| Introduction
Corn has played a significant role in the agricultural
history of the United States. It has been referred to as
the most “economically important crop in American agriculture”
during the latter part of the nineteenth and the early part
of the twentieth centuries. James Wilson, then Secretary
of Agriculture, made the following observation in 1908:
The value of this crop almost surpasses belief. It is $1,615,000,000.
This wealth that has grown out of the soil in four months
of rain and sunshine, and some drought, too, is enough to
cancel the interest-bearing debt of the United States and
to pay for the Panama Canal and fifty battle ships.
As the economic importance of corn became widely recognized,
farmers, bankers, researchers, government agencies and the
universities got involved in its development. Several major
universities and a number of government experiment stations
began research to develop new strains of corn. The University
of Illinois was among the early pioneers in corn research.
Many individuals were responsible for the early development
of corn seed which began in 1878. Two of the best known pioneers
in corn research during this period were Edward M. East and
W. J. Beal. In 1896 Cyrill G. Hopkins and Claude C. Chapman
of the University of Illinois set aside a plot of prairie
ground and began experiments on the first large-scale corn
breeding plot. Their objective was to improve the nutritional
value of corn crops. They experienced some success in 1899
and they were able to improve corn seed throughout their careers.
A few researchers also experimented with a new corn breeding
process called hybridization which produced a higher quality
product. Individuals exploring hybridization included George
Shull, E. G. Montgomery, R.A. Emerson, T.A. Kiesselbach, and
dozens of other dedicated researchers spread throughout the
corn belt. The first commercial “crossing field” for the production
of hybrid seed took place in 1921 in Connecticut. Ten bushels
of hybrid corn seed were sold for production in 1922. Researchers
and growers had also worked for approximately thirty years
without success in search of a corn strain that would grow
well in the northern regions of the United States. It was
not until Tom Roberts, Sr. and Charles L. Gunn began their
work that a breakthrough was achieved.
Tom Roberts, Sr. the first general manager of The DeKalb Agricultural
Association, Inc. believed in hybrid corn. So strong was his
belief that he pursued it with his associate, C. L. Gunn,
through ten years of experimentation before he was able to
offer the first hybrid corn seeds to the market in northern
Illinois. Richard Crabb, in chronicling the history of hybrid
corn, writes:
Roberts’ unquestioning faith in the value of hybrid corn
to corn-belt farmers, his determination to let nothing stand
in the way of bringing the new corn to just as many farmers
just as soon as possible was, from the first season in 1934
without a close parallel anywhere in the history of hybrid
corn.
While many individuals across several states played significant
roles in the invention and development of hybridization, few
men contributed as much to product innovation or product distribution
as did Roberts. Further, it was his managerial acumen that
resulted in the explosive growth of his organization into
the world’s largest hybrid corn producer. He successfully
exploited the research, production, marketing, and finance
functions so as to produce remarkable results for his company.
Roberts played a pioneering role in the founding of two major
agricultural organizations. He was an important force in the
establishment of the DeKalb County Agricultural Association
(the name was later changed to DeKalb Ag Research, Inc.) and
in the early development of the DeKalb County Farm Bureau,
which was the model upon which most of America’s farm bureaus
are based. At that time the Farm Bureau was an organization
dedicated to the dual tasks of agriculture education and commercial
enterprise. This dual orientation may have been, in part,
a reflection of Roberts’ business philosophy. He believed
in serving the needs of the farmer at a profit to the firm.
Profit was not the only motive. At the age of 93, Gunn was
asked in an interview why he and Roberts worked so hard for
so many years, he replied : “We did it to improve agriculture.”
The DeKalb County Soil Improvement Association
is Formed
In 1912 a group of “forward-thinking” farmers in DeKalb
County, Illinois established the first Farm Bureau in Illinois.
