John Deere & Company,is the world’s leading manufacturer of agricultural, construction and forestryequipment. KeyFacts & Figures· 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.
Activitiesin India Over the years John Deerehas made significant progress in India by introducing various products andprogramme needed by the Indian farmers in various segment of the agriculturevalue chain including, seeding, harvesting and post harvesting equipment, andhas 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 & VerificationCentre, Pune, Maharashtra· John Deere Electronics Solutions, Pune,Maharashtra – Electronic control for modernizingAgriculture tractors and customer convenience· John Deere Sirhind Work, Sirhind, Punjab -Harvesters Manufacturing Unit· John Deere Dewas Works, Dewas, MadhyaPradesh – Tractor Manufacturing Unit· John Deere Parts Distribution Centre,Nagpur, Maharashtra – Spare Parts· John Deere Financials India Pvt. Ltd.,Pune, Maharashtra – NBFC John Deere India hasTechnology Centre at Pune, which provides leading edge technology, productdesigns, and innovative ideas to support the company’s global business intechnical areas, including Information Technology, Product Engineering,Manufacturing Engineering, Embedded Systems and Technical Authoring. It has also partnered withthe state government in order to bring unique partnership opportunities,industries on a PPP mode to bring technology access to the farmers whootherwise are unable to access this for modernizing their farming practices.This is a tested business proposition which has helped small farmers improvetheir yield and income levels. Besides the above, JohnDeere is associated with the small and marginal farmers through “frugalinnovation at farms” and “community betterment initiatives” through various CSRand volunteerism initiatives in India.
John Deere has also been constantlyinvolved in various activities which help in empowering women/ village youth whoare engaged in farming and off-farming activities by enhancing their skillsthereby providing opportunities for a better quality life. Basic framework of performance managementsystemWhite Collared EmployeesJohnDeere uses a web based PMS called TalentCentral 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 ofthe start of the new financial year, Year-end review when the actual appraisalis done Financialyear at John Deere starts in November and ends in October.
Month of August and Septemberthe company looks at what they have achieved. Typically,enterprise is divided as corporate US enterprise, India country, and otherplatforms. These departments put together, brainstorm as to how to transforms theirown functional goals. After this process, the entire report is published to theemployees, 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 theirgoals accordingly. Goals are clearly established in two areas: Business goal- What part of the businessin terms of numbers and matrix? (E.g.
achieve profitability by x %) What theemployee going to achieve from the business? How does his work contribute tothe function he has taken? People Goal- How is an employee going todo that? (e.g. How I can reduce the overheads)Inthe beginning of the year people will set their goals and manager will have alook 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 hasdone to achieve those goals. If any course correction is required, appropriatemeasures are taken. Manager also writes his comment during mid-year review aboutthe progress of the employee towards his/her goals.Inthe year end phase- Employee writes what he/she has achieved during the wholeyear. Manager also writes his comment and gives the rating.
Bluecollared employeesPMS talks aboutparameters like, employee’s contribution to the organisation in terms ofsafety, productivity, quality and other parameters like how much improvementideas does he give. On basis of that he is evaluated and if he is an outstandingperformer he gets a promotion.Thewhole PMS is transparent and believes in open communication.
The documentsrelating to PMS and supporting documents are available on the website. Samedocuments are available to both managers as well as the employees. For exampleone of the competencies is building relationship, so there is a properdefinition as to what does 1 and 3 stand for in the rating system.
If anemployee performs some parts of 1 and some of 3 he qualifies for a 2. On acompetency perspective each employee knows what he is being rated for. A lot ofinformation regarding how does the company write business as well as peoplegoals is available to the employees, and also there are sample goals availablewhere an employee can just pick up the sample goals and use them in his owncontext. Manager has the access to the rating definition sheet and ratingdefinition tool.
The employees too have the access to the same. So both managerand employee have a fair idea in terms of when would an employee get an outstandingrating and when he would get a rating of highly successful.RatingsInJohn 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 periodfor evaluating the performance of the employee. E.g. Employee might haveassigned a new role and he/she maybe in initial stage.
That time in the ratingcriteria he/she will be assigned ‘no rating’. PMS in the early yearsInitially John Deere hadjust 1 set of ratings and there was no business separate and people separaterating system. There were 2 things primary responsibility and stretched goals.As one would go higher in the hierarchy the primary responsibilities would reduceand the stretch goals would increases. A job of a clerk working on a day to daybasis is to print invoices for the organisation, his primary job responsibilitywould be more but his stretch goals relating to the overall connectivity of thebusiness will not be as big as that of the general manager. A general managerwould have more stretch goals and less of positional responsibility on a day today basis. Performance AppraisalJohn Deere uses a verycomprehensive and future oriented method of appraisal MBO (Management byObjectives) which reflects a management policy that values and utilisesemployee contribution.
The first step involves the manager andsubordinate sitting together and establishing the goals, which would in turnwould be used to evaluate employee performance. The second step involves settingperformance standards for the subordinates in the previously decided timeperiod. Next would be comparing the goals attainedto the goals earlier agreed upon. A proper evaluation is done to find out thereason for the unmet goals and the goals exceeded. This indeed is helpful indeciding on the training needs and devising a strategy to fulfil the same. In the final step, involves establishingthe new goals as well as strategizing on the unattained goals. The subordinatessuccessful in reaching the goals are allowed to participate in the goal settingprocess next time and the similar process is repeated.
Incorporation of FeedbackAt every stage John Deerebelieves in mutual consent, when an employee designs or drafts its goals andsends it to the manager, the manager reviews it and approves those goals and hecascades other goals if he feels the need of the same. The manger when approvesthe goals, the goals come back to the employees and he starts filling themid-review comments. Once the mid-review comments are completed the employeesends 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 aboutand write about the goals. There is also a face to face conversation where theemployee as well as the manager gives the feedback. The manager the puts theratings and sends to the employee. The employee hereafter to accept theratings. In case of dispute he can raise it that to the HR.
There is formalfeedback system that the manager generates for the employees and vice versa. Anemployee can have a 360 degree feedback from his peers, subordinates, managersetc.