Deere's International Board

The agricultural-equipment maker may have a brand name that's as American as amber waves of grain, but its directors make up a global harvest

by William J. Holstein

Deere (DE), the maker of John Deere agricultural equipment, may be based in Moline, Ill., in the heart of the American Midwest, but it has created a board on which three of its 13 directors are non-American, a much higher proportion than for most U.S. companies.

Chairman and Chief Executive Officer Robert Lane says he has been able to tap the expertise of those non-American directors to shape his company's international strategy, which has become increasingly important as about 50% of the agricultural division's sales are now outside the U.S. Here are edited excerpts from a recent conversation with Lane:

Just how international is your board?

We have people born and educated on most of the continents of the world. Our business is very global. When I went to invite BMW Chairman Joachim Millberg to join the board, we found that we have a lot in common with BMW (BMW). We both have a global brand. We build diesel engines. We have high-productivity machines. But we don't compete against each other in the slightest.

How were you able to draw him in?

I also speak German. I never spoke with him in English until the day he showed up at our first board meeting, and I suspect he liked that. I confirmed everything in writing in English just to make sure there wasn't any confusion. I first called on him in Munich on behalf of my board because…as CEO, I am an agent of the board. But we sat and talked about our global businesses. He recognized that the two companies face many common issues even though they have very different end markets.

Did you create this international board or inherit it?

Deere has a history of having an international board. When I came on the board, Tony Madero, the CEO of the SanLuis Corporation (SANLUISA.MX), was already on the board. He's from Mexico. I also was able to recruit Dipak Jain, dean of the Kellogg School of Management at Northwestern, who was born and educated in India.

We've had a recognition in our company of the importance of the international view. I'm only the eighth CEO in Deere's 171-year history. The last of the founding family was William Hewitt, who later become an ambassador of the United States. But while he was still chairman of Deere, the Deere private airplane was only the second private aircraft to go over Chinese airspace after the famous Nixon-Chou Enlai meeting in the early 1970s. When China opened up, Bill Hewitt was there. We have a history of being linked to these opportunities around the world.

Isn't it difficult to manage an international board because of the different languages, cultures, and travel requirements?

It is challenging. But the members really enjoy our board. About every three years, we make a major international trip to expose the board to different countries. In November, we had the board in India to show them our factory there, which is exporting to 52 countries. We have a technology and engineering information center there as well. A few years before that, back in 2004, we took the whole board to see the huge opportunities for Deere in Brazil, particularly with sugarcane harvesting machines.

Just a few years ago, we were building close to zero of these in Brazil, but today we're building hundreds of them. And we have a brand new tractor factory.

Most U.S. boards have a distinct culture. How have you adapted your board culture to welcome or accept the non-Americans?

Since Dipak came on the board, our menus have really improved. We now have vegetarian food at all meals.