The radical road that Harley took
Harley-Davidson leads the field in worker- management democracy
KANSAS CITY, MO. — On the lilting plains outside Kansas City, Mo., a merry band of Harley-Davidson employees is doing much more than assembling 180 Sportster motorcycles every day - they're obliterating the Berlin Wall between management and workers, between white-collar pencil pushers and blue-collar heavies.
And they're achieving considerable success.
This sprawling plant, where welding sparks spew onto the floor and enamel paint assaults the nose, is home to America's most radical experiment in plant-management democracy. Here, hourly workers decide everything from how to spend their department's budget to which music to play on the line.
(Aerosmith is a favorite.) Even the wheel-spoke specialists get computer training to learn spreadsheets and Powerpoint - so they can give slick presentations about their ideas for building bikes better.
It's an unheard-of arrangement in American industry. But the quest for better worker productivity - which economists say will keep the Energizer economy hopping along - is prompting greater experimentation in US offices and factories. And to that end, Harley is setting a new standard for worker-manager harmony, and with revved-up results.
The plant is "way out there at the extreme pole," says Harley Shaiken, a labor professor at the University of California, Berkeley. It's the only plant in America, he says, "that's cast in that mold."
Most workers seem to appreciate the freedom and the entrepreneurial spirit here. Kevin McPeek is a lanky inventory manager who slips from station to station, checking to ensure each one has enough parts. He has leapt up the ranks from hourly employee to salaried worker in just a few years - something most blue-collar workers don't do in a lifetime.
"This is the land of opportunity," he says, surveying the whirring plant. "I do what I want to do here, and I wouldn't want to do it for anyone else."
Pride in this place is engraved on the workers' hands - literally, in the form of tattoos. "I'll tell you, nobody at Honda is tattooing the company's name on their body," boasts union president Ted Gee.
And what effect does all this have on productivity? Plant manager Karl Eberle says the facility's "rework rate" - or the number of parts or sections that are rejected because of poor quality - is just 5 percent. That compares with 20 percent at Harley's other finishing plant in York, Pa.
When the Kansas City plant recently ramped up production from 161 bikes a day to 180, only 11 more employees were added (for a total of 364) - a sign, says Mr. Eberle, of the innovation and productivity increases.
Harley, of course, isn't entirely alone. A 1998 study based on US Census Bureau data found that firms with employee-empowerment policies - nonsalaried workers using computers and getting profit-sharing, regular employee meetings to discuss company problems, and self-managed worker teams - had productivity rates 11 to 20 percent higher than those without.
On a broader scale, "boosting worker productivity" is a watchword of today's economy. The basic theory is this: Ever-more-productive workers enable companies to pull in profits without raising prices. This, in turn, staves off the economic bogeyman - inflation.
Still the exception
So if worker-management harmony is good for the economy - and is so good for business - why isn't everyone doing it?
Well, some have tried. And a few have succeeded. Most notably, there's General Motors' Saturn subsidiary in Spring Hill, Tenn. Workers there have lots of input. They also get lower wages - but have an incentive system that awards bonuses on the basis of plant performance.
But Saturn has hit on hard times recently, and there's wavering commitment among workers and GM to the revolutionary management structure.
There are broader signs of change in labor relations, however, especially in the auto industry. Many car-plant managers, for instance, have given up the symbols of corporate life - wearing ties, parking in special lots, and eating at separate cafeterias.
But, frankly, egalitarian structures like Harley-Davidson's require lots of effort. Because every Harley worker is on a team, for instance, and every team has input into running the plant, decisionmaking is often slow.
"Sometimes I want to scream," says Eberle, the plant manager. "In the old days, you'd go grab the supervisor by the scruff of the neck and say, 'Get this done.'"
Not anymore. The only decisions Eberle makes without union approval are salary increases. And whenever Eberle leaves town, the union bosses are in charge of the plant. (In a conspicuous sign of parity, he shares his cubicle with two union presidents.)
Often Eberle will take time to do an hourly worker's task - to see how the other side lives. Recently he spent a few hours sealing crates around finished bikes. "It was tiring," he says. "Of course, the guys were pushing bikes at me as fast as they could." Experiences like this "give you much more empathy" for the workers, he says.
All this astounds the nearly 2,000 visitors who see the plant each month, many of whom are manufacturing executives elsewhere.
But the Harley method does not mean abandoning tough requirements. Harley's corporate headquarters designed the plant to produce bikes 30 percent more cheaply than other plants. It's just that Eberle and the unions are working together to meet that standard.
The autonomy this system breeds is heartening to managers. Recently, after a small fire in the paint shop, for instance, employees scurried around - unasked and unsupervised - scraping soot off the floors and machines.
Or there are the improvements workers have come up with on their own, such as the recent suggestion that two gas tanks - instead of one - be put into the paint chamber. This little idea doubled productivity in the paint shop.
In the end, says Eberle, who knows most of the workers by name and sends birthday cards to each, "If the workers believe you care, they'll speak up about problems and solutions."
Either way, it makes for a more efficient plant.
(c) Copyright 1999. The Christian Science Publishing Society