John Deere Fall - 2001
John Deere Fall - 2001
John Deere Fall - 2001
JOHN DEERE
IN INDIA
WELCOME TIMBERJACK
AG ROLLS OUT NEW PRODUCTS
O N B O T H S I D E S O F T H E AT L A N T I C
© 2001 DEERE & COMPANY
COVER: A John Deere 5310 tractor Published for John Deere Employees, Retirees,
manufactured in India pauses on the northern Dealers, and Friends Worldwide
bank of the
Yamuna River
across from Address Correspondence to: Editor, JD Journal,
the Taj Mahal Corporate Communications Department,
near Agra, Deere & Company, One John Deere Place,
India. This Moline, IL 61265-8098
striking scene Phone: (309) 765-4170; E-mail: [email protected]
was filmed for View JD Journal on the Web at: www.johndeere.com
FALL 2001
a 60-second
television commercial that features John
Deere equipment in use around the Editor — Andy Markwart
world. In a touch of movie magic, the Art Direction and Design — Wayne Burkart
animals, huts, melons, and local
JD JOURNAL
SPECIAL FUND FOR AMERICA Thanks to the quick action of employees, Foundation will lead the donations to this fund
dealers, and suppliers, John Deere was able to with a $250,000 contribution.
provide Gator ® utility vehicles and skid-steer Employees, dealers, retirees, and friends
loaders to help in the rescue and recovery can contribute to this fund by sending their
efforts following the World Trade Center attack donation directly to the John Deere Special
on September 11. Fund For America c/o the John Deere
Employees throughout the company wanted Foundation at One John Deere Place, Moline, IL
to do more, so the “John Deere Special Fund 61265. Employees can also contribute through
for America” has been created to support their unit HR department. The Foundation’s
recovery and relief efforts. The John Deere board of directors will administer the fund.
2 JD Journal
FEEDBACK
in the corporate setting. along with all his other John symbols. The cupcakes each
VOLUME 30, NUMBER 2 SUMMER 2001
I have chosen my words Deere paraphernalia. When his had the John Deere logo embed-
MERCHANDISING
more carefully since then! cousins visit, he makes sure ded in the frosting. Each kid
JOHN DEERE’S
GOOD NAME
/Judi Berkley, financial analyst, he lays out the ground rules for decorated a tractor-shaped cookie
LEARNING
Deere & Company playing with his tractors. with John Deere colors.
HOW WE RATE WITH
CUSTOMERS A perfect example of his The farmer down the road
IN DEFENSE OF
GROWING OLDER
WHAT THE LATEST
My family would like to thank the obsession is when we went away was generous enough to drop off
SURVEY SHOWS
staff of Goodridge Farm Supply for vacation recently. Before his 4450 tractor with a huge plow
in Oakfield, New York, for their we could leave, my son made his right in the middle of the front
dedication and commitment to grandfather promise that he yard. You should have seen the
customer satisfaction and service. would check on his John Deere kids' faces as their eyes grew
They went the extra mile in help- tractors daily. When we returned, wider with each closing step!
ing us get our 420 lawn tractor the first thing my son wanted to It was a great day, and we
back up and running. Words know when his grandfather all had a wonderful time.
can't express the happiness I felt greeted him was the status of his Thank you for making such
I was looking through the JD today when I finished my five equipment! quality products./Allan C.
Journal, and I really like the acres of lawn with it after getting We celebrated his fifth birth- Jourdin, Coxsackie, New York.
battery-powered kids’ version of it back from the shop./Ron Smith, day with a party recently, and I'm
the Gator utility vehicle. I was Shelby, New York sure you could guess the theme.
trying to find this product on We hung John Deere streamers,
the Internet but could not My five-year-old son, Brad, is the green and yellow balloons, and We invite your feedback
find one. Can you please tell biggest John Deere fan I know. For used custom plates given to us and welcome news tips
me how I can purchase one every special occasion—birth- by the local John Deere dealer- and story ideas as well.
of these Gators?/Robin Culp, days, nursery-school graduation, ship, H.C. Osterhout & Son in Write Feedback, JD Journal,
Bloomfield, Iowa Christmas—he receives a John Ravena, New York. My wife and One John Deere Place,
(The battery-operated Gator Deere toy tractor. He has a spe- I made bookmarks and cus- Moline, IL 61265-8098,
can be purchased at participating cial place for all his equipment tomized cups as favors for the call (309) 765-4170, or
John Deere dealerships. To locate in his bedroom next to his bed, party, both with John Deere e-mail [email protected].
the dealer closest to you, visit
www.johndeere.com on the Internet
and click on the "Dealer Locater"
at the top of the page.)
