Do Well, Do Good

Word map: Pennsylvania State University Student Centered Farm

I have been asked to post my Winter 2016 Management Report, so here it is…

What is social responsibility? We hear that phrase all the time in the media—but what does it really mean? Is it charitable giving? Is it employee development? Is it just a bunch of hooey?

Whatever you think of the definition, it is the truth that everyone in this room practices social responsibility, pretty much every day.

And I would bet that nearly everyone in this room believes that as a citizen, of the U.S. and of the world, each one of us has some responsibility to protect, and indeed to improve, those things that matter to all, or that we all share, and over which she or he has influence—humanity, community, environment, society, government.

And truly, who in agriculture has a better social responsibility story to tell than you? You may have mixed feelings about some of the personalities involved, but knowledgeable environmentalists like Allan Savory have noted for decades — well-managed beef cattle operations offer holistic health to the land, efficiently producing nutrient-dense food for our society through improvement of soil, encouragement of diverse grasslands and wildlife, and carbon sequestration.

Like Tom’s Shoes “One for One” campaign, beef has “Tons for One” value. With beef, you’re not just giving your family a nutritious meal, you’re supporting open space, clean air and water. You’re ensuring the animal that feeds you, never has to worry where its next meal is coming from, and has room to wander, either on grass or in maintained pens. (As an aside, it puzzles me that operations raising chickens in pens receive admiration and a premium, while operations raising cattle in pens get attacked by media and arsonists alike.) You’re giving deer, moose, mouse and grouse room to ramble. When you buy beef, you support an actualization of sustainable, socially responsible concepts Americans value, but don’t intimately understand.

The checkoff-funded lifecycle assessment indicates that we have achieved a 3 percent reduction in water use, a 2 percent reduction in energy use, a 10 percent improvement in water quality. These are the result of innovative thinking, of our use of technology, of efficiency.

But I keep looking through the windshield, thinking of the challenges ahead. Aren’t real solutions about much more than telling your current story — or even looking in the rearview mirror to defend what has been? What really matters is your future story, and the stories of your children and grandchildren. Because you have the power to improve and shape those stories.

After all, beef, and food, isn’t just YOUR industry, it is a public cause. And among us in the beef “cause” there are public and industry “Galahads”—and public and industry “Don Quixotes”. Many, many people care about the beef “cause”. That simply is the truth of where we are today. I know that I feel challenged daily, and even frustrated sometimes, by the demands and expectations that surround the production of food today. And I know you share that frustration. Goodness knows the expectations, and real challenges in food production are many, and growing. And it often seems like our support from society-at-large is shrinking.

Yet I know that each of you feels a social responsibility with regard to food production, because I have talked to you about it, visited with you about the civic and social issues for which you feel individual responsibility. Healthy, strong rural communities. A wholesome, safe food supply. You care about feeding our country, and feeding the world, more than many do. For example, the issue of food security is a complex global issue linked to economics, health, development, and trade. You may think it is only an issue for developing countries, and while USDA’s Economic Research Service says 86 percent of US households were food secure throughout 2014, a whopping 14 percent, or 17.4 million households, in America, were food insecure. Larger food, environment and community health issues such as this are critically important to you, your consumers, society as a whole. You actively work to address those concerns, and these concerns are shared with the rest of your beef community—your customers that purchase and process your cattle, and your consumers, the folks that cook and eat your product.

So…I know that you do, that voodoo that you do, making grass into nutritious, delicious food, out of your passion for the work, the land, the animals, but also, out of a sense of social responsibility to America and the world at large. And I am here to tell you that your consumer, particularly your largest, most powerful group of consumers, the millennials, share a strong sense of social responsibility with you.

A national poll taken about a year ago found that 9 out of 10 Americans still believe that social responsibilities like reporting a crime, understanding the national language, and serving on a jury are “very important.” The research indicated that millennials believe we must care for those around us, particularly through volunteer community service. In fact, that belief is much stronger in those under 30 years old today than it was three decades ago, and much stronger in this age group than in those folks who are more than 50 years old. This sense of responsibility to society is especially pronounced among young people, when it comes to social well-being in disadvantaged populations for core human needs like food, shelter, basic medical care and clothing.

 “And so, my fellow Americans: ask not what your country can do for you, ask what you can do for your country.” –JFK

I ask you to take an introspective look at your assumptions and beliefs about social responsibility—because I believe this area offers tremendous opportunity for beef in particular—a unique opportunity even among other agricultural business due to the way we raise beef, and the positive impacts we have on environment and human nutrition.

Make no mistake, these opportunities translate into improved economic sustainability for us–shared social responsibility that makes great business sense.

Many organizations have learned that cutting-edge innovation and competitive advantage can result from weaving social and environmental considerations into business strategy from the beginning. I honestly believe that the winning companies of this century will be those who prove with their actions that they can be profitable and increase social value—those that both do well, and do good.” — Carly Fiorina, while at HP

A current Harvard Business Review article on what will make businesses successful into the near future, says businesses must ensure that they contribute positively to the system while receiving benefits sufficient to justify participation.

HBR warns: Companies that fail to create value for key stakeholders in the broader system will be marginalized

A robust business into the future, HBR says, must have leaders who ensure that the company is sufficiently diverse along three dimensions: people, ideas and endeavors.

