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2010 Speeches

Nate Clark     Nate Clark Largely & Wholeheartedly Innovating a Future
For the Logging Community

Oregon Logging Conference
Eugene, Oregon
Remarks by Nate Clark, Director of Public Affairs

John Deere Construction & Forestry Division and John Deere
Power Systems
February 25, 2010


On behalf of John Deere and Pape Machinery, I would like to thank the Oregon Logging Conference for the privilege of providing this year's keynote address.


I would also like to thank you on a personal level. As part of John Deere's Construction & Forestry Division, I have had the chance to work closely with loggers across the country, including those represented so well by the American Loggers Council. In my collaboration with loggers, I have met tireless workers, devoted family members, insightful business managers, passionate political activists, and good friends. It is these and other qualities — qualities to which we at John Deere and Pape Machinery certainly aspire — that have driven us to serve you in our products, services, and beyond.


For the keynote address today, I will focus on one value that the logging community will need to embrace and promote more than any other as it strives to recover from the economic recession. I believe this value will serve not only as a key to recovery, but also as the catalyst for the logging community's long-term growth and prosperity.


This value is innovation.


Innovation for John Deere means inventing, designing, and developing breakthrough products and services that our customers can use to improve their lives and those of others. At the heart of innovation is a special human element: the ability to see the value of new things or doing things in different ways, and the courage to act on this insight.


The importance of innovation — particularly at times of enormous upheaval — cannot be overstated. Whereas dramatic change often causes us to become protective and risk-averse, it is in the midst of such change that innovation may create the most opportunity and spell the difference between ultimate success and failure.


During John Deere's 173-year history, we have confronted many such moments that have demanded innovation even in the face of uncertainty and dissent. However, none was so critical to John Deere's future as its decision to enter the gasoline tractor engine business in the early 1900s. Despite the fact that today John Deere is recognized worldwide for its "green machines," in the early 1900s this future was not even a glimmer in anyone's eyes.


As companies like J.I. Case and International Harvester began making their own gasoline tractors in the late 1890s and early 1900s, John Deere faced the same dilemma as many other farm equipment manufacturers. Wayne Broehl summarizes this dilemma in his definitive history, John Deere's Company: A History of Deere & Company and Its Times:


"Was the tractor a significant piece of agricultural machinery? Was it destined to be a major new innovation that would be adopted widely? Should an agricultural machinery manufacturer concentrate on supplying the implements that would be pulled by another's tractors, or should he jump into tractor manufacturing, considering it an integral part of the long line?"


These questions had no easy answers, and opinions within John Deere's leadership at the time differed widely. For example, one of John Deere's Directors, Willard Velie, offered a resolution in 1912, stating,


"In view of the inevitable future use by farmers for diverse purposes of gasoline and kerosene tractors ... a movement to produce a tractor plow should be started at once. ..."


However, John Deere's President at the time, William Butterworth, recorded his own impressions that same year regarding John Deere's future in the tractor business, writing simply,

"Drop all tractor expenditures."


Talk about a difference of opinion.

It was not until 1918 that John Deere chose its direction, largely as a result of the vision and persuasion of Willard Velie. While between 1912 and 1918, John Deere explored both partnering with gasoline tractor manufacturers as well as manufacturing its own tractor, it had not meaningfully set its course. In response to this indecisiveness and the perception that John Deere was suffering as a result, Willard Velie wrote an impassioned letter to each of John Deere's other Directors reiterating his earlier 1912 resolution and stating,


"We have produced in the period of five years and ten months about a dozen tractors of various designs. ... Our expenditure in the process has been $250,000. ... Each tractor has cost us about $21,000."

As an interesting aside, $21,000 spent to make one tractor in 1918 could equate to as much as $4 million dollars today depending on how you calculate it. That's one expensive tractor.

Willard Velie went on to say,


"Our position as either tractor or plow manufacturers is not as strong today as when we started. ... The industrial and economic situation known to intelligent observers seems to preclude the necessity of arguing for the horse as against the tractor for plowing and farm operations in the future. I think it is safe to eliminate the horse, the mule, the bull team, and the woman, so far as generally furnishing motive power is concerned. ... I cannot refrain from remarking that we should build tractors largely and wholeheartedly, or dismiss the tractor matter as inconsequential and immaterial. Our present course is prejudicial and impotent."


Thankfully, for John Deere, it chose to build tractors largely and wholeheartedly.


