|
TOP STORY
Chapter Four: A
Highway to Success
This
story is excerpted from
The CEO Chronicles, which features vignettes on 41 TEC-member
CEOs from around the world who shared their wisdom and insights with
authors Glenn Rifkin and Douglas Matthews.
|
 |
Chapter
Four
A Highway to Success
Richard Teerlink |
Introduction
Harley-Davidson, the $2-billion, Milwaukee-based motorcycle
manufacturer, is one of the great turnaround stories in American
business. In the mid-1980's, the last American motorcycle maker was on
the edge of bankruptcy. A group of Harley executives that had mortgaged
their homes and bought the company back from the AMP Corporation were
intent on saving the vaunted Harley brand. Through determined leadership
and business acumen, they turned the beleaguered company into a highly
profitable success story. Rich Teerlink joined Harley-Davidson as chief
financial officer in 1981 and was one of the principal architects of the
turnaround. He became CEO in 1989 and lead Harley through a remarkable
resurgence that culminated in a string of record-setting quarters in
sales and earnings. Under Teerlink, the Harley brand gained such cachet
that a whole new group of customers emerged and Harley sales soared. In
fact, because of the demand and the company's focus on quality, the
waiting list for a Harley got to be as long as two years. Even
Teerlink's wife had to wait a year to buy him a Harley for his birthday.
Teerlink left the CEO job in 1997 and became chairman. He retired as
chairman in 1999, but he remains a director of the company and
rides with customers as often as possible.
I don't
think my story is very exciting, even though the company and its success
is extremely exciting. Simply put, I don't believe in the CEO hero. I
think CEOs get in trouble because they try to have their name out front
and lead the charge, and leading the charge doesn't do a damn bit of
good unless you have followers who believe in the mission. If you lead
the charge and don't have followers who believe, all you get is
compliance. I don't think any CEO is so smart that he or she can demand
all the right things of all employees.
I
really don't think employees care that much about big, Patton-like CEO
speeches and being inspired with lofty goals. They care about whether
they are going to have jobs, whether they are going to like coming to
work, whether they are going to walk into an awful or a nice
environment, and whether they are forced to be compliant to keep their
jobs.
I know
that many CEOs like the limelight and the credit, but I try not to be
that way. That's who I am. I grew up with parents who believed in
people. My parents were immigrants from
Holland
who came to the United States in the 1920s. My dad was a tool and dye
maker and an entrepreneur. He went into his own business in 1946 and was
very, very successful. He was successful believing in people. All along
the way, he believed in people. Titles weren't the important thing.
A Great Role Model
I was
12 when he went into business. He made his business' partners
multi-millionaires, but he left with very little, because that's the way
he was.
He
loved to offer counsel. He'd tell me, "When you become a supervisor,
your whole life changes, because you're now no longer just worrying
about you, you're worrying about all those people who work with you and
for you. You're the most important man to them, because you control
their lives, whether they have a job, whether they don't have a job, and
how much they get paid. So it changes how you look at the world. You
start to care about others. Do the job you've got better than anyone
else can do it and you'll get another job. Worry about your next job and
you'll probably get fired from your current job."
He had
no financial training. He was president and chairman of his company, and
every day when he walked into his office, he had three numbers on his
desk: cash in the bank, what people owed him, and what he owed people.
He walked out into the plant, and he knew about inventory; he could look
at it and see it. He was a very effective manager. He taught me early
that cash is very important. Without cash, you can't make any payments.
So forget about profits; generate cash. If your company is run well
today, the only way you get cash is from profits.
Today
it's in vogue to look at cash. But my father was thinking about that 50
years ago. My mother also taught me a lot. She was a firm believer in
the Golden Rule. That was her standard. Even though my dad was a CEO, I
never thought that I would become one as well. As my dad said, "Do the
job you've got, then you'll get another job." I never had to look for a
job until 1981, when I decided I wanted to leave Herman Miller, the
office furniture supplier, because my family didn't want to live in
western Michigan. Two friends told me about the Harley buyout and their
search for a chief financial officer. They arranged an interview with
me, and the rest is history.