Some authorities consider it to be the first farm bureau
in the world. Local bankers, newspapermen, and prominent
farmers collapsed their separate organizations into the
new DeKalb County Soil Improvement Association. Their purpose
was to act together in ways to improve farming. This included
agricultural education, soil improvement, and developing
ways to improve the quality of agricultural resources for
their membership. Their immediate purpose was to improve
the quality of local soil which was deteriorating because
of the prevailing farming practices. They also wanted higher
quality clover seeds for use in soil improvement.
Recognizing the unhappy position of the local farmers, the
newly formed DeKalb County Soil Improvement Association
created the position of the Farm Adviser. At that time the
Legislature of the State of Illinois, in contrast to nearby
states, did not regulate the quality of seeds sold in the
state. Illinois had therefore become the dumping ground
for the unregulated, poor quality seed. An important responsibility
of the Farm Adviser was to procure good quality seed from
other states for use in the DeKalb county. After looking
around the state, the Board of Directors selected William
G. Eckhardt (1879 - 1959), a University of Illinois agriculture
teacher and soils expert. Eckhardt was offered a salary
of $4,000 a year which was double of what he was receiving
from the university. At the encouragement of the President
of the University of Illinois, Eckhardt accepted the position.
For the next several years Eckhardt attended statewide agricultural
meetings, started demonstration plots, encouraged crop rotation,
bought seeds from out of state for county farmers, advocated
the use of fertilizer, and generally acted as a farm consultant
to DeKalb County Soil Improvement Association members. In
1917 Eckhardt hired C. L. Gunn to work on research to improve
seed corn for the benefit of DeKalb county farmers. That
was the same year that the DeKalb County Soil Improvement
Association elected Thomas H. Roberts, Sr. as Secretary
/ Treasurer of the organization.
Tom Roberts, Sr.: Early Years
Tom Roberts Sr. was born in 1892. After graduation from
High School, he attended Iowa State College where he majored
in accounting. He returned to Waterman after finishing college
and ran his family farm for several years. Always, interested
in the ideas of others, always believing that a number of
people working toward a goal was better than one person
alone, Tom became active in local business and farm affairs.
In 1917 William Eckhardt began to devote a large amount
of his time to the First World War farm effort. Eckhardt’s
effort was targeted at insuring that the supply of food
for the troops was adequate during the war years. He was
also appointed as the Seed Director for the State of Illinois.
These additional responsibilities, considerably reduced
the amount of work he was able to do for DeKalb County.
Eckhardt himself reported that he was able to only complete
a third of the farm adviser activities in 1918. After the
war, Eckhardt kept his interest in statewide activities.
On May 1, 1920 Eckhardt was appointed head of the Grain
Marketing Department of the Illinois Agricultural Association.
On July 1, 1920 he was asked to make this a full time position.
In 1920 Tom Roberts was appointed as the Farm Adviser after
serving one year as an Assistant..
The DeKalb County Agricultural Association
is Established
In 1917 The DeKalb County Soil Improvement Association
evolved into The DeKalb County Agricultural Association,
Inc. It was a multipurpose organization -- a farm bureau
conducting a significant amount of business for the benefit
of its members. As such, the Association’s activities combined
both farm-based business operations and agricultural education
pursuits. Because the Association’s organizational model
conflicted with the format that was being evolved by the
universities, the business portion of the Association was
separated from the educational endeavors. A new company
was formed with the purpose of engaging in business pursuits.
It kept the name of The DeKalb County Agricultural Association,
while the agricultural education endeavors were carried
on under the name of The DeKalb County Farm Bureau. This
took several years to accomplish and was the source of some
friction between the DeKalb County Agricultural Association
founders and the University of Illinois.
The Development of DeKalb Ag Hybrid
Corn
In Northern Illinois the growing season and harvesting
season for corn was too late for the crop to be very profitable.
According to Eckhardt:
Our average killing frost comes October 6th or 7th. Seed
corn gets dry enough to pick by September 25th to October
15th, depending on the season. So serious is this matter,
that no commercial seed corn growers exist in northern Illinois.
