Summary
In its inception, the John Deere Component Works (JDCW) was structured to be a captive producer of parts for the equipment divisions of John Deere. The factories were required to purchase all major parts internally, and the corporate policy favoured internal purchasing from JDCW for smaller component parts also (Kaplan, p. 136). The high volume production of the 1970's supported this company objective, and supplying the parts internally gave John Deere a competitive advantage.
Changing Environment
John Deere met with hard times in the 1980's as a result of the collapse of farmland values and commodity prices. The high dollar decreased exports, reducing income for the farmers and consequently impacting the farm equipment producers. …
