My interview with Deere and Co. Chairman and CEO Sam Allen

Overlooking the 18th Green at TPC Deere Run with Sam Allen, Chairman and CEO of Deere and Co.

Q. Sam, we’ve heard you speak for many years as an official marketing partner of the PGA TOUR, probably the greatest vehicle you drive to drive the business, if you will. I was very struck on media day when Clair Peterson, your tournament director, told us that 79 million of the 81 million that’s been raised in the 47 years of this tournament has come in the 20 years that John Deere has own and operated it. Can you talk about the pride you must feel in everything that’s accomplished for this community?

SAM ALLEN: Yeah, and that is a great statistic. I think what’s more impressive about that is of that 79 million in the last 20 years, more of that half of that has been raised in the last six years. We just keep taking it to a different level. Two years ago over 8 million; last year over 10 million for charity.

At the start of my tenure nine years ago now, it was more in the $5 million range. So that’s a tremendous impact.

Second one is economically we used to say this was more of a $25 million impact on the Quad Cities for this week; we now say it’s 53 million. It’s doubled over the last decade as well.

The economic impact, the importance of birdies, giving back, almost 500 charities, those are all really, really need things we’re very proud of, in addition to bringing a world-class event to the folks of the Quad Cities.

Q. I was talking to Jay Monahan recently, and he talked about the engagement that the community has here. We’ve got the PGA TOUR commissioner here rattling off metrics like he’s in the marketing department; 40% of the people on social media are talking about the John Deere Classic and things like that. I was pretty impressed.

SAM ALLEN: Yeah, you know, we feel very good about that, too. This year at the annual awards dinner, obviously the most important one for us we got Tournament of the Year. We really feel good about that.

But we got most engaged community again for the third time in I think the last five years, and we won the digital award. So I think the commissioner was right in what he was talking about there, and some of that insight came from the award recognition that night, that we were the digital community award winner?

Q. There were a couple really great tournament directors that I’ve come across in my 30 years around the PGA TOUR. Few can rival Clair Peterson. Then you find out he had a Deere & Company pedigree before he got this job.

SAM ALLEN: Yeah, and actually he still has a Deere & Company pedigree, because the deal we have with him is while the John Deere Classic pays his salary and all the rest, he’s still on loan from Deere, and we still pay his retirement benefits and all that.

So we still have a hook back into him. He is just a wonderful individual. He’s a true marketing talent. He came out of the advertising area with us. That’s why we have such great advertising here with this tournament always with some of the themes they come up with.

But the one good thing — because I know Clair gets a number of offers to go to other tournaments, but the one nice hook we have in him is if he goes to the other tournaments he won’t get his retirement benefits from John Deere.

Q. Good to have some leverage. Ryan Moore was asked frankly by me the other day about what it was like to drive down the highway toward a professional golf tournament and see a billboard with his picture on it. When he normally travels he sees Spieth, Tiger, Rory. He said that’s what is special about this place. You see it. You feel it from the volunteers, the people that are donating their time and talent and treasure out here. What does that make you feel like when you go to other golf tournaments or official marketing partner meetings or send your staff and you realize that this tournament that was once what I call, forgive me, but an afterthought, usually run up against a major, has now become perhaps the most significant tournament per capita. Small market, incredible fields usually. Wonderful crowds. Engaged community. What comes to mind when you think about those things?

SAM ALLEN: Well, I know I ended up going on the boards of the John Deere Classic, and when I first became a senior officer and a senior officer liaison, I told the people at that time, this is not the Quad City Classic sponsored by John Deere. It’s the John Deere Classic. You have to understand the role and responsibility you have, that you’re directly representing the brand. Therefore, we’re linked.

The neat thing is the volunteers understand that. The leadership of the volunteers really gets it. They’re 110% behind it. I think it causes them to step up their game as well and adds to the specialness of the tournament.

So we’re quite proud of that. What most people don’t appreciate here is there is 1700+ volunteers. Clair has a very small staff. It’s really the executive board, which is about seven individuals, that by the time they get to be the tournament volunteer chairperson, they will have been a minimum of seven to eight years in various roles on the boards donating time year round to this to make it happen.

That length of time I think builds a level of core commitment that then gets in turn amplified here throughout the tournament and by the volunteers.

Q. We were struck by Zach Johnson being a board member and Lance from CBS and all the people that have become intrinsic stakeholders that continue to perpetuate what you’ve created here.

SAM ALLEN: Yeah, we had about 300 customers in, and I was speaking to them the other night. I made the comment to them — first off, Lance Barrow asked to come on the board, so that in itself is a great honor.

But even Masters week, they both called in to the board meeting, and that just says something right there. I think they had a little something more on their mind but still wanted to be a part of it. That’s what’s special about the board with the John Deere Classic.

Q. Let’s spend a few minutes on the brand. This is an iconic brand. All our kids have had little tractors or whatever the case may be. I feel like as a result of your being an official marketing partner with the Tour, we can’t go anywhere without seeing your product.

SAM ALLEN: Yeah, you know, I think what it does here specifically, we’ve had a lot of studies done, and Deere in terms of brand loyalty and depth of passion to it, is off the charts. What we don’t have necessarily is breadth. There are fewer and fewer people that have an agricultural background.