To attack this problem Eckhardt hired Charlie Gunn to
help find seed corns that would improve the quality and
delay the season for the corn crop. Gunn traveled West and
North looking for possible seeds. Gunn had prior experience
in corn breeding too, and began to experiment with the local
corn seed. In addition to looking for a climatized corn
he also searched for a corn that was insect and disease
resistant. He developed a high yielding, quality corn from
the Western Plowman strain which became known as Gunn’s
Western Plowman.
In 1923 Roberts was searching for the ideal guest speaker
for the Farm Bureau’s summer picnic. It occurred to him
that the new Secretary of Agriculture was from Iowa and
he would occasionally have to travel between Washington
and his home in Iowa. Roberts surmised that the Secretary
probably had to travel through DeKalb on the Northwestern
Railroad. Roberts, “...whose friends insist that he was
never known to lack resourcefulness,...” wrote to the Secretary,
Henry C. Wallace, inviting him to be the guest speaker.
Wallace accepted.
After the Wallace speech at the picnic, Gunn, and Roberts
spoke to him about some of the prize winning corn being
produced in DeKalb County. Wallace admired the corn, but
also said he had access to a new kind of corn, a hybrid
corn, that would eventually out produce anything anyone
had ever seen. Roberts and Gunn remembered the conversation.
In 1924 Roberts and Gunn decided to begin experiments to
develop a program for breeding hybrid corn. They kept this
as a secret from the Board of Directors of The DeKalb County
Agricultural Association for several years. They knew some
of the Directors would consider their work a waste of time
and money. They did most of the work on their own time with
their own resources. The Board was notified in 1928, as
soon as it was evident that success was achievable.
In May, 1925 Charlie Gunn planted his first hybrid corn
breeding plot in a farm near DeKalb. After much trial and
error, the first hybrid corn for farmers was produced in
1934. Although drouth had dried up most of the crop that
year, there were sufficient indications that the hybrid
seed was an important advancement. Roberts and Gunn had
unsuccessfully tried to save that crop, personally carting
water to dying fields, day after day, week after week. They
failed to save the crop and suffered considerable financial
loss. Fortunately, they were able to save Gunn’s breeding
stock.
After the failure of 1934 most men would have proceeded
with caution in the following year. Roberts instead proceeded
to expand the seed planting from 75 acres to 310 acres in
1935. To get some idea of the scale of Roberts’ strategy,
a USDA researcher, seeing the planting field, said it was
the largest hybrid production field he had ever seen.
In the next year Roberts and Gunn were able to market 14,500
bushels of seed corn which met with a resounding success.
The new hybrid significantly increased farmers’ corn production
by approximately twenty-five percent. Roberts was now able
to add a superior product to his skills in marketing, management,
finance, and his commitment to research. The future of The
DeKalb Agricultural Association was assured.
Tom Roberts as a Business Leader
The authors believe that Roberts’ success as a business
leader may have been the result of certain personal traits,
education and prior experiences. He did not become successful
by chance, but by the combination of hard work and his own
abilities. Roberts had a strong background in farming and
agriculture that came from his family history. His college
training in accounting was a necessary prerequisite to put
him into the position of Secretary / Treasurer of the Association
which later became his company. Also, he was a great believer
in the value of research and development in agriculture
which he maintained throughout his tenure with the company.
Roberts was blessed with good communication skills which
he used to convince others to believe in him and his work
with hybrids. He also had a firm grasp of the business principles
which he was able to successfully apply to agriculture.
He had a particular flair for marketing, promotion, selling,
and channels of distribution. He had the ability to recognize
the value of ideas proposed by others, to use those ideas,
to expand upon them, and to give credit where it was due.
Finally, he had the capacity to generate his own original
and unique ideas to fit the situation.
Innovations in Marketing
The “flying corn” symbol was invented by Roberts in 1934.
It quickly became popular and began to be utilized in the
company stationary, brochures and signs. It became the company
logo. It was based on a marketing strategy using symbolic
imagery. In the 1930s, farmers looked for a basic crop or
product to cover the fixed costs of their farming operation.