Doing well and doing good. Well-executed social responsibility and sustainability efforts create economic value for businesses in ways that also create value for society.

Win-win situations.

Long-term, sustainable business operations.

Integrating social responsibility tenets within business decisions results in both economic value for the product or organization as well as increased value for society, and the individual consumers in it. But the incorporation of such elements, often means a completely transformed way of thinking about the business model, with an eye toward increased economic viability through betterment of social value.

Think of it this way: caring for the environment, the water, the grass, the air, and the animals, increasing production efficiency improving land and the larger environment, results in economic viability for your operations and fulfills the social requirements of the members of our food community on the eating side. Business decisions, in the checkoff and at home, that always consider the needs of both ends of the food community spectrum result in greater marketability and greater profitability.

This isn’t about a section of the budget that deals with responsible, sustainable decisions, it’s about a thought process that considers a responsible, sustainable future in every business decision. Social responsibility isn’t just a charitable act, or solely philanthropic. It is both self-interested and societally interested at the same time, assuring your own economic, social and environmental viability well into the future by way of assuring social sustainability. This may be a central shift in our way of thinking about some of the projects, some of the efforts, we fund.  But a shift that pays dividends—to your operations, to the beef community and to society as a whole.

Our founding fathers knew the value well. George Washington said, “I know of no pursuit in which more real and important services can be rendered to any country than by improving its agriculture, its breed of useful animals, and other branches of a husbandman’s cares.”

And Benjamin Franklin: “There seem to be but three ways for a nation to acquire wealth. The first is by war…The second by commerce…The third by agriculture, the only honest way, wherein man receives a real increase of the seed thrown into the ground, in a kind of continual miracle.”

The checkoff, and the industry, has made progress. We continue to get better at focusing our efforts holistically. We now have the Consumer Trust Committee dedicated to building the trust, and the bridges, between the producer of our beef and the eaters of our beef—to me, this committee represents a major checkoff program focus on the responsibility that we, and our society, share with regard to food. Our Long Range Plan mentions trust repeatedly. I mentioned our lifecycle assessment–our checkoff has been investing in sustainability research and benchmarking in the form of lifecycle assessment for several years now, to understand how we can become even better at fulfilling our end of the commitment we have to society. These are critical, and strategic, ways that the checkoff is moving into the future of responsible business as envisioned by both us, and our consumers. Social responsibility also includes things like consumer engagement and producer-level animal health and welfare standards and practices, including programs such as Beef Quality Assurance and extensive consumer education programs – with consumers directly, with restaurant and other foodservice operators, with butchers and retailers, with processors, with a full range of physicians and other health influencers. And we continue to grow our Masters of Beef Advocacy program, which helps prepare producers like each of you to meet social responsibilities through transparency and active listening to consumers, adapting where necessary, then sharing with those consumers how you help meet their needs, and the needs of their families and communities, including consumer and community health and safety. These are all pointed toward constant change and improvement of our management practices and our communications.

Last year I mentioned to you that I believed we needed to advance a fundamental change in our relationship with our customers. I said society has evolved, and consumers are seeking a more direct relationship with the way their food is produced and what they put into their bodies. We will not succeed into the future unless we continue to include them in our beef community. I believe we are doing a good job of engaging and telling, thereby better including our consumers. But I believe it is time for that next logical step toward a tighter relationship with consumers—and that step lies within our ability to learn, and change.

We know, from growing our touch points and engaging our community, that we share a passion with our consumers about food and social issues surrounding food.  The secret to our survival as a center-of-the-plate item in worldwide diets relies on our ability to answer critical questions. How can we focus more on creative and innovative solutions to challenges, and less on defending the way things are? How can we step out fearlessly to tackle sticky issues in our industry head-on? How can we enlarge the scope of factors we consider in our business decisions? How can we courageously embrace change, and the future, even if it means setting aside some of the ways we currently do business in favor of future gains? How can we turn information into improved strategic thinking, about future linkages between your business, the betterment of society and the desires of consumers? How can we embrace our own dedication to our economic sustainability, the viability of our environment for our children’s children and the responsibility we already feel to feed Americans and beyond, to make every decision, a sustainable, responsible, viable-into-the-future decision?

We must work to keep a holistic way of thinking on equitable footing with economic factors in every decision we make on behalf of the checkoff. This is the way of the future for businesses that hit targets on all three measures of sustainability—economic, social and environmental. Our ability to broaden our thinking will determine our level of success with our marketplace, and our success in passing our business, and our resources, along to the next generation.

So what is my call to action, for you today?

Be brave and thoughtful when faced with frightening challenges.

Don’t mistake disagreement, or even passionate, constructive discussion for combat.

Use your powers, of consideration, of dollars, of your critical role in society, for the good of all.

Consciously refrain from automatic “us against them” responses.

And most of all, remember that as checkoff leaders, you are a driving and influential force in the sustainable future of the beef industry.  You can effect change. You can make a difference.

