Decision quality in farming: why deciding well matters more than executing faster
Column published in Spanish on Agraria.pe on 27 May 2026.
"Plans are worthless, but planning is everything." Dwight D. Eisenhower
Peru's agroexport sector is going through a change of phase. After several years of accelerated growth, it faces a more demanding environment, marked by price pressure in some crops and critical costs that keep eroding margins. In that context, operational efficiency stopped being an optional advantage and became a condition for survival. Yet many problems attributed to farm execution are born long before the season, in decisions about investment, genetics, budget, management or operating structure that were taken, or postponed, months or years earlier.
Agriculture tends to reward whoever executes fast or reacts before everyone else, even though speed does not fix a bad decision. To bring order to this kind of decision, the six-stage Decision Quality framework developed by Spetzler, Winter and Meyer in the book Decision Quality: Value Creation from Better Business Decisions is useful. In farming, any of these mistakes can be paid for over several consecutive seasons, because production cycles do not allow what was decided badly at the start to be corrected immediately. The leader's role is not to produce every answer, but to sustain the quality of the process by which the organisation decides.
1. Frame: what are we deciding?
Decisions that look technical, such as where to plant, which variety to grow, when to prune, what density to use, how much investment and working capital is required, can compromise profitability for many years, so the first risk is answering the wrong question well.
The decision is often taken too fast, drawn by a commercial window, an apparently lower cost of land, another grower's success story or the pressure not to be left behind. But entering a new country is not just replicating a crop in another territory. It means deeply understanding the climate, water availability and quality, logistics, regulation, the labour supply, local technical capacity, the real cost of operating, distance to markets, how the fruit behaves in that area and the ability to build a reliable team. When a company scales up without having validated these assumptions for long enough, the project can fail not for lack of effort, but because it was born on an incomplete decision.
The company should distinguish between exploring, validating and scaling. First, study the country and the area with independent information. Then test the crop, the variety, the operation and the logistics at a controlled scale. Then confirm whether the results repeat over more than one season and under different conditions. Only once the technical, commercial and financial assumptions have been validated does it make sense to commit significant capital.
At this link, leadership must keep a strategic decision from being treated as a farming routine. That means bringing in whoever will execute the decision and not only whoever will approve it, and demanding that the critical assumptions be written down before the discussion. When this does not happen, the decision tends to be reopened in the middle of execution, precisely when changing course costs more and the company starts confusing operational adjustments with strategic correction.
2. Alternatives: what real options do we have?
The complexity of farming pushes companies towards incremental adjustments, such as changing a dose, moving a date, adding a shift or cutting a cost. These measures can help, but they do not always solve the underlying problem. When every option on the table is a more expensive or cheaper version of carrying on as before, the decision is badly framed before it starts, because the organisation ends up optimising a path it perhaps should no longer be walking.
In some cases, the best alternative is not to optimise but to exit, eliminate or convert. A hectare that loses money does not always need more capital; it may need to stop absorbing time, management and resources that could generate more value in better blocks. Likewise, a packing line does not always need more investment, but perhaps better scheduling, extra shifts in peak weeks or operating partners.
In varietal replacement, the alternative should not be reduced to swapping one variety for another either. It may mean improving the mix, negotiating access to genetics, forming alliances with breeders or marketers, reducing exposure to a variety that has already lost price, or postponing planting when urgency threatens to compromise the proper establishment of the crop.
Here leadership must demand genuinely different alternatives and, at the same time, recognise whether the company is trying to do different things with the same teams, the same mindset and the same limits of authority. If nothing changes in how the company decides, coordinates and executes, many new alternatives end up being the same model under another name.
3. Information: does the data reflect reality?
Agricultural information is difficult by nature: it is expensive, it gets extrapolated, it is scattered, it arrives late, it is distorted by hierarchies, and it is sometimes dismissed when it comes from the staff closest to the problem, even though that very proximity can anticipate signals that do not yet appear in consolidated reports. Besides, not everything that is measured helps to decide properly, since the same gross yield per hectare can generate very different contributions; it ends up being an incomplete metric. The budget is another critical point, because numbers that are wishes or targets often get approved but do not reflect what the field already knows in advance.
