Recently Harley Davidson, posted better than expected profits in the US for the latest quarter, with revenue up 3,8% versus year ago. Over the past two years the company has done very well, with its stock price going from $39 per share two years ago to a $68 per share range.

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Losing contact with customers

As background, starting six years ago, the company began executing a plan that resulted in an expansion of the number of dealerships from 580 to 700 by the year 2013.

All of this led to more complicated layers of management and a mushrooming number of cumbersome and disjointed processes and programmes. There was also a deep concern that they had lost their ability to stay close to what the customer was saying about Harley Davidson offerings.

Learning to listen

In recent interviews with the CEO, he made the point that given the concerns emerging from their expansion, over the last two years the company’s emphasis has been on listening. Listening to employees as well as listening to customers.

Most importantly, they made this a high enough priority corporately that whenever they uncover a key need/opportunity from what they are hearing, they quickly develop action plans and execute them to take full advantage of what they are learning.

For example, on the employee front, they launched a programme where executives were expected to spend a meaningful percentage of their time out of the office in dealerships talking to customers and employees.

They learned about some obvious opportunities. First, it led to major simplification in how work gets done within the dealerships. Sales people had been bogged down with a tremendous amount of paperwork and difficult-to-use systems and processes just to run their business day-to-day.

Additionally, they found that while customers continued to be very responsive to the Harley Davidson brand, there were clear missed opportunities. This led to the introduction of the Ultra Classic Low Harley Davidson motorcycle designed for people shorter than 5’6”, and this new model is off to a very encouraging start.

The lesson is obvious

Leaders need to get out of the office and understand the issues and opportunities. This has to become a regular habit and it has to be done in a way that makes employees comfortable with being diligent and vocal about what they and their customers are experiencing.

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The notion of listening is about as fundamental as it gets. On the other hand, it’s amazing how success will lead an individual to simply sit back and watch the action as opposed to participating in it.