The McGregor Co. Takes It Step By Step

Some people, like Steve Watts of The McGregor Co., are born with the “wiring” to see big picture trends and lead a diverse group of individuals toward an innovative new strategy. And he feels fortunate to have been in a role that allowed him to apply his talents to their fullest as the leader and facilitator of innovative change at McGregor for more than 30 years.

“My role was to try to be an advance scout and sort out what’s coming over the horizon,” says Watts, who recently retired at the end of the year. “What are the opportunities and the challenges and how do we make progress towards a goal that positions us well into the future.”

Organizations tend to take on the personality of their founders, and McGregor is no exception. Watts describes company founder and namesake Sherman McGregor as a leader who “was never giddy when times were good or overly concerned, at least outwardly, when times were a little bit tougher.  He was quick to bring us back down to earth when we were flying high and he was equally quick to reassure us when the going got tougher.  He taught me that the best way to lead in good and bad times was to act as though neither would last very long, and they seldom do.”

So inciting change even in the best of times is something that’s been built into the culture at the retailer over decades. But while that has created more of a culture of innovation at McGregor, it doesn’t mean that there are shortcuts available in the process. Getting an organization to act as one and change course may take adding more or less of certain ingredients, but the basic recipe Watts employed was always the same.

“Leaders who are able to make necessary changes in good times must do more than just see what lies ahead and figure out what must be done,” says Watts. “They must be able to convey a sense of urgency, articulate a course of action, and be willing to have their recommendations vetted, and potentially improved, by those who will be most affected. This requires ability, passion, confidence, and above all the ‘trust’ of those being led.”

And culturally, the employee team must mirror these attributes says Watts. “It takes a shared sense of purpose and personal sacrifice to leave our comfort zones and willingly work harder in the short run to accomplish something that we hope will be more than worth the price paid in the long run.  It takes discipline to create and abide by high standards regardless of whether or not it is temporarily easy to achieve financial goals. And it takes trust to follow others in a new direction when the need to do so isn’t always readily apparent.”

Case studies provide the best example of innovation. And at McGregor, one of the most significant changes Watts led during a period of relative prosperity occurred in the late 1990s when the company made the sea-changing decision to unbundle crop protection service and product pricing.

“For 50 years we had bundled everything we did into the price of our crop protection products, and it worked quite well,” says Watts. “There was no reason in the short term to change that, unless you looked at the tea leaves and tried to sort out what was going to happen in the future.”

Originally launched as McGregor 2000 and today known as the Farm Partner program, it created a scenario where virtually every McGregor customer using the company’s crop production consulting services are now paying separately for those services.

Undoing a decades old practice would not be easy, but the signs of change were clear. In the late 1990s, the combination of trends that came to pass would prove to be deadly for many retail operations. Growers were getting larger, more diversified and less reliant on retailers. The rapidly growing World Wide Web opened the door on product price transparency. The rapid introduction of generic crop protection products would send their value plummeting. And the emergence and early successes of biotechnology threatened to pull billions more dollars of crop protection spending out of the market.

“When we added it all up, it pretty clearly indicated to us that things were going to change, and it was going to be harder and harder to bundle all services into the cost of product,” recalls Watts.

In hindsight, leading innovation would seem like a slam dunk given the weight of evidence. But ushering change after 50 years of doing things the same way, especially during a time when the business was still successful, was not going to be an easy sell.

Leading and directing the change is a multi-step process, and being successful requires that every step be followed and followed through. It starts with the leadership, who must build the case for making change once the need is identified.

From Watts’ perspective, a new initiative will only get off the ground if it can be successfully articulated both to the leadership ranks and the rank and file employees. Of particular importance is addressing the impact that each employee can expect as a result of what’s being proposed. If the homework is done properly then “ninety percent of what I thought should be done should carry through,” he says, and the other 10% should provide positive and constructive change. If it’s done poorly, an idea could get changed far more than that or even die. Usually when that happens, it’s because we didn’t do enough homework.”

Specific to the process of making a case for change, the first thing they look at in considering the change is what kind of collateral damage the business could experience with customers or employees. “What are the negative financial ramifications of making this change in the short run?” Then the positive side is developed and applied to create a compelling argument for change – a process that, in the case of unbundling services, took years to unfold and build.

