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The four legs of a business

February 2017

Raymond Ackerman built Pick n Pay on a management philosophy of a four-legged table. The four legs of his table are the people (human resources), the merchandise leg (production), the promotion leg (marketing) and the administration leg (including finances).

Each leg had to be strong enough to keep the table upright, and of the same length, enough to keep the table balanced and level. If any one of the legs wobbles, the table tilts; if a leg collapses the table falls. The table settings placed on this flat, secure base are the day-today activities and operations of the business.

Remember in practice management means to plan, organise, implement and control (management task) all management areas properly. The management areas being production-, marketing-, purchasing-, financial-, administrative-, human resource-, public relations-, asset and stock-, and general management. At the same time, whilst applying each of the management tasks – the farmer/manager must also be the good leader, who can take decisions communicate internally and externally, delegate work, co-ordinate sections, motivate his employees and maintain discipline both informally and formally.

The story behind Ackerman's philosophy is that the table represents a business and the legs certain areas of management. Ackerman realised it is very difficult to manage all areas of management to perfection and he decided to concentrate on four areas – the four legs of his business. These areas should be managed managed properly to keep the business stable and running properly. If only one management area (leg) is not managed properly the business will not run as smoothly as it should and will eventually succumb to failure.

In view of a modern outlook to business, let's redefine this idea to one where each management area is seen as a table built on the four legs of planning, organising implementing and control. Your business can then be represented by nine tables – the nine management areas – stacked in the form of a pyramid. Think of the human pyramids we used to build as kids, when the guy at the bottom caves (normally the arms of this kid gave in), the whole pyramid came crashing down. Are you doing the right things in your business to support all the tables to keep your business pyramid upright?

For the smaller farmer who does most of the work himself it is all the more difficult to manage every area to perfection. Therefore, the message is that you should focus on four, crucial tables (management areas) on which the rest will stand or fall. Then focus on managing these areas to the best of your ability to build the necessary stability and strength. If these tables are functioning properly they will support the other tables. Most businesses, such as a farming business stand on the four tables of production, marketing, finances and human resources. You cannot do everything to perfection yourself, thus focus on these areas or the ones you choose. Each table has a role to play, and it is the bosses' job to keep the balance and get everything working.

Are your table tops level? If one leg is longer than the other legs, the table will slant, and a slanted table is not a good one on which to place the table settings. For instance – did you plan the work of each area properly but then neglected the implementing of your plans. Such as you have planned to plant 30 000 maize seeds/ha but eventually only some 20 000 were planted.

While all the tables are vital to the survival and prosperity of your business, the marketing table is often the one that collapses first because of poor legs. ‘Easy to make, difficult to sell’, as the saying goes. If this table collapses the other tables will eventually follow suit. The market is ruthless, it has no sentiment, and this table is the one that is often the most difficult to keep level. The marketing boards of yesteryear resulted in famers not needing to develop marketing skills, and deregulation has thrown them into the deep end. Therefore, always apply the principle – ‘never produce any product before you have not secured the marketing of that product’.

The concept of Ackerman's table in today's world has a further oversimplification. In the business world of today, especially agriculture, the tables stand on a surface that is ever changing and shifting – because of for instance political insecurities, marketing challenges, cost-price difficulties, and the climate. The legs need constant attention, and the table settings need constant re-arrangement.

Remember the only constant today is change – keep working on the legs of the tables – planning, organising implementing and control. Circumstances differ from year to year and therefore your management needs constant adjustment.

Article submitted by Marius Greyling, Pula Imvula contributor. For more information, send an email to mariusg@mcgacc.co.za.

Publication: February 2017

Section: Pula/Imvula