The crop was referred to as the “mortgage lifter.” The mortgage
lifter most often chosen by farmers during this period was
hogs and not a seed crop. Roberts’ understanding of the
farmers’ basic needs led him to “position” hybrid corn as
the new “mortgage lifter.” This was, of course, symbolized
by the wings attached to the ear of a corn. The winged ear
has undergone minor modifications since, but the concept
has not been significantly altered. Commenting on the value
of the mortgage lifting role of hybrid corn, one author
says:
Mr. Roberts showed considerable foresight. Not only did
hybrid corn become the farmers mortgage lifter, it has become
the basis for what is now the region’s largest industry.
Robert’s Success with Promotion Fuels
More Research
Few companies have enjoyed the same level of success for
their first advertisement as did Roberts for The DeKalb
Agricultural Association. A bumper crop of 14,500 bushels
of hybrid seed became available for sale in 1936. This was
a larger crop than could be sold in DeKalb County. Roberts
decided to place an advertisement in the Prairie Farmer,
a magazine reaching farmers in Illinois and Indiana. This
small, single color advertisement announced the availability
of a hybrid corn seed for sale and asked the farmers to
send their orders through the mail. The response to this
advertisement was beyond expectations. Hundreds of farmers
sent in their order with checks or cash enclosed. Seventy
percent of the orders came from farmers who lived in areas
where the DeKalb hybrid was not suitable for planting. The
company staff spent several days writing letters of apology
and returning the money to the farmers.
From this experience Roberts became convinced that the company
needed to broaden the hybrid corn seed development program
to meet the needs of different geographic areas within the
corn belt. In 1937 R. R. St. John was hired by Roberts to
develop hybrid corn seed for farms lying south of the northern
sector of the corn belt. Charles Gunn was responsible for
the northern sector. Roberts continued the corn research
expansion, this time for western corn growing country, hiring
Ralph Gunn, the son of Charles Gunn, to head up this research
effort in 1942.
Advertising’s Expanding Role
The importance of advertising was so well established in
the company as a result of this experience that a 1947 sales
manual lists the following advantages of advertising:
1.-- Advertising acquaints millions of
farmers with the name “DEKALB”.
2.--It establishes the fact that DEKALB is a reputable,high
quality product.
3.--It tells a DEFINITE and logical sales story in each
ad.
4.--It explains the vital part which you, as a DEKALB Dealer,
play in helping the farmer get the right corn and make more
from his farming operation.
DeKalb Ag took an early lead in hybrid corn advertising.
The company is recognized as the first hybrid corn company
to place a full page advertisement, use four color inserts
and four color advertisements.
Sales Promotion
As early as the 1930s DeKalb Ag was embarking on the use
of a full range of promotional techniques. These included
sales manuals, dealer publications, full page farm paper
ads, radio advertising, extensive use of field signs with
the flying corn logo, participation in major agricultural
events, and sponsorship of picking and plowing contests.
One particularly successful promotional approach was the
“Husking Kings Sweepstakes” in 1937 where former national
champions competed against each other in hand corn husking.
Repeated in 1938, approximately 40,000 spectators came to
this promotional event.
The first four color variety booklet for farmers (a promotional
device for selling seed) Acres of Gold, was published by
DeKalb Ag in 1941. The booklet was successful and soon developed
into a magazine-like publication whose content was adapted
for each separate region of the corn belt.
DeKalb Ag was among the pioneers who invited farmers to
inspect test plots of their hybrids. Although positioned
as an information sharing activity, harking back to the
education extension events learned by Roberts while director
of the farm bureau, these were also promotional in character.
The test plot event was successful and was expanded to include
conferences and other educational events, all of which had
a promotional side to them.
Farmer - Dealers
Tom Roberts’ understanding of marketing became apparent
when the new company was faced with the organization of
its extended sales channel. Originally, Roberts had set
up a system of respected local farmers selling to their
neighbors as the best method of selling corn seed. Sales
were confined at this time to the DeKalb County area. The
farmers were responsible for selling the first large seed
corn harvest of 14,500 bushels (grown in 1935, sold in 1936).