Unlocking Value Through Innovation

Innovation Change Unlocks Value March Blog

Make no mistake, despite some vocal minority voices that say otherwise–people want to eat beef.  The latest beef demand numbers say plenty, with the All Fresh Beef Demand Index having increased an astounding 13 percent year-on-year during the fourth quarter of 2014. 13 percent – that’s the largest year-over-year increase in any quarter since 1990 – 25 years. Of course, the beef checkoff can’t take credit for the entire growth in beef demand – but our community is realizing this growth despite our tight supply in recent years, which points to growing consumer preference for our product and, according to economist Glynn Tonsor, “strong consumer loyalty to beef.” In fact, demand for beef has increased in 18 of the last 19 quarters through December 2014. And for the full year in 2014, beef demand increased 7 percent – the best growth we’ve since 2004 and the second-best since 1990.

Looking at one area where the beef checkoff focuses on innovation, the NPD Group – a global information company – reported recently that a total of 9 billion servings of burgers landed in U.S. restaurant and foodservice tables in 2014 – up 3 percent from 2013. This was in sharp contrast to overall sandwich servings for the year, which dipped by 2 percent – or 201 million servings. Burgers lead the sandwich segment, and that’s no accident. The checkoff worked closely with restaurant personnel nationwide to help create many of the burger options you see on restaurant menus today. Because we have asked consumers what they want – with market and product research at the base of every checkoff program – we may assist chefs and restaurant owners in understanding and fulfilling beef community desires. Because of this, today’s burger is much more than a bun-wrapped patty. Instead, beef burgers are a discriminating and purely individual selection from hundreds of creative options, including burger bars where folks can put their sandwich together just as they like it. Some people (like me) still want a simple, perfectly grilled beef patty, topped with Wisconsin cheddar, lettuce, tomato, onion, ketchup and mustard. But given the high price of beef, you can understand why many folks feel like their burger experience is more valuable when they get the exact combination of flavors that delight their palate. And we aim to please.

As I mentioned earlier, research forms the base of virtually all beef checkoff programs. That includes market research to keep in touch with our consumers’ demands and product innovation research to keep making improvements and changes to meet those demands. Let me give you a couple of examples of the important connection between research, product innovation, and a blended beef community. Think about breakfast – a meal that in which beef has been largely absent. Our market research tells us that consumers want beef at breakfast, too. So the checkoff’s Beef Innovations Group and culinary team worked through a coordinated product development initiative to help chefs and restaurateurs bring beef products to the breakfast table, developing recipes for breakfast beef burritos, beef and egg breakfast mugs, basic country beef breakfast sausage, beef bacon, steak and eggs breakfast tacos, and beef breakfast pizza, to name a few. Once perfected, we also distribute recipe innovations to consumers through the digital platforms where they say they want to receive their beef information. We rely heavily on partnerships where restaurant of retail partners invest as much as $60 to every checkoff dollar. It’s a win-win-win for farmers and ranchers, restaurants and retailers, and the customers who love beef–a.k.a. the beef community.

So can we celebrate the win? Absolutely. But what we cannot do, is rest.

We need to take a very thoughtful, disciplined approach to the future of the beef community, too.  We are in a unique position to offer a certain experiential value to our customers that separates us from other proteins. We have unmatched equity in the area of creating food experiences to meet our customers’ search for those experiences, not simply chow or belly fill. Serving up these experiences will require that we continue to nurture and grow the trust we have gained in our beef and agriculture community by providing truth, transparency and value. By pleasantly surprising and delighting our customers constantly. By pushing beyond the status quo and reinventing the beef experience, even when we are experiencing tremendous success in demand. Especially when we are experiencing tremendous success.

“Coming together is a beginning; keeping together is progress; working together is success.”  ~Henry Ford

Metrics Matter

Deming theories

Sometimes, I’m asked what is going on at the Beef Board (as in “Heeeeey, whassup?” Not as in “What in the h-e-double toothpicks is up?!?!?”—although that happens too. That’s another rant…er, I  mean blog…though.) Despite some of my more touchy-feely blog shares, when it comes to management, I believe big-time in metrics and measurement. After all, you can’t manage what you don’t measure.

W. Edwards Deming (another one of those darned brilliant Iowans…what’s in the water in that state?), is the granddaddy of modern “measure-to-manage” strategies. Those of you not familiar with Deming might have fun first clicking back and reading some of my earlier blogs on Japan and then researching this great man and his impact on Japanese business systems (and world wide systems as well, but the Japanese were the first to listen and adapt). In 1960, the Prime Minister of Japan, acting on behalf of the Emperor, awarded Deming Japan’s Order of the Sacred Treasure, Second Class. The citation on the medal recognizes Deming’s contributions to Japan’s industrial rebirth and its worldwide success. Historians say Deming was known for his kindness, compassion and humor (Salsburg, 2002). This great man passed away in 1993, the same year he founded the Deming Institute in Washington, DC.  And today, his name and famous 14 points are eponymous with modern, metrics-based management. Many of you have heard me drone on about continuous improvement without giving the Deming Cycle or Deming himself credit—a miss on my part (I cannot even say I am even a very good student of Deming, although I try).

Deming-Cycle-Graphic

Perhaps, in the future, I’ll tell you about some cool new evaluation projects we have going on at the Board this year. But for now, let’s talk about performance.

