In response to a ProfitTips column I called The Great American Tragedy, one Ranching For Profit School alumnus, and friend, shared the following story. He gave me permission to share it with y’all but asked to remain anonymous. He wrote:

Recently a friend and I were discussing the high failure rate of small businesses and that, even for those businesses that do last more than a few years, almost none get transferred to the next generation. Then he made an interesting comment about how lucky I was that my family was one of the few examples he knew of where a successful succession took place. After all, here I was, running cattle on my parent’s ranch, operating a small but successful ranching business, living right down the road from the folks.

I took his comment as a compliment, smiled, nodded and began thinking about the idea that we had managed a successful succession. After a bit of noodling around, I reached a different conclusion: regardless of how it looks from the outside, I am highly skeptical about just how much “succession” took place, and here’s why:

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A rancher sent me this email:

My brother is the hardest worker I’ve ever seen, but he’s impossible to work for. Employees have quit, and those who stay avoid my brother and come to me with their issues. My kids, who are good workers and used to enjoy working in the operation, now detest working here. The employees, my children and I are scared to address it. We dodge him. He feels it, he has addressed it with me. When we try to discuss it we hit some kind of a wall and he gets very upset. How can I address this and still keep the peace?

Here is my response:

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Wally Olson is a rancher and RFP alumnus from Vinita, Oklahoma. When Wally is talking, I try to tune
out the distractions and listen, because he’s always got something to say that’s worth hearing. I’m
using this edition of ProfitTips, with Wally’s permission, to share an email he distributed to some
colleagues that offers some sage advice to those who are serious about making profit in the cattle
business.

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Allan Nation coined the phrase grass farmer to drive home the point that the real business of ranching is forage production. Livestock are simply the means through which we harvest the real crop. But grass is still secondary to animals in most producers’ minds. We are still cattlemen and cowboys before we are grass farmers. If the grass is secondary, where does that leave the soil?

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I just read an article written by an ag economist on the value of bred heifers. He wrote that a crossbred heifer producing 9 consecutive calves in her lifetime is worth just over $3,200. Whoa!!! Nine calves! To be fair the author acknowledges that not all heifers will produce 9 consecutive calves. He figures 34% will die or be culled before their 9th year. I think he’s a little off.

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When Pigs Fly

An Executive Link member from Nebraska sent me an email that could turn the grazing world upside down. He wrote to say that he’d crunched the numbers and his figures showed that feeding hay was less expensive than leasing pasture. He concluded that it was more profitable for him to feed his own cattle hay in the feed lot and bring in outside cattle to custom graze on his pastures than it was to graze his cattle on his ranch.

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Take half – leave half. It is probably the most common advice you’ll hear regarding grazing utilization. In my opinion it is bad advice. It was probably the brainchild of someone looking for a one-size-fits-all, easy-to-remember recipe.

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We use a process at RMC to help families and business teams create a shared vision and a plan to achieve it. We start by asking a very basic question: What do you want? Each participant answers individually by writing several short statements describing how they’d like things to be in three to five years.

Once everyone has done their best to answer the question, we start looking for statements with a common theme. We work with participants to help them describe the interests that underlie the positions they’ve described. Through this process their individual answers are transformed into a statement of what the whole team or family wants. It can be a very powerful process.

As I’ve helped families navigate this process I’ve learned that “What do you want?” is not as easy a question to answer as you might think. Most people either limit their thinking to what they think they can have or describe what they don’t want rather than what they do want. For example, they are likely to write: I don’t want to be in debt, as opposed to: I want to be financially secure. I’ve also noticed that Mom tends to struggle with this question more than anyone else in the family.

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When the only tool you have is a hammer, every problem looks like a nail. This is the phrase that kept coming to my mind as I looked at range condition on a ranch recently, except the tool wasn’t a hammer … it was a hoof. The problems included overgrazing, bare soil and plants in phase 1 and 3 side by side. The land had been hammered, but none of these problems looked like nails to me. Even so, at each site we’d visit, the host of the tour said he wanted to hit the range with more hooves. In my opinion, that’s the last thing his pastures needed.

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I once heard Bud Williams say, “Ranchers love their cows and hate their grass.” Bud thought they had it backwards. They should love their grass and hate their cattle.

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