Many of the persons who sold the seed were Board members
of the DeKalb County Agricultural Association and performed
with “almost evangelical zeal.” Questions arose about this
organization when Roberts argued, in January of 1937, the
company should expand to include a much larger portion of
the corn belt.
Several stockholders felt that grain elevator operators
were a better choice for the marketing channel than farmer-salesmen.
Since the established sales channel for seed at the time
was either direct mail or grain elevator operators, they
felt farmer customers would be reluctant to change their
established buying habits. Also, many grain elevator operators
were part of a local farmers’ cooperative. Buying outside
the cooperative would be considered antisocial by other
members of a co-op.
On the other hand, two important factors argued for the
use of farmer-dealers. First, if respected farmers were
chosen, their persuasive capabilities would be far greater
than a grain elevator operator or a mail order catalog.
Second, grain elevator operators carried a number of different
kinds of corn seeds and would be unlikely to care which
brand was sold, as long as the purchase was made from the
grain elevator.
It was agreed that setting up a farmer-dealer network would
be a much more difficult task -- the estimated number of
sales managers needed for this approach was daunting (1
for every 60 farmer - dealers), as was the estimate of 5,000
farmer-dealers to cover the entire market. Nevertheless,
Roberts’ view prevailed and the nation-wide network was
begun. The success of this network was the proof of Roberts
marketing skill. The concept of “farmer selling to farmer”
is one of the significant contributors to the success of
DeKalb Ag. Commenting on the importance of the dealer organization,
one writer states:
One of the outstanding features contributing to DeKalb’s
success has been its dealer organization. Tom Roberts idea
from the first was that the dealer should be a farmer, who
made direct calls on his neighbors rather than a seed store
or elevator operator who waited for customers to call on
him. Another innovation was making sales calls well in advance
of planting time, starting always earlier to beat competition
until most seed was sold in August and September. That these
two ideas were sound was shown by the fact that by 1940,
DeKalb led all competitors in sales and has been at the
top ever since.
Word of Mouth
DeKalb Ag recognized the importance of word-of-mouth promotion
early in their existence and utilized it effectively. The
Corn Husking contest brought thousands of farmers together
to see DeKalb products and discuss them among themselves.
The Farmer-Dealer sales concept was a word of mouth strategy
and the Farmer Dealers encouraged their customers to talk
to each other about DeKalb’s successful seeds. Visits to
experimental plots also generated extensive word of mouth
promotion.
Business Philosophy and Marketing Strategy
Indications of the Success of Roberts’ business philosophy
and marketing strategy can be found in the following excerpt
from the company’s sales literature of 1947:
1 -- “More Farmers Plant DEKALB Than Any Other hybrid Corn”.
2 -- DeKalb is a “Great Yielding Corn”. (This point is PROVED
by actual DeKalb Corn Growing Contest Records).
3 -- “DeKalb makes Seed Corn their Business -- not just
a side-line”.
4 -- DeKalb Controls its whole business of producing Quality
Hybrid Seed.
5 -- Corn Belt-Wide Seed Service means security of seed
supply. Its processing assures accurate grading and modern,
effective seed treatment.
6 -- “Good Seed Corn Costs So Little and Means So Much”.
(Free seed would be costly with a loss of only 2 bushels
of yield).
7 -- DeKalb Research is never-ending. It produces the finest
seed and proves it in a closely supervised testing program.
8 -- The DeKalb dealer is “A man it will pay you to know”,
because he KNOWS Corn -- knows the Farmers Problems.
9 -- The DeKalb corn Growing Contest is in a class by itself.
It definitely proves DeKalb’s ability to come through with
consistent yields, year after year. No guesswork about it
-- no baloney. Actual records PROVE DeKalb’s ability to
come through and do the job.
10 -- DeKalb is an organization of Farmers -- for Farmers.
It is dedicated to producing highest quality seed at reasonable
cost to users.
The above selling points are not substantially different
from Tom Roberts’ first marketing strategy. Each of them
can be seen as the result of the initial actions he took
in structuring the company from the beginning.