I
joined something special. In 1980, 13 Harley executives had mortgaged
their homes and put their entire careers on the line to buy the company
back from the AMF Corporation. I came on board just after the buyout and
became CFO. It was a daunting task to save Harley, but we all felt like
we were on a mission. We worked long hours and many days a week. We were
all deeply involved and committed to the total business. No one sat
around thinking great thoughts. We all focused on our areas of
responsibility to insure that Harley would not die. In fact, the entire
time was an adrenaline-pumping experience. It required a total
commitment and a new way of thinking about doing business. There is
nothing as intense and difficult as being on the brink of bankruptcy; as
we were in December 1985. Having pulled it out, with literally hours to
go before the end of the year, we learned a lot about adversity.
From Top-Down to People-Driven
Far
more intense was the recognition that we were in the process of changing
our very culture as a company. We recognized that the top-down,
command-and-control approach was evolving into a more people-driven
culture. We also had some very tough competitors out there, and we had
to keep coming to market with new and better products. We had to keep a
strong relationship with our dealers, and we had to continue to focus on
quality and reliability in our manufacturing turnaround.
Now
keep in mind that we refinanced ourselves to get out of our bankruptcy
problem in December 1985, and we went public in July 1986. Only in
America can you go from bankruptcy to a public offering in six months.
As you can imagine, it was pretty intense. We were driven by the thought
that though we were out of the danger of bankruptcy, we had to make sure
that we had a structure and that we had things designed to inspire
people, both inside and outside the company, to do great things.
I
learned a great deal in the eight years at Harley before I became the
CEO. We had to remember where we came from, for example. Harley had been
a star before, the company was founded in 1903 and had been highly
successful, and then it fell. Why did it fall? It fell because of
leadership. The leadership wasn't paying attention to the fundamentals.
You always have to focus. "Are we doing the right thing? Are we helping
the employees do the right thing?"
The
leader's job isn't to be out there getting gold stars but to help create
a fantastic environment. Because there is no CEO school to teach you how
to run the show, you are always trying new things. For example, we moved
to an employee-driven culture. For many leaders, this is a fearful
proposition, because they feel a loss of power. For me, this actually
supported the belief that you get power by releasing power.
Leading by Action
I
believe there's an intrinsic motivation within everybody, and a leader's
challenge is to get at that. You get at that by showing people that
they're important, not in a phony way, but by your actions. Max DePree,
the CEO of Herman Miller, frequently said, "Leaders, by their actions,
not by their words, set the tone in the organization."
For
example, in 1988, we made our first agreement with the unions to work
more cooperatively as we went forward, and that was a watershed, because
while we had a good relationship with the bargaining units, this was a
true commitment to a joint vision for the future. It brought the
Wisconsin
bargaining units together with management to share and create a plan
that would further identify what we wanted the organization to be able
to do. Together, we wrote statements that expressed our commitment to
things such as quality products, and then we worked for the next few
years to make it happen. Then in 1991, the largest union decided to
discontinue formal participation. That was a little discouraging, but we
kept pursuing our goal. We recognized that we had moved to a new level
and that at that level, the things we had learned' along the
way-conflict resolution, problem solving, how to have dialogue, how to
listen-those things would never go away. We had done something crucial;
we had laid the groundwork.
In
1996, that union, known as PACE, voted for a new partnering agreement.
Now we have partnering agreements with all six unions. So that was
significant. I also learned that you never stop learning. I learned to
ride a motorcycle when I was 46 years old. I discovered it is a great
stress reducer. When you're on a motorcycle, you are not hooked up and
wired to something. You're driving through this beautiful country of
ours, and it is inspiring. It clears your head. It feels great. So when
you go back to work, your mind is clear, the clutter is gone, and you
can focus on what's really important.
I was
lucky, because we spend a lot of time with our customers at H.O.G.
(Harley Owners Group) rallies and other events. I didn't have to find
time and say, "Damn it, let me go for a ride on a motorcycle." Such
events included two anniversary rides from
San Francisco
to Milwaukee. My wife and I still ride. Riding is part of the fabric of
the company.
