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Reaching beyond ...

Reaching beyond . Patrice Carle, Agronomist Executive Director, CEGA Thanks to my associates ! Claude, Claudine, Line, Nadia, Patrick, & Robert. ...together !. A little exercise to start…. 6 sticks = 4 equilateral triangles?. Think outside the box !. Plan of the presentation.

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Reaching beyond ...

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  1. Reachingbeyond... Patrice Carle, Agronomist Executive Director, CEGA Thanks to my associates ! Claude, Claudine, Line, Nadia, Patrick, & Robert ...together !

  2. A little exercise to start… 6 sticks = 4 equilateral triangles? Thinkoutside the box !

  3. Plan of the presentation • Overview : Centre d’expertise en gestion agricole • What do we need to reach beyond ? • Why reach beyond ? • How do we reach beyond ? • CEGA's game plan

  4. CEGA : an overview The Centre d’expertise en gestion agricole We are a second lineorganization. Target audience • Management professionals and professionnals in business transfer, launch, recovery and consolidation. • Professionalsfarmers :funding, accounting, manufacturingprocess, agri-environment, veterinarians, developmentofficers. Wework to promote and developfarm management practices for all agricultural producers.

  5. CEGA : an overview Fields of intervention • Organization, training and promotion : • Lectures, day-long training • Monitoring, research and analysis : • Current issues, • Bulletin de veille print : www.cega.net • Methodology and workingtools : • Improvement of processes and betterintegration of tools

  6. CEGA : an overview • Privileged partner • Partners of the PADEA program CEGA was appointed lead of strategic priority # 4 of the Programme d’appui au développement des entreprises agricoles.

  7. CEGA : an overview • Board of Directors CENTRES OF EXPERTISE FINANCIAL INSTITUTIONS CEGA is an organization that brings together all stakeholders in the fields of farm business and human ressources management. SUCCESSION AND PREPARATION

  8. Reaching beyond together What do we need to reach beyond ?

  9. What do weneed to reachbeyond ? Severalstudies, one conclusion !

  10. The 20 % Early majority 34 % Early majority 34 % Early adopters 13.5 % Innovators 2.5 % Refractory 16 % • Management programs and consulting services only reach about 20 %of producers!

  11. Reaching beyond together Why reach beyond ? Because of the environmentin whichagriculture evolves !

  12. Why reach beyond ? The global economy has been out of breath since 2008... The effects are still very present, even in the agriculture industry !

  13. Why reach beyond ? In the world of today, efficiency is no longer a choice... • The global economy narrowly avoided the collapse of its banking system. • Saving the banks, along with the recession that followed in 2009, reportedly cost the US and Europe $4,600 billion and 40 million jobs.

  14. Why reach beyond ? Weowetoomuch money ! Any stimulation of the economy requires public consumption and indebtedness : lower interest rates, buy now, pay later ! I spend, you invest...

  15. Why reach beyond ? Interest rates can only go up... Animal welfarestandards: Horizon 2017 Source :Financial Market Update, Farm Credit Canada, May 2013

  16. Why reach beyond ? • Investment funds are looking for business opportunities : • The stock market is unstable, blue chips are becoming scarce • The returns on savings and bond yields are very weak • Agriculture is an interesting industry for investors ! • Food demandissharplyrising :9 billion humans in 2050 ! • Land has become a gilt-edgedsecurity... for somespeculators

  17. Why reach beyond ? Grain prices are high and unstable Corn Soybeans Source :CME

  18. Why reach beyond ? Land prices are higher than ever Source :FCC, 2013

  19. Why reach beyond ? Indebtedness is becoming an issue ! Source :Farm Financial Survey, Statistics Canada Source :Farm Financial Survey, Statistics Canada, 2013

  20. Why reach beyond ? Indebtedness is becoming an issue ! Source :Farm Financial Survey, Statistics Canada Source :Farm Financial Survey, Statistics Canada, 2013

  21. Reachingbeyondtogether How do wereach beyond ? There are at least two methods possible...

  22. How do we reach beyond ? The traditional ''recipe'' • Focus on management consulting services and traditional financial support. • Group method • Closure of accounting • Benchmarking results • Budgets • Specific deliverables (2005) • Business diagnostic / business plan & budgets / succession plan

  23. How do we reach beyond ? The traditional ''recipe'' • It's how things have been done in Quebec for the last 30 years... • Global field presence of consulting services. • Highest ratio of management counsellors per business in Canada • Analysis are primarily focused on the past. • but... After 30 years, westill have not reachedbeyondthose 20 %...So whywoulditbeanydifferenttoday ?

  24. How do we reach beyond ? Switch ''recipe'' ! Liketheysay : ''Samerecipe, same cake !'' To modifyourapproach, weneed to know whatconsumerswant... We asked the other 80 %... and here is what they told us !