“You must be willing to make a convincing argument, and not just make a statement,” says Watts. “That means laying out your ideas to employees, receiving feedback, carefully considering that feedback, and making any necessary changes.” The case must also be able to “defeat” feedback that is neither helpful nor accurate. “You have to be able to defend your ideas. That builds confidence, rather than just saying, ‘because I told you so.’ People need to be sold on the idea and not made to do things ­– they need to feel they have had their say and that their concerns have been considered. When that happens they are much more willing to get behind what you are attempting to do, even when you are trying to make enormous change in good economic times.”

Watts says that when the process brings detractors into the fold, they can become your biggest allies. “While they don’t buy in quickly, when they do they push all their chips into the middle of the table and they do not back away after they have made a commitment,” he explains. “The ones that are a bit more skeptical and require you to defend what it is you think needs to be done bring out the best ideas and the best implementation plans.”

In the unbundling example, the initial discussions with McGregor’s 40 licensed consultants at that time did not go over without dissent. “There would be significant risk to taking marked-down products to producers to be more competitive on a product basis while charging separately for services formerly bundled into the price of our products,” says Watts. “But we put the focus square on our ability to deliver value with those services with our consulting services as the centerpiece.”

The last challenge is bringing the change to customers, and you can expect that some will not want to walk with you. “There are going to be casualties when you make a significant change,” says Watts. “We don’t look at our customer relationships in a cavalier way, but we recognize that it is impossible to make progress without some casualties. Often it is the customers who are most passionate about maintaining the status quo who aren’t going to be farming for the long term, and we are not part of their retirement plan. We can’t run our business for them – we have to manage the business to survive beyond their time in farming. We have to do it without burning bridges and we never try to create casualties, but we accept that they are going to come, and that we need do what is necessary to position the company for the future and not stay with what worked in the past.”

Firm Foundation

Having a culture of innovation as a foundation at McGregor has made Watts’ work somewhat less complex, but maintaining that culture by hiring the right employees right off the bat has proven a bit more challenging.

“I think that is probably the toughest challenge – identifying with very little information those individuals that will make the grade and those that won’t,” says Watts. “There tends to be a high washhout in our culture with new personnel, and we have maybe 20% turnover in the first two years. But in general, if we have people for five years we have them for a career.”

Culture may not necessarily prevent a less than ideal candidate from being hired, but Watts say that “it’s the culture that prunes the tree.”

Leave a Reply

Management Stories

ManagementMACA 2014: The State Of The Agricultural Industry, And Then Some
October 9, 2014
The trade association’s annual gathering featured speakers from across agriculture and beyond. Read More
StewardshipA Multi-Layered Approach To Water Quality
October 6, 2014
Illinois event highlights research and technology designed to better monitor and improve water quality — and the benefits of cooperative, coordinated effort. Read More
StewardshipMichigan Agriculture Leaders On Toledo Water Ban: We Want To Be Part Of The Conversation
August 8, 2014
Leaders of Michigan agricultural organizations said Thursday that the government should not have a “knee-jerk reaction” based on last weekend’s water ban in Toledo due to fertilizer run-off in Lake Erie. Read More
ManagementRussia Bans U.S. And EU Ag Product Imports In Ukraine Sanctions Battle
August 7, 2014
Russian President Vladimir Putin has banned the import of agricultural goods from countries that have imposed sanctions on Russia. Read More

Trending Articles

Matt Hopkins15 Best New Agriculture Apps Worth Downloading In 2014
December 16, 2013
These latest agriculture apps are sure to help ag professionals do their jobs more efficiently in 2014 and beyond. Read More
Seed/BiotechMonsanto Offers New Support For Ferguson, Area Communities
October 8, 2014
Monsanto Co. has committed $1 million in new support for several collaborative efforts in Ferguson, MO, and surrounding communities in North St. Louis County. Read More
Seed/BiotechUnapproved Genetically Modified Wheat Found In Montana
October 3, 2014
USDA reports that one year after discovery of Monsanto's unapproved wheat in a single Oregon field disrupted U.S. wheat export sales, the GMO wheat has again been found in Montana. Read More
Equipment2014 Product Of The Year Voting
September 19, 2014
Many new products were introduced to the ag retail marketplace this year. From this group, CropLife IRON and its consulting partners have selected five finalists for the Product of the Year award. Please cast your vote today to help us determine the winner. Read More
FertilizerFall Fertility 2014: Forecasting Fertilizer Use
September 7, 2014
Great crops this year have tapped the soil, and fall work is definitely called for, but how challenging will that get? Read More
CropLife 100CHS To Build $3 Billion Fertilizer Plant In North Dakota
September 5, 2014
The fertilizer plant in Spiritwood will be the single largest investment in CHS history, as well as the single largest private investment project ever undertaken in North Dakota. Read More