3 JD Journal
TOP LEFT: This prototype Walking Machine harvester is
designed to step over obstacles while treading lightly on the for-
BIOMASS HARVESTING:
est floor, minimizing soil erosion and damage to tree roots.
TURNING WASTE INTO WATTS
Timberjack has been a pioneer in developing equipment for harvesting and collecting
CENTER LEFT: This Deere 753GL harvester will also be biomass—wood that is normally wasted in the logging process. Forest biomass is
marketed as the Timberjack 608L through Timberjack dealerships. burned to produce electricity and heat at power plants in countries such as Finland. Timberjack
makes a complete line of machines for collecting branches, treetops, and small trees for energy
TOP RIGHT: Deere added forwarders to its product line through the Timberjack production. The equipment includes:
acquisition. Forwarders, such as the 1158 model pictured, collect cut-to-length logs from the forest — Harvesters that cut and gather small trees.
interior and transport them to roadside-collection areas. — Bundlers that collect and pack logging residue into bundles 2-1/2 feet in diameter by
9 feet in length. The bundles are crushed before being burned at a biomass energy plant. Each bundle contains
CENTER RIGHT: This Timberjack-designed 535 knuckleboom loader uses multiple the same energy as about 24 gallons of oil.
hydraulic cylinders to mimic the movement of a human arm. — Forwarders that gather and transport bundles from the forest interior to the roadside.
In Finland alone, it’s estimated that 10 to 15 million metric tons of logging waste go unused each year. The
Finnish Ministry of Trade and Industry is calling for 27 percent of the country’s total energy consumption to come
from renewable energy sources, such as forest residue, by 2010 and 35 percent by 2025.
4 JD Journal
It was a union of strength with strength. When JOHN DEERE’S customer base. “Specifically, we acquired a world-class line
Deere & Company acquired the Timberjack Forestry NEW BUSINESSES
of harvesters and forwarders used for the emerging cut-to-
Group from the Metso Corporation of Finland in length harvesting method, a broader line of tracked feller-
early 2000 for $600 million, two world leaders in This is the second in a series of articles spotlighting bunchers, and a line of knuckleboom loaders used primarily in
forestry equipment joined forces. business operations recently acquired by Deere & logging in the southeastern U.S.,” he explains. (Knuckleboom
For years, John Deere has been a leading supplier Company. In the series, you’ll learn how these new loaders are hydraulically operated loading booms whose
businesses are helping the enterprise achieve its goal
of forestry equipment in North America and had mechanical action imitates the human arm.)
of doubling value twice in this decade.
marketed products in a few European countries Deere also acquired a line of highly sophisticated harvest-
including Spain and France. Deere has offered a full line of log skidders and a ing heads, which are marketed as attachments for Deere and Timberjack
line of wheeled and tracked feller-bunchers. (A feller-buncher collects small feller-bunchers and harvesters and also sold under the Waratah trade
groups of trees as it quickly cuts each one at the stump.) Some Deere construc- name to other original-equipment manufacturers (OEMs), dealers, and cus-
tion equipment, such as excavators, crawler dozers, and wheel loaders, also tomers. “And perhaps more importantly,”Anderson adds, “there is no other
have been used in various forestry applications. group of people in the world who know the global forestry business better, who
“In order to expand our forestry business, it was clear to John Deere for understand the needs of forestry customers worldwide better, than the
some time that we needed to do two things,” says Doug Anderson, managing Timberjack employees who are now part of the Deere family.”
director, international operations for the newly named Worldwide Construction Timberjack will benefit from the purchase by using Deere’s advanced
& Forestry Division (C&F). “One, we had to either develop or acquire a broader business processes. Both companies will benefit from more-efficient supply
line of forestry equipment, including the cut-to-length harvesters and forwarders management, manufacturing, and distribution. Deere’s distribution channel and
that are mostly used in Europe but are growing in popularity in North America. customers will benefit from the expanded world-class product line, while the
(A cut-to-length harvester can remove a tree’s limbs and cut the log to a Timberjack distribution channel and customers will gain from Deere’s advanced
specific length in the parts-distribution infrastructure and customer-
forest. A forwarder is a support programs.
combination tractor/
boom loader/wagon that
TIMBERJACK Anderson says the Timberjack brand will
continue and grow under Deere ownership. The
collects and moves logs
from the forest interior
MAKES DEERE division is dual-branding most forestry products
for distribution by both Timberjack and Deere
to a roadside.) Secondly,
we had to expand our
A GLOBAL dealers in North America. With dual-branding,
the designated products are sold under both
presence into Europe,
Latin America, Southeast
FORESTRY Deere and Timberjack brand names.
