12: Case Study: Deere

Deere & Company is a 150-year-old supplier of agricultural machinery, which has branched out into construction equipment and lawn maintenance. As agriculture transitioned away from the independent farmer, Deere's sales and profits fell, and it became clear that the firm needed to reconsider how it was doing business, and with whom. What follows is another interview-style chapter with accounts from a few of the firm's executives about their experience with reengineering.

(EN: Again, loads of fluff from which I will preserve points of specific interest.)

• You could tell from the factory floor that Deere was disorganized: piles of work-in-process inventory and a circus of forklifts moving materials from one place to the next. Simply putting the cells that created a part next to the line that needed it was a major efficiency improvement, and the cost of having multiple cells making the same part was recovered in the waste and work stoppage of having too many or too few of a given part. This reduced the bustle and improved efficiency and output.
• Applying the same principles to white-collar processes was much more difficult - the problem was far less visible and the culture of the organization was very deeply entrenched. Rather than push reengineering top-down, the leaders put out an offer of help in improving efficiency, and got a good response. It started small, "at the edges" of the core agricultural business and they used small successes to be able to build enthusiasm and more requests for help.
• Where people didn't think that efficiency was an issue, they were able to get a foot in the door by offering to improve quality.
• In addition to making process changes, they also saw culture changes in management and employees who saw the positive results of change and were interested in making additional changes. This resulted in setting up a reengineering team in each division they visited.
• Mapping processes also helps to foster cooperation and collaboration. For example, the head of supply management realized that his department was an enabler for order fulfillment and product delivery, which in turn provided value to the customer. So adhering to ritual behaviors that drove departmental metrics could be counterproductive if doing so compromised the ability of other departments to perform their functions.
• The same could be said of the organization in general: when people see, specifically, how their work impacts those outside the organization, even indirectly, the entire firm becomes more customer-oriented and people gain a sense of purpose in their work.
• Perhaps the most dramatic epiphany was the degree to which suppliers served as "an extension of our factory" and contributors to the overall value delivered to the customer. That is to say that an employee of another firm who worked in a factor 500 miles away had the same potential impact on the customer as people who worked at the company's own factory.
• One interesting distinction: resistance to change has less to do with the age or years of service of an employee as how long they have been in their present position. People become accustomed to doing things a certain way and feel awkward when asked to change, likened to asking them to switch hands when they brush their teeth - it's more difficult than it sounds. You also have to consider that people are married to a process that was sold to them by the company in the first place.
• The need for communication is emphasized. When people do not know or understand changes, they make assumptions, and generally negative ones, about the motives and consequences.
• One advantage Deere had is that it was able to retain employees. Massive layoffs were not part of its history or it s plan. When jobs are eliminated, people are retrained for work elsewhere. When the gross head count must be reduced, the firm lets attrition do the job. As such, employees had no reason to fear losing their income as a result of reengineering, though they might have to take a new job.
• In terms of resistance to change, companies with a prestigious brand and a long history of success are also prone to cling to the past, assuming what they did before will continue
• For major reengineering efforts, it could take years from start to finish, and sustaining enthusiasm throughout the process is difficult. You can't wait until it's completely over to celebrate the accomplishment, but find a way to periodically celebrate the speed at which you are travelling in the right direction, even though the end is far away.