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Harley Shifts Gears

By: Gina ImperatoTue Dec 18, 2007 at 5:44 PM
The company and its customers travel together: they're tough and independent, with a taste for freedom and independence. Now CEO Rich Teerlink aims to triple production without veering off course.

Second, Harley-Davidson University is the company's annual learning link to its dealer group. As Harley has expanded its goods and services to include collectibles, clothing, financing, and other components of the business, the demands on its dealers have increased. To support its dealers Harley now runs a three-day training program with courses as diverse as how to provide top-notch service, how to do a business simulation, and how to plan for ownership succession.

Third, Harley extends its learning to its family of owners: the Harley Owners Group, or HOG. A 15-year-old initiative to build a life-long relationship between the company and its customers, HOG is the world's largest factory-sponsored motorcycle club, with 325,000 members and 940 chapters. Harley offers HOG Seminars, sessions for the club's 7,000 chapter officers to help answer questions on whether and how to incorporate, how to draw new members, or how to organize an event.

Fourth, the company's most important intelligence gathering comes at Harley-sponsored events such as the Daytona Bike Week, where dozens of company volunteers -- ranging from Rich Teerlink, chairman, president, and CEO of Harley-Davidson Inc. to factory and office workers -- interact with customers.

"This is real-time market research," Teerlink says. "Our engineers see what our customers are doing with their motorcycles, and they come back with things we could improve on or new ideas we could try."

Individuality and Teamwork!

Freedom and Cooperation! Check out the Harley Web site http://www.harley-davidson.com. The combination of words and pictures is a rhapsody to the freedom of the open road -- which Harley manages to couple with a feeling of community. At Harley's York Manufacturing and Finishing Plant the same sense of individuality and teamwork comes across.

"A major issue for us," says Bleustein, "is to get all 5,000 of our people participating. We want all our employees to be able to make decisions within certain guidelines." Inside Harley, the concept goes by the name of Freedom with Fences and takes the form of ongoing conversations and training around the company's core values and business processes.

To make it clear to employees how they fit into Harley's larger business plan, the company created its Performance Effectiveness Process: a contract written by each employee that defines annual measurable goals, which are reviewed quarterly with a supervisor. But the centerpiece of Harley's blend of individuality and teamwork is the company's partnership with its two unions, the International Association of Machinists and Aerospace Workers and the United Paperworkers International.

Based on a negotiated Modern Operating Agreement, both sides share a commitment to making Harley a high-performance work organization, where the people closest to a job have the authority and responsibility to do it the best way they can. Teerlink says part of the company's management approach is freedom and teamwork -- it encourages each plant to solve its problems in its own way.

"The issues are always the same," Teerlink says. "Quality, productivity, participation, flexibility, and cash flow. But each plant deals with them in a different way. We don't have cookbooks because there isn't a cookbook. We're on a journey that never ends. And the day we think we've got it made, that's the day we'd better start worrying about going out of business."

Gina Imperato (gimperato@fastcompany.com) is a member of Fast Company's editorial staff.

From Issue 09 | June 1997

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