Catching Up on My Simmental Reading– Succession Planning

For those of you that know me personally, you know that I am a big supporter of the Simmental cattle industry.  It’s the breed of cattle that my family raises and grew to love the breed throughout my childhood.  I also spent some time in Bozeman, Montana interning at the association’s headquarters.  Last night, I was catching up on reading the latest SimTalk and the Register and there were two articles that I particularly enjoyed that I wanted to share. 

I especially loved the article by Dr. Val Farmer in the January 2010 SimTalk titled “Seven Ways to Make Dad’s Retirement Easy –Er –Easier.”  Estate and sucession planning has become a new passion of mine over the last few years and I believe it is critical for farm and ranch families to address this issue head-on.  In fact, just yesterday I ordered a fancy little Estate binder from Blumberg for my parents because I want to make sure they have all their legal documents in order so I can easily access whatever I need.  In Dr. Farmer’s article, he doesn’t really go into estate planning issues; instead, he addresses more of the succession issue with farm management.  As more children “leave the farm,” we have a problem that younger generations are not prepared and/or interested in taking over the farm or ranch.  Estate and succession planning go hand-in-hand for agriculture operations and both are equally important. 

Dr. Farmer lists the following 7 ways to make this transition go more smoothly:

1.  Volunteer to take over — He notes that the younger generation shouldn’t be afraid to take on management responsibilities, particularly when parents are on vacation or attending an agriculture meeting/convention.

2.  Enlist Mom’s help –Dr. Farmer feels that farm and ranch mothers can play a big role on getting the couple out to community functions or weekly two-steppin’ classes at the local dancehall.  He notes that it is important for farm parents to be involved in these types of activities well before they reach 65.

3.  Work toward open and democratic decision-making — Dr. Farmer admits that “Dad” might be set in his ways and might not like giving up control of the livestock operation; therefore, it is important to have open lines of communication and keep the decision-making process democratic.

4.  Be prepared to take over — Dr. Farmer notes that unless the younger generation takes initiative and demonstrates ability, the parents will never see him/her ready to take over the farm or ranch.  He notes how important it is for the sons and daughters to show initiative wherever they can even if it is in a niche area such as marketing, website design, or machinery repair.

5.  The next generation can also develop interest away from the farm — Dr. Farmer realizes the importance for the younger generation to get involved in the community and agriculture organizations.  

6.  Be tactful – Too often conflict gets in the way of open lines of communication and emphasized how important it is for farm families to discuss disagreements.

7.  Believe in yourself – Finally, Dr. Farmer stressed the importance for the younger generation to believe in his/her ability to take over the farm or ranch.

These are issues that I have started talking to my own parents about as they are transitioning to retirement age and I am confronted with the reality that at some point in the future my brother and I will need to be adequately prepared to take over my family’s Simmental operation.  The dynamics of farm families are quite interesting and no two situations are the same.  Make 2010 the year that you sit down as a family and discuss whether the children and/or grandchildren are interested taking over the farm or ranch and how the family can help make that transition smoothly.

What is the second article that I enjoyed reading last night in the Simmental Register?  Check back in tomorrow.