It’s often said that ranching is a lifestyle, but it’s much more than that. Without a business mindset ranch owners can struggle to turn a profit. This includes prioritizing resources on cattle operations and evaluating their interactions will help with business decisions.
According to Mississippi State University Extension Beef Cattle Specialist Jane Parish, human capital is one of the resources that should be considered top priority.
“People contribute expertise, skills, ideas, and effort to raising cattle,” Parish says. “Having access to great financial and physical resources can certainly provide advantages to an operation, but poor management of those resources by the people making and implementing the decisions will erode these other resources with little to show for it.”
Parish suggest that an investment is made in the quality of people working for operations, rather than a “cheap hire.” She also mentions putting employees through continual training and education will help make them more equipped to complete their jobs correctly.
“For managers, this may involve not only keeping up with current technologies and best management practices, but also being exposed to additional technologies and trends that may be further developed or adapted to play a future role in the operation,” she says.
This ties directly into time management.
“Time and money are intertwined,” she says. “Make sure that the time that people put in to the operation justifies the payment for that time. Proper training and motivation of people can help to improve productivity per unit of time.”
Parish says to keep in mind that any time management decisions implemented need to be done with work and life balance in mind so employees don’t burn out.
Physical resources like land, cattle and forages are also part of the business equation.
“Both the quantity and quality of physical resources determine the production potential of the operation. Management then determines the degree to which this production potential is achieved with the physical resources available,” Parish says. “One pound of a lightly muscled or unthrifty calf likely has less value in the marketplace than one pound of a heavily muscled and healthy calf. Yet the financial investment in producing the more valuable calf is often greater than that of producing the less valuable calf.”
Parish says a challenge for producers reaching for the perfect management balance will be quality vs. quantity.