|Like most businesses, farming and ranching can benefit from periodic strategic planning says Jack Davis, SDSU Extension Economics Field Specialist, during a recent iGrow Radio Network interview.
"Strategic planning takes a long range look at the business to determine how it may compete in the future," Davis said.
He explains that strategic planning evaluates both external and internal factors to identify opportunities and challenges.
External factors include things outside the farm, such as interest rates; while internal factors can be broken into four general areas – production, marketing, human resources and finance. Davis says useful metrics are available to assist with internal check-ups.
"We want to take a look and see how do we stack up production wise? How are our farm resources? Do we have a good line of equipment? Are we producing at high levels for our resources? So, taking a hard look at those internal factors and measuring them against some standards," Davis said.
Davis says produces can work with their financial lenders and SDSU Extension Economics Field Specialist to locate nationally published standards to see how their operation compares. In depth strategic planning is recommended at least once every five years or when considering major business changes.
"Say we have a younger partner coming in, or we’re looking at expansion or we want to do some changes, strategic planning is a good process to go through," Davis said.