My last column talked about the do's and don'ts of budgeting. It was about looking forward and putting what you plan on doing for the year ahead into dollar terms.
Now that we are in a new financial year, it is also a good time to start looking back.
June/July is a great time to make changes for the year ahead and reflect on the past. I find now better than December/January as the Christmas period and school holidays make that a very busy time.
What could you be looking back at? I'd consider the following categories and look for opportunities to learn from your own experience. Get your team together and discuss these to see what others observed and felt happened. Learn from each other.
Land. How did it perform? Are there areas that you over or under used? Is your soil and plant health improving or declining? What impact did your management decisions have on these? What will you do differently in the future when facing the same conditions?
Production. How did your summer crops perform? What were your weaning and preg test results and how do they compare to previous years? How were the growth rates? What were the actual gross margins achieved for different crops and enterprises? What worked, what didn't and what isn't trending the right way for you?
Business. All readers will look back on their year when completing tax returns. Helen Warnock mentioned the importance of using your accounting programs to their full potential. In addition to your taxation accounting, it is worth looking back at your management accounting. Use market value for all your animals and assets and determine the economic performance of your business at a division and enterprise level. What was your true profit? What made you money and what parts didn't make as much? You could also consider benchmarking through platforms such as ProfitProbe™.
People. How have your people performed? If you're self-employed this still applies to you! What areas have your team performed well in and what areas need improving? What can you learn from the questions above? What training or skill development will help you create better outcomes for the year ahead, with less stress? This time of year is generally much better for staff reviews and salary discussions than Christmas!
- David is chairman of agricultural consulting and education company, RCS Australia. www.rcsaustralia.com.au 1800 356 004