Metric 1: Producer Awareness and Approval

This bi-annual survey asks checkoff investors if they aware of, and if they approve of, the management of the checkoff program. Many years of data allow us to trend line both awareness and approval of the program. The results of our latest survey, completed in January, show:

  • At 91%, name awareness among producers of the beef checkoff program is on the rise and rated by the independent research firm as “very high”;
  • At 78%, the research found the highest level of producer approval of the program in 21 years;
  • 80% of producers believe the checkoff contributes positively to consumer demand for beef; and
  • 79% say the checkoff does a good job of representing their interests

Metric 2: CBB Management

Each year, the Beef Board undergoes an external, independent financial audit.  The external audit determines if our financial statements are fairly stated in all material aspects. Since the inception of the program, all external audit reports have resulted in “unqualified” or, in laymen terms, “clean” opinions. In no case has the external audit found any evidence that CBB was not in compliance with the Act & Order or the AMS Investment Policy. In fact, for the last four years, the auditors have not only issued unqualified opinions, but also have not had a single recommendation for improvement – such as changes in policies or procedures.

Last December, we received the results of a USDA Agricultural Marketing Services, or AMS, Management Review of the Beef Board—the first ever in the history of the Beef Board. The objective of the AMS Management review was to ensure the Board was in compliance with the Act & Order, the AMS Guidelines, the AMS Investment Policy, the CBB Bylaws and CBB’s internal policies and procedures. The review had no findings. At the conclusion of the review, AMS commended excellence of management and operations at the Cattlemen’s Beef Board.

While we’re talking about audit metrics, I’d like to address the Office of Inspector General “peer review” of its own report issued early in 2013. This review confirmed the initial conclusion of the 2013 OIG eport that found no audit issues or lack of compliance by AMS, the Beef Board, or Beef Board contractors was found.

Personally, I don’t know of any organization that has been more painstakingly audited that the Beef Board and Beef Checkoff Program have been in the last couple of years – but the above findings (or lack thereof) certainly provide a validated body of assurance.

Metric 3: Consumer Willingness to Pay and Beef Demand

The latest Oklahoma State Food Demand Survey data indicate that, in March 2014, consumer willingness to pay more for hamburger increased by 5.42 percent. Remember, though, that if consumers are continually willing to pay the high prices that supply has helped dictate in the current marketplace — it’s a strong litmus test as to the value they see in the beef and beef products they are finding in the meat case and enjoying in restaurants.

Due to the Board’s 2013 Beef Demand Determinant Study  and the checkoff’s ongoing market research, we know that price – along with demand drivers including food safety, product quality, health, nutrition, and social aspects and sustainability, play roles in consumers’ decisions about purchasing your end product.

It’s so important to understand the role of these drivers. Willingness to pay is an absolutely critical factor in beef’s success in the marketplace – in  maintaining and growing beef demand in 2014 and 2015.

When consumers see value in a product, they have a higher willingness to pay for it. In fact, checkoff market research indicates that we have seen a cutback in at-home eatings of beef, particularly in roasts and some in steak. To put this in perspective, our loss of in-home servings per capita is somewhere in the range of 5 to 6 percent as of February.   Per person, that is a reduction of three to four beef servings per year; across the nation, that is close to a million fewer servings of beef eaten in-home. This coordinates closely to our low supply situation.

The number of meals in-home still exceeds the number of foodservice beef meals. It might be easy for us to forget, however, about the fact that people can really stretch beef in-home, especially ground beef, in spaghetti sauce, tacos, and other ingredient recipes.  Actual volume (as opposed to number of eatings or meals) remains more matched between in-home and foodservice. But the truth is, beef maintains such strength in foodservice that Technomic data indicate since 2009, beef represents the largest pound increase of any protein despite a shrinking supply.

You can start to see, then, that with reduced supply and record prices, a reduced number of in-home beef meals isn’t necessarily an issue. On the other hand (warning, a short trip down a garden path approaches), the shift toward foodservice itself is intriguing and invites further study. With higher prices, I had expected that consumers might shift meals away from foodservice and toward the in-home experience. But John Lundeen, the beef checkoff’s market research guru at NCBA, suggests that a few things are combining for our current situation:

  1. Consumers can still get relatively inexpensive but still very tasty burgers at foodservice.
  2. Millennials particularly like the quality guarantee they get at a restaurant. They may say to themselves, “Better to have a chef make that pricey steak than me.”
  3. The celebratory nature of beef fits the foodservice environment very nicely.
  4. Has to do with modern lifestyles and smaller households: Roasts often are not seen as a fit with a small household, for example. And we also see less steak consumption in single-person households.

So, we know lower available supplies mean declining consumption (please, please remember—consumption isn’t the same as demand). Recently in the media, I saw a story saying that chicken consumption had overtaken beef consumption for the first time in 100 years—of course, because these days we simply do not make as much beef as we have in the past. We cannot eat what we don’t make, so obviously we see beef consumption dropping. That said, the continued strength of beef demand throughout last year and until today surprised even the savviest of market analysts.

As Kansas State ag economist Glynn Tonsor pointed out recently in a Twitter discussion, the entire industry must continue to work together to align beef offerings closely with the desires of those consumers willing and able to buy them.  In the end, this is what supports continued demand strength. (Here’s a great blog on why internal food fights are senseless, which makes this point much better than I ever could.)