“Since we inherited dual distribution in North
Asia, and other regions
where timber is harvested. LEADER America, we have decided to dual-brand our
products in order to provide the level playing field
“Beginning in 1993, necessary for both dealer organizations to fairly
we had serious discussions with a number of the lead- compete at the retail level on their own merits,”Anderson says. “Outside of
ing producers of cut-to-length harvesting systems North America, we will distribute nearly every product exclusively under
about the potential for some sort of strategic alliance,” the Timberjack brand. The exceptions are skidders in a few countries.”
Anderson adds. “Given that Deere and Timberjack had Consolidation of log skidder production has begun at Deere’s factory in
been such fierce competitors in the North American Davenport, Iowa, using the Deere machine platforms. Skidders are now dual
forestry markets, we had no idea that we would have branded for distribution by both dealer networks in North America. Further
an opportunity to develop an alliance with, or acquire, consolidations in skidders and tracked feller-bunchers will accompany future
Timberjack. When we learned that Timberjack was for product updates.
sale, we immediately suspended all other discussions Plans are under way to dual-brand harvesters and forwarders for North
and focused on acquiring the world’s leading supplier American markets. “With the introduction of dual-branded harvesters
of mechanized timber-harvesting equipment. and forwarders this summer, we met our goal to have all major products
“When making our bid for Timberjack, Deere made it clear to the owners that dual-branded within 12 to 18 months of closing the deal,”Anderson says.
we were not interested in acquiring Timberjack if we could not retain its C&F now builds forestry equipment at Davenport, Iowa; Paragould,
key management,”Anderson says. Those retained include Mikko Rysä, the Arkansas; Woodstock, Ontario; Penticton, British Columbia; Filipstad,
company’s long-time president. Rysä now serves as vice president, international Sweden; Joensuu, Finland; and Tokoroa, New Zealand.
and new business, for C&F. C&F’s global-distribution network is a combination of Timberjack retail
The fit is excellent for both companies. “Deere and Timberjack have very companies in 13 countries, independent Timberjack dealers with more than 300
little overlap in forestry-related operations, and our product lines and geographic outlets in 40 other countries, as well as C&F’s independent network of Deere
coverage of the marketplace are mostly complementary,” Rysä says. Product dealers. “C&F is now the preeminent global supplier of mechanized timber-
overlap was primarily limited to log skidders, and to a lesser extent, tracked harvesting equipment with the acquisition of Timberjack,”Anderson says.
feller-bunchers. Deere inherited some distribution overlap in the U.S. and According to Rysä, the union of Timberjack and Deere will most likely
Canada, and to a much lesser degree, overseas. touch off other restructuring moves within the industry. “It is, however, very
Anderson says Deere acquired Timberjack for its advanced technology and hard to foresee any mergers or acquisitions that would result in a combination as
products, worldwide distribution, forestry-focused employees, and worldwide strong as Deere-Timberjack,” Rysä says./Dan Brown
5 JD Journal
PHOTOS BY STEVE DOLAN EVENTS IN ALBUQUERQUE, NEW MEXICO, AND SEVILLE, SPAIN, SHOWCASE
AG ROLLS
STORY BY LARRY RINEY
J
a theatrical punch as the new machines roared type forage harvesters. The first three sessions
ohn Deere introduced an unprece- across the stage. Thundering Japanese drums also included a 9986 cotton picker walk-
dented 54 machines and a host and rock music built anticipation. around, concentrating on new electronic
of tractor attachments at its new- The extensive lineup of new equipment header-height-sensing controls.
product introductions held July and August impressed Regina Herzlinger, a Harvard About 15 miles west of Albuquerque, dealers
in Albuquerque, New Mexico. In September, Business School professor and member of the got hands-on experience at two demonstration
63 products were unveiled in Seville, Spain. John Deere board of directors. “The machines sites. At one end of the first site, a concrete
Six waves of North American dealer per- are awesome and beautiful,” she said as track and a tractor-pull weight sled were used
sonnel, 5,000 in all, attended four-day “Take she stood between massive 8520T and 8520 to test “power hop,” or loss of traction, in
Command” sessions in Albuquerque. Each tractors on the crowded convention center the 8020-series tractor.
