Spring 2014 KRIRM Newsletter

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FEATURES 3

Wagon Tracks

“The New KRIRM Excellence in Ag Leadership Program“

By Dr. Clay Mathis

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Spade Ranches: 125 Years Strong

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Congratulations, Class of 2014

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Great Mentors of KRIRM

A balance between tradition and technology keep this historic operation moving forward

By Kindra Gordon

KRIRM graduates four students in 2014

KRIRM benefits from relationships with ranching professionals

By Ashley Patterson

Cover Art: Peace of Mind Tim Cox www.timcox.com 2 I Spring 2014 I KRIRM

Published by the KING RANCH ® INSTITUTE FOR RANCH MANAGEMENT Texas A&M University-Kingsville 700 University Blvd., MSC 137 Kingsville, TX 78363 361-593-5401 361-593-5404 fax krirm@tamuk.edu http://krirm.tamuk.edu Clay P. Mathis, Ph.D., Director and Endowed Chair Ashley Patterson, Editor

MANAGEMENT COUNCIL Chair: James H. Clement Jr., King Ranch, Inc. Caroline Alexander Forgason, Robert J. Kleberg, Jr. & Helen C. Kleberg Foundation Gus T. Canales, A.T. Canales Ranches Dave DeLaney, King Ranch, Inc. Bob McCan, McFaddin Enterprises Eric Jacobsen, AgReserves, Inc. Neal Wilkins, Ph.D., East Wildlife Foundation John Welch, Welch Cattle Company Fred Bryant, Ph.D., Caesar Kleberg Wildlife Research Institute Allen Rasmussen, Ph.D., Texas A&M University-Kingsville

“The New KRIRM Excellence in Ag Leadership Program” From Director Dr. Clay Mathis

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t the King Ranch® Institute for Ranch Management (KRIRM) we stay focused on the original intent of visionaries and supporters who created the KRIRM model of education and outreach. The vision of KRIRM remains: We are determined to educate leaders who will make a positive difference in ranching, and ensure that our hard earned heritage is not lost. The core of our effort will continue to be the training of three to four exceptional graduate students each year that will have a broad and lasting positive impact on ranching. These individuals will be exceptional ranch managers and leaders.

Although we often think first about ranch management in terms of managing natural resources, livestock, and wildlife, we should keep in mind that success on complex ranches also requires the leadership of teams working toward common goals. Feedback from our graduates over the years about their training made this point very clear and led KRIRM to increase our emphasis on leadership development. Viewing our industry as a whole, I believe the key to success will be great leadership at all levels. It is the resolve and thoughtful decision-making of leadership that has been integral to the success of past generations. In light of the issues we face as an industry today, if we look down the road a few decades I believe it will be even greater leadership that will be needed to guide our industry.

In response to this growing need, KRIRM recently created a new leadership development program that began during the 2014 National Cattlemen’s Beef Association (NCBA) convention in Nashville, Tennessee.

The KRIRM Excellence in Ag Leadership Program is a two-year series of development opportunities designed to strengthen the next generation of leaders in the ranching industry. We believe that developing the next generation of leaders is among the strongest leverage points for our industry, and NCBA also shares that view. We are grateful to NCBA for helping us identify 15 high potential leaders selected to learn along-side KRIRM graduate students in the initial Excellence in Ag Leadership cohort. All participants have a common

Photo by JoAnne Meeker

desire to learn, grow, and passionately serve our industry. The selected individuals will complete a distance-education program designed to help them identify, understand, and capitalize on their unique strengths to develop personal, organizational, and community leadership skills.

The program started with a one-day workshop where participants received the results of a personal 360-leadership assessment completed by their managers, co-workers, peers, and direct reports. The assessment identified the unique leadership strengths of each participant. The 360-degree assessment identification of perceived leadership strengths is the foundation of the KRIRM Excellence in Ag Leadership Program, and enables each participant to create a strengths based personal development and action plan that they will follow and refine throughout the two-year program. In addition, participants will attend KRIRM lectureships that focus on strategic planning, human resource management, and systems thinking. Other components of the program include webinars with industry leaders, and opportunities to attend policy and media training workshops.

We are excited about this new programmatic addition to KRIRM outreach. The KRIRM Excellence in Ag Leadership Program will be headed by KRIRM faculty member Dr. Ryan Rhoades, who has a passion and unique gift for leadership development. Currently, this program is in a trial phase at KRIRM. It is our hope that the impact of the program will enable KRIRM to find the long-term support needed to repeat the program in 2016 and beyond.

wagon WT tracks

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A balance between tradition and technology keep this historic operation moving forward.

