Phil Kenkel
Bill Fitzwater Cooperative Chair
A few weeks ago I started discussing the areas that a good board needs to get right. A good board needs to have the right structure, the right members in that structure using the right process and evaluating the right information to focus on the right decisions with the right follow through. Admittedly, that is a lot of things to get right. However, there are two more areas which you might not have thought …
Phil Kenkel
Bill Fitzwater Cooperative Chair
Twas the night before Co-op and all through the land
Monopoly power had gotten out of hand
The merchants were gouging the farmers at will
Raking in profits overflowing the till
The farmers laid down for a well-earned rest
When Capper and Volstead said we know what is best
All of sudden there emerged legislation
Anti-trust protection and unique taxation
Then the moon on the breast of the new fallen snow
Shined on …
Phil Kenkel
Bill Fitzwater Cooperative Chair
One of the innovative teaching ideas is to “flip the classroom” by spending class time working homework problems while students go over the lecture material on their own. I have found that throwing in an occasional “flipped classroom day” is a great way to invigorate interest and discussion. Many boards of directors have experimented with a similar concept by “flipping the board agenda”.
Instead of beginning the board meeting with the customary review of …
Phil Kenkel
Bill Fitzwater Cooperative Chair
In many strategic planning sessions the board and CEO develop a vision of what the cooperative will look like ten years in the future. That vision invariably brings up a conversation about growing the cooperative. While there are cooperatives that remain small and stay successful most cooperative organizations have a desire to grow. As producers grow their operations there is a need for the cooperative to grow in order to remain relevant. All of …
Phil Kenkel
Bill Fitzwater Cooperative Chair
As a professor and cooperative specialist, I get to view the internship market from both sides. I talk to students seeking internships and cooperatives seeking interns. As an economist, I see a supply curve showing the number of students willing to take an internship a demand curve showing how many interns the industry is willing to host. In this case, the price is a combination of the monetary and experience value of the internship …
Phil Kenkel
Bill Fitzwater Cooperative Chair
Cooperative leaders have the responsibility of protecting the cooperative’s financial security and providing members with information as to the firm’s status and performance. One aspect of that transparency is to describe how the cooperative retained and distributed profits. In the early days of U.S. agricultural cooperatives, there was very little non-member business and all profits were allocated to members in a combination of stock and cash patronage. Under those conditions, the description of the …
Phil Kenkel
Bill Fitzwater Cooperative Chair
One of the key aspects of managing a cooperative is the control function. The controlling function involves checking actual performance against benchmarks and historical standards. This leads to the concept of “Management by Exception” where management attention is concentrated on the areas of greatest need where outcomes differ from the standard. Many managers think of management by exception in terms of defining when to take corrective action. However there are actually two types of …
Phil Kenkel
Bill Fitzwater Cooperative Chair
There are many flavors of cooperatives and many descriptions of the value package from participating in a cooperative. Members are both customers and owners and also participate in governance. I was recently asked to describe the “DNA” that is, the core element of the cooperative model. That is a tough question because all three roles, customer, owners and member, are important. The member value package is influenced by prices, service and access to infrastructure …
Phil Kenkel
Bill Fitzwater Cooperative Chair
In my last newsletter article I discussed the revised Section 199A deduction. As you may recall Section 199A now creates a deduction at the cooperative level which can be retained or passed on to the producer. Producers marketing to a cooperative potentially face a reduction in a farm level deduction. My analysis based on “typical” grain cooperatives and grain producers indicated the cooperative needed to pass on 75% of their Section 199A deduction to …
Phil Kenkel
Bill Fitzwater Cooperative Chair
Cybersecurity is an increasingly important risk for all firms. I would be the first to say that I am no expert in cybersecurity. Most cooperative board members are also not experts. Our natural tendency is to avoid areas where we are unfamiliar. However, the board has the responsibility of monitoring and safeguarding the cooperative’s assets. That includes monitoring the risk management plan and cyber risk are one of the types of risks that the …