session began at the city’s convention center floor following the opening-night perfor- There was a buzz over the new Independent
with a welcome celebrating sales successes mance. “I’m an economist, and all I can think Link Suspension™ and ActiveSeat™ options
and engineering achievements of the past year. about is the great productivity, time savings, that improve power transfer and operator
Doug DeVries, senior vice president, and the great buy for the dollar these comfort. “This new suspension and the
worldwide marketing, began the session by machines represent and bring to agriculture.” ActiveSeat will help us go after new business,”
challenging dealers to take command of their “Wow!” said salesman Randy Harlin, said Paul Neuhaus, vice president, Barbee-
marketplace. Later, Gary Frazier, vice president, Heath’s Inc., Monticello, Illinois. “I had no Neuhaus, Inc., Weslaco, Texas, as he stepped
North American sales, urged them to take idea the company would be able to come out from the clean air of an 8520 cab onto the
advantage of volatile change by running harder, with this much at one time. The next three dusty ride-and-drive course.
smarter, and leaner than their competitors. In days should be very busy.” Next door, dealers put the new 5220 trac-
between, the machines did the talking. Divide and conquer. The next day, indoor tor’s fender-mounted controls to the test.
Video clips, white floor-to-ceiling drapes, and classes covered business strategies, John Demonstrations of new backhoe and scraper
300 computer-controlled robotic lights delivered Deere Credit, sickle windrowers, and pull- attachments showed the versatility of the
6 JD Journal
THE MOST AGRICULTURAL MACHINES JOHN DEERE HAS EVER INTRODUCED ON EITHER SIDE OF THE ATLANTIC
entire line of 40- to 79-horsepower 5000 tractor was well suited for the large farms 3400 telehandlers with a host of hooks,
TWENTY-series tractors. in her area. “The advanced transmission and clamps, and forks for just about any job from
One-source shopping. Grayson English, more horsepower means we can pull 70- to haying to material-handling, new Frontier™
manager of Rappahannock Tractor Co., 80-foot tillage equipment. And the new scrap- attachments for the smaller tractors, and new
Tappahannock, Virginia, was impressed with ers let us go after mine reclamation work.” fixed-blade ejector scrapers rounded out the
the new CX-20 and HX-20 rotary cutters. The new 6403, 6603, and high-end 6020- information-packed classes.
“We’ve sold a lot of the competition’s prod- series tractors were kicking up a lot of excite- “A lot of big dairies are going up west of
ucts simply because the company didn’t have ment. Added to the affordable Advantage- us,” explained Kerry Hurst, a salesman at
anything in that size. Warranties, ordering, series models, the new machines cover the Hurst Farm Supply, Lubbock, Texas. “With all
freight, and parts availability are a lot easier utility-tractor market from top to bottom in of the feedlots, cotton gins, and commercial
and less expensive when we can deal with both cost and features. “Rental customers, building, the telehandlers should get us into a
one supplier, John Deere.” weekend farmers, and government agencies great market.”
A
After his walk-around of the 1760 NT especially will like the low-end 6003s,” said fter finishing his jam-packed,
planter, Edward Coufal saw a clear fit for his Ken Wagner, owner of Heritage Tractor, four-day session, Donnie
area. “We’ve been into satellite mapping for Baldwin City, Kansas, after his test drive. Meadows, Goldman
five years,” said the owner of Coufal The 4010-series tractors offer an extensive Equipment’s manager in
Equipment Co., Temple, Texas. “That planter list of improvements. “The under-40-horse- Tallulah, Louisiana, was surprised by the
will work right into the precision farming in power market is heating up,” said salesman number of new products. “I’m proud to be
our area with its variable rates as well as give Derek Hill, Northeast Equipment, Wayne, part of John Deere, and I’m impressed by this
us true no-till and minimum-till capabilities.” Nebraska. “We’re seeing a lot of weekend show,” he concluded. “I was worried we’d see a
After pulling a scraper with a 9020-series farmers with less than 50 acres. The 4010s lot of decal changes. We saw legitimate,
tractor, Gayle Gustafson, owner of Prosper and the Frontier attachments will fit right in.” important changes that will make selling
Tractor, Ltd., Estevan, Saskatchewan, said the The all-new, telescopic-loading 3200 and easier. I’d hate to be the competition.”
7 JD Journal
LEFT: Spanish dealers see and hear the new fea-
tures of this 9780 CTS combine described in their
native language during the sound and light show.
