Case Study Description of Harley-Davidson: Marketing Strategy for Motorcycles--1977
Incorporates material on AMF, Harley-Davidson's parent company. This information is designed to permit analysis of Harley-Davidson in the context of AMF's corporate strategy and overall business portfolio. A rewritten version of two earlier cases.
Swot Analysis of "Harley-Davidson: Marketing Strategy for Motorcycles--1977" written by Robert D. Buzzell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Harley Davidson facing as an external strategic factors. Some of the topics covered in Harley-Davidson: Marketing Strategy for Motorcycles--1977 case study are - Strategic Management Strategies, Competitive strategy, Financial markets, Marketing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Harley-Davidson: Marketing Strategy for Motorcycles--1977 casestudy better are - – increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, there is backlash against globalization, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic ,
wage bills are increasing, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Harley-Davidson: Marketing Strategy for Motorcycles--1977
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Harley-Davidson: Marketing Strategy for Motorcycles--1977 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Harley Davidson, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Harley Davidson operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Harley-Davidson: Marketing Strategy for Motorcycles--1977 can be done for the following purposes –
1. Strategic planning using facts provided in Harley-Davidson: Marketing Strategy for Motorcycles--1977 case study
2. Improving business portfolio management of Harley Davidson
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Harley Davidson
Strengths Harley-Davidson: Marketing Strategy for Motorcycles--1977 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Harley Davidson in Harley-Davidson: Marketing Strategy for Motorcycles--1977 Harvard Business Review case study are -
Ability to recruit top talent
– Harley Davidson is one of the leading recruiters in the industry. Managers in the Harley-Davidson: Marketing Strategy for Motorcycles--1977 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Harley Davidson has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Harley-Davidson: Marketing Strategy for Motorcycles--1977 Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Ability to lead change in Sales & Marketing field
– Harley Davidson is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Harley Davidson in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Harley Davidson is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Harley Davidson is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Harley-Davidson: Marketing Strategy for Motorcycles--1977 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Harley Davidson has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Cross disciplinary teams
– Horizontal connected teams at the Harley Davidson are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Innovation driven organization
– Harley Davidson is one of the most innovative firm in sector. Manager in Harley-Davidson: Marketing Strategy for Motorcycles--1977 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Harley Davidson has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Harley-Davidson: Marketing Strategy for Motorcycles--1977 Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Sustainable margins compare to other players in Sales & Marketing industry
– Harley-Davidson: Marketing Strategy for Motorcycles--1977 firm has clearly differentiated products in the market place. This has enabled Harley Davidson to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Harley Davidson to invest into research and development (R&D) and innovation.
Strong track record of project management
– Harley Davidson is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Harley Davidson
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Harley Davidson does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Harley-Davidson: Marketing Strategy for Motorcycles--1977 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Harley-Davidson: Marketing Strategy for Motorcycles--1977 are -
Capital Spending Reduction
– Even during the low interest decade, Harley Davidson has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Low market penetration in new markets
– Outside its home market of Harley Davidson, firm in the HBR case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Harley Davidson has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow decision making process
– As mentioned earlier in the report, Harley Davidson has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Harley Davidson even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High cash cycle compare to competitors
Harley Davidson has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– After analyzing the HBR case study Harley-Davidson: Marketing Strategy for Motorcycles--1977, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Harley Davidson is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Harley Davidson needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Harley-Davidson: Marketing Strategy for Motorcycles--1977 HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Harley Davidson has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Harley Davidson is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Harley Davidson needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Harley Davidson to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Harley-Davidson: Marketing Strategy for Motorcycles--1977, in the dynamic environment Harley Davidson has struggled to respond to the nimble upstart competition. Harley Davidson has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Harley-Davidson: Marketing Strategy for Motorcycles--1977 | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 are -
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Harley Davidson in the consumer business. Now Harley Davidson can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Harley Davidson can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Harley Davidson can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Harley Davidson to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Creating value in data economy
– The success of analytics program of Harley Davidson has opened avenues for new revenue streams for the organization in the industry. This can help Harley Davidson to build a more holistic ecosystem as suggested in the Harley-Davidson: Marketing Strategy for Motorcycles--1977 case study. Harley Davidson can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Harley Davidson to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Harley Davidson can use these opportunities to build new business models that can help the communities that Harley Davidson operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Manufacturing automation
– Harley Davidson can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Harley Davidson can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Harley-Davidson: Marketing Strategy for Motorcycles--1977, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Harley Davidson to increase its market reach. Harley Davidson will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Loyalty marketing
– Harley Davidson has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Harley Davidson is facing challenges because of the dominance of functional experts in the organization. Harley-Davidson: Marketing Strategy for Motorcycles--1977 case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Harley Davidson can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Harley Davidson can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Harley-Davidson: Marketing Strategy for Motorcycles--1977 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 are -
Consumer confidence and its impact on Harley Davidson demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Harley Davidson will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Regulatory challenges
– Harley Davidson needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Harley Davidson business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Harley Davidson with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Harley Davidson in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Harley-Davidson: Marketing Strategy for Motorcycles--1977, Harley Davidson may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Stagnating economy with rate increase
– Harley Davidson can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Harley Davidson can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Harley Davidson needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Harley Davidson is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Harley-Davidson: Marketing Strategy for Motorcycles--1977 Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Harley-Davidson: Marketing Strategy for Motorcycles--1977 is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Harley-Davidson: Marketing Strategy for Motorcycles--1977 is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Harley Davidson needs to make to build a sustainable competitive advantage.