One of
the positive things about Harley is that you have an opportunity to
share your business with your family, because Harley is a big family. My
wife Ann became a very integral part of representing the company out in
public and very involved in the H.O.G. rallies. Like me, she went around
talking to customers, taking notes on a little pad of paper, coming back
and saying, "These are some of the things that I heard."
The Rewards of Leadership
I've
received a great deal of credit for my years as CEO. When I retired in
1999, I had two fantastic rewards. I specifically asked not to have any
retirement parties. It's just not my style. But the dealers at our
annual winter dealer's meeting arranged for a farewell party for me
anyway. They initiated it on their own. There were hundreds of people in
the room. The host, a Harley executive, said some nice things. And then
they passed the microphone around the audience, and any number of
dealers got up and said some very nice things about me, about how we are
a value-driven company and how much we care about the customer. They
said, "Thank you for bringing us here," and presented me with a
beautiful sculpture of an eagle, carved in Italy. They've never done
that before for anyone. I was very moved by this.
At
another meeting of company leaders, I just showed up to say "thank you"
for a great ride, and they again said some very nice things about me and
presented me with a specially commissioned sculpture of our circle
organization concept and a huge banner signed by the attendees. Both
events were very emotional for me. I am not usually at a loss for words,
but I had a great deal of difficulty speaking on both occasions. It is
an unbelievable feeling to know that your efforts have made a difference
in so many lives.
What I
really believe is important for me, more than accolades, is that as we
as a company moved to a new level, with the business, the market, and
relationships, these values became embedded in the organization. They're
not embedded because of me, they're embedded because people decided
that's what they wanted, and they took the ball and ran with it.
My
feeling is this didn't start when I became CEO. It all started in 1903.
There's a long heritage of happy Harley stories that people have. The
only thing that Harley had to do was make products that work, then give
people an opportunity to share, and keep doing it. So while it's a very
simple to say, it's very hard to make it happen all the time. It only
happens if you've got dedicated employees, dealers, and suppliers, who
know where the company is going and believe in it.
What
I've learned as CEO is that what's really important is not you. What's
really important is the long-term viability of the company. The hope is
that where we go from here is embedded in the system. I just read an
analyst report about Harley-Davidson, and it really made me feel good,
because it said the leadership transition from me to Jeffrey Bleustein,
who is now chairman and CEO, was absolutely seamless. That's the way it
should be. The big risk when you get a new CEO is that they've got to
put their stamp on the company. Many times this means making unnecessary
dramatic and unsettling changes. As Jeff and I said when he became CEO
in 1997, Jeff will do things differently than I will. I do things
differently than Jeff does. What's important is that we share the same
objectives: to serve the customer, to serve the employees, to develop
mutually beneficial relationships with all of our stakeholders. In these
things, we are alike. So in the end, it really doesn't matter who is
CEO.
Return to Top
|
BEST
PRACTICES
 Creating
Success Guides to Train Your Sales Force
- Blueprint for Success
- Getting Started on Success Guides
- Guidance for Handling Objections
- How to use the Guides with New Hires
- Creating a 'Success Story' Guide
Blueprint for Success
The days of
"he who makes the most sales calls wins" are over, says TEC speaker
Gerry Layo.
"I believe
our salespeople are like lumberjacks going into the forest to cut down
trees. In today's world, there are more lumberjacks but fewer trees," he
says. "Sales are down, so the lumberjacks are out there swinging harder and
faster. We just say, 'Go get 'em, go get 'em, go get 'em.' The customer
becomes the victim."
Salespeople
need to be focused. They need to be trained. They need to be retrained, Layo
says.
As a major
part of this training, Layo believes that TEC companies should be building
"Success Guides" for their business, including:
The success
guides are built upon the knowledge and experience of the sales people,
customer service representatives, and any other employee who comes into
contact with prospects or customers.
"There is
power both in the creation of the Success Guide, and in the repetitive
implementation of it," he explains. "You are making a resource your new
salespeople can tap into."
Getting Started on Success Guides
Success
Guides require collecting the knowledge and experiences of the people in
your company.
To start
working on one:
1.