If you do not know how to ask the right question, you discover nothing. ~W. Edwards Deming

It is not necessary to change. Survival is not mandatory. ~W. Edwards Deming

Diversity of Ideas

Last evening, I made a few remarks about diversity on our Research & Promotion Boards in conjunction with a USDA session on diversity. (Dd you know that there are 21 programs that we affectionately call “checkoffs” wherein food producers pool their dollars to do research and promotion?) From raspberries to watermelon to honey to soft lumber to beef to pork–these boards consist of volunteer producer leaders who direct the investment of their peers’ contributions. USDA gathered several of the board leaders (and a couple of staff) together for last night’s session, which gave many volunteer leaders from different agriculture backgrounds the opportunity to come together and discuss the meaning, culture and atmosphere surrounding diversity. I’ve noticed that words have different meanings and implications to different people. IMO, the best way to understand what someone else means by a certain word like “diversity” is to gather, listen and share. In fact, that’s one meaning of the word “diversity,” isn’t it–welcoming discussions and solutions fueled by myriad ideas, cultures and backgrounds.

I truly believe that two heads are better than one when it comes to vision and strategy. And two heads filled with different ideas, coming from different backgrounds and life experiences, are surely better than even 10 heads filled with exactly the same (or even highly similar) ideas. I’ve heard: if you cannot get something done with a committee of 25, then reduce the committee to 10. I unconditionally agree that fewer people often make decisions faster. However, despite our society’s love affair with hurry (hurry, hurry…ouch, that fleeting memory of orange in early February smarted for a moment), hustle and haste (or what I ironically call the ‘glorification of busy’), I submit that quality of decision matters a bit more than speed of decision. (Disclaimer: My advice is not all-encompassing. If you’re about to be hit by a monorail, then the speed with which you exit the track matters more than the quality or grace of your leap. Get off the rail! Gak!) As Tim Fargo said, “Progress and motion are not synonymous.” If, in our example, if you reduce the size of the committee simply to eliminate all who might not agree with you, your outcome (especially longer term) won’t hold up as well as if you welcome, and work to include, a diversity of ideas.

In short, diversity means different ideas, from differing voices, coming together to make a more dynamic, flexible and stronger end result. Diversity doesn’t mean (as USDA Deputy Secretary Harden pointed out last night) tokens or quotas.

Now that I’ve brought up hurry, hurry, (ouch…that smarted again…hopefully the memory will fade before next season) let’s talk about the first challenge I see to diversity on our boards, and that is time.

Service on the checkoff board takes time–traveling, attending meetings, reading business materials, participating in calls–it all takes time. Some R&P board officers may be away from home and business up to 200 days a year. More than 97 percent of farms are family owned, most of these family operated. On most farms, something critical happens every single day. By critical, I don’t mean it would be nice to get it done. (Like, ‘Yeah, we need to finish those TPS reports and reload the Swingline.’) On a farm, if it doesn’t get done, on time, something–be it plant or animal–could die.

Leaving the farm for a couple of days is tough. Heck, for our farmers and ranchers, leaving daylight hours to come inside and fire up your computer to participate in a conference call is tough. Truth is, time is a major challenge to getting a diversity of voices and ideas on our boards. Folks who serve often must use hired help, grown children or parents on the farm to cover for them when they’re gone. This limits those who can serve. I can tell you stories of board members I’ve worked with over the years, who have an interest in running for leadership positions, but they simply cannot spend the time away from their farms because they have nobody to help them with those everyday chores. My experience says that women have particular challenges in this area, because they may hold down both on-farm responsibilities and off-farm jobs, as well as manage most of the housework and child care. This limits their time even more severely.

At the Beef Board, one way we’ve tried to address the time challenge is through technology. We’ve incorporated our board communications and information into an online toolkit and blog so members may access information whenever, wherever. We’ve incorporated mobile technology into our sites. We’ve tried webinars rather than in-person meetings (frankly, with varying success…more on that in a minute). But these solutions themselves lead to another challenge, and that is technology access in rural areas.

I mentioned that we try to use advancing communications technology to help board members participate and fulfill their duties. However, lack of high-speed Internet access, as well as cell coverage in many rural areas, limits us severely. Smaller or disadvantaged farmers, or those who ranch in particularly remote areas, may not have adequate access. (Some of those folks I know only get snail mail a time or two a week!) One specific example: Last month, we put together a video detailing important consumer information in advance of our annual meeting. We thought we were giving board members an easier alternative to downloading, printing and reading paper versions. But, limited high-speed download and/or streaming capabilities prevented some board members from accessing or viewing the video. We continue to try webinars with 103 board members (and heroically refrain from strangling ourselves with our earbud cord in frustration through the burps, hiccups and slow slide refreshes–or is that just me?).

I realize that limited technology access is not a revelation to those with an interest in US rural development–many experts acknowledge this as a primary challenge to rural community health and growth in America. But technology also presents both a solution and a challenge to diversity of voices on our boards. It’s a national, as well as a very local, issue, and one that deserves increased attention federally. (Makes me wonder…if the Internet went out in Washington, DC, how long would it take federal government to make certain it came back online? Yet the issue of rural access drags on, and on…I’m allowed to opine here, remember, this is my blog!)

