Spring 2015 - King Ranch Institute for Ranch Management - Texas ...

FEATURES 3

Wagon Tracks

“Modeling Balance” By Dr. Clay Mathis

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Integrated & Innovative

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From a Dream to Reality

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A Valuable Mentor

Agri Beef Co.’s commitment to quality evident from ranch to table By Kindra Gordon KRIRM alumnus shares his story working for a historical ranch By Ashley Patterson KRIRM benefits from mentorship of manager of iconic ranch By Ashley Patterson

Published by the KING RANCH ® INSTITUTE FOR RANCH MANAGEMENT Texas A&M University-Kingsville 700 University Blvd., MSC 137 Kingsville, TX 78363 361-593-5401 361-593-5404 fax [email protected] http://krirm.tamuk.edu Clay P. Mathis, Ph.D., Robert J. Kleberg, Jr. & Helen C. Kleberg Endowed Director Ashley Patterson, Editor

MANAGEMENT COUNCIL Chair: James H. Clement Jr., King Ranch, Inc. Caroline Alexander Forgason, Robert J. Kleberg, Jr. & Helen C. Kleberg Foundation Gus T. Canales, A.T. Canales Ranches Dave DeLaney, King Ranch, Inc. Bob McCan, McFaddin Enterprises Eric Jacobsen, AgReserves, Inc. Neal Wilkins, Ph.D., East Wildlife Foundation John Welch, Welch Cattle Company Fred Bryant, Ph.D., Caesar Kleberg Wildlife Research Institute Allen Rasmussen, Ph.D., Texas A&M University-Kingsville

Cover Art: “Peaceful Blues” by Paul Cameron Smith, Weatherford, Texas www.paulcameronsmith.com

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“Modeling Balance” From the Director, Dr. Clay Mathis

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In the last issue of our newsletter I discussed some decision making differences between “good” and “excellent” managers, but there is another component to great management that I did not address. This month I will focus on the importance of managers maintaining balance between work and family. Although it’s not often discussed, this sensitive subject is an important aspect of management and leadership. Those that naturally and rightly rise to the top of management in the ranching industry are generally the hard-working, intelligent, achievers that clearly show they are interested in the good of the operation. But if they are to be truly excellent managers, they won’t just make the right decisions for the business, they will also prioritize their own responsibilities well. This goes beyond the responsibilities at the ranch or office. Excellent managers have their lives in balance and they model that balance to those who look to them for leadership. It is the leader at the helm that has the greatest influence over the culture for the employees. The nature of the business will require ranch managers and employees to work 60-70 hours a week at times, but sustained workloads at that level are not good for the employees or the ranch as a whole. In fact, recent research at Stanford University showed that employee output declines sharply after a 50-hour work week, and drops so much after 55 hours that someone working 70 hours produces no more output than someone working 55 hours a week. So if productivity drops, why do so many consistently work such long hours? I believe the answer for most of us in agriculture is simply because we

care and want to do a good job for the operation, those that we work for, and to satisfy ourselves. For others, the long hours may simply be worked because it’s required and needed to keep the job. These are respectable justifications for sacrificing time and working extra-long hours. The problem is, when our lives are out of balance and too heavily in favor our work, there is simply not enough time and energy left to devote to family and non-work relationships. Not to mention that as fatigue increases, so does poor decision making and the occurrence of work accidents. It is often those that work the hardest that are most inclined to fall into the pattern of work that can lead to an imbalance. An excellent manager will work to model balance, not only for personal reasons, but also because the manager knows that his or her behavior will likely be mimicked by employees. There are a lot of young ranch families in this industry that we all want to remain solid. I believe that ranch managers and owners that care about these young families will work hard to create or maintain an environment and work expectations that enable a great work and family balance for everyone on the ranch. When this is achieved, I believe the ranch and the ranch families are more successful.