Schedule a meeting with all the participants who have experience with the
subject you are working on. For example, to create an "objections guide,"
you need your entire sales staff.
2.
Bring in a facilitator who asks questions and leads the discussion.
3.
You will also need a note taker, who is not a meeting participant, to record
responses on a flipchart. These responses will be compiled for your Success
Guide.
4.
Tape record the meeting so all responses are captured in their entirety.
Sometimes, a "perfect" comment or story will be shared, but the note taker
can't capture it fast enough. The tape will ensure that it gets into your
Success Guide.
Guidance for Handling Objections
Especially
helpful for new sales hires, an "Objections Guide" is a blueprint for how to
handle common objections.
"I
challenge TEC members to sit with their salespeople and identify what
objections they're hearing," says Layo. Many sales professionals will claim
that prospects have 100 reasons why they won't buy, but in Layo's
experience, these can generally be grouped into about 10. Among them:
-
Price
-
Bad experience with your company before
-
Your product doesn't have all the features I need
-
Competitors give me a different deal
-
We're satisfied with current provider/supplier
"The power
in this is getting a glimpse into their world as you listen to all the
salespeople. In their minds, they think they're hearing dozens of
objections. You also understand how they feel about each objection," he
says.
By putting
the objections into categories, the facilitator of the meeting narrows down
what seemed like a huge number of objections into a manageable number.
"Here's the magic: We make their universe more focused," he explains.
Then,
taking the small number of general questions, the facilitator makes a
statement like: "Price is an issue we have to face out there," then turns to
the first salesperson and says, "Bob, how do you respond when a
customer says, 'I like your product but I think the price is too high?""
As you go
around the room and the last of the salespeople are called upon, a polished
response evolves. "The last ones are often the best," Layo says.
Each
objection is discussed in the same way, and the accumulated wealth of
knowledge is captured.
The
training guide is produced in a three-ring binder, with tabs for responses
to each objection.
How to Use the Guides with New Hires
The process
outlined for creating an objections guide can be used for whatever subject
area your company is interested in.
"Salespeople hate to hear this, but the best salespeople are canned. They
have canned, prepared responses to objections," says Layo. "The best
salespeople understand that objections are a positive, because they mean the
prospect is already interested -- and that interest is an opportunity."
Here's how
Layo recommends using an Objections Guide for new sales hires in their first
90 days:
1.
Three times a week, have the trainee meet with two more experienced sales
colleagues for one hour.
2.
Each person will rotate in one of these roles: customer, seller and
observer.
3.
Conduct a 10-minute "role practice." The "customer" shows interest in
buying, but raises an objection. The "salesperson" reads one of the
responses to that objection, word-for-word, from the Objections Guide. The
observer takes notes on the interaction, including what worked and what
didn't.
4.
Spend five minutes debriefing, with the observer sharing his or her
impressions first, then the other participants commenting.
5.
Everyone rotates roles, and repeats the process, until each person has been
the customer, the salesperson and the observer.
Repeating
this process three times a week will ensure that the responses are learned.
By practicing, the trainee will learn the canned responses. By watching
seasoned sales professionals, the trainee will see how well it can be done.
With so much practice and feedback from observers, the trainee should be
able to deliver the response without sounding like it is canned.
Creating a 'Success Story' Guide
TEC
members, who are often the senior sales people in their companies, and their
top sales executives, often have outstanding examples of how their customers
have flourished.
Often,
these stories are not captured and used for the company's success.
"These may
be stories about existing customers who bought your products or services,
despite reservations about price or changing vendors, or whatever," says
Layo.
"By getting
these third-party stories on paper, and putting them into a Success Guide,
you are giving your new hires tools that the senior salespeople have," he
says.
To capture
these stories, Layo recommends having a facilitator work with the senior
sales people and ask questions like, "In our book of business, did any of
our established customers come to us after we overcame their price
objections?" "Are any of our accounts ones that we won from an established
relationship, where the customer wanted to maintain the status quo?"
"Write down
the customer's name, the timelines, and a paragraph with the story and the
benefit created for the customer," Layo says.
These
stories can be compiled into a Success Story Guide, and used in role
practices in handling objections.
