Leadership of a precision farming business can take many forms and come from different places within a dealership. But it often takes a coordinated effort by ownership, management and specialists to create and sustain a productive culture.
The stability of a precision business is rooted in its people and their ability to collaborate on a unified goal to maintain a competitive advantage. Employee development, customer service and revenue growth are challenges many dealerships encounter on the precision side, but there are proven, tactical approaches to maintaining precision profitability.
So what’s the secret to getting universal buy-in at the dealership level on its precision business? It starts with communication and planning, cornerstones of Eis Implement’s strategy for establishing its precision farming department.
As a single-store John Deere dealership (an increasing novelty) operating in a highly-competitive area of Wisconsin, Eis Implement, formed in 1946, has established its precision business as reliable, yet flexible to adapt to customers’ changing technology appetites.
We assembled owner Jon Eis, precision farming manager Eric Hagenow and precision farming specialist Phil Davister for a candid conversation on how Eis Implement has established a progressive culture, fostered inter-department collaboration and carved out a loyal customer base.
Jon Eis: We started our precision farming division in 2014 when Eric came on board, and then we added Phil a few years later. I've been with the company for 13 years and have spent the bulk of it on the aftermarket side. In 2018, I took the position of COO, and I also oversee the service department, parts department, marketing and accounting. I've been working hand-in-hand with our sales department as well.
Eric Hagenow: I am the precision farming manager. I worked for a competitive Deere dealer about 35 miles away from here for about 21 years. I left that dealership and went into the precision field with an independent dealership, and worked there for three and a half years.
I heard that Eis was looking for a precision farming specialist, and I thought it would be a nice gig. I wanted to get back into the Deere side of things again, and it's been really good the last 5 years. We've grown immensely. We started an RTK network for DigiFarm and started selling tile plows, things that Eis Implement wouldn't have even thought of doing before.
“When I proposed an RTK network, and was told if I didn't have 20 guys signed up right away that it was ridiculous to even think about building a network. Well we did, and today I think we're standing close to 45 customers on it now…”
— Eric Hagenow
Phil Davister: I came into Eis in the parts department, started in shipping and receiving, and then graduated up to the front parts counter. I waited for the precision farming department to take off and warrant a second person, so that's when I joined that part of the business.
Precision Farming Dealer: Jon, from your perspective as upper management, could you share your approach and involvement in the oversight of the precision side of Eis?
Eis: For us, it's just been a new sense of trying to drive some goals to the guys, get them on a path, show them the numbers, being an open book to them and letting them see how they're having an impact on the store. That’s been important. We've laid out a lot of different directions for them, and we even built a bit of a quarterly bonus structure for them this year.
When Eric started in 2014, it was very informal. I let Eric run with it. He didn't get much direction from us as management, and we did a poor job of linking the other departments, the rest of the organization, with precision farming. We talk about all the time, how they're kind of on their own island. We keep trying to find different ways to connect the departments with them.
PFD: From your seat, Jon, how do you develop that vision of where you want to take your precision business?
Eis: I've always been one of those forward thinkers, and a nerdy, techie type person. So going back to the original GreenStar, I was the kid that was pulling apart the demo box and hooking it up to a Gator. My uncle, who was our sales manager at the time, was like, ‘Just throw that thing away, it's junk.’ So I always tend, on the tech side, to want to know where things are headed.
That's how I view our precision department. It's linking everything. We need to have that connection. And pretty soon, it's going to be more popular in terms of volume than even equipment sales. So we need to adapt to that and be talking about it, and at least anticipating it.
Both Phil and Eric have been crucial. On the data side, Phil is working to coordinate third-party apps into the John Deere Operations Center and we've got to be looking at how can we capitalize on it. Eric has helped add our tile plow business and some of the RTK programs and services, which have been important, too.
It’s important to have an ear open for those guys. From a management standpoint, if I can strive to listen to my staff — I may not agree with them — but I have to look at the data and understand it to see if what they are saying makes sense and can be a lucrative deal for the dealership. And sometimes I’ve just got to let them try it. Let them prove that it can be done and it'll work. That's where I've given my trust to them.
