As organizations grow and change, or seek to grow and change, hopefully for the better, strategic analysis and implementation plays a pivotal role. Simply put, Strategic Auditing, as it is often called, consists of taking a close look at current organizational situations, internal/external factors, as well as ways that that new strategy can be put into practice and evaluated for future adjustments and changes in the new strategies. One of the American companies that has typified the ability to survive despite many challenges over the years is Harley Davidson, and as such, will be the focus of this paper.
This paper consists of selected sections of a Strategic Audit, based upon the case study “Harley Davidson Inc- The 100th Anniversary” by Patricia Ryan of Colorado State University. Where appropriate, additional resources are referenced as well.
Analysis of Strategic Factors Because of radical changes that have taken place in the American economy and workforce over the past several decades, among them increased foreign competition, demographic shifts, and the threats of international terrorism, domestic firms have been forced to take a much closer look at their strategic factors than they had in the past (Barnum, 1991), not only in terms of human resources, but strategic resources as well. This is particularly true in the case of Harley Davidson.
To begin, based upon the case data in regard to the Harley Davidson organization overall, an objective analysis of Strengths, Weaknesses, Opportunities, and Threats, commonly referred to as a SWOT Analysis, is presented, as well as a Review of Current Mission and Objectives, as follows: • Harley Davidson, at the time of the case study, holds the enviable position of being the nation’s most profitable and longest-lasting manufacturer of motorcycles. Attesting to the company’s success over the years are honors such as being names Forbes Magazine’s Company of the Year for 2001, selection by Business Week as one of The Nation’s Most Admired Companies, and kudos from Fortune Magazine as one of the top American companies to work for.
In 2003, the company celebrated over 100 years in business, despite many hardships and obstacles, showing that the strength of the company is due in large part to longevity. This longevity can be attributed to many factors, but one of the most significant is the fact that the vast majority of Harley owners are males, who often times purchase the motorcycles because females are attracted to men who choose Harley Davidson over other brands of motorcycles (Frenger, 2003).
This mystique notwithstanding, it must be understood, however, that continued success must be fostered by a sharp strategic vision to avoid the hard learned lessons of the company’s often troubled past. If any organization is to be viable long-term, it is exactly these types of strategic vision that must be embraced and practiced if the organization is to grow and overcome the pains that often accompany maturing businesses such as Harley Davidson (Robinson, et al, 1992).
Harley Davidson, while well established in the motorcycle industry and indeed in the American marketplace and beyond, is far from immune to downturns in the economy, the sometimes fickle nature of the average consumer, and of course the pressure that competitors constantly apply in an effort to gain Harley Davidson’s sizeable market share. Because of the vast financial resources, market presence/position, and innovation that Harley Davidson has readily available, the firm is positioned to embrace new industries, expand global presence, and build on the successful business model that has given Harley Davidson an advantage over competitors since recovering from eroding profits and poor strategic decisions that were made on behalf of the company by earlier management teams within the firm. A particular opportunity exists for Harley Davidson within the area of the company name and image itself.
Over the decades, Harley Davidson has come to symbolize the freedom of the open road, self expression, power and good old fashioned leisure and fun, not to mention a level of envy from those who are not lucky enough to enjoy the power and beauty of a Harley motorcycle. As a result, the name and logo of Harley Davidson has acquired tremendous recognition among consumers, and products emblazoned with this name and logo typically sell briskly, even among non-motorcycle owners, representing an untapped market segment for the firm. This being understood, Harley Davidson has a unique opportunity to use their marketability to enter new markets, offer new products, and of course, generate new profits.
At the time of the case study, Harley Davidson was reaching maturity stage, which along with experience and skill, can bring with it apathy and decline. If growth is pursued in an attempt to overcome this apathy, the growth will have to be carefully planned and implemented to avoid costly errors with uncontrolled, or inappropriate growth. Internally, the possibility of company politics must also be recognized; if the agendas and conflicts of individuals in the corporation are allowed to take root, the strategic planning process can be led astray; therefore, this threat must be taken seriously, as it manifests itself in small and large businesses alike (Jones, 1985). Also, the threat of foreign motorcycles which are featuring high technology and speed over size at lower prices needs to be heeded.
During the time period covered by the case study, the current Harley Davidson mission was to satisfy the needs of their customers every time and to uphold the tradition of the American motorcycle and retain the loyalty of the riders who crave Harley motorcycles, while achieving the internal objectives of increasing product quality, reducing waste, producing more product and effectively utilizing all assets to their best use, the net effect of which would be survival and growth of the organization.
This would be accomplished through the expansion of its dealer base domestically and internationally, improving relationships with suppliers to obtain favorable raw material pricing, realignment of production facilities, increasing research and development, and paying attention to the voice of the loyal customer core. In doing so, Harley Davidson is achieving its objectives and increasing stakeholder value. This mission, and subsequent objective, appear to be appropriate. Harley Davidson is achieving global market share and domestic dominance in a relatively short few decades after nearly collapsing, rising from a faltering American manufacturer to a world player in the complicated and highly competitive motorcycle industry.
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