Any conversation that starts with what happens after the farmer dies inevitably turns to what should be done today.
And the most important task? Talking about what the farmer wants to happen and what the on- and off-farm heirs would like to see. That was the take-home message for those who tuned into a recent Farm Futures webinar, What happens when the farmer dies?
Christian Goodman, a fourth-generation Iowa farmer, is living with the impact of poor communication from one generation to the next. After losing his grandmother, who had succeeded his grandfather, communication among the third generation of on- and off-farm heirs quickly disintegrated into arguments and lawsuits.
“I think the biggest pitfall that we ran into was lack of clear communication between generations,” he said. “That was probably the biggest thing — just a lack of expectations, a lack of having those conversations.”
Which brings Goodman to today, when his mother and his siblings are navigating transition in the wake of the unexpected death of his father, Kevin Goodman.
Prioritizing family harmony over tackling the hard succession conversations simply delays the decision-making to a time when emotions likely are running higher following the death of the farm leader, said webinar guests Goodman and Mike Downey, manager of succession planning with UnCommon Farms.
“Our issues were not unknown to us,” he said, remembering conversations with his father about talking to his grandparents about a succession plan. “We knew the right things to do, but there was no execution and follow-through.”
Return on relationships matters, too
Succession planning, Downey said, isn’t merely about passing down assets.
“Recognize that your will tells the court or your executors what to do with your stuff,” he said. “Whereas a more comprehensive succession plan tells your family what you want to do with your legacy and what that looks like in the future.”
The Goodman family is figuring that out, with support from their farming partners and neighbors and by leaning into existing long-standing business relationships.
Downey noted that he has calculated plenty of rate of return over the years, which shows total net gains (or losses) on an investment over a specific period of time. But he suggested farm families also should consider RoR, an acronym for “return on relationships.”
“It doesn’t show up on the balance sheet, but it can pay a lot of rewards,” he said.
“We’ve spent a lot of years developing good relationships,” Goodman said. “We had great relationships with all of our vendors and our neighbors. Everyone has been incredibly helpful, which gave us the opportunity to get a crop in this spring because of how our community treats each other. The whole point of why I’m here is you can do whatever you can legally, but it’s never going to end well if you don’t already have good relationships in place.”
Ultimately, farmers must adopt a management mindset, Downey said. His own farmer grandfather was a man of few words who measured success by how many hours he put into the operation each day. But Downey thinks a more modern approach requires taking a “time out” once in a while to talk about higher level business planning topics. But that’s not all you have to discuss – why not also share your vision for future generations?
Even those who are worried about how those conversations will go must take that crucial step, Goodman said.
“Whatever fear you’ve got about having these conversations about what’s going to happen with the farm after you’re gone, it’s more terrifying going forward not knowing,” he said. “It doesn’t have to be a perfect conversation initially, but just something to get the ball rolling and crack the door open.”
To hear more from Goodman and Downey, watch What happens when the farmer dies?