Entrepreneurial Drive
Tom Roberts consistently acted to make his company grow
whenever a favorable circumstance created an opportunity.
When there was a successful crop, Roberts sought the opportunity
to market it outside DeKalb county. He used the Prairie
Farmer advertisement to communicate his message. When the
Prairie Farmer advertisement proved demand for hybrids existed
outside the northern corn belt, he initiated research to
develop seed corn for regions with different climates and
hired additional researchers for this purpose. He was also
closely involved in early development of the Farm Bureau’s
Oil Cooperative Distributors who sold oil products to farmers.
He was one of the forces in the development of the Co-op
insurance company, which eventually began to sell policies
on a statewide basis. Realizing that farmers’ needs for
improved seed corn also suggested needs for other genetic
improvements, he expanded his company’s research efforts
beyond corn to poultry, wheat, cotton, and sorghum. He also
played an important role in the company’s later expansion
into the oil industry in the early 1940s as a financial
strategy. Some of Tom’s entrepreneurial drive and his ability
to drive others can be partly seen in a letter to a customer,
dated September 10, 1929:
Dear Patron:
We are glad to announce that at the end of our second year’s
business the demand for our oil service is continuing to
increase. During the last year it has practically doubled
and we have been able to adjust our service so as to meet
the demands of our patrons with prompt service. Considering
the fact that during the first five months of last year
there was practically no profit in the oil business, we
feel highly pleased that the year wound up in such shape
that we can send you a patronage refund.
We are enclosing the payment for the patronage refund and
trust that you will help yourself by helping us to sell
to your neighbor or friend as this increased volume tends
to cut our expenses and make larger patronage dividends.
We would appreciate it if you would go to your neighbor
now and see if you cannot land him as one of our oil patrons.
Please cash this check immediately.
Very Truly yours
DEKALB COUNTY AGRICULTURAL ASSOCIATION
BY: Thos. H Roberts
THR:IK
Inspirational Leadership
Tom Roberts has been described as an inspiring leader.
He was successful in bringing together persons of diverse
skills to work together to advance his organization. He
made a special effort to recruit highly trained researchers
from universities and colleges. He also attracted farmers,
agriculturists, innovators and inventors. It was because
of his inspirational leadership that he was able to manage
and grow the diverse group into the largest firm in the
industry.
It is often said that great leaders have a clear vision
and they are able to convince others of it. Leo Golden’s
interview with Charles L. Gunn came directly to this point.
Golden asks Charlie Gunn to describe the nature of the relationship
between the Board of Directors of the DeKalb Agricultural
Association and Tom Roberts. Was it joint motivation? Was
the Board the driving force? Or, was Roberts the impetus
to action? Gunn was direct. He said that Tom had to sell
the Board on most everything.
Tenacity
Entrepreneurs, perhaps by definition, are tenacious. Robert’s
tenacity was illustrated when the University of Illinois
decided that the farm bureau system should conform to its
format. Dean Mumford at Illinois had decided that the educational
role of a farm bureau was paramount and exclusive of business
activities. The DeKalb Agricultural Association had been
founded in 1912 with the idea that, in part, it would act
to buy and sell for farmers. Illinois voiced its displeasure,
centering in on the fact that Roberts was both Farm Adviser
and Secretary / Treasurer of the Agricultural Association.
After repeated requests that Roberts resign one post or
the other the University of Illinois severed its ties with
the DeKalb Association in 1927. After two years the Association
was allowed to reaffiliate, on condition that Roberts would
hold only one position. In 1931 this was finally accomplished
and the farm bureau became an entity separate from The DeKalb
Agricultural Association.
Robert’s was also tenacious in supporting Charlie Gunn’s
hybrid research. The nine years spent working on the first
successful hybrid seeds must have been a long time to wait,
experiment, and hope. Numerous other examples of Robert’s
tenacity are apparent throughout this article and the written
record of the early years of the company.
Recruiting Successful People
In many ways Roberts’ vision of the future, along with
those special leadership qualities may have been responsible
for his success in identifying and recruiting talented people
to his organization. Some of the people he was able to recruit
and manage included Russel Rasmusen, R.R. St. John, G. H.