PFD: I had the opportunity to ride along with Eric earlier this year for our Day In The Cab series. From my perspective, it looks like your team has a very good rhythm. Talk about the day-to-day relationship that you guys have in terms of collaborating and communicating expectations.
Hagenow: Phil and I take care of about 95% of all the precision calls and problems, and besides sales, we provide all the support. Spring is always the worst time for us. There's only two of us; he usually takes north of the store, I usually got south of the store. But many times, we're overlapping.
In the heat of spring, we're probably talking to each other a half-dozen times a day. We'll start in the morning, and if either of us have something that's blowing up right away, the other one will cover something on the backside. Then we work off of that. Everything seems to fall into place after a while, even though we might get up in the morning and think we’ve got five things staring at us that we didn't get done yesterday. We're very even as far as what we do. We challenge ourselves as far as selling things.
Davister: He's pretty much summed it up. We try to call it controlled chaos in spring, because things can get pretty out of hand pretty quick. But we develop somewhat of a game plan, so we can tackle each customer’s needs efficiently and effectively.
PFD: Could you elaborate a little bit on that division of responsibilities, how you guys decide who's going to do what, and then the accountability side of that, to know that customers are in the best hands?
Davister: Today, we make our own work orders, put our time on it and then we’re responsible with billing. We're taking that whole cycle and doing it ourselves. So as far as service agreements, I handle a lot of those responsibilities.
Eis: A good example was our RTK network. Eric proposed it to us, and it was a significant investment on our part. But working with DigiFarm — compared to building our own radio towers — our cost was substantially less. So that really worked out well for us and we were able to cover a large area for just our single store.
It's bringing some of that recurring revenue for them that they needed to really start building a foundation. We’ve continued to do that with our annual service agreements for the precision side. When Eric or Phil sell a precision product, they're tagging on a free year of service support, and then renewing that service support the following year at $350 for the year.
It's maybe a little bit harder now with the challenges on the large ag side, but we're still looking for new avenues and new ways to grow. The big push for us has been on the labor front and how can we capture that labor? One thing that’s really unique for Eric and Phil is we initially had them on the sales side. They were doing purchase orders and each deal was an individual deal. And it's a bit cumbersome that way. We wanted to figure out how we could incorporate labor more with a work order, where they have a service tech and they can bill some of their hours.
That's turned out to be a cumbersome task at times. But the unique thing is they're touching all department processes. So they may be doing a parts ticket, and having the parts guy build something out that's just been ordered. Or they may be doing a work order that they're going to be billing some labor to, or they may be selling a stock unit the they're going to be doing setup on, and then doing a purchase order for that.
“I've learned a lot about available income and have driven that through the departments that this is how we're going to right the ship…”
— Jon Eis
That's been one of our hurdles, is they're doing so many different processes, multiple ways. Mainly because it tracks well on the accounting side, so we can see it, and it's providing the customer with the information they want to get on an invoice. We're struggling through that on the admin side, and how we can better make use of Eric and Phil’s time. If there's a way to make it work, it's convenient for Eric when he's out on the road and he knows he needs to order these pop-up kits from another supplier, he can just make a phone call and get them ordered. Our challenge has been connecting those pieces in the back end.
Hagenow: One of the problems I run into is that I may take a phone call when driving to another customer, and this customer needs me to stop and maybe calibrate his steering system. I’ll do that, and then have to remember to make that work order second. It would be easier if the phone call went to a service manager, he made the work order and got the expense that way. We're not like that; we take calls all day long. And we may be running from one fellow to another, then still tracking all that.
Three days or a week later, I’ll sit down and say, ‘All right, what did I do last week?’ And I have to remember what I did. Because that's where I'm running into issues, is trying to figure out how many places was I at, do I need to make a work order for this guy or was it actually a warranty call, was it just a ‘we need to get you going’ kind of call? We're roping it in with the selling of the new product.