“Excellent managers have their lives in balance and they model that balance to those who look to them for leadership.”

wagon WT tracks

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By Kindra Gordon

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n 1968, Robert Rebholtz, Sr. fulfilled his childhood dream of becoming a cowboy and someday owning his own cattle business—he purchased Snake River Cattle Co. and founded Agri Beef Co. Today, almost 50 years later, Agri Beef Co. has evolved and expanded well beyond what even Rebholtz’s could have imagined. With corporate headquarters in Boise, Idaho, the company is well-respected in the Pacific Northwest and involved in every step of the beef lifecycle, including cattle ranching and feeding (AB Livestock), cattle nutrition (PerforMix Nutrition Systems) and beef processing (Washington Beef ), while preserving natural resources through recycling by-products, composting, water reclamation and bioenergy initiatives (Agron BioEnergy). Most consumers know Agri Beef for its globally recognized premium beef brands: Snake River Farms, which features American Wagyu Beef; Double R Ranch Beef featuring USDA Choice and higher levels of marbling; St. Helens Beef, which represents Northwest grain-fed beef; and Rancho El Oro Beef designed to meet the unique needs of the Hispanic marketplace. These products are sold through restaurants and retailers across the U.S., including a number of Michelin Starred restaurants, and exported to more than 25 countries around the globe. Today, Agri Beef Co. continues as a family company, now led by Robert Rebholtz, Jr. The company is guided by three core values—leadership, integrity and innovation. Agri Beef Co.’s commitment to quality is most evident in their efforts to consider Sustainability, Total Quality, Animal Well-Being and Responsibility, known as their STAR Commitment. These four factors are considered with each management decision that is made, in an effort to achieve the company’s mission, which states: We will produce the highest quality meat products with a commitment to superior service, 4 I Spring 2015 I KRIRM

value and innovation. As part of the STAR Commitment, Agri Beef Co. has developed “Guidelines for Animal Well-Being and Humane Handling,” a program that encompasses all company locations, all phases of production, and all transport activities, to provide consistent and proactive standards for animal well-being. These standards were developed in collaboration with leading industry experts and are continually updated to reflect the most proactive policies. Additionally, employees receive training on low stress animal handling techniques, and handling facilities were designed with consideration to cattle’s natural instincts to make movement and handling as comfortable and natural as possible. Adherence to the guidelines throughout the company is also regularly evaluated and verified by a certified third-party animal welfare auditor. Of their approach, Wade Small, president of Agri Beef Co. Livestock Division, said, “The STAR commitment is something that effects everyone within the company at some level. It allows us to focus on the things that we believe are crucial to the longevity and success of our brands, our business, and the cattle industry. It serves as a constant reminder of how we believe we should conduct business.” Looking ahead, Small is bullish for the beef industry’s future. “I believe there is tremendous opportunity in the beef industry for those who are willing to be progressive and adapt to consumer demand,” he said. “No matter what segment of the industry you are in, focusing on improving the product you sell to your customer will always benefit you.” Agri Beef’s Livestock Division owns and raises cattle at the 70,000 acre Double R Ranch in Loomis, WA, but is also committed to working with family-owned and operated farms and ranches throughout the Northwest to purchase superior cattle for Agri Beef ’s branded programs. Feeding and care of Agri Beef cattle takes place at three

feedyards: Snake River Cattle Feeders - American Falls, Idaho; Boise Valley Cattle Feeders - Parma, Idaho; and El Oro Cattle Feeders - Moses Lake, Wash. Rations consist of local Northwest ingredients supplemented with vitamins and minerals from Agri Beef ’s PerforMix Nutrition Systems. Washington Beef is Agri Beef Co.’s state-of-the-art processing plant located in Toppenish, Wash. The plant is USDA, ISO and HACCP certified and includes more than 24 food safety interventions, a sophisticated tracking system and a full eight hour cleaning shift. All are part of the effort to produce high quality, safe boxed beef, value added beef and by-products. Double R Ranch Beef is one of Agri Beef Co.’s premium brands To help conserve natural resources and minimize impacts featuring USDA Choice and higher levels of marbling. Additionally, the to the environment, Agri Beef has also built a water company offers beef labels including Snake River Farms, St. Helens Beef reclamation facility and biogas dome at the Washington Beef and Rancho El Oro Beef. plant. These have helped reduce water use by as much as 40% and displace 20% of the plant’s natural gas needs. Composting is used to recycle cattle waste into nutrient rich fertilizer for area farmers, and beef tallow is used to create biodiesel at AgriBeef ’s newest entity Agron Bioenergy, which was founded in 2012. All total, the proactive actions by Agri Beef Co. reflect the company’s true commitment to the industry, the environment and the consumer. Morevover, Agri Beef Co.’s role as a good citizen is evident through its involvement as a founding member of the Beef Counts program in Idaho and Washington, an organization that provides a consistent supply of nutrient rich beef for hungry families in the Northwest. In addition to El Oro Cattle Feeders in Washington, Agri Beef Co. operates To think that Agri Beef Co. started with the dream of one Snake River Cattle Feeders and Boise Valley Feeders both in Idaho. young man, we can only hope that more young people pursue their dreams of growing up to “be in the cattle business.”