Stringfield and Leo Olson.
Russel Rasmusen, a graduate of the University of Illinois
and a former agriculture teacher, was recruited in late
1936 to work as a sales manager for the new DeKalb Hybrid
Corn. Rasmusen was successful in organizing the company
into twenty sales districts initially, and was able to manage
the company’s geographic expansion to almost one hundred
by 1960.
R.R. St. John, who had done outstanding work in hybrids
at the Indiana Experimental Station was recruited by Roberts
in 1937 to expand the DeKalb hybrid to warmer regions of
the corn belt. He was an Associate Agronomist and corn breeder
for USDA at Purdue University for thirteen years. St. John
was able to make an important and immediate contribution
to DeKalb Ag research in the south eastern and central areas
of the corn belt. “The Saint” also was a source of motivation
and encouragement to the sales force.
G.H. Stringfield, an experienced researcher was recruited
in 1959. He had thirty years of experience in hybrid corn
development in Ohio and served as the corn research specialist
for the USDA and Ohio Agricultural Experiment Station. “String”
served as the coordinator of many different research programs.
He also brought new approaches and methodologies of corn
breeding to DeKalb Ag.
Leo B. Olsen, a World War II veteran, was a DeKalb native.
He graduated from Northern State Teachers college, became
a faculty assistant, then a school teacher for four years.
After showing great organizational and promotion skill he
became the Advertising Manager for DeKalb Ag.
Many other researchers, marketers and managers were recruited
by Tom Roberts, Sr. He was able to forge a partnership between
the researchers, marketers, managers and operations personnel
so as to provide for the continued growth of the organization.
He maintained a strong personal relationship with many of
his staff.
Product Innovation
The history of DeKalb Ag is the history of hybridization
in Agriculture. Starting from the early beginning when Roberts
and Gunn began their hybrid corn research until the time
of Tom’s death, DeKalb Ag pioneered the development of new
ideas, new businesses, new products, and new techniques.
Although his hands-on research experience may been limited
to working with Gunn on their first hybrid, Robert’s innovation
in new product development was accomplished by his ability
to foresee the importance of hybridization in corn, and
then in other product lines. Robert’s research division
used methodology similar to Edison’s. This included experimentation,
trial, testing and retesting across large numbers of alternative
solutions to develop different varieties of corn hybrids,
wheat hybrids, poultry hybrids, sorghum hybrids, and cotton
hybrids. All of these but cotton were successful product
entries. These successes took years to accomplish and would
have been impossible had Tom not recognized their importance
and provided both organizational and financial support and
patience.
Innovative Approaches To Finance
In 1936 - 37, when The DeKalb Agricultural Association
was poised for rapid expansion, its capital was primarily
in inventory, accounts receivable, and fixed assets. Most
of the current stockholders at that time were unable to
invest more money in the company but they also did not wish
to issue more shares in fear of losing control of the company.
Issuance of bonds and preferred stock was not considered
desirable due to the current earnings situation. Further,
the banks, recognizing the inventory risks inherent in the
seed business, had limited short-term credit to notes secured
by warehouse receipts. Roberts was not deterred and found
an innovative approach for handling the problem. He developed
a system such that the farmers had to make an advance deposit
for the hybrid seeds they ordered. The previous year’s corn
crop had been so successful in the field that farmers were
willing to do this and the company’s entire 1937 seed supply
of 80,000 bushels was ordered with deposits by December
of 1936.
Roberts utilized a unique approach for financing the purchase
of hybrid seed corn from the supplier farmers. In this way
the company was able to minimize its need for credit during
the fall and winter months. Financing of seed purchase at
that time represented a major cost for DeKalb Ag. The farmers
were typically paid by DeKalb Ag(at a premium over the price
of regular seed) upon delivery in the month of October.
