Harley-Davidson, Identifying Ebusiness Risks

Topics: Management, Risk management, Management accounting Pages: 14 (4640 words) Published: May 15, 2011
Harley-Davidson, Inc: Identifying eBusiness Risks and Related Assurance Services for the eBusiness Marketplace. Copyright © 2006 by Pearson Education, Inc., Upper Saddle River, NJ 07458.


Risks Involved For Harley Davidson Since Integrating E-Business Into Its Supply Chain Management System2

Internal Controls Which Harley Davidson Can Implement To Mitigate The Risks Identified And How Best Can These Controls Be Audited5

Business Risks For The Harley Davidson’s Business Partners Due The Company’s E-Business System6

Likelihood Of Impact Of E-Business On This Year's Audit At Harley Davidson: A Memo From The Audit Manager8


RISKS INVOLVED FOR HARLEY DAVIDSON SINCE INTEGRATING E-BUSINESS INTO ITS SUPPLY CHAIN MANAGEMENT SYSTEM The main risks associated with e-commerce are those of hackers, viruses, and interception of credit card numbers travelling over telecommunication lines etc (cl.cam.ac.uk, 2009). Certain technological developments seem to mitigate many perceived risks (Kaufman, Leslie, 1999) but some recent surveys have pointed out the issues of high costs involved in using this technology (McCartney, Laton, 1997). Hence no matter how much one believes that e-commerce system implemented at Harley Davidson is full-proof, considerable risks still exists in the system. The author has classified the risks which Harley Davidson is likely to face into following six categories which are information risks, technology risks, business risks, risks related to Branding and Reputation, Integration risks and lastly Project management risks.

Information Risk
Information risk as defined by Miller and Engemann in their paper titled, “Managing Risks In Electronic Commerce” is as follows [Quote], “Information risks stem from information published and contained in web sites and associated with the conduct of e-commerce. Peripheral to information risks are risks associated with misuse of information, such as violation of laws in the United States and other countries” [Quote] (Miller, Engemann, 2009). The different kinds of Information risks associated with e-commerce are as follows • Harley Davidson’s website and other public interference medium like podcasts etc can be exposed to defamation of character, slander etc. • Harley Davidson company might also face copyright infringement issues arising from the posted content on website or from digital scanning • Vital information about the company, like the latest R&D break through, future strategy of the company, key financial stats which are not meant for public release etc, can be exposed more easily owing to the onset of e-commerce than it would have been in the traditional method. • Various patent issues related to Harley Davidson’s breakthrough technology might also be a cause of worry for the company • Credit card information can be easily intercepted via internet for deceitful purposes. Even though this risk doesn’t seem to be directly affecting the company, it is stated here to understand the magnitude of risk involved using E-business

Technology risks
These risks result due to the misuse of technology or due to a wrong implementation of a technological solution addressing the required business needs. Some prominent examples of technological risks which the company might face in the future are as follows • Breach of Harley Davidson web portal is very likely possible, which can hamper the PR of the company • Presence of some trivial errors in the development code of the company’s e-business systems can cause huge loss to the company. • Since Harley Davidson's popularity is ever growing, bandwidth can be a problem as it might be insufficient to handle the traffic. • As all the operations of Harley Davidson are now based on internet, thanks to e-business systems, crash of Internet service provider (ISP) server can be disastrous for the company as it will virtually bring the company to...
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