Freedom, Inc_ - Brian M. Carney [49]
Thanks to Harley’s near-collapse in the late 1970s and early 1980s, the unions and the executives worked closely together for several years after Teerlink’s arrival because both sides knew that the company’s very survival was on the line. But after the crisis had receded and Harley, now profitable and growing again, had taken its shares public in 1986, Teerlink began to worry. If the company slipped back into its old ways and a not-my-job mentality, another crisis would be inevitable. He wanted to use the moment he had to drive a permanent transformation of the company, one that would survive the now-subsiding sense of crisis that had driven the earlier collaboration.
His first idea was to develop a gain-sharing plan, which was promptly rejected by the union. After consulting several professors and experts, it appeared that much deeper corporate transformation was needed, and it had to be done together with the unions. Lee Ozley, a management consultant, told Teerlink and his team early on that people will resist having things imposed on them—even if they’d willingly do those same things if they felt it was up to them to decide. Teerlink would later adopt the idea and often repeat “people don’t resist change; they resist being changed,” but it’s a permanent truth. Recall how the Smuggler-Union mine had no problem paying three dollars a day for an eight-hour day—but the owners didn’t like having those conditions imposed on them by the striking workers.
So, in the same spirit, Teerlink and Ozley and the executive team did two things. First, they reached out to the unions to try to explain what their goals were. Some of the unions weren’t interested—the union at the York, Pennsylvania, plant, in particular, wanted no part of the transformation.3 So, for the moment, Teerlink let that go and focused on finding willing partners at the plants in Wisconsin.
Teerlink took an additional step in 1988. In a few months, Harley’s current three-year contract with the unions would expire. Rather than present the union leaders with the traditional list of demands about changing the work rules here and improving productivity there, Teerlink came to the negotiations with just one request: Work with us for a year on developing a joint vision for Harley-Davidson. Sit down with us, and let’s try to figure out what we all want this company to be and to do. Instead of negotiating another three-year deal, he wanted to renew the expiring agreement for one year, focusing in the meantime on how to start transforming the company.
This proposal accomplished two things: It broke the cycle of trading goodies for sensible improvements in work rules—and it signaled to the unions that management really wanted to try something different by working with them. By giving up its own traditional demands at the start of a labor-contract negotiation, management showed that it was prepared to pay a price itself to get the process started. Harley’s leadership tried to break the competition for material goodies by, first, giving up some of its traditional prerogatives voluntarily.
Rich Teerlink’s focus on building a “true, human” partnership with his unions was not born out of a United Nations-like idealistic belief in the brotherhood of all men. His focus is not universal, even in the corporate world. It reflects the realities of a large, heavily unionized organization in which a liberating leader usually can’t overcome people’s mistrust, and develop genuine relationships with them, until he has done the same with their unions. Conversely, in nonunion incumbents, not to mention small companies and startups, a liberating leader can start building genuine relationships with people by treating them as equals “in dignity and rights” from the outset.
THE LEADER AS BLOCKING BACK
Don’t print and circulate organizational charts.