Leaders

Leaders must guide the NGC, especially through its early stages.  Finding quality leaders is a prerequisite for success.  Past experience has demonstrated that leaders must come from within the producer group.  Although external advisors will be needed during the development process, these individuals should not lead the overall initiative.  Leaders, sometimes called project champions, should be agricultural producers who will become members of the NGC.  Leadership may come from an individual or small group.  Either way, these leaders must be willing to put in the time and energy required during the project’s early stages.

What qualities should leaders possess?

The following criteria may help in measuring an individual’s potential to become a project champion:
 

  • Credibility and competence
Leaders should be individuals who have gained respect in their communities because of their sound judgement skills and their ability to accomplish tasks.  If the project’s leadership lacks competence, then there will be a lack of confidence among prospective members.
 
  • Industry knowledge
Leaders need to be able to understand the industry in which the NGC will be competing.  Since NGCs represent vertically integrated operations, leaders need to have a solid understanding of activities that take place beyond commodity production, including processing and marketing to the final consumer.  Individuals who understand the importance of market research will be in a better position to lead the NGC than those who only understand the production side of the business.
 
  • Financial stability
Because the creation of a NGC can be time-consuming, leaders should be individuals who are in a position to devote time to the cooperative without jeopardizing their personal operations.  In addition, individuals who have experienced failures in the past, such as personal bankruptcy, may not be able to gain the trust of potential members and lenders.
 
  • Patience and balance
Leaders will sometimes be criticized or insulted, and they will often find themselves in high-pressure situations.  Individuals who are willing to lead should have the ability to handle these sorts of situations.  Individuals who possess patience, good communication skills and the ability to not take things personally are more likely to be effective leaders.
 
  • Ability to separate emotions from business judgement
Leaders should not let emotions cloud their common sense.  A successful NGC is built on sound business judgement.  Even though the enthusiasm and emotions that surround rural cooperative development are great motivators, they should not be the controlling factors.
 

Steering Committee

 Project leaders are part of the NGC’s steering committee.  The steering committee is responsible for identifying the critical questions that need to be answered before the cooperative can begin.  It is an informal group that schedules and oversees the tasks that are necessary in order to start the NGC.  This group should be comprised of people who possess sound business judgement and are well respected by potential members and lenders.  Not all members of the committee need to be agricultural producers.  For instance, individuals who represent economic development organizations may be included.  Typical activities performed by the steering committee include:
 

  • communicating with other interested producers and potential members
  • organizing meetings
  • overseeing the completion of a producer survey to determine the level of potential member support
  • preparing the scope of work required in a feasibility study and selecting a consultant to conduct the study.  In addition, the committee members will participate in the feasibility study process.
  • obtaining funding to pay for the feasibility study and other start-up costs
  • obtaining the necessary legal and accounting services
  • setting deadlines for the completion of tasks


 The steering committee works with outside advisors to determine whether the project has the potential to succeed.  If the feasibility study shows that it does, then the business planning stage begins.  Once the decision is made to incorporate the cooperative, the steering committee is disbanded and an interim board of directors takes its place. 

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Adapted from:

Patrie, William. 1998. Creating ‘Co-op Fever’: A rural developer’s guide to forming cooperatives. Rural Business-Cooperative Service Report 54. United States Department of Agriculture.
 
 

Other sources:

Myers, Mary, Greg Lawless and E.G. Nadeau. 1998. Cooperatives: A tool for community economic development. University of Wisconsin Center for Cooperatives. Madison, Wisconsin.

Rapp, Galen and Gerald Ely. 1996. How to start a cooperative. Rural Business-Cooperative Service Cooperative Information Report 7. United States Department of Agriculture. Online. Retrieved May 12, 2000. www.rurdev.usda.gov/rbs/cir7/cir7rpt.htm.