In 1918, John Deere purchased what was then known as the Waterloo Gasoline Engine Company for $2,350,000. After the purchase, Charles Velie, another of Deere's Directors, opined,


"I am more than satisfied we have made the best move Deere & Company has ever made, and that it was an extremely fortunate thing we were able to buy this plant. I believe if we handle this proposition right, the Waterloo Boy will be to the tractor trade what the Ford car is to the automobile trade."


As they say, the rest is history. Because of the innovation represented in this one decision, John Deere became what it is today. And because of the lessons learned from this one decision, Deere invests over $2,000,000 in research and development every day to make sure that it does not miss the next great innovation that will permit us to serve our employees, dealers, customers, and those who depend upon us for the next 173 years.


From this little-known example from John Deere's history, which I am thrilled at the opportunity to share, I believe there are two aspects of innovation that ultimately determine whether an innovation is successful: The nature of the innovation, and the value others see in it.


Against this backdrop, I ask that each of you consider two questions. The first question is this: What do you see as the single most important innovation that will sustain and strengthen the logging community for years to come?


As luck would have it, one source for a possible answer to this question can be found a mere 45-minute drive from us here today in the Willamette National Forest. The H.J. Andrews Experimental Forest established there in 1948, and featured in Jon Luoma's wonderful book, The Hidden Forest: The Biography of an Ecosystem, has helped lead to discoveries regarding the very nature of forests that will ultimately improve forestry and create more opportunities for those who work in them.


One discovery stands out for me. This discovery involves the critical role microorganisms play in maintaining and reinvigorating the living soil of a forest. As Jon Luoma records in his book, immediately after the eruption of Mount St. Helens in 1980, Fred Swanson, one of the scientists from Andrews Experimental Forest, worked with others to investigate the soil deposit pattern created by the blast. What Fred Swanson unearthed, however, was critical evidence of how forests recover, revealed in the faint spider web-like threads of burn-site fungi spreading through the ash. Jon Luoma writes,


"At the time, Swanson didn't know what the threads were. But he would learn.  Here in the blast zone, in the most inhospitable environment imaginable, those tiny threads had spread themselves through the ash, the future soil of the mountain. They had spread themselves as a living, under soil web in just the ten days since the eruption. ... Swanson, of course, could not have known that the tiny threads would one day help lead his team to a new way of imagining what a forest can be."


These threads led the team at Andrews Experimental Forest to many discoveries regarding the importance of the invisible world beneath our feet. Organisms in the soil are not only nourished by the trees above them, but they also provide the environment in which trees can again thrive after a disturbance such as Mount St. Helens or timber harvesting. For example, these organisms can help store and regulate nutrients including nitrogen needed by the trees to grow. In addition — and more amazingly — organisms can help certain species of trees share and exchange nutrients to enable their collective success. Countless organisms, materials, and structures that survive after a disturbance serve as what the team from Andrews Experimental Forest calls "biological legacies" that enable forests to recover.


What does the discovery of the importance of diverse microorganisms and other biological legacies mean for the future of logging communities?


On a basic level, it means logging communities that incorporate into their work discoveries regarding how forests recover from disturbances will improve their own chances of success. Healthier forests at every level of the ecosystem mean more opportunities for the logging community.


Already, some in the forestry industry have incorporated these discoveries for their benefit. Some nurseries here in the Northwest introduce fungi into their soil to foster seedling growth and survival. Similarly, some have adopted a host of practices often referred to as "New Forestry" — a term coined by one of its pioneers, Jerry Franklin — to improve profitability by mimicking nature's best practices in forest health and recovery.


It also means loggers who develop the capacity to create and use innovative forestry practices will earn more and be more profitable. These loggers will have a competitive advantage in a market that increasingly demands and pays for such innovation. Innovation will not be limited to forestry practices, but will also include new products for you to harvest, new products for you to use in your work, and new business models for you to employ.


More importantly, it means loggers who develop the capacity to innovate will create their own equivalent of biological legacies — let's call them "economic legacies" — and thereby create an economic environment rich in diverse opportunities that will be necessary to survive future disturbances such as the economic recession that ravages the logging community.


Let's be clear: Economic survival in the logging community has become increasingly tough.  According to the United States Bureau of Labor Statistics, in February 2005 there were 66,000 Americans employed in the logging industry. Today, that number is close to 47,000.


