Background Information
Harley-Davidson Inc. is one of the largest motorcycle manufacturing companies that has not only dominated the United States market, but also other parts of the world. The Company has 100 years experience in terms of motorcycle manufacturing and has attracted a broad base of clients across the United States (Brannen, Jeffrey and Nabil, 11). Economists have mentioned that Harley Davidson Inc. is one of the two motorcycle manufacturing companies that did not experience significant impact as a result of the Great Depression (Zarco and Morgan, 47). Besides, the company has undergone a series of management as well as ownership arrangements. The Company has established itself as an Iconic Brand across the United States. It has also achieved a significant number of loyal customers such as club owners and supported brand-focused museums. It has traditionally, marketed and promoted its heavy-weight motorcycles with engine capacity of 700cc and above. The Company has established its manufacturing sites in Missouri, Wisconsin, Milwaukee and Kansas City among other places (Zarco and Morgan, 47). To enhance cost-effective production, Harley-Davidson Inc. has also established its manufacturing sites in countries characterized by the existence of cheap labor such as India and Brazil (Das and Aftab, 48). This paper presents an analysis of the strategic management approach applicable by Harley-Davidson Inc. Company. In the analysis, the following models, SWOT Matrix, External Factor Evaluation (EFE) and Internal Factor Evaluation (IFE) Matrix shall be applied in the analysis. Besides, Competitive Profile Matrix will also be applied as a key model in the analysis of Harley-Davidson Inc. strategic managerial approach.
Company Mission and Analysis
The Mission of Harley-Davidson Company is to fulfill the dreams of its customer through the provision of high quality motorcycles (Cianferoni and Costantino, 17). The company also aspires to fuel the passion of its clients so that they are able to express their dreams and desires. This is an exceptional mission considering that it indicates that values of the company; it appears that the desires of Harley-Davidson clients are at the core of the company values. This is achieved by the provision of high-quality motorcycle products that enable its clients to express their opinions and individuality.
Strength, Weakness, Opportunity and Threat (SWOT Matrix)
Strengths
As mentioned earlier, the company has developed a strong brand over the last 100 years, therefore, attracting a broad perspective of clients across the United States. It has established itself among customers that prefer high CC motorcycles in the United States and other parts of the world. Besides, Harley-Davidson Inc. has attracting a high pull of customers through appropriate promotional strategies and branding, hence, achieving a Top-of-the-Mind-Awareness Score. Also, the company provides a wide perspective of products that is, the manufacturing of motorcycles from 500CC to 750CC (Cova and Stefano, 1088). This approach has been critical in attracting young riders; thus, providing a solution to the ageing problem experienced by the company. Consequently, Harley-Davidson Inc. has a stronger customer base compared to other motorcycle manufacturing companies. This has enabled its stakeholders to attain a stronger financial foundation as well as a stronger heritage.
Weaknesses
One of the major weaknesses of the Company is based on the fact that it only has two manufacturing sites outside the United States. One manufacturing site is located in Brazil while the other site is in India. This has created obstacles in terms of appropriate pricing by making it quite expensive for the company stakeholders to export their products to other parts of the World. Harley-Davidson also over-relies on its production and distribution within the United States. It has not effectively explored external markets in other parts of the World. In fact, about 65 percent of its revenues are generated from the US; it is imperative to acknowledge that the US market is subject to certain aspects of growth limitation, hence, affecting the development of the Company (Bhandari, 6). Many market researchers argue that the fact that Harley-Davidson Inc. depends on a single supply is one of its major weaknesses. This is because over-dependence on a single supplier limits the capacity of the company to control Input Cost, hence, affecting its operational costs.
Opportunities
There is an expanding market of Harley-Davidson products in the Asian and European region. The Asian and European markets are also characterized by limited competition, hence, creating an opportunity for the success of the Company. It has also been mentioned that the development of lower CC motorbikes is an important opportunity for the company to attract young and low as well as middle income earners across the globe. Consequently, the company can apply contemporary and appropriate promotional strategies to attract women and young riders in the United States and other parts of the World. Women and Young riders create a lucrative and untapped market that can be properly explored by the company to enhance its success in the current global market.
