South Dakota Top Blogs

News, notes, and observations from the James River Valley in northern South Dakota with special attention to reviewing the performance of the media--old and new. E-Mail to

Friday, October 16, 2020

A congeries of rinktums*

*a black colloquialism  for rectums recorded in William Faulkner's work

When I was released from active duty in the Army after being drafted, I found a job within a week at the East Moline Works of International Harvester Company, popularly known as IH or IHC.  That factory made harvester threshers, corn pickers, mowers, and other harvesting machines.  If you drove west out of the plant along River Drive all the way through Moline, Ill., to  its western border, you'd end up at the Farmall tractor plant in Rock Island, Ill., where the red Farmall tractors were designed and made.  At peak production times, each plant employed almost 5,000 workers.

During the time I worked for IHC, its sales were booming.  But it had problems with profits.  Much has been written about why one of America's biggest corporations eventually failed.  It had much competition.  John Deere & Co. was headquartered in  Moline and maintained a number of factories there. J. I. Case also manufactured farm equipment in the community.  The fact is that IH produced some very good farm machinery, but John Deere had embarked on an effort to produce more competitive and productive equipment and to work harder on its labor relations.

For a brief period of time, IHC intensified its competitive efforts by sending a team from the plant out to investigate customer and dealer complaints.  The team consisted of a district sales manager, a test engineer, a service parts specialist, and a correspondent from the materials control department, which was me at times.  We evaluated problems that were raised by company products and services and made recommendations about resolving them.  At times, we ran into representatives from our competing companies in the field.  Team members noted that local people often gave  the Deere and Company representatives preferential treatment.  The Deere people were under special orders about what they should do when out in the field.  For example, they were not to engage in carousing after hours and were always to be polite and respectful.  They also had a special program to help farmers who had breakdowns, no matter what brand of machinery they were using, to enable them to get back to work.  The Deere people were trained to establish a special rapport with rural communities, and from what we witnessed, they were successful.

When we submitted our reports, the executives in the local plant would get to work and resolve problems as much as they had the authority to do.  But our reports were not even acknowledged by the corporate office on Michigan Avenue in Chicago.  And when executives from Chicago visited the local plant, the reports and the issues they dealt with were never brought up.   The sales manager, who headed the team, at one time suggested we put a slogan in the report:  "Our machinery works in the field, but our executives don't."  That was never put in a report, but it was an apt summary of a problem we saw.

We received our paychecks every Friday afternoon.  Some nearby watering holes cashed paychecks and IH employees would gather at them, cash their checks, and have a drink or two to start the weekend.  Lower level supervisors often joined in, and there were discussions about what the company was doing wrong.  These were not just gripe sessions.  They were observations of experienced, knowledgeable employees who were frustrated by executives who seemed oblivious to their customers, their employees, and what constituted good business for the company.  The eventual demise of the company was predicted at those Friday sessions.

There was a time when the two factories in the community shut down and put the entire workforce on layoff for a time to stop a drain on the company's finances.  The test engineer on the customer service team explained the problem.  The axles that drove the tractors and combines started to fail in the field and pushed the company into a financial crises.  As the machines increased in size and power, they were putting more strain on the drive components.  The engineers recognized this and were specifying transmission and axle parts that went through a complicated process of heat treating and hardening that could withstand the increased workload demanded of them.  Some executives thought the extra processing unnecessary and that they could save money by eliminating what they thought were unnecessary steps.  They overruled the engineers and eliminated some steps from the manufacturing process on the grounds that they had never been used before and the company had never had problems with them.  But one year farmers had tractors break down during plowing and planting and combines broke down during harvest, and the company's treasury and reputation took a terrible beating.  Some of the executives suggested that the breakdowns were caused by farmers abusing the machines by doing things like driving them through rocks.

That was one example of a decision made under an order to look for cost savings that could bolster the profit margin.  In this case, the company had a massive recall program that replaced the failing parts with ones that were given the complicated more costly heat treatment and hardening process.  The designers and engineers had made the case for the upgraded drive components but their specifications were dismissed because the executives "knew better" and had the authority to order otherwise.  

This failure had a demoralizing effect on the people who designed and built the farm equipment.  They said the designs and manufacturing specifications they sent up were carefully thought out, but did not make it through the "asshole department" intact.  The executives had to exercise their power and  authority, rather than act as problem solvers and builders.  It was more about asserting executive power and showing who is boss, rather than building good equipment and finding ways to make a good business.

When problems arose within the company, these executives would insist everything was fine because they were exercising their power and authority, and they knew what--was-what better than anyone else.  And they were dismissive of their employees and customers.  The business was all about them.

Those dire Friday night predictions all came true.  The company eventually failed and was bought out by a competitor.  It did not survive the asshole department, a congeries of rinktums.


Jake said...

Excellent posting, David! Exactly the living proof of today's conservative right wing clamoring for reduction of regulations of any kind from any sort of government. Their distaste of government on all levels is a lie because they seem to lust and crave for the positions of that 'power' over the populace. There never seem to be any shortage of GOP candidates for any given office in SD and then when elected (like our governor Noem) too often don't want to govern. Instead she stands on the sidelines cheering up her icon Trump instead of being in the governor chair leading the fight against a killer virus-"I trust my people to do the right thing" instead of setting an example of mask wearing and staying safe.

Curt said...

Thank you, Dr. Newquist for this enlightening account of the demise of a once-great agri-business manufacturer. I have wondered before what must have occurred to bring about the downfall of IH. This should be required reading for every MBA-candidate in the world.

Blog Archive

About Me

My photo
Aberdeen, South Dakota, United States