RIGHT: The driving course was designed to mimic
the narrow passages and small turning areas found
on many European farms. FAR RIGHT: Dealers
enjoy traditional Spanish flamenco dancing at the
Congress Palace Convention Center. BELOW RIGHT:
Attendees were treated to Seville’s magnificent
architecture, including the Plaza de Espana. BELOW
CENTER: Joaquin Hervas Bonafe of Alcudia Carlet,
Spain, and 3,200 others tested the new equipment
near Carmona. BELOW FAR RIGHT: Luis Fernando
Zara, Patricia Mozo, and Miguel Angel Duque
Garcia will share their hands-on experience with
others at their dealership in Valladolid, Spain.
Photo by Mark Moore.
SHOW TIME
DEALERS FROM 54 COUNTRIES POUR
INTO SPAIN TO WITNESS DEERE’S
MASSIVE AG EQUIPMENT ROLLOUT
Magnifico! Gigantisch! Incroyable! Fantastic! South America, and Global Harvesting market leadership in Europe,” said Claus
Praise was lavished in 49 languages on the Equipment Sourcing, described the introduc- Wiedenroth, a dealer from Moelln, Germany.
“Take Command” product introduction at the tion as “the most significant launch in Full Agenda. Long days saw dealers on the
Congress Palace Convention Center in Seville, any John Deere region ever.” move from early morning until evening.
Spain. Beginning on September 2, almost Paul Enz, vice president, marketing, Attendees visited educational stations at the
3,200 dealers and dealership staff from 54 Agricultural Division - Europe, Africa, South convention center and on a 2,500-acre farm
countries attended six consecutive four-day America, said the products were being near Carmona, 20 miles away. There were sta-
sessions packed with presentations and field launched into a marketplace that holds great tions for each new line of equipment and for
demonstrations. Each session was conducted potential for John Deere. “In the United John Deere Credit, Agricultural Management
primarily in Spanish, German, French, States, John Deere dealers receive nearly Solutions, and sales.
English, or Italian, and additional languages half of the total spend on farm machinery, Occasional touches of humor lightened
were available through translation. while in Europe we get just over 15 percent the presentations. Dealers at the 8020-series
The most stunning statistic was the 63 (the percentage for tractors and combines tractor station were invited to hold glasses of
new equipment models presented during a is higher). This is important because the water while sitting on the new ActiveSeat™
spectacular light and sound show. European European market is larger than all of North suspension during a simulated bumpy ride.
dealers welcomed 6020-, 8020-, and 9020-series America, including Mexico.” Colleagues tried to steady their glasses while
tractors, as well as new combines, balers, Such major dealer gatherings are rare in seated in a conventional seat. “That really got
mower conditioners, telehandlers, crop Europe, and dealers were delighted with the the message across,” said Jose Maria Reseco
sprayers, and more. Dave Everitt, president, event. “What has impressed me is John Casado of Spain.
Agricultural Division - Europe, Africa, Deere’s unequivocal determination to gain After hearing about the features of each
8 JD Journal
IN SEVILLE
PHOTOS BY ULRICH BÜKER
S T O RY B Y M A R K M O O R E
new model, dealers could envision how the Company, a major German dealership. culture of Seville, from where Columbus set
products would fit into their local markets. “Farms in eastern Germany are very large sail to find the Americas. They enjoyed a visit
“The 6920S (tractor) with Autopowr (stepless and need greater productivity.” on the program’s final evening to a farm famous
transmission) is going to be a real hot item Many dealers echoed Heller’s point about for breeding beef animals destined for the
for us,” said Patrick van Mellick, a Dutchman customers’ hunger for greater productivity. bullring and high-quality thoroughbred horses.
who has built a dealership in Stara Dabrowa They were pleasantly surprised to learn how Dealers said that the event generated
in northern Poland. “It will precisely fill a John Deere engineers have delivered products excitement they’ll carry home. “We expected
gap we had just below the 7810 tractor. I can to boost operator output. “I have a customer the event to be inspiring and that has proved
see it adding 10 to 12 additional tractor who is desperate to get his hands on a combine an underestimation,” said Heller. “We see the
sales at our dealership each year.” with higher capacity to handle the four- expense involved in bringing 19 of our staff
“Autopowr has generated a lot of excite- tonne-per-acre wheat crops we get in Kent here as a good investment, because the
ment,” said Paul Smith, manager for (United Kingdom),” said Nick Booth, sales- enthusiasm ignited in our people will spread to
a 6020/7010-series tractor station. “We’ve man for Palmers Agricultural Ltd. “There is a potential customers and generate new business.”
noticed that as soon as the presentation is clear trend to fewer, larger farms and contrac- “The significance of Seville was twofold,”
over, dealers are immediately on their mobile tors. Both groups are desperate for more says Everitt. “Not only did we introduce 63
phones to tell the world about it.” capacity. The 465-hp STS combine, with its fabulous new models equipped with market-
“I’m delighted to see the introduction of a rotary threshing system and 11,000-liter tank beating technology, but we have also given
new 8020-series tractor with over 300 horse- (only available in Europe), is a world leader dealers new business tools with which to reach
power,” said Claus Heller, branch manager of and is exactly what these farms need.” our ambitious business goal of doubling mar-
the Scharpitz, Germany, outlet for the Drees Delegates experienced some of the rich ket share by 2005.”
