Tomorrow's Farm Managers: Who Will They Be and How Will They Learn?

The changing agricultural environment has wide-reaching implications for farm and ranch managers of the future. A turbulent business environment arising from increased integration of the agricultural sector into the national and world economies, technological change, projected changes in Government regulations, and expected changes in weather patterns will create new challenges for managers of farms and ranches.

Other changes are occurring in the agricultural sector that will affect the types of skills farm managers need; these include the movement toward fewer and larger commercial farms, a proliferation of part-time farmers near urban areas, increased vertical integration in livestock production, and increased involvement of lending institutions in farm management and ownership. These changes affect the way farms and ranches are managed, the knowledge tomorrow's managers will need, and the forms their training will take.

Tomorrow's managers will be fewer in number, better educated, and more diverse than those of yesterday. They will use a broader set of managerial skills to meet the challenges of the turbulent business environment of the future. And they will have access to new information and management skills that go beyond their formal education. This continuing educational process will take many forms, ranging from technology-based information transfer to intensive management development programs.

Tomorrow's Managers

The challenges of managing the farms and ranches of tomorrow will be met by a wide and diverse group of managers. Farming is a business, and the successful farm operation will be managed as a business. The farms may be owned and operated by families, partnerships, or corporations, but the management will rely on business skills for success.

While experience is one method of developing these business skills, continuing education and training combined with farm experience is a faster, less risky means of developing sound business skills and practices.

The traditional types of farm business entities sole proprietorships, partnerships, family corporations, and other corporations will continue into the future. However, two new types of fanning operations may become more prevalent in the future:

Professionally managed farming operations typically operated by lending institutions, farm management companies, or insurance companies will be managed by a wide range of individuals, with backgrounds similar to managers employed by corporate farming operations;

Vertically integrated production operations are becoming increasingly prevalent in livestock production and may increase in grain production as new technologies emerge. Management depends on arrangements between the production operation and the integrator, who often plays an important role in continuing education and professional development of these managers.

Skills Managers Will Need

Tomorrow's farm and ranch managers will need an expanded set of managerial skills to succeed. Managerial skills in three areas communication, business and economics, and technology will be developed through formal university education, business experience, and continuing education.

R.P. King and S.T. Sonka have identified five areas of management skills that tomorrow's farm and ranch managers will apply to a broad set of problems:

Managing Innovation and Change. Changes in technology, information, and marketing systems are occurring at an increasing rate. As this rate of change continues, farm and ranch managers will be forced to adopt new practices and employ strategic thinking to survive. Changing consumer demand also will require increased innovation to fill existing or developing market niches.

Managing Risk. The growing exposure to global competition in production and financial markets; changing Government policies related to trade, supply, and the environment; and changes in climate require new managerial skills in dealing with risk. Tomorrow's farm and ranch managers will be forced to use the futures and options markets, contractual arrangements, and other risk-shifting tools to manage these risks.

Designing Effective Organizations. As the structure of farms and ranches evolves over the next several years, managers will confront many organizational challenges, including the need to develop organizations that use labor effectively and that can take advantage of new relationships with buyers, suppliers, and competitors.

Designing Information Systems. Increasing information and rapidly evolving information technologies create a distinctive set of challenges for farm and ranch managers. Practical information acquisition systems and computer decision support systems will continue to be developed to aid managers in this area.

Managing Human Resources. As the average size of commercial farms increases and the number of part-time farmers grows, human resource problems will become more important to farm and ranch managers. These problems may be exacerbated by absentee land owners and managers. The challenges of dealing with more seasonal employees, reliance on specialized personnel, and expanded interactions with suppliers, buyers, and processors are likely to occupy more and more of the farm or ranch manager's time. The part-time farmers will face the need to balance farming demands with off-farm employment.

Strategic Planning

In addition to developing these five specific skills, farm and ranch managers will have to be strategic thinkers, capable of dealing with a turbulent environment by using the techniques and tools of strategic planning. (See Part II, Chapter 1 on strategic planning.) These techniques will aid in managing technological innovations and in dealing with changing governmental policies, markets, weather, and business. Although based on theory and technical knowledge, these skills will best be developed through case study learning experiences.

Global Marketplace

The managers of tomorrow's farms and ranches will need to understand agricultural production and marketing in the global marketplace. This implicitly includes an understanding of consumers and their evolving needs. As the firms that farm and ranch managers deal with as buyers, suppliers, and competitors become increasingly global, the managers of the production operation will need to understand their needs to better develop working relationships. In addition, exciting opportunities may exist for cooperation between individual farms and ranches or among groups of farms and ranches, particularly in satisfying consumer needs by filling niche markets. Farm managers will likely learn about changing consumer needs through nontraditional study including internships, study abroad programs, and various conferences and institutes.