Trainees
should be taught to:
1.
Clarify the
objection with the prospect
"You are concerned about our price."
2.
Validate their
concern
"Yes, I understand how you might feel that way."
3.
Address the
specific concern
"That's how the people at Coca-Cola felt until we showed them that
…" This is the opening for the third-party success story that pertains to
the objection.
Your new
salespeople will learn, too, from reading these success stories about how
prospects were taken from the point of expressing an interest to overcoming
objections to making the sale.
"This gives
them more confidence, and sometimes that makes all the difference," Layo
says. "Since the days of 'he who makes the most calls wins' are over, I know
that harnessing the power of your knowledge and experience -- then getting
everyone on board with it -- will lead to wins."
Created for MyTEC. Copyright 2004, TEC
Worldwide, Inc. All rights reserved.
Return to Top
|
|
EXPERT INSIGHT
FISH!: Simple Fish Market
Principles Can Transform Businesses
How could a
few
Seattle fishmongers inspire a philosophy that is
changing the way business is done around the world?
When
colleagues Stephen C. Lundin, Ph.D., and John Christensen
discovered the
World Famous Pike Place Fish Market, they saw a group of co-workers
creating magic with truckloads of smelly, dead fish.
If the
fishmongers could exhibit such a sense of joy and purpose by flinging fish
and making a show out of it, what universal lessons could be learned from
them to help transform the thousands of lifeless workplaces in the U.S. and
around the world?
Lundin and
Christiansen, a former TEC member, set out to define what made Pike Place
Fish Market such a success. The ultra-simple formula they discovered:
-
Play
-
Make Their Day
-
Be There
-
Choose Your Attitude
Lundin,
Christensen, Harry Paul and Philip Strand summarized this approach in a
management parable called
FISH! A Remarkable Way to Boost Morale and Improve Results. It is the
tale of how a manager in a low-performing back office visited the fish
market, where she learned and applied these principles. Today FISH! is a
veritable phenomenon that has touched the lives of tens of millions through
combined book and corporate training video sales, as well as speaking
engagements for Lundin and his co-authors.
MyTEC
interviewed two of the co-authors of FISH about their discovery in the Pike
Pace Fish Market -- and how it might translate for TEC members.
This, the
first of two articles, describes how Lundin, playfully described as
ChartHouse Learning's "Big Tuna," found himself riding an unexpected tsunami
of corporate culture change.
MyTEC: What's your impression of today's workplaces, in general?
Lundin: As a national marketing director, I marveled that so many
workplaces were so dead. When I was younger, I worked as a camp director
with physically challenged children. Their world was always so full of
energy and so upbeat. I marveled as I went through life how rare that
outlook was.
Why would
able-bodied people in one of the world's top five places of income not have
an "alive" workplace? Why would the people who work there have so little
life in them, when all these little kids with these external limitations
bring joy to life every day?
MyTEC: How widespread is the problem of workplaces that are "toxic energy
dumps?"
Lundin: When I coined that phrase -- "the toxic energy dump" -- little
did I know how much that would resonate with people. It's much worse than I
ever expected it to be. There are far more places that are dead than I ever
imagined.
MyTEC: What's at the root of this epidemic of toxicity?
Lundin: We become so accustomed to shallow, analytical, left-brain talk
and we become accustomed to living on that plane. We almost feel it has to
be that way in the world of work, that there can't be any joy because it's
counter-productive.
MyTEC: Have CEOs embraced FISH! as an avenue for improvement in their
companies?
Lundin: The first time that happened on a major scale was four years ago
when the president of Ceridian walked through a bookstore and bought 5,000
copies. [Ceridian mentions its commitment to the FISH! Philosophy in
a short statement on its Web site.]
MyTEC: When CEOs become interested in FISH!, how do they get others in
their companies on board?
Lundin: The worst way to implement FISH! is to roll it out in some kind
of grand strategy. That's a surefire disaster. To try to drive it through an
organization as an initiative coming from the top is difficult because
people are cynical.
Even in the
top 50 companies in the world, the best way is to have it emerge from the
inside with natural energy. Tell the story. Fan the flames. Spread the word.
