Previously, we introduced an episode from the “zombie producer” series featuring producers driven by desperate hopes instead of proactive management. Signs of these producers include lack of focus on cost control, managing from Schedule F records, and failure to seek assistance and advice.
Moving to our next episode, let’s examine some other financial and marketing elements as they pertain to “zombie producers.” First, producers that have zoned out from the business realities tend to wait until the last minute possible to conduct financial monitoring. Prior to that point, they often have no idea how much money or equity was lost in that year, or any given year. In fact, in these types of situations, losses often compound year after year. Yet, as long as they can secure operating money, they tolerate the losses. This scenario will most likely come to a harsh ending when the agricultural lender denies the line of credit or refinancing request.
Also resembling procrastination, the “zombie producer” has a tendency to avoid decisions regarding unproductive business assets. One prime example of this zombie-like management is land. Some have said they cannot give up a piece of marginally productive, rented land because they will not be able to get it back when the economic cycle turns. And still others view giving up land, even unproductive land, as a mark on their reputation, or more likely their pride. Neither reason justifies keeping the piece of land, yet, the “zombie producer” refuses to make the hard and necessary decision.
Another practice of the “zombie producer” is ignoring the business’ generational transition.This includes those who turn the process over to a professional with very little participation or input. Others just ignore an official, detailed process all together. Either way, this often results in eroded hopes and dreams for the younger generation as times passes and eventually runs out.
Finally, it should not be surprising that “zombie producers” tend to view educational opportunities as worthless. After all, information presented may challenge their perspective regarding the business’ economic realities. These producers ignore the established trend that uncertainty often comes hand-in-hand with opportunity, for those that can apply new knowledge.The “wait and see” approach is fear-based, and only increases business vulnerability as it forces a reactive instead of proactive and educated approach.
Well, that concludes our second “zombie producer” episode! As in the movies, zombie-like behavior can place one in a scary place. In today’s agriculture, proactive management is critical to survival. Lastly, remember that zombie-like practices will only work until a certain point because business realities have ways of demanding attention, eventually.
If you missed it, take a look at the first of the series about "zombie producers."
For more from Dr. Kohl, follow his "Road Warrior" blogs.