Latest News

Seed/BiotechSyngenta Ranked A Top 10 Biotech Employer For Third tim…
October 20, 2014
Syngenta ranked in the top 10 among the world’s top biotech employers, according to an annual survey conducted by Science magazine. Read More
CropLife 100Wheat Growers Break Ground For New Facility At Kennebec
October 20, 2014
Wheat Growers has broke ground for a state-of-the-art shuttle loader grain handling, fertilizer and agronomy facility in Kennebec, SD. Read More
FertilizerVerdesian Life Sciences Signs Agreement With Los Alamos…
October 20, 2014
Verdesian Life Sciences has signed a licensing agreement with Los Alamos National Laboratory to develop and market LANL’s latest nitrogen enhancement technology for plants. Read More
MicronutrientsStoller Group Announces Groundbreaking At New Office Bu…
October 20, 2014
Jerry Stoller, founder and president of Stoller Group, announced the groundbreaking at the site of the company’s future headquarters in Read More
Crop InputsBioSafe Systems Opens New Production Facility In Nevada
October 20, 2014
BioSafe Systems has completed construction of a state-of-art production facility in Sparks, NV, for its line of activated peroxygen products. Read More
Crop InputsPlatform Specialty Products To Acquire Arysta LifeScien…
October 20, 2014
Once the acquisition is complete, Platform Specialty Products will combine Arysta LifeScience with previously acquired companies Agriphar and Chemtura Crop Solutions. Read More
Seed/BiotechEPA Approves Dow’s Enlist Duo Herbicide
October 15, 2014
The Enlist Weed Control System, breakthrough technology to fight resistant and tough weeds, has received the long-awaited green light from federal regulatory authorities. Read More
MicronutrientsGypsum On Farms Could Help Keep Water Clean, Not Green
October 14, 2014
Gypsum, which has roots in the past as a farm soil treatment, also may have a bright future, and not just as a booster of crops but also as a protector of water. Read More
Photo credit: The United Soybean Board/The Soybean Checkoff.
Crop InputsVerdesian Grows Sales Staff
October 14, 2014
The new account managers will drive sales growth and support relationships with key customers in the plant nutrition and seed treatment and inoculants product categories. Read More
WebinarsUpcoming Webinars
October 14, 2014
Register for one of our upcoming Webinars or access our archive of past Webinars to view recordings of presentations that may be of interest to you. Read More
CropLife 100The Andersons Purchases Six Grain Elevators, Four Agron…
October 14, 2014
The Andersons has acquired Auburn Bean and Grain of Auburn, MI, which will increase the storage capacity of its Grain Group by about 13%. Read More
StewardshipThree Ohio Ag Retailers Honored With 4R Certification
October 13, 2014
The 4R Nutrient Stewardship Certification Program has announced its first three agriculture nutrient service providers to achieve certified status. Read More
Eric SfiligojEntering Agriculture’s New Phase
October 13, 2014
The market’s giddy ride the past few years might be coming to an end in 2015, warns one industry insider. Read More
Eric SfiligojWar And Green Peace
October 11, 2014
A one-time member of Green Peace recently explained why he left the organization after 15 years. Read More
StewardshipCover Crops Add To Farm Sustainability
October 10, 2014
Farmers nationwide find cover crops to be a tool that helps groundwater, prevents erosion, builds soil quality and complements existing best management practices. Read More
EquipmentMeeting Changing Liquid Storage Needs
October 10, 2014
Tank and containment choices are expanding with shifts in farming practices and the economy. Read More
StewardshipEDF Launches Initiative To Reduce Fertilizer Pollution …
October 9, 2014
The effort will engage farmers and businesses throughout the supply chain to transform the way fertilizer-dependent grain crops are grown and sourced. Read More
ManagementMACA 2014: The State Of The Agricultural Industry, And …
October 9, 2014
The trade association’s annual gathering featured speakers from across agriculture and beyond. Read More