The growing presence of technology in production agriculture is undeniable. But can all this technology make you money?
Here are some examples:
The most profitable operations tend to test and adopt new technologies quickly. As an example, we discussed auto-steer in the March 2006 RiskWise article and demonstrated efficiency improvements and relatively short periods for payback on the investment.
Seed selection and nutrient management are especially cost effective technologies.
A third area to consider is farm management. This concept is less tangible, but perhaps even more important when it comes to overall profitability.
Top farmers view themselves as general managers of a management team. This team may include a risk and marketing manger, an agronomic consultant, an ag retailer and a CPA. Top producers do what they love and are good at and hire experts to handle other areas. You need to manage these relationships, and you don't have the time to sit behind a desk all day to do it.
You're not alone. The entire economy is moving more toward a “distributed environment,” which is described as having a cell phone signal and internet access rather than a traditional office or place of business.
According to a December 12, 2005 Business Week article, 12% of the American work force is now in a “distributed environment,” soon to be 40% of the work force by 2012.
Sun Micro Systems now has half of its work force based at home, saving them $300 million/year. IBM already has a third of its managers in a distributed environment and say they're 15% more productive, have lowered costs and are better able to attract and retain top people.
A distributed environment on the farm can result from cell phones and Internet access.
The challenge and opportunity is to figure out how to apply these technologies to increase your managerial efficiency and ultimately your bottom line.
One way Russell Consulting Group is taking advantage of the “distributed environment” is by partnering with Commodity Update. The company delivers commodity market data and other critical information to individuals' cell phones via text messages. You can select which markets you want to watch and have that information delivered to the screen of your phone.
I signed up in about five minutes at www.CommodityUpdate.com. In the beginning I subscribed to the service to keep me apprised of what the markets were doing as I traveled. We liked the concept so much we decided to provide it to all our clients and the response has been very favorable.
We have also started sending out other relevant information to our clients through the system. For example, this morning as I'm writing this article, a couple of USDA reports came out and we sent a brief summary out through Commodity Update to our customers.
My thinking about “distributed environments” really came full circle when one client called from his combine as he harvested wheat in western Kansas just to thank us for keeping him informed.
If you'd like to learn more visit www.CommodityUpdate.com or call them at 866-376-6094.
Moe Russell is president of Russell Consulting Group, Panora, IA. Russell provides risk management advice to clients in 24 states. For more risk management tips, check his Web site (www.russellconsultinggroup.net) or call toll-free 877-333-6135.