There is also external information that moves the margin and cannot be reviewed only when it shows up in the income statement. Variables such as the exchange rate, fertilisers, oil, the minimum wage, freight, climate and price must be monitored before they force the plan to be corrected. Relevant information is not what confirms the budget, but what allows a timely decision, even when it upsets a projection that already seemed closed.
At this point, leadership must create a space where it is safe to bring bad news early, listening to irrigators, plant health staff, the farm manager and the external adviser, among others, before the decision is taken and not after.
4. Trade-offs: what do we give up, and in exchange for what?
In farming, trade-offs are constant and rarely made explicit; the most common are tensions between short and long term, field and commercial, volume and margin, cost and productive reserve. The problem is not that tensions exist, but that the company decides as if they did not, letting each department defend its own indicator even when the system as a whole loses value.
This shows when nutrition is cut back because of high cost without distinguishing whether the problem is over-application or an external rise in fertiliser prices. The same cut can look efficient in the budget and, at the same time, be costly for future productivity if nobody understands what trade-off is being made and who ends up paying for it.
Pruning and harvest calendars illustrate this well, because a decision that looks commercial can move crews, pressure on the packhouse, export windows, quality, next year's yield and labour costs.
That is why leadership must sit field, commercial, logistics, finance and sustainability at the same table, not so that everyone opines on everything, but so that the trade-offs are clear before the decision is approved.
5. Reasoning: does the decision hold up in real scenarios?
Farming has a technical culture that respects the agronomist's judgement, which is valuable, although it can also become a shortcut when it replaces analysis and leads to approving decisions because the base case looks positive. If the margin depends on yield, price, exchange rate, fertilisers, labour and freight all behaving favourably, the company is not looking at a robust strategy but at a bet that can break with the first relevant change.
Reasoning well means moving several variables at once, because a year of lower productivity may come with a better price, a short-term saving may reduce the productive reserve of the next season, and a varietal replacement may look attractive on expected price but destroy value if it is planted outside the right window, without enough trials or without the technical capacity to manage the learning curve.
Benchmarking also demands reasoning, because it can be useful or misleading depending on whether it compares geography, age, variety, density, cost structure and commercial channel. Changing a decision because of a phone call, a news item or an isolated figure from another company can be as risky as deciding without information, since the problem is not using numbers, but using them without a logic that explains what is being compared, why it is comparable and which decision it helps improve.
At this link, leadership must demand dynamic scenarios in order to anticipate the different possible contexts. It is not enough to know what was decided; it is also necessary to know why it was decided, under which assumptions and which signals would force a review of the course if reality starts moving in another direction.
6. Commitment: what is the capacity to execute?
In farming, execution happens far from the board and management, in changing conditions and through a layer of middle managers who have often not been strengthened to the level the operation requires, so a company can approve a great strategy and still execute it differently from what was planned. If the farm manager does not have real authority, a clear budget, understandable targets and aligned incentives, the decision will be executed as best it can, not as it was approved.
One possibility is for each farm or large block to behave like a mini-company, with a person in charge, a negotiated budget, clear targets, a reading of margin and the ability to reassign resources within defined limits, although for that responsibility must be properly assigned. If middle management only executes, the company loses a critical source of information, and if the best farm manager earns almost the same as the worst performer, the organisation is not building leadership but managing an operation without sufficiently differentiating performance.
The six moments are sequential and cumulative: if the frame is wrong, the following stages solve the wrong question; if the alternatives are poor, the company chooses among mediocre options; if the information is comfortable, reality arrives late; if the trade-offs are not made explicit, each area defends its KPI; if the reasoning is weak, the first change breaks the plan; and if there is no commitment, execution is reduced to an intention that rarely turns into margin.
In the coming years, the difference between farming companies will lie in who decides earlier, decides with better information and has the discipline to sustain those decisions when the season gets tough. The quality of the decision process is one of the most significant efficiency levers still pending in the sector's favour.
