John Deere plows ahead
A lot of things about Deere are as outsize as its big green tractors (the largest comes in at 560 horsepower). The company’s growth, for instance: After 10 successive quarters of record revenue gains, Deere (DE) reported $32.6 billion in sales for 2012, another record. Its ambition is outsize too: It aims to hit $50 billion in revenue by 2018 and has seven new factories in the works. As for its tractors, bigger isn’t always better. Some of the company’s top-selling models are too large for growers overseas — the soil often isn’t as firm, nor are the farms as sprawling as in the U.S. (though that, too, is changing as farmers expand grain production). To sell overseas, the 176-year-old agricultural giant has developed a suite of new equipment to appeal to first-time buyers. In the past two years the company has introduced hundreds of new products — more than ever before in its long history.
Slowly but surely
Deere was founded in 1837 by a blacksmith named (you guessed it) John Deere. The company he built moves deliberately: It specialized in horse-drawn plows for nearly a century before making the switch to internal combustion; it has seen just nine CEOs in its 176-year history (that’s one every 20 years, on average); and its reserved financing division requires big down payments and has few defaults. One result of such stability: devoted customers who covet those iconic ball caps.
Invest in R&D
Deere spends more on innovation: About 4% of its annual revenue goes to R&D, vs. the roughly 3% spent by its two closest competitors. This investment has helped the company quickly move to growth markets, such as Brazil and Russia. Coupled with a reputation for reliability, that innovation has helped Deere grow faster abroad than its competitors.
While its competition has struggled to build a network of salesmen, Deere’s equipment dealers are an open secret of its success. Dealers work closely with farmers to customize a machine’s weight, traction, and accessories (Bluetooth speakers, mini-fridges) and consult with their clients as new products become available. A good dealer, says Adam Fleck, an analyst at Morningstar, is essentially serving as a trusted adviser, not just as a salesman. “That’s what has allowed Deere to dominate the market,” he says.
Most Admired Companies Rank: 38
Headquarters: Moline, Ill.
The business: Designs and manufactures tractors, balers, and other agricultural machinery, as well as equipment for construction, forestry, and turf care.
This story is from the February 25, 2013 issue of Fortune.