MyTEC: The FISH Philosophy involves a simple, four-step process. How did
you identify that?
I'm a
psychologist, but I spent a lot of time with anthropologists to come up with
the descriptors. We had to find out how people define these four ingredients
themselves,. Less than six months later, we realized what we'd identified is
some old wisdom that's been around since the beginning of time. Southwest
Airlines is well-known for their use of the same ingredients.
MyTEC: Of the four elements: Play, Be There, Choose Your Attitude, Make
Their Day -- which is the most important?
Choose Your
Attitude is the most important. But the most difficult one is play. People
are attracted to it. In talking to organizations that have used the book,
they say the biggest struggles/resistance invariably arise with "Play." We
have been taught that play has no place at work. To think of play at work is
to be shirking your duties and sloughing off. Yet the best workplaces in the
world are playful.
MyTEC: Can you give us an example of how one of these elements plays out
in a company?
Lundin: At Land's End in Dodgeville, Wisconsin they got fishy
very early on. They have big warehouses with rows of sewing machines. On
their own, the people who work there created a board with buttons on it
describing an array of attitudes.
They
developed the tradition of wearing a button that showed the attitude they
felt. You'd see people with one, two or three buttons on. One day, this guy
barged through the group who was talking and he exchanged buttons. He picked
one that said "Pissed off. " It's not about choosing a positive attitude all
the time. It's about choosing. The minute you accept that it's your choice,
you have that power. You accept that responsibility.
MyTEC: What makes FISH! sometimes difficult to adopt?
Lundin: It's different. It's not like getting permission. It's not like
being led. It's not like following somebody's else's five-step protocol.
It's accepting the philosophy and stepping into it, making choices and
finding your own way.
The most
difficult thing for people to accept is that it can start immediately inside
them and spread from that point. That's exactly what happened at the market.
MyTEC: How did this sense of fun and helpfulness start at the market?
Lundin:
Johnny, who owns the market, went to a seminar 15 years ago where they
provoked him into thinking there were ways to manage other than being a
tyrant. One of the guys said, "As long as we're going to be here every day,
why don't we be 'world famous' or something?" They laughed at the kid at
first, but then started talking about what that would look like.
MyTEC: Is there a success story that makes you the most proud?
Lundin: What's happening in healthcare has been closest to surface for
me to watch. It's an industry under such incredible stress that they've got
little to lose (by trying something new and different,) and a lot to gain.
We've seen
the FISH! philosophy spread like a positive staph infection. It jumps from
one nurse professional to another, and now it's jumping hospital boundaries.
In
healthcare they have good metrics, so you can get an idea of the nature of
the impact. We now have documented situations where employees' perceptions
of teamwork, attitude, communication and satisfaction went from the lower 15
percent to the top 5 percent.
MyTEC: Did you have any sense you would rock the world when you co-wrote
this book?
Lundin: This was my first book outside of the boring one I did when I
was an academic. I came from a research tradition in Minnesota. I was a
pretty analytical thinker.
I had no
expectations at all. I was pleased to get it published, and I thought if we
sold 5,000 to 10,000 copies, that wasn't bad. So far, we've hit 3.5 million
around the world.
MyTEC: How has this phenomenon changed you?
Lundin: Two things happened in two years' period of time. The day after
the book was bought, my Dad had a massive stroke and I was interpreting a
living will. Life has a way of reminding you.
Then
several months after the book was published in 2000, I lost my daughter at
the age of 31 to a drunk driver. [She was a well-loved
Hollywood set
designer who was a recovering alcoholic, too -- as is Lundin. He freely
shares this information with the public, when it is appropriate.]
I decided
to step forward with more energy and vigor to speak for both of us. Doing
this is a legacy in that way, a real source of energy for me.
MyTEC: How do you carry on the FISH! tradition?
Lundin: Mostly, I do speaking and writing and grandfathering I get
invited to go places to speak. I've been in 21 countries now, and it's the
same there as it is here. We're the conveyor of a story that provoked tens
of millions of people to do things differently.
Additional Resources
Return to Top
|
|
