Tuesday, September 4, 2012

Why focus on growth?

By Dave Christiansen,
President & CEO
I always find it interesting when I run into someone who asks the question, why focus on growth?  Somehow the vision the founders had for growth, from the day this company began, went from being an expectation to being assumed. Today, active growth is at times thought of with negative connotations.

At the time the coop was organized, the passion for meeting the constantly changing needs of the farmers’ expectations may not have been referred to as growth.  However, I’m sure our  founders had certain expectations of the coop’s ability to meet the changing needs of the growers.  At that time, they built elevators and purchased equipment that satisfied the needs of the day and new assets were surely designed with the future in mind. I assure you our founders didn’t or couldn’t dream big enough to anticipate the speed at which we operate today.  Nor could they grasp the complexity of the challenges and the volatility the future would bring with markets, supply, technology, communication, regulations, labor, finance, or the myriad of issues faced by growers or their coops today.  We face the same challenges today that our founders did. It is difficult to conceptualize or anticipate the speed at which we will operate in the future. I don’t believe the founders would expect us to be satisfied with mediocre performance or allow us to be content with leaving things alone.

Growth has had very positive effects on our members, owners and customers.  The most obvious has been our ability to employ people who are or can specialize in one segment of the business rather than trying to bounce from one highly technical segment to another.  As you know, the technical expertise necessary today far outweighs what it did in years past.  Examples of this are our grain marketing specialists and crop insurance specialists.  These people focus on what it takes to meet your expectations by having a good understanding of your operation and then applying the right product to meet your needs and risk tolerance.  Another example is our seed specialists  who have an understanding of why and where to place the right hybrid.  We are fortunate to have specialists in safety, environmental regulations, agronomy, finance, precision ag, energy and many other specialized positions. 

Our growth has put us in a position where vendors come to us with specialized programs that others in the industry will never experience.  A great example of this would be the soybean revenue assurance program we offered last year that put close to $3 million into our producers’ hands in a year when it was desperately needed.  Our tissue sampling is another program designed to help producers maximize yields.  In addition, our growth has allowed us to provide multiple on-line offer systems, risk management programs and farm-gate representatives.  Because we chose to pursue growth, we are able to offer these programs managed by specialized employees.
I believe your cooperative needs to prepare for rapid growth opporunities in the future - and not just for growth's sake.  This growth will be a result of the natural course of business as we continue to prove our worth to our growers.  Regardless of where our growers live, they know that MKC can be depended on; we will fix our mistakes when they occur and we have the specialists who understand and can provide the producer the tools to be more successful in this landscape fraught with risk.  These values position our company to be a strong and desirable partner in the future.  They have precipated our growth over the years and there is no reason to believe expansion will slow down.  History has indicated that mergers typically didn't occur until one party felt some financial stress.  Hopefully, in the future more members will support mergers between successful companies for the good of the members and the cooperative system.   

Should growth concern us?  Certainly, if we are not diligent in our preparations.  We focus our efforts on building a team who can execute in a growth environment on a daily basis.  We also focus on building relationships with vendors who are willing to help us along.   Our growth over the past 47 years has proven to make us a stronger company with a broader reach. Future growth will not diminish our focus on local control, our service to you at the farm gate or the responsibility of the location general manager to provide excellent customer service.   Management of growth has not been an issue in the past and I don’t see it as an issue in the future.

In the words of Peter Drucker, a highly renowned management consultant, “the best way to predict the future is to create it.”  I think this is what the founders of all cooperatives had in mind. By working together we can shape a dynamic company that will continue to meet your needs.

Thank you for your help in continuing the vision of the founders of all the cooperatives. 

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