Intern Opportunities at Agri Beef Co. King Ranch® Institute for Ranch Management (KRIRM) student Rhonda Wulf had the opportunity to learn more about Agri Beef Co.’s fully integrated approach through an internship during the summer of 2014. Of the partnership, Wade Small, president of Agri Beef Co. Livestock Division, said, “Collaborating with the institute allows us access to interns and potentially future employees who can hit the ground running and add value to our company. They have experience and skills that allow them to offer a unique perspective to problem solving and the ability to help implement solutions.” Wulf’s internship project focused on evaluating the profitability of Wagyu genetics in Agri Beef’s Snake River Farms program. Wulf explained that Agri Beef leases Wagyu bulls to ranchers, primarily for use on heifers. The resulting calves are contracted back and fed to finish at Snake River Farms feedyard, and then marketed through the Snake River Farms brand. During her internship, she and Agri Beef leadership also began working with John Genho, a geneticist, to calculate the ongoing work of developing genetic evaluations with EPDs and Indexes to be used in this system. “Because Agri Beef leases bulls to ranchers, and therefore is in control of the genetics, they have the opportunity to select for genetic progress to increase profitability in the whole system,” Wulf explained. Of her internship experience, Wulf said she appreciated the opportunity to learn from various members of the Agri Beef Co. team. She also had the opportunity to see how Agri Beef utilizes the Balanced Scorecard in their feedlots to communicate trends and goals. “On the feedyard level, they review it weekly, and on a livestock team level, they review it at their team meetings every few months. The balance scorecard is part of the strategic planning curriculum here at the KRIRM, so it was valuable to see it in action,” said Wulf. Wulf, who grew up on a seedstock operation in Minnesota, says she was particularly impressed by Agri Beef’s marketing team and the relationships they have built through the retail and foodservice segment. She explained, “Restaurants and stores are proud to feature Agri Beef brands because of the quality of the product, but also because the restaurants and chefs know the people producing the beef. Agri Beef offered several tours for chefs and they were able to see the whole system from the ranch to the feedyard to the packing plant. Especially with the Wagyu beef, a product that costs more to produce than conventional beef, they have developed a market and it has worked well throughout the system. Additionally, because Agri Beef owns the animal until retail, and has the relationships with retail and restaurants, communication can move back through the chain for continuous improvement.”

The biogas dome (pictured) at Agri Beef ’s Washington Beef processing plant in Toppenish, Wash. displaces 20% of the plant’s natural gas needs. KRIRM I Spring 2015 I 5

By Ashley Patterson

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t’s a lifestyle and career most people dream about. Waking up every day to a sunrise across breathtaking scenery and heading out on horseback to begin the day’s work, it is no wonder that the ranching lifestyle is one to cherish. King Ranch® Institute for Ranch Management (KRIRM) alumnus Jeremy Gingerich is one of the fortunate people who call the vast landscape of a ranch his office, where the only traffic jam might be with an elk or bison herd, he said. It is 585,000 acres of office space to be exact. As the assistant general manager of Vermejo Park Ranch, Gingerich is responsible for numerous special projects on the ranch that spans four counties in New Mexico and Colorado. The historic ranch offers fishing and hunting excursions, a profitable and genetically significant bison herd, and an expanding ecotourism program, which Jeremy is helping direct. In line with their conservation roots, Gingerich’s largest special project is with the renovation of the Casa Grande, the 25,000 square foot stone owner’s mansion built in the early 1900’s.

