SELECTIONS - Fall 2002
Meet the Challenge of Change
and Seek Value
By David Thorbahn, general manager and executive vice president
Editor’s note: After this article appeared as the "Final
Thought" in the March Western DairyBusiness, several patrons
commented about how they appreciated Dave’s thoughts. We reprint
the article here so that producers throughout the country
can read these remarks.
Being a successful producer in the 21st century isn't easy because
the world around us hasn't stopped changing. Consumers' attention
to food safety spikes whenever related stories hit the news, but
they still expect affordable dairy products. Consolidation continues
throughout the industry. Finding value when purchasing herd replacements
and other inputs is a rollercoaster. Governments' intervention in the
trade of livestock, genetics and food remains, but the nuances change often.
As dairy producers balance the management of cows, employees, cash flow,
environmental regulations, new technologies and other challenges,
reacting to external forces that affect your business can be overwhelming.
So where does this change and unpredictability leave you? The well-known
Serenity Prayer, which talks about changing what we can and having peace
with what we cannot, is an excellent business strategy. The key is to
determine what can be improved in your operation, and then make a plan
to achieve those goals. This is true whether the business is a dairy
or an A.I. cooperative.
Value is Important.
Recently I was in an airport at lunchtime, and looked at the menu for
a beverage to accompany my sandwich. A container of water was $2.50,
soda was $1.75 and a bottle of milk was $1.50. The lowest price was
attached to the highest cost-of-production product with the best
nutritional offering. I noticed that the most popular drink was not
milk, however, showing that more than price went into value decisions
about the beverage purchases.
Hopefully, as dairy businesspeople, we're more savvy about buying inputs
than the folks at that airport lunch counter. But, when trying to manage
a dairy in the midst of change, it can be tempting to look for a "silver
bullet" or the least-expensive choice. More often than not, neither
provides what the dairy really wants.
A real-life illustration is today's availability of replacement heifers,
which is a growing challenge. When trying to meet an immediate need of
rounding out the milking string, it can be tempting to save money by
purchasing unidentified heifers bred to a herd bull; in essence four
legs, some milk and a pregnancy. Contrast the outcome of this "silver
bullet" with the result of investing in heifers with known parentage
that carry an A.I. service - the added knowledge of the true value of
this heifer and her calf helps you get what you pay for.
So, as you focus on the things you can change, think in terms of value.
Be An Orchestra Conductor, Not Superman.
Perhaps one of the best ways to create value on a dairy is to multiply
your efforts. Just as a conductor leads a group of musicians in an
orchestra to create beautiful music, a dairy manager can harness the
knowledge of others.
Since few of us are experts in every area, a la Superman, it's
important - whether you're the president of the United States, the
manager of an A.I. cooperative or the owner of a dairy - to surround
yourself with a trusted team. This is becoming the gold standard for
operations of varying sizes, creating a fundamental shift of how
business is done.
The secret to success is involving the best available talent and choosing
organizations and people who not only can help you today, but also will
still be in business to help you tomorrow.
While these teams evaluate practices throughout the dairy, undoubtedly
they will continue to look at the need for high-quality replacements.
Despite the rhetoric about cloning, sexed semen and other technologies,
meeting this need still comes down to the basics: getting cows pregnant,
ensuring that the pregnancies are of high genetic value and then
raising healthy replacements.
Leading producers are asking their A.I. suppliers for more than a
one-size-fits-all approach to reproduction, so the pressure is on
to provide true reproductive solutions in addition to high-quality
semen. In response, Select Sires now offers a portfolio of reproductive
services - including reproductive troubleshooting, estrus-synchronization
programs, A.I. training and professional technician service - that can be
tailored to meet individual herd needs.
As much as we might wish that the world would take a breather from change,
it's probably better to prepare for an acceleration. Dairies that embrace
the possibilities of change that are within their control will continue
succeeding. They understand that the best way to adapt to change is to
focus on what you can change, to realize no one is Superman and to seek
value in everything they do.
Are you ready?
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