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Iamarchangel
| | Posted on Thursday, October 29, 2009 - 11:22 pm: | 
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SAP: Stop All Production. What a useless implementation process. Put us out of production for about a year.
I have been in those kinds of meetings several times in my career. You are really only working on short term, keep us afloat thinking. Not long range goals of the future. it is a survival mode, and you hope you make the right decision.
See, here's the thing: every other survival situation you analyze and prepare emergency plans. Buildings, ships, planes, etc., all have evacuation plans. People study other disasters and make plans based on previous cases.
Not business, "Oh, nobody has the same troubles we have.". It becomes a free-fall with chaos management. The problems get fancy names but there's really only a few, nothing new: over-extending; market loss; raw material loss; over-confidence.
Risk management asks, "What can go wrong?", which should be followed by, "What do we do when that happens?".
Sorry, Rex, no disrespect to you, but companies that depend on survival mode with no long range plans just disgust me.
Managers manage, workers work: managers don't manage, workers don't work. That's the deal but, just watch, the failure will be harsher to the workers that made the Buells than the managers. |
Etennuly
| | Posted on Thursday, October 29, 2009 - 11:39 pm: |
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Possibly an interesting note on the "chrome lifestyle". I was in a dealership looking at the severely discounted Buells last week. My son had asked me to look at pricing an Ultra Classic Limited for him(I know, some just don't get it). They said MSRP. No discounts what so ever on big HD's.
I thought they might knock of a grand or so to motivate fence riding HD shoppers. Wrong. You want the life style you pay full price. Seems kinda like paying full price to hear the band play on the Titanic after they realized the water was over the safety walls.
But then.....that would knock the value of used HD's in the head! Can't have that can we?
I wonder if that PR lady from HD who explained the reason for Buell's demise had ever ridden a bike? Seems like HD has lost their bike riding leadership, traded for a few stock chips. The leadership's focus was lost when it's passion shifted from making motorcycles to making money. |
Hex
| | Posted on Friday, October 30, 2009 - 12:33 am: |
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The leadership's focus was lost when it's passion shifted from making motorcycles to making money.
Thank you!
My company (Ryan Rod Co.) went SAP because my family (mom) decided to cut funding, I was so close...
I had to battle the 'overworked' patent office for a year and a half later than I projected. Now I am finally digging my way out of the stand still, and am finding ways to get back into production. What a waste of time (the patent clock is ticking), to come to a grinding halt.
I hope Erik finds a way to get things going again, take my advise, the sooner the better. |
Ronbob43
| | Posted on Friday, October 30, 2009 - 09:16 am: |
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I work for a company where beancounters rule too. The employees get hamstrung trying to support the customer base against the cold logic of systems that can never see the soul of an organization. Cut inventory-the customer can wait. Close that non-performing profit center-who knew that it was a vital part of the whole customer experience? The employees you wouldn't listen to knew. Reopen that center-why haven't the customers come back? Did they stay with the people who had served them and are now with a competitor? |
Doerman
| | Posted on Friday, October 30, 2009 - 10:17 am: |
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There's an interesting book touching on some of theses subjects:
"What would Google do"
200 and some pages and the author repeats himself. But interesting none the less. |
Cheddarheads4erik
| | Posted on Friday, October 30, 2009 - 10:26 am: |
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There's a monstrous myriad of factors in this, that unless you have recently gone through such a liquidation as I am experiencing with General Motors, you have no idea. I don't mean that as an insult to anyone, but a bit of perspective on the bigger picture; tax laws, Warren Buffet, South American (Brazil) operations, South American politics now going really bad, horrible management ideas, horrible management running beta tests on the lives of thousands of employees, etc..
It was not a decision based on Buell's bottom line profits v. losses. It was a bad set of decisions based on the worst decision making motivator there is; fear. Couple that with a guy like Wandell who enjoys instilling fear into Corporations, which momentarily delights the shareholders, and you have the remaining employees staring at each other's backs wondering where the next bullseye will appear. More fear. Pay cuts. Vacation denied. Millions of dollars saved.