A Strong Foundation

Like many other KRIRM graduates, Gingerich’s position at one of the country’s most historic and revered ranches is impressive. However, it takes many years of hard work and dedication to land a position at a prestigious ranch such as Vermejo. Gingerich’s love for the outdoors began at a young age along the Front Range of Colorado where he spent as much time outdoor as possible. After earning a bachelor’s degree in natural resources management and completing an interdisciplinary program in conservation biology at Colorado State University in 1999, Gingerich entered the ranching profession from a conservation perspective. The reasons Gingerich chose a career in ranching are, of course, conservation based, but he also desires to improve the land’s productivity and profitability, all while conserving the land for wildlife, ecosystem services, and the enjoyment of people. “I enjoy the feeling of responsibility for a ranch, even if it’s not my own,” explained Gingerich. “Being able to 6 I Spring 2015 I KRIRM

share the outdoors with friends and family is also another important part of the ranching lifestyle.” His career began as a ranch management trainee on the 87,000-acre Chico Basin Ranch in southeastern Colorado. There, he managed 850 cows on 35,000 acres of sandhills and shortgrass prairie. His next opportunity took him to Montana where he worked as the operations director responsible for grazing 1,600 to 1,800 yearlings at Sun Ranch, a 25,000-acre ranch of rangelands, critical wildlife habitat, and numerous recreational activities. While responsible for the yearlings, Gingerich maintained significant stretches of riparian habitat and provided range for nearly 2,500 elk. In 2007, Gingerich’s time with Turner Enterprises began on the Red Rock Ranch near Dillon, Montana, where he served as the manager responsible for the bison cow/calf and yearling operation. His desire to continue his education lead him to KRIRM where he improved his business skill set in order to manage the complexities of a diverse ranch for profit and conservation values. Gingerich graduated from the program in 2012. Now, in 2015, he holds a position that allows his conservation interests to flourish. “The size, scale, and mission of Vermejo Park and the Turner Western Ranches is what appealed to me,” he explained. “What I like most about my position is the opportunity to effect change on a large scale, the challenge of new tasks, and the opportunity to experiment with different approaches at generating profit from a land-based business.”

The Value of Mentors and Education

One common chord that Gingerich is sure to share with other KRIRM alumni is the value of mentors in the ranching industry. Mentors helped Gingerich throughout his ranching career by passing along new opportunities and serving as a sounding board for ideas or challenges that arise, he said. “It is always important to have someone to bounce ideas off, especially when that person or group has more

Ash Mountain, 11,430 feet, on the southwestern boundary of Vermejo Park Ranch.

experience.” Learning experiences in the classroom were also valuable to the enhancement of Gingerich’s career. Systems thinking, which is the basis of the KRIRM program and taught to KRIRM students and outreach attendees at the John B. Armstrong Lectureship on Systems Thinking, provided Gingerich with the abilities to manage a diverse ranch. “Weather, livestock, markets, wildlife population dynamics, personnel, and stochastic events like fires, drought, disease all contribute to the complexities of managing a ranch,” described Gingerich. “Having a frame of reference to structure these elements is very useful.” Along with systems thinking, the leadership course and special projects with King Ranch all contributed to Gingerich’s ability to work at Vermejo. He gives advice to others with similar career aspirations to always seek guidance and wisdom from those that have gone before, but also remain open to new ideas.

Gingerich, pictured with wife Maud and children Marija and Danica on Vermejo

Challenges and Rewards

Between Gingerich’s responsibilities with the Casa Grande renovations; shortgrass prairie restoration projects; coordinating riparian restoration work; and helping with the bison herd planning, working, and shipping, one could say some challenges arises. But Gingerich is not one to let those challenges get in his way of successfully managing his duties of the ranch, all while managing 30 full-time employees and up to 70 seasonal employees. “Time management is of utmost importance,” he said. “Using a framework like Covey’s 7 Habits and tools like a good planner and notebook help keep me on task and prevent the important from falling through the cracks.” It seems challenges associated with such an operation could persuade one to pursue different career paths, but not Gingerich. He believes the diversity of people and landscapes that comprise Turner Enterprises is rewarding, and that through all of his experiences from previous ranches and KRIRM, it will allow him to create a larger positive impact on the ranching profession and the conservation of western landscapes.

Casa Grande, a 25,000 square foot stone owner’s residence built from 1907-1909, currently undergoing a major renovation.

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By Ashley Patterson Photos courtesy of King Ranch, Inc.