(Ahem. Brain. Focus.)

I’ve discussed both time and technology, and I’ll also discuss money. While the board reimburses members for direct expenses incurred while engaging in board business, we do not pay for lost opportunity costs while serving–like extra help needed on farm while folks are away, or lost income (or opportunity for income) from off-farm jobs. Also, I’ve heard some leaders say it’s difficult to comply with the documentation guidelines we require for reimbursement (like itemized receipts for meals, instead of simply a credit card receipt.) Leadership and staff tries to ease this situation–for example, we book and pay for hotels and airfares directly with an organizational account or credit card. When I’m with board members, I do my best to pay expenses and then handle reimbursement. However, we must remember that board members sometimes run a very tight ship–often with both time and budget constraints–and the documentation and wait time for reimbursement may be too much of a burden to bear. (A very special thank you to some of our board members, you know who you are, who choose to give not only service but don’t request reimbursement for their expenses…going above and way beyond.) Particularly the critical younger voices, (USDA data consistently show, not surprisingly, significantly higher debt-to-asset ratio for our younger farmers), so important to the future of agriculture and our board, or our disadvantaged farmers and ranchers, may have difficulty with the resources required to front the costs and request reimbursement.

Given these very real challenges, I’d like to say a loud and proud THANK YOU to the volunteers who serve on the Beef Board, and other volunteer R&P boards. It’s clear that your significant dedication and passion makes a huge difference for agriculture. I’m amazed and humbled by your service. (And now that I’ve re-read my post, I suspect your sense of dedication may even override your better judgment sometimes. Thank you especially for those crazy, wonderful, moments.)

Project Cowherd 2020

Castle Rock in the foreground, Pikes Peak in the background.

On many weekend days, I enjoy a spectacular view from my chair at the breakfast table. Our home, situated on top of a hill, offers views of Pikes Peak, with Castle Rock in the foreground, that take my breath away. The crystal clear air shimmers with bright sunlight. (I feel just like Yertle the Turtle with this view.)

Yertle the Turtle

I’ve heard because Colorado has low humidity, the air is clearer than in other parts of the country. The bright sun coupled with intensely clear air make me glad I am alive. 

But then, if I were somewhere else, with another spectacular view, I would also feel blessed, wouldn’t I? After all, if your view clouds over–you may not be aware that anything is blurring your clear line of sight.

Our vision is like that. Our lives are like that. Blurred and blocked and fettered by our experiences and our prejudices, our inability to imagine things that have potential gets in our way. That is why expanding ourselves helps our world grow, and paves the way for imagination too. 

(Truth is, Pikes Peak MAY be the most beautiful mountain in the world. But until I’ve seen the Alps, I’m withholding judgment.)

Bear with me. This is my unique and individual (ok, some would say weird) way of introducing my topic–the cowherd in 2020

When my son was young, I used to encourage him, saying “Almost no decision cannot be undone later. Do what you think is right.”

But what I didn’t tell him was that there are opportunities that only come once. Some only come once in a lifetime. If you don’t have the vision and the courage to take them when they come, you lose them. Forever. 

What if I told you that beef producers (indeed the entire beef business) has one of those huge, once-in-a-lifetime opportunities, right this very minute? 

An opportunity so big, that we may never get this chance again. An opportunity with so much potential, it could change our business forever. 

It is the chance to rebuild our cowherd, reset our future, reform our beef supply.

With cow numbers so low, and herd expansion shivering on the brink of fruition, we have an unmatched opportunity to determine our own future. 

What if every commercial cattleman and woman, dedicated him or herself to Project Cowherd 2020–an aggressive, genetic improvement plan for the future of our business? What if we called upon our business partners, feeders, processors, extension agents, seekstock suppliers, to help us to do just that? How much progress could be made?

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I’ll bet you my friend Don Schiefelbein would say A LOT. (I’m cheating here, because I’ve heard him say something similar, without the cool name Project Cowherd 2020, on several occasions!)

It’s about you, envisioning how your herd could work best for you, and for the beef consumer, in 2020. If you asked your buyer how your cattle did on the rail, what would you want to hear? What would your calves’ feed efficiency look like? How would your cows perform in your environment? Dream big. Build (or rebuild) your perfect herd for 2020 by beginning with the end in mind.  

What if EVERY producer started today? I believe if a majority of us dedicate ourselves to Project Cowherd 2020 this year, we have the opportunity of a lifetime.

I’m not blowing sunshine up your skirt here. Our national herd is very small. While we rebuild, we have enormous potential for improvement–if we rebuild consciously and carefully. 90% of successful innovation is timing. By 2020 our cowherd could be the best it’s been in history–with the potential for optimum production efficiency, enhanced business sustainability and practices, improved consistency and consumer acceptability, optimal diversity of beef offerings to satisfy everyone’s demands. Or it could look about the same as it did 10 years ago. Your choice. 

A Chinese proverb says: The best time to plant a tree was 20 years ago. The next best time is today. (Has anyone mentioned to you how much beef China is going to want by 2020?)

