John 2016 the company had a: o Revenue

 

John Deere & Company,
is the world’s leading manufacturer of agricultural, construction and forestry
equipment.

 

Key
Facts & Figures

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·        
Founded in 1837  

·        
Fortune 500 Company

·        
In 2016 the company had a:

 

o  
Revenue of US$ 26. 64 billion.

o  
Net income of US$ 1.52 billion.  

o  
Spent US$ 1.39 billion on R.

 

Activities
in India

 

Over the years John Deere
has made significant progress in India by introducing various products and
programme needed by the Indian farmers in various segment of the agriculture
value chain including, seeding, harvesting and post harvesting equipment, and
has the following units established in the country:

·        
John Deere Pune Works, Pune, Maharashtra –
Tractor Manufacturing Unit

·        
John Deere Technology Centre, Pune,
Maharashtra – IT and Engineering Services

·        
Product Validation & Verification
Centre, Pune, Maharashtra

·        
John Deere Electronics Solutions, Pune,
Maharashtra – Electronic control for   modernizing
Agriculture tractors and customer convenience

·        
John Deere Sirhind Work, Sirhind, Punjab –
Harvesters Manufacturing Unit

·        
John Deere Dewas Works, Dewas, Madhya
Pradesh – Tractor Manufacturing Unit

·        
John Deere Parts Distribution Centre,
Nagpur, Maharashtra – Spare Parts

·        
John Deere Financials India Pvt. Ltd.,
Pune, Maharashtra – NBFC

 

John Deere India has
Technology Centre at Pune, which provides leading edge technology, product
designs, and innovative ideas to support the company’s global business in
technical areas, including Information Technology, Product Engineering,
Manufacturing Engineering, Embedded Systems and Technical Authoring.

 

It has also partnered with
the state government in order to bring unique partnership opportunities,
industries on a PPP mode to bring technology access to the farmers who
otherwise are unable to access this for modernizing their farming practices.
This is a tested business proposition which has helped small farmers improve
their yield and income levels.

 

Besides the above, John
Deere is associated with the small and marginal farmers through “frugal
innovation at farms” and “community betterment initiatives” through various CSR
and volunteerism initiatives in India. John Deere has also been constantly
involved in various activities which help in empowering women/ village youth who
are engaged in farming and off-farming activities by enhancing their skills
thereby providing opportunities for a better quality life.

 

Basic framework of performance management
system

White Collared Employees

John
Deere uses a web based PMS called Talent
Central in SAP. Talent central given to the employees has 3 different phases:

     
At the start of financial year review,

     
Mid-year review that is after 6 months of
the start of the new financial year,

     
Year-end review when the actual appraisal
is done

Financial
year at John Deere starts in November and ends in October. Month of August and September
the company looks at what they have achieved.

Typically,
enterprise is divided as corporate US enterprise, India country, and other
platforms. These departments put together, brainstorm as to how to transforms their
own functional goals. After this process, the entire report is published to the
employees, in terms of overall goals and priorities for a particular function/department.
On the basis of the role an employee is assigned, he/she can pick and choose their
goals accordingly. Goals are clearly established in two areas:

     
Business goal- What part of the business
in terms of numbers and matrix? (E.g. achieve profitability by x %) What the
employee going to achieve from the business? How does his work contribute to
the function he has taken?

     
People Goal- How is an employee going to
do that? (e.g. How I can reduce the overheads)

In
the beginning of the year people will set their goals and manager will have a
look at those goals. Once those goals are finalised there are mid-year comments,
during mid-year review. The employee writes his perspective around what he has
done to achieve those goals. If any course correction is required, appropriate
measures are taken. Manager also writes his comment during mid-year review about
the progress of the employee towards his/her goals.

In
the year end phase- Employee writes what he/she has achieved during the whole
year. Manager also writes his comment and gives the rating.

 

 

Blue
collared employees

PMS talks about
parameters like, employee’s contribution to the organisation in terms of
safety, productivity, quality and other parameters like how much improvement
ideas does he give. On basis of that he is evaluated and if he is an outstanding
performer he gets a promotion.

The
whole PMS is transparent and believes in open communication. The documents
relating to PMS and supporting documents are available on the website. Same
documents are available to both managers as well as the employees. For example
one of the competencies is building relationship, so there is a proper
definition as to what does 1 and 3 stand for in the rating system. If an
employee performs some parts of 1 and some of 3 he qualifies for a 2. On a
competency perspective each employee knows what he is being rated for. A lot of
information regarding how does the company write business as well as people
goals is available to the employees, and also there are sample goals available
where an employee can just pick up the sample goals and use them in his own
context. Manager has the access to the rating definition sheet and rating
definition tool. The employees too have the access to the same. So both manager
and employee have a fair idea in terms of when would an employee get an outstanding
rating and when he would get a rating of highly successful.

Ratings

In
John Deere there are 5 types of rating for business and people (white collared).
Outstanding, highly successful, successful, performance need improvement,
unsatisfactory. There can be a situation where there is no sufficient period
for evaluating the performance of the employee. E.g. Employee might have
assigned a new role and he/she maybe in initial stage. That time in the rating
criteria he/she will be assigned ‘no rating’.

PMS in the early years

Initially John Deere had
just 1 set of ratings and there was no business separate and people separate
rating system. There were 2 things primary responsibility and stretched goals.
As one would go higher in the hierarchy the primary responsibilities would reduce
and the stretch goals would increases. A job of a clerk working on a day to day
basis is to print invoices for the organisation, his primary job responsibility
would be more but his stretch goals relating to the overall connectivity of the
business will not be as big as that of the general manager. A general manager
would have more stretch goals and less of positional responsibility on a day to
day basis.

Performance Appraisal

John Deere uses a very
comprehensive and future oriented method of appraisal MBO (Management by
Objectives) which reflects a management policy that values and utilises
employee contribution.

     
The first step involves the manager and
subordinate sitting together and establishing the goals, which would in turn
would be used to evaluate employee performance.

     
The second step involves setting
performance standards for the subordinates in the previously decided time
period. 

     
Next would be comparing the goals attained
to the goals earlier agreed upon. A proper evaluation is done to find out the
reason for the unmet goals and the goals exceeded. This indeed is helpful in
deciding on the training needs and devising a strategy to fulfil the same.

     
In the final step, involves establishing
the new goals as well as strategizing on the unattained goals. The subordinates
successful in reaching the goals are allowed to participate in the goal setting
process next time and the similar process is repeated.

Incorporation of Feedback

At every stage John Deere
believes in mutual consent, when an employee designs or drafts its goals and
sends it to the manager, the manager reviews it and approves those goals and he
cascades other goals if he feels the need of the same. The manger when approves
the goals, the goals come back to the employees and he starts filling the
mid-review comments. Once the mid-review comments are completed the employee
sends back the form to the manager, the manager then again puts his comments.
So at every stage there is an opportunity given to the employees to talk about
and write about the goals. There is also a face to face conversation where the
employee as well as the manager gives the feedback. The manager the puts the
ratings and sends to the employee. The employee hereafter to accept the
ratings. In case of dispute he can raise it that to the HR. There is formal
feedback system that the manager generates for the employees and vice versa. An
employee can have a 360 degree feedback from his peers, subordinates, managers
etc.