SOP’s TO THE RESCUE Time to get organized?!

SOP’s Introduction

•What is it?

•Why do we need “Standard Operation Procedures?”

•Real Applications

•How to Build SOP’s

What is a Standard Operating Procedure?

• Employee Hand Books

• Process Manuals

• Contractor / Supplier Documentation ….. i.e. insurance form

• “How To?”

• Client Documentation

The First SOP…… Define Your Operation

• Consistency, Slow Growth, Relationships 1. Steady, “Auto Pilot”

• Growth Production , Max Efficiency 2. Full Power, “Take Off”

• Slowing Down, Transition 3. Idle , “Final Approach”

• Define your Principals i.e. Integrity, Honesty, Quality

Why Standard Operating Procedures? SOP’s

• Business – sustainability / consistency … Correct & Transparency

• Safety – Self reporting, Aviation example

• Economic and personal growth

• Generational transition

Why?

• Efficiency – increases profitability : and cross training / Backup support

• Designing standard processes for quality / productivity measurement……… if you can’t measure it, you can’t improve it….

• We can regulate ourselves, or - we can be regulated!!

• Allows you to delegate responsibility

WHY ???

SOP’s …….. Over Done

SOP Challenges

• Discipline of writing them….. Not much fun

• Getting "buy-in" from others in the organization

• SOP's can often need updates or improvements

• Use them…. Don’t forget they are there

• Misuse / No Use …… Like a Treadmill

Extreme Ownership / The Book

• Leadership Clearly Defines Responsibilities

• Clear Chain of Command

• Defined / Specific Expectations / Timelines

• Measures Results

• Accountability Consistency

Business Structure

Operations Business

Equipment Company

Trucking Company

Diversification Company

Parent Company

How can we bring in extra cash?

Learn By Teaching • If you can’t explain it; You don’t

understand it! • Employee Training : 5 minutes and go Vs. SOPs.

• Family and organizational meetings.

• Share your farms details with other farmers. (e.g. TPEN Host)

• Teach your suppliers (e.g. Brokers, Agronomic, Financial )

Safety SOP

Farm Name__________________________

Safety Training and Information

General

10 mph speed limit in yard

No texting and driving in any company vehicle

No alcohol in company trucks or equipment

No operation of trucks or equipment with blood alcohol over legal limit

Shop

Must wear eye and hearing protection

Employees only (unless under direct supervision of an employee)

Be sure cords and electric tools are in good condition

Safety SOP Grain Bins and Dryer

Cautious of wet conditions and electricity

Watch surrounding (kids)

Don’t go into grain bin without second person knowing

Use lock out/tag out of electrical equipment during repairs

Trucks

Don’t drive more than 35 mph on gravel

14 hours on/ 10 hours off

Stay in truck when grain cart is unloading

Machinery

Do not approach moving piece of machinery

Do not operate equipment with missing shields or safety guards, be sure to replace them

after repairs, servicing, or if missing

Additional information at: www.necasag.org and www.osha.gov

Cost of Production SOP “Start Up”

• Define Profit Centers, i.e. Corn, Soybean, Cattle, etc.

• Identify a unit price for every line item expense.

• Keep each expense in it’s correct year

• Identify income with in the same year of production.

• Identify the right tools and PEOPLE for support

• Correct - Transparent – Make the difficult decisions

Decision Rights/Responsibilities

• Land/Real estate acquisitions and sales

• Marketing

• Capital purchases/$1000 or more

• Equipment purchasing

• Employee hiring/firing/compensation

Decision Rights/ Resp0nsibilities

• Inputs i.e. seed, fertilizer, crop protection, herd health

• Financial analysis/Business structure

• Operational structure (agronomic, logistics)

• Growth and development

• Maintenance and repairs

Decision Makers

• Primary: the ultimate individual responsible

• Secondary: backup/assistant …… Trust but verify (Protocol ?)

• Support: third party opinions/consultants

The person responsible for the results needs to be responsible for the decisions in the process!!

Maximum Farming…. Example

Save Money

• Better placement

• Better products

• Better Timing

• Protect yield potential

• Better overall Efficiency

Increase Yields

• Precision Soil testing

• Balance nutrients

• Farmer focus on details

• Better zone management

• Setting higher goals

Calendar of events

Do Your Own SWOT Evaluation

Strengths Weaknesses

Opportunities Threats

Prioritize to Survive

• Business Structure Review. Know Where the Profit is Coming From. (Profit Center / Zone)

• Consider Networking Options.

• Know your Costs Per/ Bu. on “Every Expense.” Not Just the Check Amount.

• Control “Return to Management” Expenses.

• Market Value Balance Sheet with Trends Analysis. “Earned Equity”

• Do What You Do Well. Let someone else do the other stuff.

• Protect Yourself from Risk Insurance.

• Marketing. Keep it Simple and be Disciplined.

• Protect Working Capital. Without Impacting Productivity.

Dad’s famous Quote

“We need to get organized around here”

• What needs organized?

• Who is in charge?

• Who defines the process?

• Who does the process?

• Who makes sure the process is completed successfully?

• Who is accountable if the process isn't completed or fails?

Website: Agviewsolutions.com

Chris Barron

AG View Solutions LLC.

E-mail cbarron@agviewsolutions.com

Phone: 319-533-5703