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by Irwin W. Rust
Farmer Cooperative Service
U.S. Department of Agriculture
A13 r ;37
FARMER COOPERATIVE SERVICE
U. S. DEPARTMENT OF AGRICULTURE
WASHINGTON 25, D. C.
Joseph G. Knapp, Administrator
The Farmer Cooperative Service conducts
research studies and service activities
of assistance to farmers in connection
with cooperatives engaged in marketing
farm products, purchasing farm supplies,
and supplying business services. The
work of the Service relates to problems
of management, organization, policies.,
financing, merchandising, product qual-
ity, costs, efficiency, and membership.
The Service publishes the results of
such studies; confers and advises with
officials of farmer cooperatives; and
works with educational agencies, coop-
eratives, and others in the dissemina-
tion of information relating to coop-
erative principles and practices.
Changes in today's co-op--------- 1
Methods used--------------------- 3
Methods measured---------------- 5
Points to remember--------------- 7
Key steps to sound programs------ 7
Coming events cast shadows------- 11
Co-ops vs. autocratic efficiency- 14
by Irwin W. Rust
Membership Relations Branch
Management Services Division
n the early days of farmer cooper-
atives, a member learned about
his association by actually taking part
in its affairs and functions. But as
cooperatives became more specialized
and grew in size and variety of services,
they began to delegate more and more
of the actual operations to employees
Changes in Today's Co-op
Thus today the detailed knowledge
of cooperative affairs is likely to be
confined only to those members acting
in some official capacity such as on
the board of directors. And conse-
quently the rank and file member feels
less involved in his cooperative.
In addition, today's member no
longer thinks of his cooperative as a
major social outlet. He no longer has
as much time to spend on it. There is
increasing competition for his time and
interest from other activities. And he
is often quite a ways removed from
the cooperative -- both because of the
larger areas most cooperatives serve
and the increasing technical knowledge
required to run many aspects of the
All these changes make it increas-
ingly difficult to maintain a feeling of
warm, close personal relationships
between cooperatives and their mem-
But at the same time the need for
this close relationship has become
more and more imperative. For ex-
perience has taught us that the
informed -- and involved -- member
is the loyal member. And the loyal
member in turn provides the foundation
for a strong, vigorous cooperative.
Progressive and far-sighted coop-
erative leaders have recognized the
difficulty and the necessity of keeping
Meetings to educate and inform members about
their organization are helpful to any member
members well-informed, and over the
years have developed various methods
of membership education.
Today, these educational activities
are usually grouped into what is called
a member relations program. Usually
these programs include at least the
following three methods -- meetings,
personal contacts, and printed
materials and audio-visual aids.
Meetings include such events as the
annual membership meeting, local or
district member meetings, and board
At the annual meeting, members
learn about their cooperative by listen-
ing to officers and key employees
review policies and give an accounting
of their stewardship for the preceding
year in the form of an annual report.
Here also they have an opportunity to
ask questions on any points bothering
Local or district meetings are often
held by the larger cooperatives. Here
members meet cooperative staff per-
sonnel who brief them on cooperative
Board meetings, by necessity
largely restricted to directors, give
board members an opportunity to learn
the more technical details of the
organization and operation of their
The second method for educating
members, personal contacts, is par-
ticularly effective if wellplanned. Such
contacts may be between member and
employee, member and director, or
even member and another member.
Contacts may be made in the cooper-
ative's office, on the member's farm,
on the street, or at any gathering where
cooperative members and staff meet.
Worthwhile contacts may be made also
during special events, such as an edu-
cational tour or speaking contest spon-
sored by the cooperative.
An advantage of the personal con-
tact method is this: If you're looking
a man in the eye, he probably will
listen to what you have to say.
Personal contacts may be made at special
events, on members' farms, or at any gather-
ing where cooperative members and staff meet.
Publications and Audio-Visuals
A third method for educating mem-
bers is printed materials and audio-
visual aids. Among the most widely
used are printed annual reports; regu-
larly issued magazines, newspapers
or newsletters; outside newspaper
stories; radio and television programs;
institutional advertising; and posters
and charts. An advantage printed
materials have is that they can be
studied at leisure. A disadvantage is
that they can easily be discarded, for
a man reading his mail in the privacy
of his home can't be forced to read if
he doesn't want to.
With several choices of methods,
a cooperative planning a member
education program must devote most
of its attention and funds for this
activity to methods that have proved
their worth in the past.
To measure the relative effective-
ness of these various methods, in 1950
the -Membership Relations Branch of
Farmer Cooperative Service made a
survey of 2,750 members of a large,
federated cooperative noted for its
member relations program. These
2,750 were asked to rank, in order of
effectiveness, seven educational de-
vices most commonly used by their
cooperative. These seven most ef-
fective methods turned out to be:
1. Cooperative periodicals, 2. personal
contacts, 3. circular letters, 4. annual
reports, 5. annual meetings, 6. educa-
tional exhibits, 7. radio programs.