By Kindra Gordon

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arbed wire is what brought Isaac Ellwood and his son to West Texas in 1889. Ellwood, an Illinois native, was one of the original co-inventors and patent holders of barbed wire in 1874, and he was looking to bring this “new technology” to Texas. The Ellwoods ended up buying a 130,000 acre ranch at Renderbrook Springs with acquisitions of cattle, horses and more land to follow.

In his heyday, Ellwood owned 475,000 acres of ranchland across Texas. Some of the land was sold off in the 1920’s, but today, what became known as the “Spade Ranches,” marks 125 years in the ranching business raising cattle, Quarter horses and offering fee hunting.

The ranch is still owned by Isaac Ellwood’s descendants, and includes six ranches on more than 250,000 acres. It is listed by the National Cattlemen’s Beef Association as one of the 25 largest ranches in the nation.

Wesley Welch currently serves as president and CEO of Renderbrook Spade Inc., the managing partner of Spade Ranches. He took on the role in 2012, and becomes only the fifth manager in the ranch’s 125-year history. His father, John Welch, served as CEO and president of Spade Ranches from January 2003 through 2011; he succeeded William J. “Dub” Waldrip who had managed the ranch for 35 years.

Wesley Welch was assistant manager of Spade Ranches for four years prior to this CEO appointment, and he recognizes 4 I Spring 2014 I KRIRM

the unique legacy behind the ranch, but is equally focused on the future. Welch says, “From the time the ranch was founded it was a leader in technology for the times – first with barbed wire and later with crossbreeding. While we continue to tip our hat to tradition, we are also looking forward to new technology and ways to operate the ranch more efficiently.”

He adds, “One thing I’ve always appreciated about Spades is we are very bottom-line driven.”

Eye On Efficiency

Efficiency is a focus in both the genetics of the livestock raised on Spade Ranches as well as the ranch management and labor. The ranch has a capacity for about 10,000 total head of cattle—typically about 6,000 mother cows and the balance being replacement heifers, herd bulls and stockers— across their six ranch locations. The six ranch units across the state include: Renderbrook Spade, Colorado City; Wagon Creek Spade, Throckmorton; Borden Spade, Gail; Alpine Spade, Alpine; North Spade, Turkey; and Panhandle Spade, Canadian.

Welch shares that their workforce averages about one employee to 700-800 animal units, meaning they have only about a dozen total ranch employees. “A lot of our ranches are stand-alone, one to two man operations,” he shares. Welch explains that this management approach works for their

operation because the six ranches are quite spread out from one another.

Each ranch unit is set up to have its own ranch manager and be run with minimal inputs including employees.

As president and CEO, Welch is based in the Spades headquarters office in Lubbock, and says, “We need to think bigger picture all the time and that’s what this office was set up for.”

Both Wesley and his father John Welch credit the ranch’s efficiency and success to finding the right people and then letting them do their jobs. While regular communication with unit managers to discuss goals and budgets is an integral part of the Spade Ranches business plan, unit managers are also given some latitude. “You’ve got to hire someone with a lot of initiative and then leave them alone,” John Welch says of his time as CEO. The “hands-off” approach has been effective. Employee turnover is very low at Spade Ranches, with most of the ranch’s employees having been part of the ranch for a minimum of five years and some for decades.

Future Focus

With severe drought across Texas the last few years, Spade Ranches is slowly starting to rebuild their herd numbers. To get through the drought, they had been selling replacement heifers and shipped several hundred pairs to greener pastures in Montana and Wyoming.

Today, Welch says they are about 85% stocked and they have been retaining heifers and buying heifers. He explains that they are focusing on heifers because there are more genetics— and sheer numbers—to choose from. “The pool of available bred heifers and cows is pretty limited right now,” says Welch.

As they restock, Welch is focused on what he calls “moderate-type heifers” that offer a balance of maternal and terminal traits for their rugged West Texas ranch country. The ranch has been utilizing SimmAngus and Balancer (AngusGelbvieh cross) cattle for several years and are happy with the performance on the ranch and rail.

Crossbreeding was first introduced at Spade Ranches in the 1960s, and it is still utilized today. Composite SimmAngus and Balancer bulls are used, with heifers from one mating crossed to the other composite to maintain a high level of heterosis while producing a uniform calf crop as well as producing quality replacement females.

With the changing times of the industry, Spade Ranches has participated in various value-based marketing programs.

As well, all calves from Spade Ranches can be source and age verified, and calves from the Panhandle Spade Ranch in Canadian, Texas, are verified non-hormone treated cattle.