It’s a big dream, a wildly important goal. But also one that is completely achievable with dedication, and clear vision. Would you rather write your destiny, or sit still and see what others do for (or to) you? Does we have what it takes to write our own destiny? I guess we shall see…and sooner rather than later. 

Celebrate Differences

On my last day in Taiwan, I’m building on a previous post (Dewa Mata) in which I made some observations about the Japanese market for U.S. beef–here are some similar observations for the second part of my Fellowship trip. Will this be my last post? I’m not sure…I guess we shall see if the muse stays with me…

Safety is the price of entry (part deux)

At risk of sounding like a broken record, if safety is important in Japan, it is even more important in Taiwan (is that possible?). With an influential news media (dare I say the media here have a more sensitive hair-trigger than at home?), we can’t afford to give either politics or media a chance to tank the market. We know we do it right–we know we have the most stringent safety standards in the world. We know that the checkoff, in partnership with industry partners, makes significant investments in beef safety every single year. Let’s not take our eye off the ball (and remember to encourage our partners as well) to tell the story of our impeccable, continuing efforts on the beef safety front.

We’re baaaack

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Young Taiwanese love U.S. beef. Generally, they have fewer issues with eating beef than their elders (with respect to religion or husbandry as I’ve mentioned here before). Our job here (given what I’ve said above) will be to prove how yummy we are, especially when compared to pork, and build consumers the confidence to add more beef servings to their diet. And, as the CEO of the Beef Board, I’m allowed to say it out loud–in this market, pork=Goliath and beef=David. Pork is traditional, well-understood, well-loved. We know what we have to offer. We need to load up the slingshot and fire away.

Beef Can Be Mature and JIT here too

I’ve heard a LOT about wet and dry aging since I arrived. A noticeable trend in both retail and foodservice, it plays well with our need to ship product. However, the best steakhouses have product air shipped in a couple of days, then dry age it from 21 to 45 days onsite. They tell me discerning consumers pay for the waste, the hassle and the process. Good news for U.S. beef. Perhaps a dry aging movement would work well in Japan, if we associate it with the “mature” or “right time” concept mentioned before in this space.

Our Product Offering Works

In my closing post about Japan, I mentioned the trend of “Just for Japan” products. I believe (due to a growing “Westernization” of Taiwan) the products we offer our domestic consumers work well here, with the caveat that consumers here are more familiar with pork, and need education about the many ways to cook beef. And, like chefs at home, white tablecloth chefs here crave creative ideas to offer the discerning palates.

U.S. First, Company Brands Second

Even though we’re feeling the love, we still have some work to do to solidify our relationship with Taiwan’s younger consumers — to tell them about the product attributes of U.S. beef, to teach them about different cuts and appropriate ways to prepare beef. IMO, the Taiwan retail market is not as ripe for a brand bustout as Japan. However, I did hear in multiple foodservice meetings that restaurants need differentiation (read: brands) to compete in this HIGHLY competitive environment (particularly in Taipei). Opportunity exists for different production methods (natural, organic, grass-fed, and whatever else we can think of to differentiate), different product claims and creative ideas in Taiwan. Calling all beef entrepreneurs–come on out to Taiwan (but get ready to study and learn about how to do business in Asia. If you’re ethnocentric, you needn’t apply).

Taiwan Loves Baseball

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At the Elephants and Lions game last Tuesday night. Let me tell you, between the fan band, the horns, the drums and the yellow cone knocker thingies, this place has some enthusiastic baseball fans!

…and American ball player Manny Rimerez. Huh? It’s not as random as you may think. Taiwan loves American sport–particularly baseball and basketball. They admire American athletes (and athletes here at home). In the U.S., the checkoff funded “power of protein” concept pays dividends to encourage consumers’ love for beef. The health and nutrition message, coupled with images of strength and power, as the checkoff is doing at home, would work well here, with Taiwan’s youth, who are health conscious, more willing to turn to food (instead of supplements) to get the nutrients they need, and have a tradition of Chinese medicine (which teaches about the power of nutrients in food) to fall back on. The Power of Protein–call me crazy, but I think a campaign extension opportunity in Taiwan. The messaging would be slightly different (it’s not the same here, remember what I’ve said before about having the in-country expertise), but I think it has “legs.”

Convenience

People work long hours here, and many women go to the office every day too–especially in Taipei. Convenience plays an important role here–just like in Japan (and the U.S. I’m sensing a trend…)

Packaging Matters

Like Japan, packaging matters. But here, I mean ANY packaging. Many Taiwanese shop for meat hanging from a hook in an open-air wet market (it is the traditional way of marketing pork and chicken). Elder consumers want to touch and smell for freshness. Young consumers, however, don’t have time (or interest?), and go to supermarkets. Again, we have opportunity with younger consumers here. Some creative shopkeepers now sell meat in temperature-controlled cases, in independent shops close to wet markets–taking advantage of the close-to-home location of the markets.

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Disclaimer: This blog and the thoughts on it are my own flights of fancy. They don’t represent the views of the beef checkoff, CBB, the Operating Committee, or USMEF. I’m so glad the checkoff has in-country experts who know these markets and work on behalf of producers every day.