A similar survey was made in 1960
which bore out the results of the 1950
survey -- with cooperative periodicals
and personal contacts again listed as the
most effective methods and annual
meetings as effective as they were
thought to be in 1950.
These were the 1960 results:
Cooperative periodicals -- 98 per-
cent of the members surveyed reported
reading all or part of their cooper-
Personal contacts -- 83 percent
had personal contact with the manager
at least once a month, and 55 percent
contacted their directors at least once
Printed materials telling the cooperative's
story have an advantage, for they can be.
studied at the member's leisure.
Annual meetings -- only 15 percent
of the members attended the annual
meeting, 55 percent had never attended
an annual meeting.
Points to Remember
Effective membership education
must be a continuing process. Many
cooperatives today understand this and
have set up member education pro-
grams as a departmental activity. But
many others cannot afford a separate
member relations department. How-
ever, it is still possible for a cooper-
ative without such a department to have
an effective member education program
if management -- both directors and
manager -- make the best use of the
best available methods.
And above all, the program should
reflect a thorough understanding of the
basic principles of communication.
Key Steps to Sound
So let's dig a little deeper and
analyze just what goes on in a sound
member education program. Let's
speak in abstract terms for a moment.
Using these terms, we see three major
phases in any membership relations
program: Projection, or sending some
form of communication. If successful,
this results in Motivation -- that is,
the creation in the member (receiver)
of a desire for -- Action, or partici-
pation in the cooperative's program.
Projection -- One basic method of communica-
tion is through the appearance of facilities.
Impressions formed here may affect the mem-
ber's overall appraisal of the organization.
Ideally this includes both patronage and
participation in cooperative activities.
Note that projection (communi-
cation) is the first and key step and
that some form of action is the desired
end product. But three questions still
arise: What shall we project, or
communicate? How shall we communi-
cate it.? and Why should we communi-
What to Communicate?
Let's consider first what we shall
communicate. Cooperative members
will want to know mainly about these
The cooperative itself -- its back-
ground, objectives, organization, and
general operation; products it handles,
where they come from, and where they
Cooperative policies -- especially
the reason for adopting new policies,
or changing old ones, and how policies
affect themselves and their fellow
Cooperative plans -- involving such
things as changes in methods, equip-
ment, services offered.
The outlook -- for business and
agriculture in general, and for their
product in particular.
Cooperative finances -- about sav-
ings or losses; about plans for the
future, such as development of new
methods of procurement or marketing;
about development of new products.
To summarize, cooperative mem-
bers want full information about their
cooperative, including the good and
the bad news.
How to Communicate?
Now for the second question -
How shall we communicate ?
We know that the act of communi-
cating is an exchange of ideas, opinions
or impressions. This exchange takes
place through several communication
channels. For example, we can ex-
change ideas through:
Words -- spoken or written.
Sight -- pictures or other visual
Activities -- such as the day-to-day
operations of your cooperative.
Attitudes -- expressed by the man-
ner in which your cooperative performs
Perhaps the most important thing
to remember when thinking about how
to communicate is this: WE CAN'T
We communicate all the time,
whether we intend to or not. You have
all gone into a store, for example,
and stood waiting while a clerk finished
some bit of idle gossip before waiting
on you. Your reaction was probably
something like this, "If they don't need
my business any more than this, I'll
go somewhere else"!
The clerk's indifferent attitude
communicated itself to you. And your
reaction, from the point of view of the
store, was highly undesirable. You
stopped patronizing it.
Or, take visual communication. If
you have a choice between two business
firms, one of them shoddy and run
down in appearance and the other
immaculate, you are apt to patronize
the one with the better appearance.
Both communicated to you visually,
and you reacted accordingly.
How can a cooperative make the
best use of such involuntary communi-
cation? Simply by being everlastingly
aware that it is going on, and by guid-
ing itself accordingly.
And now for the third question --
Why should we communicate? This is
a little more difficult to answer.
Because the better informed the
cooperative member is, the better the
cooperative will be and the better it
can compete with the increasing compe-
tition of today's modern economy of
bigness and concentration of power.
Coming Events Cast Shadows
Someone has aptly remarked that
"Coming events cast their shadows
before." We are now in those shadows.
For today's cooperative member
lives in the shadows of this bigness
and concentration of power everyday,
whether it's Big Business, Big Labor,
or Big Government. He meets it when
he sells his farm products and when he
buys his production supplies.
The Federal Trade Commission
reported this about total food sales in
1958: Food chains with 11 or more
stores accounted for 28 percent, the
Motivation -- Making members aware of co-op
operations is one method of creating a desire
largest food chains accounted for over
29 percent, and the four largest food
chains accounted for 20 percent.