9 JD Journal
THEY JUST KEEP GOING
That’s not a custom cut-
ting crew from the 1970s—
ETC
it’s the Norris family of
Wellington, Kansas, who
have been harvesting their
farm’s wheat with John
Deere 95 combines for three
generations.
Larry Norris says the
whole family gets involved
when it’s time to roll out
their fleet of six model 95
tale sounds that confirm the horse has overcome its natural fear and is
comfortable enough with Bedis to allow her to lead. She says horses have
some of the same communication needs as people. “I’ve learned to be very
specific with horses,” she explains. “They don’t want you to be wishy-washy.
I stay in the conversation until we’re both clear about what is expected.”
Bedis also uses the listening and coaching concepts with young horse riders.
WORK INSPIRES ART Les Reu’s boyhood memories, career, and
artistic talent converged recently in his drawing Going Green. Reu
is a credit administrator at the Ag Marketing Center in Lenexa,
Kansas. His colored-pencil drawing of a dealer shaking hands with
a farmer after delivering a new Deere combine was a scene Reu
recalled from dozens of childhood trips with his father, Dave, a John
Deere dealer in Donnellson, Iowa. “The scene is a composite of those
memories,” Reu says. “I just updated the combines.” He adds that
it’s a common scene today. “I've traveled to 28 states for this compa-
ny, and I've seen this picture in about every area of the country.”
The drawing took Reu about 75 hours to complete. It is one of his
first works after making a “new millennium resolution” on Jan. 1,
PHOTO: TOM SIZEMORE
10 JD Journal
FLOW MANUFACTURING IS MAKING IT EASIER FOR JOHN DEERE TO PRODUCE THE HIGHEST-QUALITY PRODUCTS IN LESS TIME AND AT LOWER COST
Amateur champion used a sponsor’s and allows him to play on the tour through
exemption to get into the field. His 19-under 2003. Gossett didn’t receive the largest check
265 at the Tournament Players Club at from the tournament; 300 charities within
Deere Run course in Silvis, Illinois, earned 100 miles of the Quad Cities split nearly
Pierre Leroy, president, Worldwide Construction & Forestry Gossett a $504,000 first-place check and a $1.3 million raised through "Birdies for
Division, celebrates a team birdie with Ryuichi Seguchi, John Deere Spin-Steer Technology™ lawn Charity”and other fundraising programs.
president of Hitachi Construction Machinery Co., during the
John Deere Classic Charity Scramble.
largest construction company in the world, division, John Deere Worldwide Construction
equipment purchases. in terms of volume, Kiewit owns a fleet of & Forestry Division, says the pro-am is
Tuesday’s Charity Scramble raised 17,000 pieces of equipment, valued at $1.7 an opportunity for Kiewit to learn more
$13,000 for youth golf in the Quad billion. A small amount of the fleet is John about Deere’s strategies and philosophies, and
Cities while Deere executives hosted Deere equipment that was purchased two how Deere matches up with the contractor’s
customers, dealers, and suppliers. and a half years ago. business plans. “To have them take three
Among the many Deere guests Like John Deere, Kiewit is looking to days off from their busy schedules is a real
playing in the Wednesday pro-am were reduce their number of suppliers and align commitment,” Mohr said. “It shows their
executives from Peter Kiewit Sons, Inc. themselves with just a few strategic partners. interest in wanting to build a stronger
of Omaha, Nebraska. The eighth Roger Mohr, director, corporate business relationship with Deere.”