The price of seed was determined by the prevailing Chicago
prices at the time of delivery. Roberts allowed the farmers
to choose any delivery date that met their needs. He knew
that farmers preferred delaying the sale of their crop as
long as possible hoping for higher prices. In fact, they
often delivered and collected for seed in January, February,
and March. This strategy worked like a charm and Roberts
was able to reduce his dependence for external credit in
the fall and winter months. Customer-farmers paid an early
deposit for future seed. Supplier-farmers delayed their
request for payment, holding out for higher prices at the
end of the possible delivery dates. The company’s improved
financial situation made it possible for Roberts to make
the necessary plant expansion from retained earnings.
Development of DeKalb Ag to 1967
Roberts also took DeKalb Ag into the business of oil production.
Tom and his managers decided to buy oil rich land in the
1940s when they needed a way to reduce their excess profits
tax burden. By 1954 daily production was 4000 barrels.
Roberts was also intimately involved in the company’s success
in each of the milestones of the company listed below.
Milestones: DeKalb Ag Under the Leadership
of Tom Roberts, Sr.
1917 - The DeKalb County Agricultural Association (predecessor
to DeKalb Ag) was Incorporated. Roberts identified as secretary
/ treasurer.
1924 - Hybrid Corn research was started by Gunn and Roberts
1934 - First Hybrid Corn was sold
1944 - Poultry research was initiated. Eventually became
the DeKalb Chix Project
1948 - DeKalb Chix placed on the market for the first time.
1948 - DeKalb seeds sold internationally for the first time.
1949 - Research in sorghum hybrids begun in Texas
1956 - Three hundred twenty five Chix Hatcheries franchised.
1956 - First commercial sale of sorghum
1959 - Hybrid wheat research began
1959 - DeKalb Chix exported to Europe
1967 - DeKalb seed sales and chix sales double over the
past five years, the greatest expansion of the company in
its history.
1967 - Tom Roberts, Sr. passes away
Tom Roberts’ Legacy and Message for
Future Leaders
Tom Roberts, Sr. turned his education, background, and
ability to understand others into the largest company in
his industry. In The Winged Ear, the company’s newsletter
to its dealers, Roberts wrote a column for almost every
edition. What he told his dealers about their customers
may have been the company’s overall key to success -- and
may be Tom’s best message to business executives who wish
to follow in his footsteps in any business. In the March,
1948 edition Tom Roberts, Sr. wrote:
“Whoever you are, and wherever you may be, there is one
person who is the center of your business --- the farmer.
At this time when you are concerned with meeting your obligations
to him, there are several things about the farmer, as a
customer, it is well to keep in mind.
First, the farmer, as a customer, is not dependent upon
you; rather, you are dependent on him.
He is not an interruption of your work --- he is the purpose
of it. You are not doing him a favor by giving him service
--- but, he is doing you a favor by giving you the opportunity
to do so.
He is not apart from your business, he is it. Around and
in him your business functions.
The farmer, as a customer, is not just another person, He
is a human being with feelings and emotions like your own
--- with prejudices and biases --- even though he may be
lacking certain qualities you think important.
He is not someone to argue with or match wits against. No
one has ever won an argument with a customer even though
he may have thought so. Hence the saying, “The customer
is always right.”
The farmer, as a customer, is a person who brings you his
wants. If you have sufficient imagination you will try to
meet those wants and handle them in a manner profitable
to him and to yourself.
Adding up these points, you will find that the farmer, as
a customer, is your business, and to make that business
successful you will have to operate on his terms. remember
always, the farmer, as a customer, is the important person
--- around him your business centers, and through him your
business functions.”
--- Thos. H. Roberts.
Tom’s legacy is The DeKalb Ag Research, Inc. and the innovations
and management techniques he brought to agriculture. His message
for future leaders lies in our understanding that Tom believed
almost everyone he met should be treated as though he were
Tom’s own customer.
*By JOHN S. WAGLE and A.H. KIZILBASH
*Copyright 1990. The Illinois Business Hall of Fame. All rights
reserved. No portion of IBHF may be duplicated, redistributed
or manipulated without the expressed permission of the IBHF. |