13 th Annual Farmer Cooperatives Conference SUCCESSION PLANNING Jim Hoyt Vice President Strategic Planning & Corpo

1. 13th Annual Farmer Cooperatives ConferenceSUCCESSION PLANNING Jim HoytVice PresidentStrategic Planning & Corporate ServicesGROWMARK, Inc.

2. MissionVision Values Strategic Direction Goals Drivers of Change Actions Objectives Strategies Success Factors Strategic Issues Priorities Measurement Reporting Internal Assessment Alignment Primarily Board Board & Staff Primarily Staff Strategic Planning Process

4. Strategic Issue System Leadership Succession Development It is essential that we work proactively to deepen our bench strength for key System leadership responsibilities. Goal: Extend the corporate depth chart in three additional vice presidents’ areas and implement the CDR tool to individuals identified as “ready” and/or “development” employees. Goal: In conjunction with member cooperative boards of directors, create and recommend individualized plans for the development and succession of board leadership.

5. Are You Ready For Key Leadership: • Retirements • Unexpected Departures • Long-term Illness • HBBT

6. Employee Demographics Age Buckets 20-35 23.9% 36-45 18.5% 46-55 29.5% 55-60 16.8% 61+ 11.1%

7. Drivers of Change • Aging leadership team • Complexity of business • Changing business models • Experience exodus • Institutional memory/accumulated knowledge • Workforce demographics • Specialization • Available and skilled talent pool • Competition for best talent • Gen X – capabilities and expectations

8. Succession PlanningProject or Process • Assessment of: • Current leadership talent • Future leadership needs • Current bench strength and gaps • Increasing bench strength • Development programs • Individual • Group

9. Depth Chart • Key positions • Key people • Ready now • Development needed • Mid-management and up • Honesty – openness – agreement

10. Depth Chart Example

11. Development Plan • Are you using traditional and creative development programs? • Individual and experiential • Special project assignments • Cohort groups • Job rotations • 360 evaluation and profiling • Mentoring • Diversity • CEO/VP sign off

12. Questions • Do you know your bench strength in key positions--mid-management and up? • Are you rounding future leaders’ experience? • Do employees know they are in a leadership development process and what is expected? Do they want to be? • Are you attracting an appropriate percent of external talent? • Are you comfortable with “just in time” leadership?

13. Shared Responsibility • Board: • Strategic Plan • Risk Management • Expect – Understand – Monitor • Senior Management: • Plan Design – Cultural Acceptance • Implementation – Active and noticeable participation • Mid Management: • Identify and mentor – Ensure development – Special projects • Look for opportunities • Cross-train • Job rotations

14. Board Succession Ask the tough questions • Do you have a formalized succession plan? • Who are potential directors for your board? • Is a directorship an endowment? • What is the “right” length of time to serve? • Should directors serve as officers until retirement from the board? • What is best for your cooperative?

15. Succession Planning “Skate to where the puck is going to be” The GREAT ONE