The combination of our turf business and the golf side of the business and then using the Classic as a way for us to extend that breadth, and then by bringing customers and everybody in here, shaking up a little bit of that depth of loyalty and spreading it to a few other people as well.

So for us, there is a very intended purpose with this. It is about giving us a breadth component to the John Deere brand. We already have a real deep loyalty in those people that use the John Deere product.

Q. I heard you tell a great story about having four of the five majors using John Deere product. Recount that for us.

SAM ALLEN: Yeah, I was down with the commissioner playing at TPC Sawgrass the week before the PLAYERS seeing the new redo, which is fantastic, by the way.

One of our other playing partners said, Do you have equipment at Augusta? They knew I had been at Augusta. I said, No, that’s the one out of the four majors that we don’t have.

Before I even got that last world out, Jay said, No, you have four out of the top five majors.

Q. So there is brilliance behind the marketing of golf. It’s more than just entitling one golf tournament a year. Again, it’s about market share. You’re a publically-traded company. There are opportunities for the depth, as you speak about. What do you think is next for John Deere?

SAM ALLEN: We just spent $5.2 billion on an acquisition of a road equipment business, Wirtgen out of Europe. That really is going to round out our construction and forestry business, make it a solid No. 2 leg behind our ag product line. That’s enough to chew on here for a little bit right now.

But what we’ve always said is we’ll focus on items that reinforce the brand that we can leverage our No. 1 asset, which is our dealer base, and then we won’t stray away from the core.

So we won’t go into something that doesn’t have a manufacturing component to it and isn’t in some way close to what we’re already in.

Q. As CEO and someone who worked up through the company, how would you describe the culture of Deere & Company?

SAM ALLEN: Yeah, I do have 42 years. It has evolved some. But what I would tell you, the culture has always — first and foremost, you can see it in who our customer base is, especially on the ag side.

You know, ag customers all over the world, but particularly here in the U.S. Farmers are humble people. They’re salt of the earth. Not about egos. They want to get the job done, do a hard day’s work, have a lot pride, a lot of integrity. That’s all embedded in our culture.

Neat thing is those customers reinforce that culture. I would tell you if you wear your ego on your sleeve you’re probably not going to survive at John Deere. It’s just not that type of culture.

Also a collegial culture, so we want to together, talk it through. We don’t want people ordering each other, things like that.

I tell new employees, Really get a sense for our culture. If you don’t like it, you ought it leave quickly. If you love it, like a lot of the us do, then you’ll stay like most of us do for a long, long time.

Q. You really appreciate that. I teach a sports business class in Orlando, Florida at Fullsail University. We give the kids access to Fortune Magazine, Forbes Magazine. They read all these articles about the top 100 CEOs of the year. Power is overrated. I think influence and relationships are really the key. That’s what we stress academically. Would you concur, and are there other attributes that fledgling executives would think about if they wanted to grow?

SAM ALLEN: Yeah, I would concur. I, a year ago, was given Thurgood Marshall Award. During my leadership comments there, I made the comment that during my career I have found that leaders, especially top leaders, if they’re really good, they’re probably going to be pretty humble.

The ones that have a tendency to be very loud, very outspoken, a lot of times there is something there that they’re not nearly as comfortable or confident about.

So I do think that’s like a lot of things, you want to walk softly and carry a big stick. You want to talk softly and have that big track record behind you that supports what you’re doing.

But I think it’s also more true today, because the world is becoming increasingly close in the sense that we’re all connected. As a result, we’re having to get along better and better from a diversity standpoint, cultural-wise, et cetera, et cetera.

So that skillset, the ability to be more humble, to communicate well with people, that’s going to be even more important ten years from now than it is today.

Q. Do you think that’s a key to your global success when you go to other cultures that carry themselves that way?

SAM ALLEN: It’s certainly one of them. I will tell you we’ve been in Mexico for 60 years; Argentina for 60 years. When you’re in those operations, first and foremost you will say this is just another John Deere plant. This could be in Iowa. The culture is exactly the same. It will have a different language they’re speaking, but it’s exactly the same.

There is a commitment to the farmer customer, et cetera. That’s what we try to instill in all our locations. So, yeah, I think it has.

Q. We’ve seen some branding on some of the equipment that just says Deere. Is there any thought to shortening? I remember when Gatorade went to G. It didn’t work too well.

SAM ALLEN: First off, let me be very, very clear. It will always be John Deere on ag equipment. The Deere, back in about 2004, Deere it got prominence on the construction side of the business to kind of differentiate it from the ag side of the business. There is still John Deere on the construction, but big Deere in bold letters, kind of like what CAT does with CAT in big bold letters.

So it’s more on construction only. Everything else is John Deere and will stay John Deere.

Q. I want to close with your golf game. I saw you tee off the other day in the pro-am. You’ve got a good game.

SAM ALLEN: No, the commissioner has a good game. Definitely from my game you can tell you, He must still be working for a living as a CEO, because I don’t play this much golf.

Q. I think your announcer planned it beautifully, because when he announced you he said who you were and there was rousing applause, and then they just introduced him as being from Ponte Vedra, Florida. I think he would’ve got loud applause if they knew who he was.

SAM ALLEN: I know he would’ve, and actually I wanted him to be announced as the commissioner. They asked not to do that, which I think shows something about Jay Monahan as well.

 

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