Harley Davidson: Preparing for the Next Century
Harley Davidson: Preparing for the Next Century
BUSI 615 40
Professor David Houghton
By
Brian Lynch
Since the founding of Harley-Davidson in 1903 by Arthur and Walter Davidson and William Harley, the company has a rich heritage and a loyal following. The company has proven to be resilient and innovative throughout the years. They have made their fair share of mistakes, especially while under the ownership of AMF, whose decisions almost destroyed Harley-Davidson. They have also made an inspiring come back, recapturing their share of the market and more. Harley-Davidson has managed to attract all sorts of riders including motorcycle “rebels”, women and blue and white color workers. In fact, in our church small group there are two Harley enthusiasts. All of the history, resolve and innovation that has made Harley a house hold name will be needed to get then through the challenges they now face.
Harley-Davidson faces two main interrelated problems in their future. One is slowing sales, according to John Morgan, from Ryan Beck & Co “. . . heavyweight motorcycle registrations exhibited robust growth from 1996 to 2000. However, growth in the touring and cruising market slowed considerably in the second half of 2002 and throughout 2003 and 2004” (Nolan & Kotha, 2007). This suggests that Harley-Davidson’s market may be maturing. That is, the market had essentially reached a state of equilibrium marked by the absence of significant growth or innovation.
The second is the aging of the baby boomers that made up a large portion of Harley customers. “The median age of the Harley customer, which was 35 in 1987, was now closer to 47” (Nolan & Kotha, 2007)
External Environmental Factors affecting Harley-Davidson
The world in the year 2007 would not be recognized by the founders of Harley-Davidson. Technology is advancing at a quicker pace than ever before, changing the decision making dynamic for managers. They have to decide to be a market leader,
BUSI 615 40
Professor David Houghton
By
Brian Lynch
Since the founding of Harley-Davidson in 1903 by Arthur and Walter Davidson and William Harley, the company has a rich heritage and a loyal following. The company has proven to be resilient and innovative throughout the years. They have made their fair share of mistakes, especially while under the ownership of AMF, whose decisions almost destroyed Harley-Davidson. They have also made an inspiring come back, recapturing their share of the market and more. Harley-Davidson has managed to attract all sorts of riders including motorcycle “rebels”, women and blue and white color workers. In fact, in our church small group there are two Harley enthusiasts. All of the history, resolve and innovation that has made Harley a house hold name will be needed to get then through the challenges they now face.
Harley-Davidson faces two main interrelated problems in their future. One is slowing sales, according to John Morgan, from Ryan Beck & Co “. . . heavyweight motorcycle registrations exhibited robust growth from 1996 to 2000. However, growth in the touring and cruising market slowed considerably in the second half of 2002 and throughout 2003 and 2004” (Nolan & Kotha, 2007). This suggests that Harley-Davidson’s market may be maturing. That is, the market had essentially reached a state of equilibrium marked by the absence of significant growth or innovation.
The second is the aging of the baby boomers that made up a large portion of Harley customers. “The median age of the Harley customer, which was 35 in 1987, was now closer to 47” (Nolan & Kotha, 2007)
External Environmental Factors affecting Harley-Davidson
The world in the year 2007 would not be recognized by the founders of Harley-Davidson. Technology is advancing at a quicker pace than ever before, changing the decision making dynamic for managers. They have to decide to be a market leader,
Bibliography: Keller, Kevin, and Philip Kotler (2008) Marketing Management (13th Edition) Alexandria, VA: Prentice Hall, Print. Nolan, Richard , and Suresh Kotha. "Harley-Davidson: Preparing for the Next Century." Harvard Business School 9-906-410 (2007): 1-17. Print. "Economy nearly stalled at end of 2007 - Stocks & economy- msnbc.com." Breaking News, Weather, Business, Health, Entertainment, Sports, Politics, Travel, Science, Technology, Local, US & World News- msnbc.com. N.p., n.d. Web. 21 June 2010. <http://www.msnbc.msn.com/id/22912358/ns/business-eye_on_the_economy//>.