The member also confronts this
increased size and decreased number
of firms when he buys farm supplies.
Thus today's cooperative member
is engulfed in the wave of bigness that
is not only sweeping him along in its
wake, but his cooperative as well.
Farmer cooperatives are decreas-
ing in number. But farmer cooperatives
continue to hold their share of the
agricultural market. This means that
cooperatives, like other businesses,
are growing in size.
Farms have decreased in number.
But the farm of today's cooperative
member has grown 29 percent in size
since 1940 and is still growing.
These conditions then face the mem-
ber and his cooperative: fewer farms,
bigger farms, and increasing concen-
trations of economic power -- and
from these concentrations a new,
In 1960 an article in Business Week
described how an electronic computer,
then being tested, works.
A computer at company headquar-
ters is connected to similar computers
at the company's branch plants. Infor-
mation fed into branch-plant computers
is flashed to the headquarters computer
which processes it and arrives at a
decision in a matter of seconds.
The decision may then either be
referred to an employee for approval --
or sent back to the branch-plant com-
puters as an order. Conceivably the
branch-plant computers could then
carry out the order untouchedby human
hands or heads.
The efficiency of these machines
in an organization means no wrong
moves, no impulsive gestures, no
hanging on to unneeded plants, un-
wanted products, or unneeded em-
ployees, and no chances for discussion
to bring in ideas from the organiza-
tion's owners or employees.
Listen also to Harold J. Leavitt of
Carnegie Institute of Technology's
Graduate School of Industrial Adminis-
tration. He has said:
"I argue that a third technology
is already moving in -- let's call it
information technology -- that its major
idea is the idea of information theory;
that its tools are a new mathematics
and the computers; that its practition-
ers are eggheads -- operations re-
searchers; or simulators, computer
program designers and such; and
finally, that its target is the conversion
of the middle and upper management
decisions from seat-of-the-pants judg-
ments to analytic problem solutions."
Computers now handle many
functions formerly handled by middle
management, such as foremen and
branch-plant managers. Through these
machines, control can be concentrated
at the very top of an organization,
control based on information accurate
and precise to a degree never dreamed
of a few years ago. This is an almost
Co-ops Vs. Autocratic
Can cooperatives, democratic in
form and by nature of that form deliber-
ate and slow, compete with this control,
this efficiency? To do so, today's
cooperative member may have to give
up some prerogatives that he enjoyed
in the past. These could be deciding
what and where to plant, to buy, and to
sell. Does today's cooperative member
have the information, the understanding
of what he and his cooperative are
faced with, to accept this discipline?
This is his decision to make. And
to provide him with the information
to make a sound decision lies within
the responsibility of the cooperative's
member relation program. But before
providing him with this information
must come this important realization:
that today's cooperative member dif-
fers from yesterday's.
One cooperative leader put it this
way. "...we probably are safe in
assuming that increasingly the member
we are dealing with has joined the
association well after its founding; that
he played no part in its early struggles;
that he has, therefore, no emotional
involvement with it; and that he belongs
to the organization mainly for commer-
cial reasons arrived at through
rational, intellectual processes rather
than because of any deep-seated eco-
nomic or social philosophy.
"...the challenge to the cooper-
ative's member relations program in
the future is to find some way of
cracking this hard commercial shell
and then providing the member with
Action -- A good member relations program
must find ways to persuade members to pull
together for the solution of mutual problems.
a rationale for membership partici-
pation that will fit his kind of business
and social thinking.
"Obviously, what we need now is to I
thread our way between these extremes
of sentimentality and materialism,
picking our way along the hard, if
narrow, ground of truth until it brings
us to a sound basis for a successful
membership participation program."
But participation, perhaps in pro-
gram development, is not enough. The
above writer concludes that "the in-
tangibles -- the sense of belonging,
of sharing, of having an effective
voice -- these are the vitamins that
keep the cooperative body strong and
The challenge to your cooperative
is to find ways to operate effectively
in today's efficient marketplace while
maintaining the fundamental virtues
which set cooperatives apart -- and
to instill in members an awareness
of those virtues, a sense of pride of
ownership of an organization so
uniquely endowed. It is up to you to
help your cooperative face up to that
Strong member relations is the key.
UNIVERSITY OF FLORIDA
3 1262 08500 2086
Other FCS Publications
Exploring Communication Processes
in a Farmer Cooperative -- A Case
Study. General Report 97. James H.
Copp and Irwin W. Rust.
How Do Members Use a Co-op Paper ?
General Report 30. Job K. Savage.
Making Your Membership Publication
Do the Job. Information 13.
Suggested Steps for Improved Member
Relations. Information 12. Oscar R.
Popular Publications on Farmer Coop-
eratives. Information 7.
A copy of each of these publications may
be obtained while a supply is available
Farmer Cooperative Service
U. S. Department of Agriculture
Washington 25, D. C.
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