Harley-Davidson Inc Case Solution

The recommendations made were to revamp the existing business by redefining the target audience and setting a strategy structure based on these significant changes in the organization. Furthermore, the three issues highlighted in the case were found to be the key success factors for obtaining a leadership position in the industry. Another recommendation was to develop a strategy that facilitates innovations based on customer demands. This would result in the development and improvement of the brand image once again. The post-case scenario showed that the company has changed the core target audience to young people rather than the prior core customer, 40 years of age.

1. Issues

The core issue of the case is the inability of Harley-Davidson to adapt to the changing technological innovations in bikes. This changing technology had led to a change in the mindset of the bike-riding individuals. This change had been brought about with the new generation and the core target audience of the company reducing significantly. The preferences of these individuals belonging to the new generation had shifted from the core offering that the company had for its customers. As a result, the company aimed to adjust by offering price as well as style variants for these customers. However, this had a dilution effect on the brand and the loyalty of the loyalist customers decreased significantly.

2. External Assessment

The external environment was shifting as a result of a change in technology. This shift had caused the customers, a part of the external environment, being impacted, resulting in a change in the mindset of the people. Also, the natural environment includes a shift in the demographics of the target audience that prefers bike rides. This shift is characterized by the shift of bike riders from old to younger rides which are appealed by some factors other than what Harley-Davidson offers.

The assessment of the external factors shows that the competitiveness in the industry has increased significantly. The competitor brands are offering products to buyers that include the components of a Harley-Davidson bike that are attractive, and additional features that are a resultant of technological change. Furthermore, in this competitive industry, maintaining a competitive advantage is difficult because companies can replicate the product offering.

The third factor is the task environment. With the Harley-Davidson brand image encapsulated as an American cowboy, the same customer image cannot be projected to other markets such as Europe and Asia; promising markets for the company. The differences in the tastes and preferences of people are the global environment is difficult to adjust to.

3. Internal Assessment

The performance of the company has reduced to a certain extent because of some steps that increased the company receivables. This included credit extension to customers and also defaulters, resulting in an unstable condition for the company, resulting in an adverse effect on the financial performance. The only competitive advantage that the company has been its brand image that also has been diluted with the product and line extensions offered to a diverse audience. Furthermore, leadership, as a component of the internal organization is not strong because of the lack of experience in working in the company. The capabilities of the company include the production of high-quality vehicles. This capability of the company has been inculcated in the brand. Activities such as distribution and inventory management have been improved significantly over time that show that the operations aspect of the company has improved. Another value chain component is that of technology that is a weakness for the company since Harley-Davidson lags behind in technology adoption. The major strength of the company is its brand image. However, the weakness of the company is that in an effort to maintain the sales and profitability of the company, the brand image has been diluted.

4. Key Industry Success Factors

According to the analysis above, the key industry success factors that have been found are; technology adaptability, brand image development, and customer demands. Technology adaptability was found to be a key industry success factor given the failure that Harley-Davidson is facing in this case. The importance of this factor is highlighted by the fact that companies such as Yamaha that were not as old as Harley-Davidson was improving to increase its market share in the industry. The second key factor is the development of a concentrated and focused brand image.