Harley Davidson Tows Matrix

Topics: Strategic management, Brand, Competition Pages: 5 (1304 words) Published: November 10, 2008
“Strategic planning involves identifying the current business of a firm and the business it wants for the future, and the course of action or strategy it will use to pursue its objectives.” (definition)

While Harley-Davidson and its competitors, both domestic and international, have been alive for decades, it is becoming increasingly difficult to shift such established entities to compliment a new, younger group of potential riders. An expanding economy, technological advances such as the internet and online retail, liquidity and market demands have all contributed to the stability of profits in this business. Competition changed the fundamental landscape of the motorcycle industry forever. Several factors including the necessity to compete and evolve, a more streamlined manufacturing process, new management and a wealth of demographic and retail analysis information have enabled the industry to obtain and attain a rapidly growing portion of the population.

Harley-Davidson has always been the leader in heavy-weight, classic cruisers with their rumbling motors and definitive styling. Owners adhere more to the lifestyle and freedom of the bikes, rather than utility and dependability. Harleys generally come with a spirit and attitude of genuine America and an institution that is hailed as an iconic model of pre-industrial America. Riders will agree that the feeling is almost religious and unified, as gatherings and conventions feel more like family reunions than an ordinary general interest group.

With the addition of such loyalty programs as HOG and financial services directly offered by the company, buyers are becoming more comfortable and attached to the brand as ever before. HOG has created a unified community of followers enabling them to stay in touch, exchange ideas and even schedule get-togethers. Harley’s financial services division is a rapidly growing profit center aimed at making and servicing the buying experience as smooth as possible. The profits from this division have allowed Harley-Davidson to be able to put more investment capital towards future model changes and expansion.

Strategic planning has now come into light as a “saving grace” for the motorcycle company. Strategy begins with a clear statement of direction. The primary task of top management is to think through the mission of the business, which is not what was occurring historically. Top management are now facing required enhancements as a result of several forces in the market today:

1- Increasing demand for quantity without degradation of value
2- Complete financing solutions
3- Competition in other motorcycle sectors (performance bikes, cruisers, etc)
4- New competitor entrants
5- Pricing transparency and power of consumer
Harley-Davidson has now become a full service entity with its retail chains around the globe. With focus on the customer, detail, integrity, teamwork, employee empowerment, innovation and quality, the modern Harley-David hopes to attract a new breed and generation of riders by offering more buyer incentives at competitively low rates all while keeping costs down and shareholders’ pockets lined.

This paper will focus on these issues broken into four major sections (industry analysis, company analysis, corporate-level strategy and competitive strategy).

Porter’s Industry Analysis
Definition:The five forces model helps managers understand the competitive intensity of an industry & identify competitive advantages given industry competition. a.Competitive Rivalry within an Industry & Industry Competition: -Many new & established motorcycle companies, especially geared towards performance bikes and cruisers. b.Threat of New Entrants

- Low barrier to entry makes it easy for new companies to form c.Bargaining Power of Customers
- Customers have transparent/real-time prices and information - Customization of bikes and pricing
- High
d.Bargaining Power of Suppliers
- Medium to low as...
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