The ability for the logging community to be innovative will open up a world of diverse opportunities as we collectively struggle with massive challenges such as economic recovery, energy independence, and climate change. One such opportunity is reflected in the theme of this year's Oregon Logging Conference: Forest Biomass  ... Fuel of the Future?Energy from forest biomass holds great promise for Oregon and many other states rich in forest resources. For example, the Oregon Department of Energy presents encouraging statistics about the energy potential from merely the treetops, limbs, and cull material left over from Oregon logging activity:

"The Department of Energy estimates that 3.3 million bone-dry tons of forest biomass residue was generated from timber harvest activity in 2004. An estimated 0.63 million bone-dry tons of forest biomass was economically available to be used for energy production. The available forest biomass resource had an energy value of 10.8 trillion Btu."


As an aside, the primary energy contained in that amount of woody biomass, 10.8 trillion Btu's, could be used to power 82,000 U.S. households for an entire year.  And this represents only a small portion of the forest biomass available as a result of timber harvesting alone.


What if we were to include forest biomass generated from efforts to improve forest health and remove the fuel built up over decades of fire suppression? According to a report by the Oregon Forest Resources Institute entitled Biomass Energy and Biofuels from Oregon's Forests, there is an estimated 4.25 million acres of forestland in Oregon with the potential to provide 1 million bone-dry tons of biomass annually from thinning to reduce the risk of uncharacteristic fire. If we look at these and other possible sources of forest biomass, we see great potential.


The ultimate success of forest biomass as a fuel of the future, however, is — much like Deere's position in the early 1900s as the future leader in agricultural tractors — far from certain. It will take cutting-edge loggers like those in attendance here, skilled in the best woody biomass harvesting techniques, to turn the promise of forest biomass energy into a reality. The Oregon Department of Forestry recently stressed the role of loggers in its report entitled Environmental Effects of Forest Biomass Removal, stating,


"As interest and advances in bioenergy occur, we will need to continue to evaluate the forest landscapes and forest cover types to ensure ongoing resource protection. ... Scientific input is needed to help establish appropriate remove/residual policies for forest slash in thinnings and fuel reduction treatments by forest cover type. Also key is continuing to encourage logger certification programs, such as Associated Oregon Loggers' Professional Logger certification program, to include woody biomass harvesting techniques training."

In short, the answer to my first question — what do you see as the single most important innovation that will sustain and strengthen the logging community for years to come — is you. You are the innovation, and it will be your capacity to recognize, pursue, and courageously embrace change that will ensure your future success and the success of the many new opportunities before you.


My second question to you is this: What are you doing to teach others the essential role that the logging community can play? In my recent work with Danny Dructor, the exceptional Executive Director of the American Loggers Council, I was struck by one of the terms he uses to describe the logging industry. He describes it as an "invisible industry" because the essential role it plays is neither widely understood nor recognized — so much so that its overall existence is often taken for granted.


To be sure, there are many costs to being invisible, including the fact that much of the recent suffering within the logging community goes unnoticed and untreated. Rick Attig of The Oregonian recently highlighted this phenomenon in his article entitled "Oregon's Appalachia: Poverty in Rural Schools." He writes,


"Oregon has rural schools where one quarter to one third of the students live below the poverty line, according to a new U.S. Census Bureau report. Such grim child poverty statistics are sure to surprise many people in Oregon, where rural issues don't get much attention. In fact, when's the last time you heard about child poverty in connection with any of the major economic and environmental debates that involve rural Oregon?  ... The jobless rate in some of these timber counties is a staggering 16 percent. The child poverty rates found in the local schools are deeply disturbing."

Just like many do not recognize the current suffering in the logging community, they also do not recognize the future potential of the logging community to help tackle some of our most significant political, social, and environmental issues. In other words, if the logging community is truly invisible, then its capacity to do great things will be invisible as well.


This means that you — each of you — must work to teach others about the essential role of the logging community. While crafting such an education seems a daunting innovation in and of itself, you can again find inspiration in the discoveries made in the Andrews Experimental Forest. For example, one of the discoveries involves a concept called "mutuality," or how organisms can evolve to rely upon each other for their mutual good and survival. Jon Luoma describes mutuality far more eloquently:


"The living soil of these woods is a matted webwork of fungal strands like these: little threads much like those Fred Swanson had seen on the newly devastated slope of Mount St. Helens. Science has long known that fungi play a mutualistic role in the life of some trees. But when they began their studies, the Andrews scientists had little idea how intimately these near-invisible fungal strands are woven into the life and survival of the entire forest ecosystem. Little did anyone suspect that here, in a living soil, functioned an exquisite symbiosis among living tree, living fungus, dead tree burrowing mammals, and even the host of then-largely-undiscovered insects in the soil."

