Expert Says Fonterra Backing Current Strategy With New CEO Appointment
The appointment of Richard Allen as Fonterra's new chief executive signals execution, not strategy, according to agribusiness expert Dr Nic Lees.
Fonterra shareholders are unhappy with moves to reduce the number of Farm Source area managers, who work with farmer shareholders inside the farmgate.
On the New Zealand Dairy Farmers Facebook page, which has over 30,000 members, farmers have been venting their frustration on possible reduction of face-to-face support. The Facebook page claims Fonterra intends to reduce the number of area numbers from 45 to 20.
"I don't think reducing the number of area managers is a good decision in the current time given how much uncertainty we are all dealing with," complained one farmers.
Another Waikato farmer says she spoke recently with a Fonterra director.
"There have been more calls to him on this management move than any other issue he's had while on the board," she says.
Another dairy and beef farmer from Waikato warns that reducing the number of area managers will be a step backwards.
"Face to face is paramount with all the issues and regulations coming our way. Online is not the answer at this time.
"Smaller teams are not more agile, not more available: smaller senior management works but feet on the ground is essential."
Fonterra farmers are also raising the issue with board members and the Fonterra Co-operative Council.
Council chair John Stevenson told Dairy News that questions on specific details of the proposal should be directed towards Fonterra management.
Stevenson says the council is not consulted on proposals between Fonterra and its staff.
"We are not part of the decision-making process. Our role is to represent Fonterra farmers," he says.
But he confirmed that councillors have received a considerable amount of feedback from Fonterra farmers recently.
"Counil has heard that Fonterra farmers are passionate about their co-operative, the level of support that they expect and the people that directly support them.
"Council is actively communicating that farmer feedback and sentiment to the board."
Stevenson says over the last 18 months, the council has regularly provided feedback to the board and to management on the importance and expectation of face-to-face support for Fonterra farmers.
He says support for Fonterra farmers is critical, especially during the current period of significant change.
"Council will continue to represent the interests of members and will pass on any further feedback received. Council is awaiting the outcome of this process before it can comment publicly in more detail," he says.
A Fonterra spokesperson told Dairy News that the proposed changes are subject to consultation with their team.
"No decisions have been made yet, so it would be inappropriate for us to comment further at this stage."
Farm Source has 68 stores around the country. It also employs area managers and sustainability and farm management advisors who interact with farmers.
The Farm Source website says it is "all about connecting with and supporting our farmers".
"In the community, on farm and in store, we bring the collective strength of the Fonterra co-op to help our farmers get the products, services and advice they need to run their farms successfully."