So, the OP asks to help understand the money; Brazil operations were supposed to help inflate H-Ds bottom line. The President of Brazil took the money and ran into the arms of Putin and Chavez. Buffet bought H-D debt knowing damn well this economy was going to be the worst since the Great Depression, and H-D/economy would not recover itself before the 15% rule kicked in. Taking the tax charges to close Buell is inevitable; that's the way our tax laws are written, and it is the current trend in American big business. The ensuing fire sale of Buell bikes is going to Buffet's loan payments as will the sale of M.V..
Then, there's the use of Enron-style accounting! And on and on it goes. Blech. |
Mikej
| | Posted on Friday, October 30, 2009 - 10:55 am: |
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Please explain more about that 15% Rule kicking in.
I'm wondering if Buffet is thinking he might have potentially bought H-D for nickels on the dollar.
I also have a desire to revisit and refresh my memory of the end days when AMF ran the company just before some employees and investors bought in.
This economy is pretty much in uncharted waters, I wonder if we'll have a new economic term coined called "The Tsunami Effect". Hmmm, I like that name so 'dibs' (C)2009 MikeJ if it isn't already taken.
I'm off to Amazon to Google it. 8-p |
Court
| | Posted on Friday, October 30, 2009 - 11:01 am: |
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quote:It was not a decision based on Buell's bottom line profits v. losses. It was a bad set of decisions based on the worst decision making motivator there is; fear. Couple that with a guy like Wandell who enjoys instilling fear into Corporations, which momentarily delights the shareholders, and you have the remaining employees staring at each other's backs wondering where the next bullseye will appear. More fear. Pay cuts. Vacation denied. Millions of dollars saved.
Well put. You should see what's happening at Juneau.
Try holding a basketball underwater. |
Mikej
| | Posted on Friday, October 30, 2009 - 11:04 am: |
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Dang, late to the dinner table again, that name is used for a bunch of stuff, for example:
http://www.bakerdonelson.com/Content.aspx?NodeID=2 00&PublicationID=132
Carry on. I think I'll go change some bicycle tires today. |
Iamarchangel
| | Posted on Friday, October 30, 2009 - 01:01 pm: |
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I'm part of the Big Three meltdown. New managers installed SAP. Result was most of the year without any parts.
Next move was to remove incoming material inspectors: no problem for decades, who needs them? Well, part shipment came in with one machined surface unfinished. Result was several catastrophic field failures and $50 million repair.
New owner wrote a book and described his worst mistake and all its repercussions. Within a year, his org did the exact same thing, again.
We now have no legacy management left. Present management doesn't know our history so they don't bid on jobs, outside our norm, that we have done before.
Madness. |
Hughlysses
| | Posted on Friday, October 30, 2009 - 03:29 pm: |
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This story just popped up on Google: "HarleyDavidson Inc. Reports Operating Results (10-Q)"
http://www.gurufocus.com/news.php?id=73037
Here's one thing that caught my eye right off:
quote:The Company expects previously announced restructuring activities, together with costs associated with winding down the Buell product line, to result in one-time restructuring and impairment charges of $215 million to $245 million over 2009 and 2010, or an increase of $55 million from the estimate provided July 16, 2009.
So, obviously they were planning to close Buell back in July, but they've already had to raise their estimate for how much this is going to cost them by $55M!!! (~33%) Oh yea, these guys know EXACTLY what they're doing. NOT.
Lots more info here that I'm sure some of our more financially astute members will find interesting. |
Crashstp
| | Posted on Friday, October 30, 2009 - 04:38 pm: |
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page 9 - where or why did they jump close to 600% on retail? last time I checked HD sold thru dealers?
Wholesale
$ 958,683 $ 1,164,236 $ 870,693
Retail
4,103,286 740,721 787,585
5,061,969 1,904,957 1,658,278 |
Crashstp
| | Posted on Friday, October 30, 2009 - 04:43 pm: |
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from pg 12.