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he King Ranch® Institute for Ranch Management (KRIRM) owes much to the numerous ranch partnerships that help make the program unique and a one-of-a-kind experience. But none as much as King Ranch itself, and one of KRIRM’s greatest mentors, Dave DeLaney. DeLaney, the Vice President and General Manager of Ranching and Wildlife Operations for King Ranch, was present soon after the ideas for KRIRM began forming in 2003 (as part of the celebration of King Ranch’s 150th anniversary). From the beginning of his career, he has been devoted to the industry, and since 2004, KRIRM. In fact, DeLaney moved from Virginia—where ranch work was only part-time—to Texas where he attended Texas A&M University, working towards his MS and then later (after a stint as a cowboy in West Texas) as a researcher working toward his Ph.D at the USDA/Texas A&M Research Center in Bushland, Texas. His career, progressing rapidly though the years, eventually led him to Kingsville, Texas, to one of the most legendary ranches in the world.

From the Ground Up

In DeLaney’s role at King Ranch, he oversees the many complex and diverse operations on the 825,000-acre ranch in South Texas. These operations include wildlife, cow-calf, stocker, feedyard, and the quarterhorse segments, as well as all the infrastructure and natural resource management required on a property of such a large scale. “My job is to enhance communications, prioritize projects and develop strategies for the future that tie all these different systems in together,” explained DeLaney. “I have to make sure everything we do on a daily basis somehow fits the overall 8 I Spring 2015 I KRIRM

management goals and objectives set forth by the King Ranch board.” It doesn’t quite stop there. Beyond that, DeLaney must stay informed on legislature and regulatory issues, looking down the road for “black swan” events that could potentially disrupt operations, he said. That, along with managing 86 employees, sounds like a tough job. One has to start somewhere, and for DeLaney it was indeed a cowboy job right out of graduate school. He reflected back on that time and offered advice to young people hoping to be successful in the ranching field. “I would say step back and identify opportunity. Be willing to start in a position where there is an opportunity to advance, or at least where there is an opportunity to learn more about ranching.” Too often people get tied up on job title or immediate salary when they should be looking to the future and if the operation is going to serve as a stepping-stone to a career, he said. Before starting his position at King Ranch, DeLaney was the General Manager for Friona Industries Feedyard Division and Friona Industries Cattle Company, one of the largest cattle feeding operations in the world. It was there that DeLaney said he learned much about how the various segments of the industry fit together in providing a high quality product for the consuming public. It was also where he began to fully understand all the complexities involved in the beef production cycle and how all the segments had such diverse profit drivers. He believes all the complexities and logistics of procuring, feeding, and marketing nearly 500,000 head of cattle per year was good preparation for dealing with the complexities of operating such a large scale and complex

As the VP and General Manager of Ranching and Wildlife Operations, DeLaney oversees the diverse operations that call the 825,000 acres in South Texas home, such as the Santa Gertrudis cattle (left) and wildlife pictured.

an operation such as King Ranch. Working for a diverse family ranch is also not new to DeLaney; prior to Friona, DeLaney worked for Corsino Cattle Company, which he said provided him much of the background for managing a ranching operation such as King Ranch. While employed by Corsino, DeLaney also helped manage cow-calf and stocker operations on hundreds of thousands of acres in the Texas Panhandle, encompassing multiple family owned ranches, many of which were iconic legacies in their own right. This experience in working with family owned ranches gave DeLaney much of the background and experience necessary to manage King Ranch. “All the landowners had a deep respect for the environment, for the stewardship of the natural resources, and an appreciation of what it took to survive and prosper through multiple generations,” he explained. DeLaney described Friona and Corsino as excellent operations with fantastic ownership. He said he didn’t leave those operations for any reason other than the desire to accept additional challenges and opportunities. He eventually accepted his current job at King Ranch (when he left Friona) due to his desire to return to ranching and managing natural resources, his true passion. “When the King Ranch job came available, it was something I wanted to get back to,” said DeLaney. “I loved ranching and it was probably the one job I would have left either of those companies to come work for.”

