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Beef Insider: Plan for profit

03/19/2013 @ 4:16pm

Planning to be profitable is a habit for Meadow Lake, Saskatchewan, beef producers Don and Bev Campbell and their sons. The elder Campbells have managed holistically since the mid-1980s, and their efforts have paid off in sustained profitability.

“Holistic management is about people, land, and money. And it is helping us make room for the next generation,” says Don.

Managing resources holistically has brought a doubling of grass production on their 4,200-acre land base and has lowered per-animal production costs for their 700-cow herd.

The operation now includes the Campbells’ sons and their wives: Scott and Jenna, and Mark and Bluesette. The young couples’ children represent the fourth generation of the family to be involved in the ranch.

Don and Bev’s early efforts in holistic management centered on grasslands.

They built a grazing system based on techniques learned from ecologist Allan Savory, who founded Holistic Management (HM) as a whole-systems framework for resource management and decision making.

Savory cofounded the Center for Holistic Management, and this later gave rise to Holistic Management International (HMI), which is based in Albuquerque, New Mexico. An HM course in financial planning was the next step for the Campbells.

Applying the holistic perspective to economics freed their thinking and permitted them to analyze resources and finances in various hypothetical combinations.

Results were immediate. At one point, the Campbells were borrowing $1 million to stock their ranch with yearlings.

Holistic financial planning helped them decide to own 200 cows debt-free and to custom-graze the balance of the available grass.

“The result was a loan of $0; a $50,000 savings in interest and an income of $10,000 on money we had in the bank,” says Don. “Over the years, we did start to increase our cow herd again and decrease the custom grazing. In the long term, full ownership in the cows increased our income-earning capability.”

In time, Don became an HMI-certified educator. The Campbells now travel throughout Canada presenting training sessions on holistic management.

Three-part goal

The process of holistic management begins when an operation’s stakeholders set a three-part goal.

  1. Quality of life.
    This statement describes the individuals’ values and desired living and working conditions.
  2. Forms of production.
    This describes what can be produced to create the life envisioned, including levels of desired profitability.
  3. Landscape Description.
    “We described what we wanted our ranch to look like in 50 to 100 years,” says Don. “We described, too, what we wanted our community to look like in 50 to 100 years.

“All decisions we make must carry us toward our three-part goal,” he continues. “It’s like our North Star; it gives us direction in our lives and in our business."

Identifying and addressing possible logjams is part of the overall holistic financial planning process. A logjam could be a people problem or any other obstacle blocking individuals or the organization from meeting goals.

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