Buell Asset Impairment
The Company periodically evaluates the carrying value of long-lived assets to be held and used when events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date.
During October 2009, the Company unveiled a new strategy that is designed to strengthen the Harley-Davidson brand for long-term future growth by focusing exclusively on the Harley-Davidson brand. As the Company developed this strategy, several scenarios for the Buell product line were under consideration during the third quarter of 2009, including the option to discontinue the product line. Because the option to discontinue the Buell product line and potentially dispose of the related fixed assets before the end of their previously estimated useful lives was under consideration, the Company determined that an evaluation of the carrying value of the Buell fixed assets was necessary. As a result of the evaluation, it was determined in the course of preparing financial statements for the third quarter 2009 that the carrying value of Buell fixed assets exceeded the fair value and the Company recorded an impairment charge of $14.2 million.
On October 15, 2009, the Company announced the discontinuation of the Buell product line; see Note 19 for additional discussion. |
Mndwgz
| | Posted on Friday, October 30, 2009 - 06:07 pm: |
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A bit more:
The Company expects previously announced restructuring activities, together with costs associated with winding down the Buell product line, to result in one-time restructuring and impairment charges of $215 million to $245 million over 2009 and 2010, or an increase of $55 million from the estimate provided July 16, 2009. The Company estimates annual savings from these restructuring activities, measured against 2008 spending (cost of sales and operating expenses), are as follows:
• 2009 - $75 million to $90 million;
• 2010 - $100 million to $130 million; and
• 2011 and beyond - $140 million to $150 million.
...and it looks like York is under the gun too.
and a bit more:
The Company’s third quarter 2009 net income was $26.5 million, a decrease of $140.1 million, or 84.1%, from the same period last year. Diluted earnings per share also decreased as a result of lower net income, down 84.5% from the second quarter of 2008.
and the WOW:
Operating (loss) income from financial services - - - - (188.5 )%
and the last paragraph:
Item 1A – Risk Factors
Refer to Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 for a discussion regarding risk factors relating to the Company. In addition, investors should consider the following:
• The Company may not be able to successfully execute its new long-term business strategy. The Company may not be able to successfully execute the long-term business strategy that the Company announced on October 15, 2009. If the Company is not able, on a timely and cost effective basis, to successfully exit certain product lines and divest certain company assets as part of the strategy, the result could be increased costs and diversion of management attention from its focus. In addition, there is no assurance that the Company will be able to drive growth to the extent desired through its focus of efforts and resources on the Harley-Davidson brand or to enhance productivity and profitability to the extent desired through continuous improvement.
i think i see a ship sinking
(Message edited by mndwgz on October 30, 2009) |
Doylejj
| | Posted on Saturday, October 31, 2009 - 12:03 pm: |
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Another nugget on p 36, especially the projection that international sales will be 40% of sales by 2014 and a projection that sales to core customers is the lowest growth rate of its sales categories:
• International retail motorcycle unit sales to grow at a faster rate than domestic retail motorcycle unit sales over the long term:
• The addition of 100 to 150 international independent dealer points through 2014; and
• International retail motorcycle unit sales to exceed 40% of total retail motorcycle unit sales by 2014.
• Retail motorcycle unit sales to core customer base to grow over the long term from 2009 levels, but retail motorcycle unit sales to outreach customers to grow at a faster rate
(Message edited by doylejj on October 31, 2009) |
Hellgate
| | Posted on Saturday, October 31, 2009 - 04:27 pm: |
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SAP = Stop All Production, I don't think that was the case here. I've done two implementations of a variety of SAP modules and while difficult they work well. Following "The Rule of 7 Ps" is the key; if not you are doomed to frustration and additional cost. |
Iamarchangel
| | Posted on Saturday, October 31, 2009 - 11:18 pm: |
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Difficult would be an understatement.
As I was not directly involved in that training, I don't know if the "Rule" was properly followed.
In any case, the implementation was poorly managed and production was at a standstill for months. Madness.
(Message edited by iamarchangel on October 31, 2009) |
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