Given its 125-history, Spade Ranches has proven its strength and ability to adapt to changing times. As the world’s beef industry continues to evolve, that focus will continue and is sure to pay dividends for Spade Ranches well into the future.

From 2003 to 2012, John Welch served as president and CEO of Spade Ranches, which encompasses 250,000 acres on six different ranches in West Texas. Welch recently became a member of the management council of the King Ranch® Institute for Ranch Management.

In 2012, Wesley Welch was appointed president and CEO of Renderbrook Spade Inc., the managing partner of Spade Ranches.

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Tylor Braden

I feel blessed to have had the opportunity to be a part of the King RanchÂŽ Institute for Ranch Management (KRIRM) Class of 2014. While the program offers many experiences, I consider some of the best at KRIRM to be: knowledge base and experiences of classmates, very applicable and significant management projects, and substantial personal exposure to high level ranch management executives. While I cannot speak for other alumni, I strongly feel that my time at KRIRM would not have been the same without the other students. The amount of experience and the capabilities that sit in the office can be quite impressive.

To me, one of the most rewarding parts about the program were the ranch projects. Two projects that stood out to me focused on a large property acquisition analysis presented to a VP, controller, & cattle manager, and an infrastructure blueprint for a complex agricultural property with roads as the only existing development.

The first project consisted of evaluating the acquisition of a ranch, operating multiple enterprises with positive cash flows, capitalizing on the asset’s appreciation in 20 years, and then make recommendations based on the project Net Present Value with a given hurdle rate.

The latter project consisted of developing an infrastructure blueprint for a property consisting of hundreds of thousands of acres with efficiency as a priority. All developments where planned while considering state/county laws and regulations, water districts, quality of school districts, and availability to urban amenities. The implementation of the plan was expected to take over twenty years and was viewed as an outline and starting point, not the final draft. I felt this was a once-in-a-lifetime experience and may never again be done on a similar scale in North America, considering that virtually all properties of this size already have significant infrastructures in place.

Finally, I consider the exposure to managers of some of the largest ranches in the nation to be irreplaceable. We as students had an entire day to spend just asking questions and visiting with Wayne Fahsholtz, CEO of Padlock Ranch and Burke Teichert, past Rex Ranch Manger and VP of ranching 6 I Spring 2014 I KRIRM

for AgReserves Inc. This experience, as well as interacting with other ranches including the King Ranch, have been the best preparation for working with management boards in the future.

Tyson Johnson

As graduation draws near, I reflect back on my decision to apply for acceptance in the KRIRM in 2012. I would like to walk you through my thoughts and experiences of the last two years in explaining why I decided to apply, my experiences, and my future expectations after graduation from KRIRM. In the transition of selling out of my own cattle business and exploring options to further my education and career, I focused on four factors that I felt would give me the best opportunity for continued success in the industry. These factors were marketing or exposure, diversification, reputation, and return on investment (ROI). I wanted my next venture to promote opportunities of gaining capital in my career by increasing valued contacts while supplying exposure to fresh practices and ideas within the industry.

After calculating, contemplating, researching, and turning to mentors, I felt that KRIRM was the best option that fulfilled the requirements that I had set for myself. Now, two years later, having a plethora of experiences with the institute, I can confidently say it was the right decision.

Valuing relationships as an eternal principle, the associations and rapport gained with the faculty, staff and colleagues, is personally one of the greatest outcomes in attending the institute. The lessons that I learned from each one are too long to list. The camaraderie among classmates as we worked on projects will be missed. Diversification of courses that were well balanced between science, business, and leadership gave me an appreciation for the strategic plan implemented by KRIRM. Another highlight of the institute was the assigned projects.

Even though some of the King Ranch projects were daunting at times, the experience gained from working on projects of this scale and presenting them to upper management was

irreplaceable. Then receiving feedback and getting advice from influential personnel of the ranch was a unique and treasured experience. My final project with the East Wildlife Foundation has allowed me to pick the minds of sharp, top executives while producing a useable product. However, for me the most cherished and memorable experience was completing an internship in Uruguay. The opportunity for a challenge of that magnitude while working with successful executives was invaluable, and it gave me exposure that couldn’t be matched.

I feel that KRIRM has given me the tools for continued success. The institute not only met my initial four requirements, but surpassed them by transcending my expected ROI. I feel it an honor to be a graduate of KRIRM, but more importantly cherish the friendships that were formed.

Chris Redman

I have grown more than I could have imagined over the two years I spent at the KRIRM. Experiences at KRIRM have exposed me to a variety of topics improving my ability to see a bigger picture of the ranching industry. Subjects were covered through a variety of methods including classes, lectureships, short courses, and small group

question and answer sessions.

