There is an old statement that “the more things change, the more they stay the same”. Memories are very short and we constantly hear things like: this is the worst ..…, this is the biggest……, this is the first ….., we have never seen this before etc. The superlatives are often bandied about by 20 and 30yo journalists, but it would be rare for the superlatives to be accurate.
In rummaging around in the old newsletters, the following article, written in 1993, suggested it should be polished up and revisited almost 30 years later. It is as relevant today as it was in 1993.
The NAB Rural Focus (August 1993) looked at the requirements for managing a rural business in the ’90s and beyond. It was written by a New Zealander, Pita Alexander. I have summarised it below because it has some important messages.
- Develop a respect for time.
- Set and re-set goals.
- Don’t spend $1,000 removing a $100 problem.
- Get into the habit of removing obstacles.
- Specialise before you diversify.
- Get top advice and measure it, not by the hourly rate but by the results.
- Always be prepared to learn from the top operators.
- Emotional upheaval is more energy sapping than hard work.
- Motivate the motivator. Spend 1% of gross farm income annually on personal development.
- Reduce waste on all fronts.
- People allow themselves to be only as successful as they think they deserve to be.
- Don’t be a workaholic. 3 day weekends and regular holidays are essential.
- Beware of the level of ‘invisible’ expenses buried in the personal drawings.
- Build a buffer. As a benchmark, have 10% of Gross Farm Income as a minimum in reserves.
- There is never a bad time to reduce debt.
- If you put marital problems on the back-burner, they are sure to boil over.
- Give yourself and staff a clear agenda.
- Don’t divorce yourself from your business transactions, ie. keep your hand on the cheque book and deposit book.
- In a farming downturn, the amount of a farming couple’s attitude is every bit as important as the bank balance.
- Don’t look back, except to learn.
- Stick to what is essential and in general a 10% decrease in expenditure is the equivalent of a 5% increase in gross income.
- Don’t wait for something to go wrong. It is the gap between waiting for trouble and hunting for progress, that will determine where you will be in 5 years time.
- The rule of holes.
- When you are in one, stop digging.
- It doesn’t matter how comfortable the hole is – get out of it.
- Make sure your advisers have seen the hole.
- Do the first 3 now.
Dr Terry McCosker