@umn.edu