Eis: We do have Salesforce, and we're working with Anvil App Works, and they've built automation with us throughout our quoting procedure on the sales side, and some of the purchase orders and invoicing. So we're developing a wholesale workflow with them right now throughout our shop. We're looking at ways that we can incorporate that system into the precision side to automate some of that for Eric and Phil so that when they do get those calls, they can create some tasks that will automate and remind them that these things need to be done.
We'd like to get to the point where we have an admin person that they can go to, where some of these requests would automatically go, and that admin would create the work order, get things rolling for them, and then they can fill in the blanks at a later date.
PFD: Sometimes the precision team is pretty far removed from ownership, and they're not 100% sure exactly what they do or how they function. There's a lot of autonomy with that group. What are some of the keys or advice you guys have on trying to avoid those barriers or disconnect in forging a strong relationship between ownership and employees?
Hagenow: Trust and communication are the biggest things. Sometimes, especially in spring, the heat of the battle, you don't know what your day is going to look like until that morning. So sometimes you're ordering parts, you're standing in the middle of a field and ordering parts, and they just show up to shipping and receiving. Saying, "This is coming, this is going to go forward." And then they have to trust that they're going to come back and tell the folks at the store whether they're going to make a work order, or it's going on a parts slip, or it's going to a stock unit number, just so everything's accounted for.
Davister: It’s an everyday occurrence, especially in spring. All of a sudden, the guy you've been working with the last 2 weeks decides that he's going to do something and needs it yesterday. I've just got to keep it going to keep the customer going. Sometimes that creates a little havoc on the shipping and receiving side.
Hagenow: I am that guy who will pick up the phone and call a supplier to have some liquid fertilizer parts ordered in. I'm just going to have a name for a purchase order, and our purchase lady, she gets a little excited because she doesn't understand where they go, and I know where she's coming from. Spring is our worst time, because I can't get ahead enough to tell her that these are coming and they're going to go to so-and-so. Like Phil says, we usually have 3 different ways we're going to bill it.
I always tell her, ‘Just hang in there with me. I'll come back, we'll go through all your pack slips, and I'll tell you where everything is going to go.’ But that may be 2 weeks away. I can't always say I'm going to have time within the week that the equipment shows up.
With management and Jon, he's been great, because he's got an open door policy. If we have an issue, we can just discuss it. When I proposed an RTK network and was told if I didn't have 20 guys signed up right away, then it was ridiculous to even think about building a network. Well we did, and today I think we're standing close to 45 customers on it now.
Eis: For me, it's being the bridge. I feel like every day I'm the bridge between the departments. I'm trying really hard to see both sides of any situation. Phil and Eric, their time is valuable, so for them, it's about efficiency. What's the fastest way I can get this order transacted, so I can move on to the next one, because I've got another 3 in the queue, or I've got another guy on the phone with me.
On the admin side, they want to ensure thoroughness and detail, and that continuous, smooth stream of processes. When you bring the two together, it just doesn't work. I've really been trying to drive everybody to ask questions rather than make statements. When entering a challenge or a hiccup in the process, let's ask some questions about it, let's understand why Phil and Eric weren't able to get around to something for a week. Rather than making statements or throwing emails out about stuff.
We're all one team, we've got to work together, and without them out there pounding it, there's not sales coming in, and there's no paperwork to be done. On the flip side, if the paperwork is not getting processed, the money is not getting collected. It goes hand in hand for both of them. I try to always remind everybody we can't be throwing knives at each other.
PFD: Obviously, the bottom line is the indicator on the financial success of a dealership. But what are some of the other elements you use to measure and assess the productivity of your precision team?
Eis: Up until last year, Phil and Eric were handled similarly to the salespeople, in that they had a base pay and then they got commission on the deals that they got on an individual basis. Conversations with them helped me understand that they're in it together. It's not a matter of just me me, me, and I'm going to worry about my own deals.
It brought me to the point of setting some departmental goals, and we're going to bill it off of available income. Through our Spader business group, I've learned a lot about available income and really have driven through the departments that this is how we're going to right the ship, by focusing on available income goals. So we set some vigorous goals for the two of them, and lined up a number of expenses that they would be responsible for, and I said, ‘Let's go after it. Let's see if we can't break even this year in the PF department.’ Currently, we're above break even. So it's a huge accomplishment, I believe, for a precision department to be in that position.
