Cooperative Opportunities in a Global Economy Global Involvement … Lessons Learned John E. Gherty Immediate Past President & CEO Land O’Lakes, Inc. 8th Annual Farmer Cooperatives Conference

2 Importance of this Conference  Recognizes global nature of 21 st century economy/marketplace  Reflects our responsibility to be “good global citizens”

3 Global View In today’s complex and changing economic environment, being financially successful and adding value for members long term, will … for many of our cooperatives … require that we be prepared to pursue international business

4 Global View The question is not whether we will have to operate in in a more unified global market … but rather when and how.

5 Topics  The ways international business can add value for cooperatives and members  How you build board and membership support for international efforts  How Land O’Lakes has approached these issues

6 Adding Value through International Activity  Historic cooperative focus … commodities  Today access depends on being least-cost on a global basis on a global basis  Future opportunity will be in finding ways to add value to commodities  Differentiate member production

7 Adding Value through International Activity  Differentiating member production  Further processing  Quality  Dependability of supply  Traceability  Exporting new technology  Meeting global needs of domestic customers

8 Adding Value through International Activity  Helping generate the size and scale necessary to compete and win  Critical mass and economies of scale key attributes of successful companies

9 Communicating with Board and Members  CEO develops Vision for international involvement international involvement  Develop and implement detailed communication plan communication plan  Develop and implement specific projects and strategies projects and strategies

10 CEO’s Role  Be point person with the Board  Critical “point of sale”  Demands compelling message(s ) Based on facts and data Based on facts and data Use outside resources Use outside resources  Also need to build broader membership support

11 Ten Things to Think About in Communicating Strategy 1.The CEO or leader must be fully committed to the Vision 2.You need to craft compelling messages around the Vision 3.Take your messages to decision- makers first 4.Send written material ahead of any meetings 5.Have a communications plan with tasks, timing and accountabilities

12 Ten Things to Think About in Communicating Strategy 6. Once you go beyond the board, be tactical about whom you communicate with first 7.Use information meetings in the country 8.Keep other stakeholders informed 9.Be a good listener and incorporate feedback 10.Over-resource your communication efforts

13 The Land O’Lakes Experience  Early 1980s Land O’Lakes:  UMW regional cooperative … little international vision  CEO Ralph Hofstad started the process  Had a vision for Land O’Lakes growth … domestically and internationally

14 Land O’Lakes Global Involvement Land O’Lakes is proud to be a leader in the delivery of international humanitarian and technical assistance.

15 Land O’Lakes Global Involvement Bangladesh Russia/Siberia ArmeniaTurkmenistan AzerbaijanUkraine Georgia Uzbekistan Angola Ethiopia Kenya Malawi Sudan Tanzania Uganda Zambia Albania Bosnia Macedonia Philippines Pakistan Mali Mozambique Nigeria South Africa Colombia Honduras Afghanistan

16 Communicating Our International Vision  Key objectives:  Reach out and help farmers in less developed countries  Use international development projects to develop relationships that could lead to commercial opportunity  Get board, members and employees involved - Make them advocates

17 Communicating Our International Vision Initial challenges … skepticism  Global development assistance would create new competitors  Doing business in global markets would detract from our ability to succeed at home

18 Communicating Our International Vision Key messages:  International development was a reflection of who we are as an organization  Our involvement in international development had the potential to create positive relationships and open the door to commercial opportunities  Land O’Lakes faced a very real need to expand its horizons

19 Communicating Our International Vision Enlightened Self Interest Enlightened Self Interest

20 Communicating Our International Vision Took these messages to:  Board  Membership  Annual meeting  Country meetings  Member publications

21 Communicating Our International Vision Spreading the message:  Getting directors, members, employees and employees and retirees directly involved in international development programs development programs You learn by doing!

22 Land O’Lakes Today Directors, members and employees:  Proud of our international development efforts  Understand importance of the ability to think, plan and globally  Recognize global activities create new opportunities, rather than foster new competitors

23 Land O’Lakes International Development  International Development Division established in 1981 established in 1981  Record of achievement:  137 projects in 66 countries  Training for 2,500 cooperatives and private companies companies  Training for more than 50,000 foreign nationals nationals Global school nutrition programs have fed more than 1.5 million youngsters.

24 Land O’Lakes International Development Goals:  Provide meaningful assistance  Generate a positive image in current and potential markets  Develop Land O’Lakes international experience and expertise

25 Land O’Lakes Global Business  First exported butter to Africa in 1925 in 1925  Late 1980s … developed staff specifically dedicated to sales in specifically dedicated to sales in Latin America and Far East Latin America and Far East

26 Land O’Lakes Global Business  Dairy Foods  34 countries  Feed  39 countries  Seed (alfalfa)  5 countries

27 Cooperatives and the Global Future  Cooperatives cannot afford to ignore global opportunity or global competition  Cooperatives need to focus on core businesses and competencies  The most significant opportunities exist in the value-added sector  No one organization will do it alone … collaboration and cooperation will be key