Agriculture today is one of the most exciting, innovative and progressive industries in the world, one that is consistently growing, evolving and adopting in response to changes in consumer trends and localised or global events. We are witnessing the role that research is playing in plant and animal genetics, as well as the impact that technology is having in data collection, analysis and improving decision-making and business efficiencies. Yet, in a time when so much is changing, there is one area that often gets overlooked for improvement and that is your team. Whether the team comprises of family members, full timers, casual staff, seasonal workers or contractors, people are integral not only to helping a farming business run day to day, but to helping it grow and achieve its goals.
Every farmer has the same question:
Where can we find skilled labour to work in our business?
Skilled labour is hard to source and not everyone can afford to attract these people to their farm. There is merit, however, in developing your own. Any one team member can become skilled if you invest in them and provide them with the appropriate guidance, support, experience and opportunity. One of the common comments we get from clients is that you put all this work, time, training, cost and effort into an employee and then they leave. While this is unfortunate, it is far better to train someone to the level that your business needs and they leave, than not train them, they are poor performers, and they stay!
Perhaps the real question we should be asking in agriculture is:
How can we develop and retain our skilled workers and what is the tradeoff between the cost to the business and the return on investment?
Using the right communication
Agriculture, whilst extremely diverse, is still very reliant on manual labour across all commodities in primary production, especially horticulture. It is an industry with high safety risks and strict product quality standards. Margins are often narrow, and time and money are precious resources that cannot be wasted. However, for an industry that lays so much on the table, the biggest source of waste in many farm businesses is ineffective communication within the team and, therefore, inefficient use of labour.
There are three main learning styles a person has. They are visual (watching), auditory (listening) and kinaesthetic (doing), and there is no right or wrong as to which a person should be. Interestingly though, if you take a self or team assessment, you will find that most people sit somewhere between visual and kinaesthetic – being shown how to do the task and trying it themselves. Yet in many farming systems, the most common method of communication is still verbal instruction. This poses massive room for error. While the likelihood of injury or death happening in the workplace might be low, the risk to your business is extremely high, meaning that, today, word of mouth communication on its own is not sufficient.
Providing various sources of communication such as visual signage or in-person training and having clear and controlled processes in place will help to develop a team with clear roles and expectations. Without these, employees might be wasting time wondering how to do their job, or what job they should be doing next. When you convert this wasted time into dollars and multiply that across each staff member throughout the season or year, this dollar figure can add up to a significant amount. Fortunately, this is a cost that can be easily mitigated. Completing a communication style assessment within your team such as identifying their DISC (dominance, influence, steadiness and conscientiousness) profile can help you to understand your team members better. Whilst these types of assessments can be costly in time, they provide excellent insights into the appropriate ways to communicate with each staff member and help you to understand the strengths of each employee and how they can work within your team. I have included a link to this at the bottom of the article if you would like more information.
Leadership and coaching within your farm business
As well as role clarity, having effective and consistent leadership in your business is the key to enabling productivity to thrive. Many farm businesses have efficient managers that drive improvement and get the job done, but it is great leadership within your business that is the key to success. Leaders focus on people, develop the team, enable improvement and guide the team to complete the job. Having great leadership in your business helps provide a safe and supportive environment for team members to continuously improve, and when provided with coaching, support and appreciation, they will get the job done every time. People are willing to work and perform for good leaders.
Coaching is an essential skill in leaders and involves equipping people with the tools, knowledge and opportunities to develop and become successful in their role. Good coaches connect with and empower their employees, are good listeners, and provide constructive feedback in a way that boosts people rather than brings them down.
Having a continuous improvement culture, communicating changes in the business and making people feel involved in these changes as well as celebrating wins along the way helps people feel like they are part of the business’ development and future.
Cultivating a skilled workforce
Last year I had the pleasure of visiting a successful family farming business and getting to know its employees. One was a standout employee who far exceeded the others in his knowledge, skill and capabilities on the property. When I returned this year, I was sad to see that he was no longer working for the family, and I thought, what a missed opportunity. As my visit progressed however, the story began to unfold. Turns out the boss had indeed recognised the skill and value that this person could offer to the business even to the point of sharing with other farmers in the area the big plans he had for him. Unfortunately, for the boss, he wasn’t the only one who had eyes on this employee, and while the boss intended to keep him employed, he didn’t communicate his vision and plans to the staff member himself. Even though the boss invested in upskilling this worker, he failed to provide a work environment that the worker felt he could progress in, and better opportunities came up. The family then had to employ someone else to replace him and begin the training process from scratch again.
The point of sharing this story is to highlight the importance of making your team members feel included and valued within the business and feel that they are helping the business reach its goals. In family businesses it can be difficult for a staff member to continue to grow their career when management roles are usually pre-filled by family members, however, a high turnover of staff can be costly when you consider the money and time spent training replacement staff, and as already mentioned, these are your two most precious resources. Employees leaving can result in a decrease in productivity and disruptions to team dynamics and workflows as new members are introduced.
So, are you better off training and retaining your own employees, or should you look to recruit skilled labour for your farm business?
Over seven years of benchmarking WA horticulture through the Building Horticulture Business Capacity program and now across Australia through the HIA-funded Level Up Hort vegetable and onion project, strong trends in the data have shown that the most profitable growers are spending a lower percentage of their income on labour costs than the average grower. In the 2022/23 season data for Level Up Hort, the most profitable growers spent 32% of their income on labour (including family labour) compared to the average of the industry data set of 41%. Interestingly, the most profitable growers spent $31,300/ha on labour compared to the average of the industry data set of $28,600/ha. This means that whilst the most profitable are spending more money per hectare on labour, they are far more effective in converting that labour into saleable yield and therefore income.
Whilst at this early stage of the project we have not explored where these profitable businesses are sourcing their labour from, one thing that remains clear is that whether you invest in “buying” or “developing” skilled employees, being able to retain them in your business is the key to driving productivity and ultimately profits. Even in businesses that rely heavily on seasonal workers, research has found that workers who returned to the farm were on average 15% more productive than new workers due to the costs saved in inductions and training, and the skills and farm knowledge previously acquired (Zhao et. al., 2023), further reinforcing that any staff retention can help improve business performance.
This national program will continue to examine businesses and assist growers with evaluating labour costs.
In closing, utilising effective communication, leadership and coaching provides people with the opportunity to upskill and feel included in the vision of the business. Acknowledging that each business is different, in an industry that is continually changing and improving, investing in your team might just be the key to success.
In your next business strategy session, consider the following quote by Patrick Lencioni, the author of the book, The Five Dysfunctions of a Team, which is further elaborated on in this month’s article by farm business consultant, Cameron Weeks.
“Not finance. Not strategy. Not technology. It is teamwork that remains the ultimate competitive advantage, both because it is so powerful and so rare.”
Resources
DISC Profiles Australia – https://www.discprofile.com.au/disc-profile/
References
Lencioni. P.M. 2002. The Five Dysfunctions of a Team. Jossey-Bass
Zhao. S., Blinks. B., Kruger, H., Xia. C., and Stenekes. N. 2023. What difference does labour choice make to farm productivity and profitability in the Australian horticulture industry? ABARES. https://www.agriculture.gov.au/abares/research-topics/productivity/productivity-drivers/seasonal-workers-report#seasonal-workers-contribute-to-productivity-and-profitability-gains