  25. How do we reach beyond ? What the other 80 % told us... Think of one of the major decisions you made during the last 3 years. Have you sought information from... A majority of producers answered : '' I have not made an important decision for the last 3 years. '' Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  26. How do we reach beyond ? What the other 80 % told us... Here is what they have done... Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  27. How do we reach beyond ? What the other 80 % told us... Think of one of the major decisions you made during the last 3 years. Have you sought information from... Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  28. How do we reach beyond ? What the other 80 % told us... Think of one of the major decisionsyou made during the last 3 years.Why have you not met with a management counsellor ? Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  29. How do we reach beyond ? What the other 80 % told us... Do you keep an annual budget? Is it on paper? ''95% of business owners keep budgets''* Yes No *Source : Survey of financial institutions, 2011 Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  30. How do we reach beyond ? • The bottom line : • There is a gap between the perceptions of ''management'' For a management counsellor, management is... Data comingfrom ''good accounting'' A balance sheet, a complete and up to date incomestatement, detailed budgets Comparables, crediblereferences ''Rewarding'' and ''reasonable'' decisions Investing:a major decision

  31. How do we reach beyond ? ...a gap between the perceptions of what ''management'' is For 80 % of producers, management is... Paperwork (actualpaper or virtual) Meeting requirements (regulations, standards, programs) Meeting the demands of financialbackers (5 Year Business Plan...) Helpfulwhenmaking major decisions : reversal transfer Investingis part of the routine ! Technical performance = Economical performance Source :Survey of non-usersof management consulting services, by AGÉCO, for CEGA, 2012

  32. In management, ''The skyis the limit!'' The traditionalapproach : ''Let's do some real management!'' Gap between perceptions ''I'mtired of this; I don't have time anymore; I quit!'' ...or attitude ? Management; isit a matter of altitude ? 80 % of producers : ''I'mcrushedunderpaperwork!''

  33. How do we reach beyond ? We must adapt to the customers we cannot reach ! Segmentation of producers based on business planning/management At the moment, our message primarilyreachesplanners! How canwereach all other groups ? Source : Baseline Study on Farm Business Management Planning, Agricultural Management Institute, 2011

  34. How do we reach beyond ? We must adapt to the customerswecannotreach ! • The quantity of time spentsortingpaperwork! • The amount of detailsrequired to ''manage''! • The amount of tasksthatneed to bedone! • The lack of qualified labour! Understandwhatisstoppingthem!!!

  35. How do we reach beyond ? Organized businesses are leading the way... CEO Finances Human Ressources Research and Development Production Marketing and Distribution Taxation Succession and Training New techniques Transport Inputs Accounting Staff Market position New products Tasks Retirement Market analysis Profitability Maintenance and Purchases Environment

  36. How do we reach beyond ? Less organized businesses run out of time... Taxation Market risk New techniques Animal health Succession and Retirement Accounting Management $$$ Staff Daily work Environment Financial planning Growth Purchase of machinery Strategic vision Animal transport Feeding of the herd Market position Building and machinery maintenance Training Genetics ''Management'' ranks very low on priority lists... far behind paperwork !

  37. How do we reach beyond ? We must adapt to the customers we cannot reach ! Understandwhatintereststhem ! • Getstarted, even if modestly ; but getstarted ! • Track the main points of income/expenditure ? • Provide assistance in human ressources management ? • Track the line of credit? • Provide assistance towards marketing efforts?

  38. Reaching beyond together CEGA's game plan Our 4 strategic priorities and The project under development

  39. CEGA's game plan Our 4 strategic priorities • Promote and use management information in decision-making for all businesses • Develop core knowledge in the field of management for all counsellors and focus on : • networking • interprofessionality • economical screening • referencing customers

  40. CEGA's game plan Our 4 strategic priorities Promote the adoption of best management practices and entrepreneurial mindsets to future farmers Develop management knowledge, new approaches and new concepts

  41. CEGA's game plan The project under development • The vision ''Management tools that use the accounting, financial and production data of a farm business, that offer basic functionalities... to all producers who wish to improve the day-to-day management of their business... ...that promote interaction between accounting and agricultural counsellors in Quebec, that improve their consulting capacity, and that standardize data analysis and reporting methods... ...in order to improve profitability and competitiveness of farm businesses in Quebec.''

  42. CEGA's game plan The project under development • Overview Simplify management processes Help producers manage and categorize their information. Link the information (technical, accounting, human ressources) of the business. Quickly make that information usable. Involve producers in management processes Tools available to producers Tools tailored to their needs A unique work platform

  43. CEGA's game plan The project under development • Overview Facilitate business tracking Supply producers with a portrait of their business that is as close to real-time as possible. Make the short term advantages of management tangible. Common workplace for stakeholders Facilitate communications between professionals involved in the business. Improve the quality of recommendations.

  44. CEGA's game plan In conclusion... From coast to coast, our challenges are the same ! Management programs and consulting services only reach about 20% of producers; The ''traditional'' approach does not meet the needs of the other producers. In order to reach as many as possible, we need to modify our approach ! Understand the concerns of producers that are part of the 80 % ; Leave paradigms behind ; Adjust services to the real needs of producers.

  45. Reaching beyond together We face the same challenges ! Let's work together ! To reach beyond the 20 %, we have to pull together !

  46. Agriculture is... • ''the planet's life insurance''... And management is ''the life insurance to a familyfarm business''

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