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The power of peer groups

Terry Betker for Progressive Dairyman Published on 31 January 2019
A properly set up and structured peer group can be an added resource for a farm business

Where can you get unbiased insight and information on critically important and sometimes sensitive issues and opportunities?

Farmers have used external resources to help with management challenges for years. Accountants, lawyers and lenders are long-established sources of advice and assistance. 

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More recently, farmers are using advisers who have expertise in production and marketing. As farms increase in size and complexity, more farmers will look to people who can provide them with the information and support they need to manage their farms.

The range of available resources will expand to meet these needs – for example, advisers who have experience and expertise in human resource management for farms.

But what if you wanted to get advice from someone who really knows what they’re talking about? Who has “walked a mile in your shoes”?

Peer groups

Another farm management resource gaining in popularity is peer groups. Peer groups have existed for years in several different types of applications within different industries. They are also known as peer advisory groups, farmer-to-farmer discussion groups and peer advisory boards.

Danny Klinefelter of the Texas A&M University Department of Agricultural Economics notes four states of knowledge exist:

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  • What you know
  • What you know you don’t know
  • What you don’t know you don’t know
  • What you think you know that isn’t so

Peer group participants take the “what you know” from within the group discussion and interaction and apply it to their “what you don’t know” and to their “what you think you know that isn’t so.”

A peer group is a small number of people who get together in regularly scheduled meetings over time. They share insights on experiences and performance. They aren’t a new concept, and they definitely aren’t the breakfast group at the local café.

To function optimally, a peer group should have a high degree of structure and formality.

Group composition

Typically, a peer group consists of five or six farms but can be up to 10 or more. Having more than 15 people in attendance requires careful facilitation so each individual is able to be actively involved in the discussion.

A well-structured group doesn’t have “freeloaders.” Each participant can expect to take away information or knowledge from a meeting, but the accompanying requirement is that they contribute.

There should be some clear discussion about the distance between farms to ensure people are able to speak freely and openly. There should not be any element of competition. Farms can have similar or diverse operations. Peer groups with participants who are progressive and have a business management orientation have better outcomes.

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The expectation is: Members of a group attend the meetings. Members have to be prepared to make the commitment and investment (time and money) to attend. Three key success factors are trust, respect and confidentiality. Participants should sign a statement acknowledging confidentiality and pledge to respect that confidentiality at the outset of each meeting.

One of the challenges in forming a group is determining whether the members are actually peers. The purpose is not to have a group of farmers who agree on everything. The purpose is to be challenged but not criticized.

In most instances, participants will not know each other very well, if at all, as the group forms. Relationships form and deepen over time. Trust builds as relationships crystallize. Once a peer group “matures,” the benefit from participation is optimized.

A key element of a highly functioning peer group is vulnerability. It evidences a peer group member can benefit from another’s perspective. Participants should be willing to:

  • Own their weaknesses
  • Be transparent
  • Admit they don’t have all the answers
  • Ask for help

Groups can change over time. Farmers can opt to resign, and new members can be brought in.

Meeting structure and frequency

Groups decide among themselves how often they want to meet. In-person meetings are required – at least as the group is being formed so relationships can be established. Meetings can be anywhere from a half-day to two or more days.

Groups should develop a charter or set of bylaws that define how the group will manage and govern itself, such as defining who can join and how people are expelled. Groups function better with a hired facilitator whose role is to:

  • Plan and facilitate meetings (including logistics for in-person meeting)

  • Coordinate data collection where applicable

  • Prepare reports

  • Get things started

  • Ensure everyone is participating

  • Move things along if discussions are getting bogged down

  • Provide input and contribute to the discussion when appropriate

I personally have been involved in a consultant peer group for nearly seven years now. Our group has 12 members with U.S. and Canadian participants. We meet four times a year (twice in person).

Similar to a farmer peer group, we get together and talk about farm management best practices, challenges and issues. I find it to be a hugely valuable experience. The return on investment is difficult to quantify, but in my opinion, very high.

Where else could I spend two days with 11 other peers, where relationships and trust have been established, talking about business and personal issues and benefiting from their insight into things I’m facing?  end mark

Illustration: A properly set up and structured peer group can be an added resource for a farm business. Illustration by Corey Lewis.

Terry Betker, P.Ag., is a farm management consultant with Backswath Management Inc. Email Terry Betker or (204) 782-8200.

Reasons why farmers might join a peer group

  • Strengthen or advance management practices

  • Affirm or challenge how things are being done

  • Build collegial relationships with farmers with similar management mindsets

  • Introduce an element of accountability to ensure things are getting done

  • Access to a “board of directors” for the business

  • Input into or feedback on management issues

  • Share management techniques

  • Hear how decisions are made

  • Learn how challenges are handled

  • Benchmarking performance

  • Potential for business investment and development

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