12 JD Journal
WELCOME TO THE FAMILY
MARINES RECOGNIZE RICHTON BRINGS IRRIGATION
TRAM TEAM EQUIPMENT TO JOHN DEERE LANDSCAPES
Brigadier General Jim Feigley, commander Deere & Company has acquired Richton International Corporation,
of the U.S. Marine Corps Systems a diversified service company with two business lines, including
Command in Quantico, Virginia, visited irrigation and computer-related services and products, for
Davenport Works in July to present cer- approximately $125 million. Century Supply Corp. is a wholesale
tificates to members of the original TRAM distributor of irrigation products and systems, while CBE
SST LAWN TRACTOR
TM
13 JD Journal
14 JD Journal
JOHN DEERE IN INDIA
STORY AND PHOTOS Manufacturing and marketing operations in the world’s second most populous
BY MARK MOORE nation illustrate how the company is expanding its worldwide customer base
When executives from Deere & Company and The Charminar monument in
Larsen & Toubro Limited (L&T) cut the ribbon the city of Hyderabad towers
to a 37- to 55-hp 5000-series tractor plant near above the 5310, the first model
Pune, India, on October 6, 2000, the ceremony manufactured by the joint venture.
marked an important step toward expanding
John Deere’s global presence in ag equipment. rare and that power out-
The L&T-John Deere Limited joint venture is ages, difficulties with
part of a manufacturing network—including water supply, and India’s
facilities in Georgia and Mexico—that will pro- famously congested infras-
duce 5000-series tractors for major markets tructure are more serious
around the globe. problems.
INDIA IS KEY. About as large as Alaska, the Marketing the tractors
country produces over 200 million tons of grain also has its challenges. As
to feed its billion-strong population. The effort much as 80 percent of landholdings are tiny—
it takes to produce that grain translates into little more than a few acres. Some 5 million
impressive machinery sales. More than 254,000 buffalo are used as draft animals to provide
tractors were sold last year—compared with power on many small farms.
150,000 in the United States—though average The demand for tractors is expected to grow,
horsepower is far lower in India. however, as a shrinking number of farms
A share of the Indian market is virtually accumulate more land, and as draft animals
all-new business for John Deere, because high are gradually replaced by tractors.
tariffs keep imports of foreign-manufactured Hindi, the national language, and English
equipment to a trickle. are spoken widely, but customers prefer to buy
“India is an important growth market for in their local tongue. Fourteen main languages
the ag division,” says Dave Everitt, president, and dozens of dialects are spoken in India.
Agriculture Division – Europe, Africa, South In addition, each of the country’s 22 federal
America, and Global Harvesting Equipment states has its own tax and commercial laws
Sourcing. “It’s a cost-competitive manufacturing and a unique mix of religions, customs, and
environment. It’s also a supply base for parts traditions.
and components, which offer us a competitive PARTNERSHIP. Everitt says working with
advantage when we introduce them into our L&T greatly increases the chances of success in
worldwide network.” this complex marketplace. L&T is a highly
The Pune factory will build 10,000 tractors respected engineering company whose electri-
this fiscal year. Klaus Ramsauer, CEO of the cal, cement, and construction businesses have
joint venture, says the plant is on target to gained it a reputation for quality throughout
produce 30,000 tractors by 2004, representing rural India.
10 percent of tractor sales in India. During the 1990s, L&T identified a gap in
CHALLENGES. Westerners from Marco Polo the agricultural-equipment market. “Research
onwards have discovered that India is a poten- showed that the Indian market was ready
tially rewarding but challenging country in for a more sophisticated tractor and higher
which to do business. For example, the tractor levels of reliability and customer support than
factory retains a qualified snake catcher. The was provided by the seven manufacturers in
outsourced service removes King cobras that India,” says Ganesh Apte, deputy CEO of the
seek refuge in factory buildings when heavy joint venture.
monsoon rains arrive in June. L&T sought John Deere as a partner that
Ramsauer says cobra appearances are quite could bring both a proven tractor design and
marketing system to the joint venture.
Zora Singh, manager of product support, explains the workings Engineering remains the responsibility of John
▼
of a 5310 to a group of farmers in India’s Punjab state. Deere, which receives a royalty for each tractor
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sold in addition to its share of the joint venture’s profits. ing and in the engine, transmission, and vehicle-assembly focus factories.
The tractors are basic by Western standards. There are no plush cabs, Jobs at the factory are highly sought after. Working conditions are
and transmissions are built to a basic collar-shift design. Nonetheless, comparable with those at other John Deere facilities. Wages of $1 to
with features such as power-assisted steering, they are at the top end $2 an hour represent substantial buying power in India, where the
of the market for Indian customers. Oil-immersed disc brakes and high- average wage is 50 cents per hour.
performance engines are regarded as key selling points. “What sets L&T/John Deere apart from some local manufacturers is
The 55-hp 5310 was the first tractor produced at the the willingness of managers to listen and greater investment in employee
plant and retails for about 390,000 rupees ($8,300). training,” says Sukhdeep Singh, a marketing department employee.