Impact to KRIRM and the Industry

For many managers in a position such as DeLaney’s, it is important to be an active spokesperson and supporter of the industry. DeLaney has served on both the boards and on numerous agricultural policy committees with the National Cattleman’s Beef Association and Texas and Southwestern Cattle Raiser’s Association (TSCRA), and is adamant about devoting his time to areas where he can actually make a

positive difference. DeLaney is also a member of the Executive Committee for both TSCRA and Texas Wildlife Association. As wildlife operations play a significant part in the success and profitability of King Ranches Ranching and Wildlife operations DeLaney spends a significant amount of time on wildlife issues as well. “I heard an individual one time say the world is run by those who show up… I think as the urban society becomes more and more disconnected from ranching and rural life, it’s important that we participate and ‘show up’ whenever necessary to protect our interests and tell our story,” he said. Of course, DeLaney also emphasized that he would not be able to do that if not for the excellent and experienced managers that directly oversee the day-to-day operations at King Ranch. “We are blessed DeLaney (below) has been with to have some highly King Ranch since 2003 when he successful and left Friona and accepted his current professional managers position with the ranch. that are at the forefront of our industry,” he said. As a supporter of KRIRM, DeLaney serves as a mentor to students and serves as an adjunct professor at Texas A&M University-Kingsville. He explained his mission and goals to contribute to KRIRM goes back to the founding of the institute when King Ranch shareholders KRIRM I Spring 2015 I 9

Commit to Lifelong Learning

Upcoming Events August 10-13, 2015

John B. Armstrong Lectureship on Systems Thinking

September 18-19, 2015

B.K. “Kley” Johnson Lectureship on Current Ranching Issues: Managerial Accounting

October 22-23, 2015

12th Annual Holt Cat® Symposium on Excellence in Ranch Management

Visit krirm.tamuk.edu, or follow us on Facebook and Twitter to learn more about our upcoming events and program.

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wanted KRIRM to be dedicated to improving the ranching industry. He team teaches a finance course that offers reallife ranching issues every year and oversees master theses and other small projects. DeLaney stressed that these classes and projects are important because the issues and problems can’t simply be found in a textbook. They are problems that arise on a diverse ranch daily, with no textbook on how to solve the issue. And with no two ranches being the same, these opportunities allow students to be flexible in their thinking. “It lets the students step out and look at things from different angles and be exposed to problems that you might experience in real life.” Recalling the King Ranch family members and stakeholders who were instrumental in the creation of KRIRM, DeLaney said they always viewed innovation and education as a primary driver in ranching success. DeLaney is committed to seeing that mission through with his work alongside the students and faculty of KRIRM.

A Positive Outlook

DeLaney said he considers himself (and any successful manger) a lifelong learner, attributing his own success to excellent mentorship from several influential individuals in the agricultural industry. He also said that in addition to hard work, he felt many of the people he has worked for in the past would describe him as having the highest integrity and character, as well as a willingness to take on any task and to work his way up from the bottom. As the cow-calf producer has been gaining more leverage in the industry, explained DeLaney, the profit outlook has never looked more promising, something DeLaney believes is a huge benefit for potentially holding many of the larger economically viable ranching units together in the future. In addition, he believes the urban population is beginning to see that the wide-open spaces provided by ranching and wildlife operations are indeed sustainable resources and provide a huge societal value at many levels. “I think our trade associations are working hard to educate and inform public perception, and I think it’s all being done in an environment where the potential profitability for ranching looks really good,” he said. For the rancher, many have seen the value of incorporating other profit centers into their operations. Regardless, of the enterprise, diversification and efficient production practices will be key to keeping families and employees on the ranch and preventing fragmentation in future years, said DeLaney. Described by himself as much a natural resource manager as he is a wildlife or cattle manager, DeLaney is motivated to steward the land, protect the ranching legacy, and protect the natural resources for the benefit of future generations. This is directly inline with the King Ranch shareholders’ beliefs, and what they envision for KRIRM, King Ranch, and the ranching industry.

Excellence in Ag Leadership Program

Testimonials of the

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Incredily honored. The places I have traveled and the leaders I have met is an experience I will carry with me the rest of my life.

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Clay Burtrum; Oklahoma

Meghan Anderson; Nebraska

How would you describe your first year in the program? Tyrell Anderson; Oregon

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It has helped me expand more friendships and interact with great leaders all across this great beef industry.

”

It was challenging going through the personal development process, but I have enjoyed the refining process and hope to come out a better student and leader.

”

The Excellence in Ag Leadership group pictured at the Systems Thinking Lectureship in August of 2014. To learn more about the leadership program, visit krirm.tamuk.edu/leadership-program/ KRIRM I Spring 2015 I 11

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