Random Photo of the Day:

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A quick game of “Name that Meat” anyone? I’ll give you a hint: the long ones are tongues. Thank you Lord, for international markets.

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Heeey…wait a minute? You talkin’ about me?!?

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Snot soup? Booger bologna? Nosh a nostril? Schnoz sandwich? Loogie lasagne?

Catch you back in the states, dear reader!

Value of Trust

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I’m fulfilling an Eisenhower Fellowship with the goal of helping beef producers better understand the customer in Japan and Taiwan, especially with regard to the reputation of the product branded U.S. beef, and also specific branded products offering added value built on the foundation of company names and reputations.

Heads up: To my beef industry colleagues and to the beef producers who are my bosses, my friends or my industry partners, I’m about to tell you something uncomfortable.

I believe that it is better to tell the truth than a lie. And I believe it is better to know than to be ignorant. ~H. L. Mencken

Consumers in Asia don’t trust us.

(I know, some experienced international marketers will say that this is not a news flash.)

Now, deep breath. I can feel the hair on the back of your neck rising from all the way over here. I can hear you saying, “If they don’t trust us, then it’s their problem!” But truly, it is our challenge–and our opportunity. We have the responsibility to earn and maintain their trust–just like we have the chance every day to earn and maintain domestic consumer trust. And, like domestic consumers, if we lose trust, we lose on many fronts. Freedom to operate. Market share. Flexibility. Profit potential (would you rather throw tongues in a waste bin or sell them for $8/lb? Your choice).

At home, when I’ve mentioned earning consumer trust by fair dealing and honesty. Some people (who are, I believe, trying to help me) tell me:

  • I’m naive and I need to be less “Polly-anna” (pun intended);
  • Consumers should feel lucky they have food on the table;
  • Asian consumers should feel lucky they get American beef;
  • “They” could never understand what we do–and
  • Further, we don’t have to explain it to them because we’re the experts;
  • “They” should take what we give them (and furthermore, and “they” need to learn to cook)

Stubbornly (and I pray daily to the good Lord to save me from my stubborn self), I’m once again telling folks: I haven’t changed my mind. I still believe in the importance of transparency and fair dealing with our consumers. As a matter of fact, I believe it even more strongly after seeing more of the world outside U.S. borders.  I believe straightforward honesty built American agriculture. I believe that’s how most farmers and ranchers operate on a daily basis. I still believe that’s the foundation of America.

I’ve met with several large importers in both Japan and Taiwan–these are customers of the major and minor U.S. packers.The Eisenhower Fellowship gave me the opportunity to listen to the chairmen of these import companies. Powerful men, who run billion-dollar companies, who purchase nearly every pound of beef entering Asia–from the U.S. or elsewhere.

The importers I visited say that the cultural divide between West and East makes business dealings a bit harder–but certainly not impossible. What muddies the water now, they say, is the lack of trust. Trust in what we tell each other as we continue long-term relationships with partners here, or begin new business relationships. Trust in the safety of U.S. beef, and the care producers have for animals, land, quality and safety.

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Is it possible for us to build trust in Asian consumers? I believe it is.

I, for one, am not worried about what will happen here when we offer consumers a choice of beef produced in different ways (natural, organic, never-ever, use of various production technologies)–and label it (and price it) accordingly. In Taiwan, U.S. beef is known as the best quality available. Taiwanese (especially young people) crave it–they want to buy it, it’s the buzz on the streets. At a fantastic dinner the other night hosted by my new friend and Taiwan EF Fellow (see Food and Heart, I had some of the best Top Cap I’ve ever eaten, U.S. beef of course), one of our group literally said a cheer for U.S. beef right in the middle of a toast (they toast a LOT here in Taiwan!)–seriously, a cheer for you, my friends in beef. Made me proud. The beef produced in Taiwan cannot hold a sputtering candle stub to the quality, consistency and taste U.S. producers offer. But the discussion about U.S. beef is almost always followed by a “but” … is it safe?

Without trust as the foundation of our relationships, with companies, with consumers, there are no workable talking points. We, and our business partners at home and in country, have to trust each other to make it work. It takes two (as Pearl Bailey said) to tango.

Tell the truth. Offer choices. Build trust. Sell beef.

It’s really that simple. At home, and abroad.

PS. Allow me a small space here to talk about U.S. packing companies. Producers, feeders, like it or not, they are the ones that put a face on your product once it leaves your farm and feedlot. They tell your story around the world to your international customers–through their business reputation, their brands, their actions, their people, their words. Packers represent you to customer-facing businesses like importers, retailers and foodservice. In a global marketplace, your profitability lives and dies with their ability to sell your product for the best price, worldwide.

Random Photos of the Day:

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Chiang Kai-shek Memorial in Taipei. That’s a guard standing by, even though he looks like a tin soldier. The memorial statue is huge.

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This dragon snuggled up to me at a street festival. Here, kitty, kitty…

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With the Dean of Ag and key agriculture and forestry faculty at National Taiwan University. From left, YuanTay Shyu, Dean, College of Bioresources and Agriculture, Randy and your faithful scribe, Ming-Ju Chen, chairman, Department of Animal Science and Technology and Biing T. Guan, chairman, School of Forestry & Resource Conservation.