It has already proven itself by gaining impressive India’s roads carry a chaotic mix of pedestrians, trucks, motorbikes,
market share in its horsepower segment. and vehicles of every type, making bus travel the safest transportation
The 47-hp 5203 and the 37-hp 5103, launched option. Tractor-factory workers ride busses from their homes in Pune
this summer, are expected to see the same kind to the factory 20 miles away, six days a week—the typical workweek
of success in their market segments, which in India.
typically have much higher sales volume. On arrival, the staff stream out of the buses in the light-blue shirts and
MARKETING. “As output has gradually risen, dark-blue slacks worn by staff and management alike.
we have begun marketing machines state-by-state, The uniform helps offset India’s traditional acknowledgement of
beginning with those closest to the factory,” says class and hierarchy. Some
Jyoti Banerjee, chief of marketing. “This approach wear turbans indicating Below: Tractors are often used as the power
ensured we could support the product intensively from day membership of the Sikh source for custom-built combines. The tractors
one, and the reputation of the 5000 series is now well established.” religion, which is closely are removed and used for other tasks once
harvest is completed.
Territory managers and a handful of area offices support 75 indepen- related to Hinduism, the
dent dealerships. Banerjee says the target is 200 dealerships. religion of the majority. Since
A rigorous selection process was used to identify qualified dealers, Hinduism discourages meat
like K. Sudershan Reddy and his business partner, N. Ravindra, consumption, the outsourced
who own a dealership at Nizamabad, near Hyderabad. food service offers exclusively
“Indian farmers are concerned about the impact of globalization. We vegetarian meals.
feel that our future and that of our customers is best served by offering a The staff’s average age is
high-quality product,” says Reddy. “The 5310 has proven exceptionally 25, and worker enthusiasm
well-suited for use in rice paddy fields, a key application here.” extends past the workplace.
The dealership facilities and signage conform exactly to the Cricket, the top sport in
stipulations of their contract. The dealership is connected via the India, is passionately fol-
Internet with Pune for parts and whole-goods ordering. lowed by most, and teams
Dealerships currently offer tractors only. The joint venture is from the focus factories
planning to add locally sourced tillage equipment, because Western- play each other regularly.
manufactured equipment is currently not competitive in the Indian The workforce is largely,
market. Salesmen receive salary and commission. Competition is but not exclusively, male.
tough and negotiations can last for weeks. Many customers plan “Women engineers are well-
purchases to coincide with one of about 20 days each year defined as represented in some fields in
auspicious by the Hindu calendar. Unless a tractor can be delivered India, particularly software,
on a particular day at a specified time, the deal may fall through. but we’re still unusual in Above: Tractors fitted with cage wheels are
MANUFACTURING. The Pune factory was built on a carefully manufacturing,” says Gauri used to prepare paddy fields for rice planting.
chosen, green-field site within India’s industrial belt. Tavte, a 21-year-old mechan-
“This location means the majority of our suppliers are within ical engineer working in the transmission focus factory. “I like the
150 miles,” says Ramsauer. “Almost 95 percent of tractor content now challenge. Even at a company like L&T/John Deere, as a woman, you’re
comes from Indian sources.” Engine castings are bought from Indian a bit of a pioneer.”
suppliers and machined at the factory. Transmissions are built at GLOBALIZATION. Everitt sees the Pune facility as an important
Pune to a Kanzaki design under an agreement with that company. piece to a global tractor-marketing strategy. “These are true John
Indian suppliers are beginning to supply John Deere factories out- Deere tractors that we’re producing in India,” he explains. “They
side India. “Units worldwide are already sourcing parts from India continue our heritage of product quality and design, which means
through our wholly-owned international purchasing office based in they‘re not only suitable for India, but potentially other markets.
Pune,” says Ramsauer. “And because we have a common platform in the 5000 series,” he
EMPLOYEES. “The Pune area is home to nearly three million people, adds, “the cost advantages of Indian parts, components, and even
and education facilities are good, which means there is a pool of highly services, can be more easily leveraged into our worldwide networks.
qualified labor,” says Ramsauer. A total of 460 employees work in market- It’s a genuine win-win situation.”
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Left: Gauri Tavte, a
mechanical engineer,
works in the transmission
focus factory at Pune.
10 JD Journal
17 JD Journal
WHAT’S SO DARN FUNNY?
Quite a lot, actually, and there’s plenty of room for humor in the workplace.
By Gene Ritzinger
19 JD Journal