John Deere Business Organization

The organizational structure of a business has a great effect on how the business is run.  The organization needs to look at all of these structures and decide which one fits their business best. They should first decide if they want to have a centralized or decentralized strategy and which one would be more beneficial to them.

Divisional Organizational Structure

John Deere has chosen to be centralized and very orderly.  They are organized by eight total divisions.  These divisions include agricultural, construction, turf, forestry, financial services, power systems, parts services, and intelligent solutions.  Organizing their businesses in this manner gives each division the advantage of concentrating on the needs of their particular industry.  For example the agricultural team has recently developed a line of row tractors that enable the operator to widen or shrink the space between the wheels at the push of a button from inside the cab.  This allows for the tractors to drive down the rows of fields much easier and be adaptable to each individual farmers rows. The turf division does not need to worry about driving down rows but instead should look for ways to take pressure off the ground so that they don't leave indentations in the earth because they are usually working on soft ground.

The disadvantage of this type of business structure would have to be that it is expensive to hire duplicated personal for each division.  It can also lead to divisions not sharing ideas if they are competing against each other.  John Deere doesn't seem to have to much of a problem with this because they are organized by industries.  Forestry generally doesn't have to much to do with agriculture and vice versa.  This prevents the divisions from competing for the same customers.

Some of these divisions are there for the sole purpose of supporting the other businesses.  Financial services, power systems, parts and service, and intelligent solutions are used to create new and innovative ways to help enhance the John Deere experience and to ad value to the product.

If a business wants to compete in an increasingly competitive world they must think hard about how their business is structured to be as efficient as possible and deliver the most value possible to the customer.