A unique aspect of the KRIRM program is the size of each graduating class and the attention to each individual.

Some students are able to give presentations in front of large groups and others may take additional courses. The summer internships are intended to provide a unique experience for each individual that takes them out of their comfort zone to encourage growth and understanding of the industry.

Leadership development is another strong focus of the KRIRM program. As part of the development process, I was evaluated in a 360-degree review identifying strengths and potential areas for improvement. The 360 review gets feedback on leadership ability from the individual, past and present supervisors, peers, and direct reports. I took the feedback from the evaluation, and using tools learned from the advanced leadership class taught by Dr. Rhoades, I made a detailed plan with Dr. Rhoades and Dr. Mathis focusing on advancing key areas of leadership development.

My greatest growth was in my ability to communicate through presentations using both writing and verbal methods.

I was able to improve these skills through presentations of project recommendations to King Ranch, several written projects and proposals, classes that focused on improving communication, and having opportunities to visit with a

diverse group of influential ranch managers.

I look forward to using the tools, skills, and knowledge gained from the KRIRM program as the assistant manager for Roaring Springs Ranch in southeastern Oregon.

Darrell White

I would like to take this chance to thank the (KRIRM) for an opportunity to pursue the only master’s degree for ranch management in the world. The ability to tailor curriculum to each student’s needs, while incorporating practicality and economics, in order to develop the core skills essential to successfully manage and lead complex ranching operations, is what I think makes this program truly unique. After all, as Burke Teichert once said, “General managers don’t need to be experts in one particular discipline; they need to be pretty good at a lot of stuff.”

Forty-nine hours of customized coursework enhanced my strengths and improved my weaknesses by encompassing an array of disciplines such as accounting, finance, animal science, range management, wildlife management, and more.

Lectureships such as strategic planning, oil and gas, human resource management, and more added to the breadth of the subject matter covered. As students, we also attended great industry events and additional educational opportunities that helped us connect to various segments in the ranching industry and network with professionals across the U.S. Another unique aspect of my time at KRIRM came with the case studies and seminars with CEO’s, VP’s, and general managers such as Jack Hunt, Dave Delaney, Wayne Fasholtz, and Burke Teichert. These professionals provided unique experiences beyond what is typically found in traditional academia. I also felt that special projects, conducted in large part with King Ranch Inc., were also valuable in developing my decision-making processes by analyzing real world scenarios with insight and feedback from King Ranch management. Finally, and perhaps one of my most interesting learning opportunities, was my ability to spend several months at a large cattle operation in northwest Wyoming during my summer internship developing a grazing management plan and range monitoring program.

The professionalism exemplified by faculty and staff, quality of fellow graduate students, and challenging curriculum created an ideal environment for mature students seeking the greatest return on their investment. My personal and professional development, facilitated by KRIRM, exceeded my expectations and was well worth the effort.

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A scenic view of Vermejo Park Ranch, one of the partnering ranches of KRIRM.

KRIRM benefits from relationships with ranching professionals.

By Ashley Patterson

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here are many reasons why the King Ranch® Institute for Ranch Management (KRIRM) is truly a unique program.

As the only master’s in ranch management program in the world, it offers an unparalleled educational experience for KRIRM students. One of the reasons KRIRM students are successful leaders is because of their training and experiences with great mentors.

Mark Kossler of Vermejo Park Ranch and Wayne Fahsholtz of Padlock Ranch are two of the many individuals who serve as great mentors to the KRIRM program and its students.

Mark Kossler

Spanning more than 920 square miles in Raton, New Mexico, Vermejo Park Ranch is one of the west’s premier hunting, fishing, and nature tourism resorts. With its rich history, it is the largest tract of privately owned land in the west and offers guests rare 8 I Spring 2014 I KRIRM

experiences to explore a variety of ecosystems.

Kossler serves as Vermejo’s general manager and has graciously offered his knowledge to many KRIRM students. Over the past six years, Kossler and Vermejo hosted three students during their summer internships. During these summer internships, KRIRM students collaborate with their host ranches and work on specific projects that benefit not only the student, but the ranch as well.

Students travel back to Kingsville, Texas, each August and report on their experiences.

The students who participated in internships with Vermejo are described by Kossler as “some of the best young, experienced folks working in agriculture today.”

“All three spent an appreciable amount of time with the ranch manager and the division supervisors to see what exactly their areas of responsibilities were,” he said, “what the main challenges of the position were and how they structured and carried out their Vermejo Park Ranch’s bison herd that lives and grazes in Costilla duties.” in the high country.

