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NIGHT OF THE LONG KNIVES AT HARLEY

New Harley-Davidson chairman and chief executive Jochen Zeitz finally launched some vague details of his “Rewire” initiative — in parallel with a ruthless management purge. BDN financial editor Roger Willis reports. 

Veteran Harley chief financial officer John Olin (pictured) has been dismissed with immediate effect, after 17 years with the brand, and is to be followed out of the door by up to 700 extraneous staff.

Current treasurer Darrell Thomas, who has vice-president status, took over as interim CFO until a successor for Olin is appointed. Commenting on Olin’s abrupt departure, Zeitz said: “Significant changes are necessary, and we must move in new directions.” He went on to explain that streamlining Harley’s structure requires approximately 700 fewer positions across its global operations, with about 500 jobs disappearing this year.

“The Rewire is progressing very well and substantial work is being done to eliminate complexity and get Harley-Davidson on a path to winning,” Zeitz continued. “Our new operating model is simpler, more focused and enables faster decisions across the entire company. We’ve taken a hard look at our entire set-up, our spending, and how work is getting done, to align our operating model, structure and processes. We are building a strong foundation to drive a high-performance organisation in the future.” 

His outline of five key Rewire elements to date are:

  • Enhance core strengths and better balance expansion into new spaces

  • Prioritise the markets that matter

  • Reset product launches and product line up for simplicity and maximum impact

  • Build the parts & accessories and general merchandise businesses to full potential

  • Adjust and align the organizational structure, cost structure and operating model to reduce complexity and drive efficiency to set Harley-Davidson up for stability and success

Zeitz intends to present a more comprehensive summary of Rewire actions and financial impacts when Harley releases its Q2 results sob story later this month. This will lay foundations for a new 2021-2025 strategic plan, which should be revealed in Q4.

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