Threats
Harley-Davidson stakeholders lack foresight in their market approach; as mentioned earlier, more than 65 percent of the company’s sales are performed in the United States. This means that the company has failed to apply appropriate marketing strategies to capture other parts of the world. This could be a threat to its growth and development. There are myriad properly established motorcycle companies that threaten the success of the company by developing substitute products. For instance, companies like Vector Motorcycles, Indian Motorcycles and Royal Enfield among others have created stiff competition for the company.
Harley-Davidson Inc. Competitive Profile Matrix Analysis
Harley-Davidson External Factor Analysis Matrix
As mentioned initially, companies that have less than 2.50 weighted scores are weak. The External Factor Matrix indicated above shows that Harley-Davidson Inc has attained more than average performance in the United States market. There are critical opportunities that can be explored further to facilitate the success of the company; for instance, there is an untapped market among youthful and female riders. This market can be explored to expand and facilitate the success of the company. Besides, the increased access of internet services has played a pertinent role in the success of many modern companies. This platform can also be utilized by Harley-Davidson Inc. as a channel to implement its global promotional strategy. However, it is crucial to recognize that Harley-Davidson Inc. is also facing various threats that might hinder its future successes. One of these threats is the high level of competition exerted by well-established Motorcycle Manufacturing companies such as BMW, Honda, Ducati and Suzuki among other. The entrance of electric-charged motorcycles in the United States and other parts of the world is also a major threat to the success of Harley-Davidson Inc. A significant number of individuals and stakeholders, particularly, those with high regard to sustainability prefer the use of electric-powered machines in the current transport sector.
Harley-Davidson Inc. Internal Matrix Analysis
It is crucial to take note of the fact that the internal operational factors in the Company are above 2.50. The Company attributes its current success across the United States to the strong brand image and high level of customer loyalty. In fact, it is believed that the strong customer loyalty enjoyed by the company as well as its positive brand image is some of the factors that have enabled it to withstand the impact of the Great Depression that affected a significant number of American Companies. The company expects to achieve even higher levels of success following the decision by its stakeholders to tap youthful and female riders in different parts of the world. However, it appears that its operational objectives may be hindered by certain weaknesses such as over-reliance on the United States market and the dependence on a single supplier. Many people believe that over-dependence on a single supplier could hinder a successful control of the company’s inputs, hence, leading to lack of cost-effectiveness. The development of high CC motorcycles is also another major challenge that may impact the success of the company. The current high CC motorcycles created by the company appear to target mostly the working class and individuals with stable financial income. This means that the company does not target individuals from the middle and lower income classes as seen by other motorcycle manufacturing companies such as Honda, BMW and Ducati among others.
Recommendations
Global operation has become an important aspect of most modern companies. Many business-related organizations have implemented strategies that enhance their capacities to expand their operations on a global perspective (Barreiros and Oliveira de Mira, 7). In fact, a significant number of economists argue that global operations among business organizations are a key strategy towards increasing revenues and improving the overall company’s competitive advantage. It appears that one of the major weaknesses of Harley-Davidson Company is poor global operation; the company only has two manufacturing sites in Brazil and India. It is believed that it has not explored its global operational capacity to the fullest capacity (Felix, 21). Researchers mention that the demand for motorcycle products is expanding in the European and Asian regions. Harley-Davidson Inc. can also expand its operational capacities and revenues by targeting the youthful and female riders (Ha, 10). Many youths and women across the globe are developing an interest in the operation of Harley-Davidson Motorcycle products. Consequently, the company should consider engaging in contracts with various suppliers to ensure that it controls the prices of raw materials. Harley-Davidson Inc. stakeholders should also consider engaging in research and development so that they are able to understand market trend issues such as customer preference and new technologies that might affect the demand for their products (Bronson and Graham, 206). In summary, the EFA and IFA Matrices indicate that the company is above 2.50. This means the company is showing tremendous performance in the United States, although its performance in other markets is relatively weak compared to other motorcycle manufacturing companies.
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