A bachelor group of bull elk grazing on Vermejo Park Ranch.

The students helped Vermejo with ongoing projects that were lost in the busy schedules of the ranch employees, said Kossler. These projects included a strategic management plan for the ranch, as well as a white paper that delineated how the ranch was structured economically, ecologically, and staffed with human resources.

The benefits for the students participating in these projects are obvious; they become exposed to diverse operations that might be out of their geographical comfort zones, such as Vermejo Park.

“Because Vermejo Park is a very different operation from normal livestock agriculture,” said Kossler, “it can give them insight and experience in areas not commonly found at this size and scale. I am convinced that many of these young people will be the future leaders in our industry.”

But the benefits are not only for the students. Vermejo certainly appreciated the work done by KRIRM students because they were able to look at the big picture of the ranch mission and analyze the

Wayne Fahsholtz and wife Judi on Padlock Ranch.

progress as a result of good questions posed by KRIRM students, said Kossler.

“They often times had great suggestions. The ranch staff enjoyed working with and associating with the students.”

Wayne Fahsholtz

For more than 70 years, Padlock Ranch has strived to be a successful and sustainable cattle operation, offering quality cattle to generic and natural markets. Each year, the ranch raises more than 10,000 calves. The ranch encompasses 475,000 acres straddling the Montana and Wyoming state line.

The Padlock values are outlined as profit, people, perpetuity, and pride, which all aligns with the mission as stated on the ranche’s website: “It is our mission to manage the resources and assets of the ranch for long-term sustainability, while conserving and improving our environment and communities. We must fulfill our vision

Each year, Padlock markets quality cattle to generic and natural markets and raises more than 10,000 calves.

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Commit to Lifelong Learning

Upcoming Events May 14-16, 2014

Richard Mifflin Kleberg, Jr. Family Lectureship on Equine Management

August 11-14, 2014

John B. Armstrong Lectureship on Systems Thinking

September 19-20, 2014

B.K. “Kley” Johnson Lectureship on Current Ranching Issues: Human Resource Management

statement by operating in a manner consistent with our values.”

Wayne Fahsholtz, the CEO and president of Padlock, has served as another great mentor to KRIRM and the students. Since this partnership began between the two organizations, Fahsholtz has mentored six KRIRM students. Two of these students were interns who spent the spring and/or summer on Padlock working directly with the ranch management.

Jen Livesy, KRIRM class of 2011, worked closely with Padlock on two separate projects. Livesy spent her summer internship in 2010 on Padlock and later collaborated with the ranch on her final project for the program. Through those experiences, she learned from her mentor, Fahsholtz.

“I learned the importance of continual self-learning as a manager; Wayne was constantly referring to new management books and is one of the more tech-savvy people I know,” she said. “I also gained insight into just how important people management is; he focuses intensely on the personal development and relationships with Padlock employees, and also skillfully works with a large group of family owners.”

In addition to guiding student projects, Fahsholtz also came to know some KRIRM students while visiting Kingsville during KRIRM meetings, which ultimately led to him hiring a student as the assistant operations manager for Padlock, and recommending one student to a general manager position. Fahsholtz praised the work ethic of the KRIRM students he has worked with.

“Because they have experienced the working environment before starting this program, they are more serious and dedicated to learning.”

The work of Padlock and Fahsholtz to educate future ranch managers and leaders of the industry is certainly beneficial in today’s ranching world. KRIRM students who work with mentors such as Fahsholtz are prepared for challenges ahead.

“There is a need for new ranch management professionals,” Fahsholtz explained. “The beef industry is changing and evolving.

The demand for good managers is growing each year.”

The KRIRM program has been fortunate to have Kossler and Fahzholtz serve as mentors to its students. The mentorship provides an extra edge for students during their master’s program, all in conjunction with other world-class learning opportunities. The dedication of mentors to guide and teach KRIRM students is critically important to the KRIRM training model.

October 23-24, 2014

11th Annual Holt Cat® Symposium on Excellence in Ranch Management

Fahsholtz talks to a group of students on a tour of Padlock Ranch.

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NON PROFIT ORG U.S. POSTAGE PAID AUSTIN, TX

KING RANCH® INSTITUTE FOR RANCH MANAGEMENT

TEXAS A&M UNIVERSITY-KINGSVILLE

PERMIT NO. 1718

MSC 137 Texas A&M University-Kingsville Kingsville, TX 78363

Save the date for the 2014 Holt Cat® Symposium on Excellence in Ranch Management!

October 23-24,2014

Kingsville, TX