Tuesday, September 9, 2014

Harley Davidson: The Lean Machine

Harley Davidson, for me, has always been synonymous with 'huge, shiny motorcycles', 'tattooed bikers', 'close-fit leather vests', may be even Steppenwolf's 'Born To Be Wild'.

But 'lean'? Not really. Putting them side by side seems more like an oxymoron! I was really intrigued when I came across articles that said the mean machine had now been transformed into a lean machine.

Putting the principles of the 'The Toyota Model' into practice by eliminating waste, having fewer hourly workers and more robots, helped Harley Davidson drop production costs and make higher profits.

During the recession period around 2008, Harley saw a severe nosedive in sales figures. Newly elected CEO Keith Wandell thought the company's plant at York, PA was unsustainable, and the operating costs were rocketing by the day. They had two choices to cut costs: stay in the same location but have fewer workers, or shift base to Kentucky. The workers voted for Harley to stay.

What they did instead, was, they transformed their operations and management structure.

A new factory was built in the run-down expanse of land in York, PA where 41 buildings of Harley once stood. This new factory is almost* automated. Better designed assembly lines churn a Harley out the line every 90 seconds. Conveyor belts to transport equipment around the factory have reduced thrice in length than the years past. Robots do the more physically arduous tasks like steadily cutting and welding parts together precisely. By the time a fender or frame has moved along the line a short distance, a computer will have already taken its picture to let the painting department know what colors to prepare for the paint job.

Tasks have been divided and isolated between the various Harley plants. The plant at York manufactures gas tanks, fenders and frames. Engines and drive-trains are shipped from Kansas City, Missouri. Offshore assembly is done in Brazil and India.

The factory does not have full-time employees as such. For every 1,000 full-time hourly employees, there are around 100 flexible 'casual' workers who come and go as needed during the peak period. This revamping has allowed Harley to quickly increase or decrease production in response to shifting demand.

With a flatter organization structure now, workers are classified under one of five job classifications, instead of 65, as it was.

* Not every operation is automated, even though the work definitely gets done faster with automation. An employee from the paint department said that people did the same chore all day. Now, jobs are rotated to avoid boredom and physical strain. Also, instead of pushing the job to the next department, workers are urged to fix flaws by themselves. Men wearing head scarfs imprinted with the Stars and Stripes perform quality-control. How do they check for leaks? They use the century old tried and tested formula: dunk parts into water and look for bubbles. The manager of the plant seems to be satisfied with that!

Harley now houses only 2 buildings. In going down from 41 to 2, it has literally gone 'lean'.

Harley-Davidson York Manufacturing Factory:


Lean in Harley-Davidson: Launching the Harley-Davidson Operating System

2013 IW Best Plants Winner: Harley-Davidson -- Driving a Future of Excellence

Harley Goes Lean to Build Hogs

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.