When I read this description, I see a way to reveal the invisible logging community as playing a mutualistic role in all of our lives by harvesting materials for our enjoyment, use, and even survival.


But let's have the courage to think bigger. Does anyone suspect the full scale of what the logging community can "harvest" for us beyond simple products? I have briefly touched upon the role of loggers to harvest homegrown, clean energy in the form of forest biomass. Loggers can also harvest carbon from the atmosphere to minimize the risks posed by global climate change. Loggers can help harvest clean water by ensuring that forests remain healthy and continue to purify the water we all use. Loggers can help harvest biodiversity by protecting critical habitats.


It is the ability of loggers to do these great things that lead John Deere to our biopower alliance with ADAGE, a joint venture formed between AREVA and Duke Energy. Early this month, we announced our first project in Shelton, Washington. For our part, we will work with local loggers, such as those skillfully represented by the Washington Contract Loggers Association, to supply the woody biomass for a state-of-the-art 55-megawatt power facility. For our loggers, this will mean as much as 100 jobs in the harvesting and delivery of biomass. For the Shelton community and Washington as a whole, it will mean even more in terms of rural revitalization, clean energy, and environmental stewardship.


Probably biggest of all, loggers can "harvest" knowledge about how our forests work.  While there are many great scientists at Andrews Experimental Forest, think about the value 50,000 logger-scientists could create for themselves and others. National Medal of Science recipient E.O. Wilson describes the value of "citizen scientists" in his book, The Creation: An Appeal to Save Life on Earth:


"The information from citizen scientists is needed, now more than ever, and it has permanent value. ...To move the exploration of Earth's fauna and flora forward, these overworked researchers need more eyes, more boots on the ground, and more fresh ideas. ... Now it is the turn of invisible life to be revealed. ... The positive impact of this scientific knowledge on medicine, agriculture, and resource management will be beyond measure."

Some progress is being made in teaching others about what the logging community can offer. For example, in March 2008, the New York Times featured an article entitled "Loggers Try to Adapt to a Green Economy." This article features, among others, Josh Anderson, a timber resource manager from Vaagen Brothers Lumber in Colville, Washington, who sums up both the innovative capacity of the logging community and the need for mutual support from others. He is quoted as saying,


"We're doing a lot of things here that nationally we say we want to do — biomass, fuels reduction, forest health, green jobs — we're doing all of it now. ... We want to be here to be able to do that when things improve. ... We need to see something that moves a long-term trend toward work on these projects. It's got to be pretty integrated."

As you leave here today, I challenge you to find at least one way to teach others about the logging community. Here are some suggestions:


Join together with others in the logging community to make your voice louder and more clear. I have already mentioned the American Loggers Council in this speech, and I cannot say enough about how effective it and its state partners like the Associated Oregon Loggers have been over the last year in increasing awareness about the logging community. Leaders like Mike Wiedeman, the American Loggers Council's President, and Jim Geisinger, the Associated Oregon Loggers' Executive Vice President, make these groups so effective, and you should strongly consider joining with them.


Reach out to public officials at all levels, including specifically your members of Congress, to tell them your story and how you can contribute to meaningful solutions to the challenges that we face. While associations like the American Loggers Council can coordinate, it is ultimately up to individuals to communicate.  Recent success by individuals throughout the logging community in influencing the direction of energy and climate change legislation to embrace forest biomass more broadly should reveal to you the impact you can have.


Educate children both inside and outside of your communities about the critical role that forests play in their lives, and teach them that there is a rich future within the logging profession. Growing up in a family with roots in rural Iowa, I have seen firsthand the weakening of rural communities as much of our young talent leaves for different professions and what they believe are bigger opportunities. By striving to transform logging communities into cutting-edge sources of timber, energy, and science, you will create more economic opportunities for yourselves and draw new talent to your ranks. Ultimately, the success of the logging community will be your ability to attract others to you both in terms of financial investment and personal passion.


In conclusion, thank you again for the opportunity to share these thoughts about innovation. I have a great deal to learn about you and your business, and I welcome the opportunity to do more. We at John Deere promise to provide you the tools, services, and other opportunities to match your innovative goals. I invite you to meet with the many experts from John Deere and Pape Machinery in attendance at the conference to explore these tools and services more fully. I also invite you to speak with us about our new biopower alliance with ADAGE. Beyond this, we at John Deere promise to stand with you to help tell your story. We are honored to continue our work with the American Loggers Council and others to advocate on behalf of the logging community in Washington, D.C., and elsewhere. Our success is intertwined with yours, and we see in the logging community a spectacular future.


Thank you.