It's because those two are chasing it. We set goals for different product types and categories. We sat down and I said, "What do you guys think? How many do you think you can move this year?" And then we assigned a regular goal, and what we call a BHAG goal, a big hairy goal, just for fun, to try to see if we can't chase something. That's worked out really well. It's not a perfect science, that's for sure. There are things I'm asking them to do that are above and beyond what I ask other individuals. But on the flip side, they trust that I'm going to work with them at the end of the day to help them as much as I can.
Hagenow: When I first started, yes, I was more on the sales side. And then Phil comes over from parts. We didn't have anything to benchmark against, other than what we were getting on commission. That’s it. Now, Jon has laid everything out. If I were honest, do we think we're responsible for all these charges? Maybe not. But we’ve got big shoulders, we take care of it. But at least we have a benchmark. We know what we’ve got to do, we know where we need to be and how we need to get there is up to us. We didn't have that before.
PFD: Looking at the responsibility that each of you has, how much of a motivating factor is it contribute to the overall success of the dealership when you have those measurable goals that you're setting?
Hagenow: Human nature says you don't want to be the weak link. We know that large ag right now is not going to make a lot of money. It's down, it's a tough market right now. We feel we have a market where a customer could spend $5,000 - $10,000 and he's got something he can work with. So we’ve been able to capitalize on that.
We want to make sure that the whole store knows that the PF department is doing its job, it's making things happen. And the store buys into that. They can see it. The things that we're doing, the things that we're bringing into the shop to work on, that we're selling, they can see that.
Eis: The indirect revenue from their department goes unnoticed too often. Selling a new planter today, you're not going to sell it without a bunch of precision products on it. That deal does not happen if we don't have a successful precision department.
Or there might be a customer who they sell some hardware to who ends up buying some parts from us at a later time. Again, it's an indirect sale, very difficult to track. So something for management to always keep in the back of their minds, is the other revenue that is generated from them being a part of the organization.
Today, we make our own work orders, put our time on it and then we’re responsible with the billing out. So we're taking that whole cycle and doing it ourselves…
— Phil Davister
Davister: At the end of the day, we're all wearing the same shirt, no matter if you're a service person, sales, precision or parts. We're all in it together, and there's some things we'll go out on demos for tractors, and not necessarily bill our time. But still, we're going out there to help get that customer familiar with this equipment, try and make that sale.
Eric and I have a lot of people that only deal with the precision side with us. So sometimes they're calling us for parts that aren't precision, so we try and to direct that customer to the parts department where it should go. We're out there to bridge the gap between all the departments and tie everything together.
PFD: What are the components of keeping employees productive, and in creating a healthy culture?
Davister: Support from all the other departments. When we’re bombarded with problems and feel like we can turn this one over the shop and have full confidence it will be taken care of, that's a big weight off our shoulders.
Hagenow: You have to get everybody to buy in. When I was at the other Deere dealership, I was a service tech for 21 years, and I thought I was very good at it. But I wouldn't let anybody get close to me, because I always feared they would take my job.
When I started here, first time Phil walks in the office, I had that same tendency to do that again. I told myself, you can't, because he's got strengths that I don't have. And it took me a while to figure that out. I want to work with you not against you, to make sure we're all on the same page at the end of the day. For me personally, that was hard to do right away.
Eis: It's finding somebody that has a passion. When Phil interviewed for the parts job, he openly discussed the interest in the precision side. It's unusual, sometimes in a small organization, being a single store, to have that ladder of progression for employees.
I'm always conscious of that, wondering if an individual going to get bored of doing the same job, knowing that they can't move up to a management role in the foreseeable future, or take a different path because we've got to fill their spot that they were in smoothly and transition them somewhere else. If somebody is passionate about it, like Phil here, he's going to excel at it.
Anybody new that we're bringing in, they have to have passion and a drive for what they're going to be doing. We know what it's like, it only takes one person to be the culture killer, and it just resonates through everybody.
Exclusive Online Q&A
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