Most farming families don’t set out to build a complex business. It starts with a paddock, a plan and plenty of hard work. Then over time the business grows. More land. More machinery. More debt. More opportunities. More people.
Before long, you’ve got a serious business operating alongside a family, and that is where things can become complicated.
The reality is that many of the biggest challenges in family farming have little to do with production. They’re about people, communication and decision-making.
Questions like:
- Where are we heading as a business?
- How do we balance the interests of different generations?
- When is the right time to invest?
- Who is responsible for what?
- What happens when Mum and Dad step back?
- How do we make sure important conversations actually happen?
These aren’t issues that can always be solved with a chat around the back of the ute or in the sheep yards.
When family and business collide
Family businesses are unique because everyone has more than one role.
You might be a director, manager, shareholder, business partner, parent and sibling all at the same time. That overlap is often a strength. It creates loyalty, commitment and a long-term mindset. But it can also make discussions difficult.
Different generations may have different attitudes towards debt, risk and technology. Family members can have competing priorities. Sometimes important conversations are avoided simply because nobody wants to create tension.
Without a structured process, decisions can become reactive rather than deliberate.
The value of creating space to work on the business
One thing I see regularly is farming families becoming trapped in the day-to-day.
There is always another crop to plant, another livestock issue to solve or another operational challenge demanding attention.
The result is that the business spends all its time working in the business and very little time working on the business.
This is where a family advisory board can make a real difference. At its core, an advisory board is simply a structured forum where the family can step back from operations and focus on the bigger picture.
It provides a regular opportunity to discuss strategy, financial performance, succession, risk and future opportunities before they become urgent.
Importantly, the advisory board does not make decisions for the family. The family retains ownership of every decision. The role of the board is to provide perspective, challenge assumptions and improve the quality of the discussion.
Good businesses don’t leave important conversations to chance
In my experience, the strongest family businesses tend to be deliberate about their decision-making.
They create time to discuss:
- Financial performance and cash flow
- Long-term strategy
- Succession planning
- Risk management
- Policies and procedures
- Investment and growth opportunities
- Governance, systems and accountability
None of these topics are particularly exciting on their own. What is exciting is what they help create. Clearer communication. Better decisions. Greater accountability. Alignment between generations. A business that is prepared for opportunities when they arise.
These outcomes rarely happen by accident.
Sometimes an outside perspective helps
One of the most valuable aspects of an advisory board is the ability to bring in an independent perspective.
Every business develops blind spots over time. That’s normal.
An experienced external adviser can ask the questions others may not ask. They can challenge long-held assumptions, bring experience from other businesses and help guide discussions that families sometimes find difficult to facilitate themselves.
The goal is not to tell people how to run their farm.
The goal is to help families make better decisions for themselves.
Preparing for the future
Succession is often the topic that gets people thinking about advisory boards.
But the benefits go well beyond transition planning.
The most successful farming businesses are continually preparing for what comes next. Drought. Expansion. Market shifts. New technology. Changes in family circumstances.
An advisory board helps build the systems, processes and conversations that allow a business to adapt over time.
In many cases, it creates something that every farming family is looking for: Confidence.
Confidence that everyone is moving in the same direction.
Confidence that risks are being managed.
Confidence that opportunities can be acted on when they appear.
And confidence that the business will be well positioned for the next generation.
After all, farming has always been about thinking beyond the next season. The same principle applies to the business itself.
Could a Family Advisory Board Be Right for Your Business?
Every family business is different. Our role is to help farming families create a formal structure around decision-making, improve communication and to work through issues such as strategy, succession and governance with confidence.
If you’d like to discuss how a family advisory board could work for your family group, contact Ben Leditschke or your local Moore Australia Advisor today.
