Managerial competencies in primary production : the view of consultants and other professionals

Abstract

Primary production is based on the use of three major resources, land, labour and capital. But the efficiency of the production depends on a fourth critical resource, the skill level of the person making decisions on how the resources should be used (managerial skill). Survey records show there is a very wide range of levels of profitability achieved, presumably due to a wide range in managerial skill levels. Over 1999-2000 return on capital for sheep and cattle farms averaged 2.6% but with a range of -5% to over +9%. These observations lead to the question of whether the general level of managerial skills can be improved through training programmes. To institute such programmes it is necessary to know the important competences (skills) that should be targeted. To obtain the views of consultants and other professionals on important managerial competencies a survey of all members of the NZ Institute of Primary Industry Management was conducted. The mail survey of 708 members obtained 339 useable replies. Respondents were asked to rate the importance of a wide range of competencies grouped into classes termed 'Managerial Attributes', 'Entrepreneurial Skills', and 'Personal Attributes'. In addition, respondents were asked to give details of their interests, age, education, views on farmer computer use and preferable training mechanisms. They were also asked to respond to a group of 25 questions designed to classify their individual management style. An important finding was there was little difference in the respondents' views on important competencies with variations in age, education, farm type interest, style and self-assessed intelligence. The four most important 'Managerial Attributes’ were: a) ability to identify the key factors in a problem, b) effective communication (with employees and contractors), c) being up to date with the current condition of the property (bank balance, animal condition, crop growth, soil moisture), d) assessing job priorities. The four most important 'Entrepreneurial Skills’ were: a) understanding deadlines and being able to ‘act in time’, b) an ability and determination to look/ask/seek out information thought to be necessary for making decisions, c) ability in learning new skills, d) understanding sources of risk and what can be done to reduce its impact. The four most important ‘Personal Attributes’ were: a) early observations of important indicators around the farm (eg lambs are scouring, wheat is infected), b) ability to learn from experience, mistakes and failures, c) developing a ‘good moral character; involving openness, integrity, reliability, and trustworthiness, d) having the confidence to draw conclusions and act quickly and decisively. When the full list of 45 competencies (managerial attributes, entrepreneurial skills and personal attributes) were combined and analysed for correlations it was found that the following groupings formed an important 'kit bag' of attributes: a) understanding deadlines, acting on time and having anticipatory skills, b) obtaining relevant information and recognising problems and opportunities, c) understanding risk and what to do about it, d) identifying key factors, e) understanding how to choose between alternatives and ensuring ALL are considered, f) effective communication and good negotiation skills, g) ability to learn new skills and learn from experience, h) knowing the current state of the property, i) ability to develop long and short term plans, j) an ability to picture the consequences of decisions and to assess job priorities, and k) a belief that the farm is under the manager's control. It would be desirable to develop interactive computer based training packages to assist managers in improving these skills or competencies. The respondents believed farmers would prefer tutor supported locally based competency training programmes. However, this would be a very costly exercise so computer based packages would be more practical (and the second preference). A similar survey of over 700 farmers is currently being analysed to see whether farmers have the same views as the NZIPIM respondents. The two surveys should give a clear indication of the competencies the industry believes are important. In analysing the responses of 25 questions on managerial style it was clear five basic factors could be used to categorise style. These were called 'anxious responsibility', 'careful logician', 'consultative', 'obsessive professionalism' and 'lively professionalism': Everyone will exhibit a degree of each of these characteristics. These characteristics might influence a person's managerial ability and the best competency training methods. As farmers' objectives may impact on appropriate competence and training packages, the respondents were asked to rank a range of statements. The top four were: a) planning for the maximum possible sustainable cash return, b) producing products and using farming systems that the farmer really enjoys being involved with, c) planning for the maximum possible average annual increase in the net value of total assets, d) selecting farming systems that minimise risk. Following the results from the farmers' survey, the next step in the work will involve deciding on the competencies to target in training programmes. This stage will need farmer involvement. The development of the training programmes and their testing for effectiveness will then follow.