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Harley-Davidson Company’s Strategic Management

Summary

Strategic management is an essential element of an organization that aims to analyze its external and internal factors affecting performance and sustainability. To thrive in a fast-paced business environment, corporations must understand different forces that influence production, financial growth, and societal cohesiveness. This essay delves into the specific processes that have made Harley-Davidson a successful company in the automobiles industry.

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Critical Specific Processes for Long-Term Success in Harley-Davidson

Harley Davidson, the fifth-largest designer, manufacturer, and distributor of heavy-weight motorcycles, is an action-oriented company that maintains efficient business operations based on resilience and competitiveness. From a personal viewpoint, a significant strategic management area would be to maintain its production and customization of unique, handcrafted, and innovative designs that meet the expectations of many customers. Supporting brand image using the available resources is essential in Harley-Davidson. As such, the company should capitalize on output quality that aligns with its corporate branding.

Another critical decision would involve the establishment of more distribution facilities around the globe. Although the company focuses on online systems for orders and requests, physical presence is still essential (Tita, 2020, par. 4). Therefore, the company should develop its Supplier Diversity policy in a bid to cover shipping costs for overseas customers who love heavy-weight motorcycles (Bradley, 2011, par. 3; Brinker, 2014, par. 5). Lastly, Harley-Davidson has diversified its products to compete effectively in the industry. Recently, the firm started designing and manufacturing lightweight bikes to offer its customers a wide variety of choices. The company is also accelerating its growth internationally by producing electric motorcycles (Rumelt, 2011, par. 6). This strategy will pave the way for more business as the firm targets multiple modern personas. Focusing on international corporate strategies helps organizations thrive in today’s dynamic and competitive markets.

Underlying Reasons for Strategically Critical Processes in Harley-Davidson

The most notable characteristic of the strategic moves is improved efficiency, product quality, and diversification, which have boosted its international sales. In 2019, the company claimed about 38.2% of the heavy-weight market share of motorcycles worldwide (Tita, 2020, par. 1). Although this percentage marks a fall in profits as compared to previous years, Harley-Davidson still dominates the supply of high-performance bikes. According to Tita (2020), the firm’s move to introduce new lightweight motorcycles, such as the Bronx Street Fighter, is expanding its sales among the young generation (par. 4). This strategic move focuses on seizing a larger market share shortly.

Specific Tools used to Improve Processes in Harley-Davidson’s Strategic Management

Harley-Davidson uses Political, Economic, Social, Technological, Environmental and Legal (PESTEL) analysis to assess the internal and external factors that influence its business. Although the company is a leading producer and distributor of chopper motorcycles, Thompson (2020) reveals that its management must utilize these tools to analyze various threats and opportunities for sustainable profitability (par. 3). With an enduring brand, Harley-Davidson thrives as a top player in the motorbike industry, both in local and global markets. A PESTEL analysis enables the company to identify various strategic factors for reform based on its micro and macro environments.

Harley-Davidson also applies Strength, Weakness, Opportunity, and Threat (SWOT) analysis to boost its performance and long-term sustainability in the automotive industry. According to Greenspan (2020), this tool has helped the company to deliver low-cost motorcycles and expand its business across transnational borders (par. 2). Besides, SWOT analysis has enabled the firm’s management to identify internal strategic factors, such as brand image, organizational culture, and prowess in chopper bike designs, that are responsible for growth and development (Triwastuti, 2017, p. 115; Academy of Management Executive, 1990, par. 6). Finally, the company applies Porter’s Five Forces to analyze the motorcycle industry and determine the probable levers of profitability (Pearce, 1982, par. 4). This management tool helps the automobile maker to understand various forces which influence its success and establish a strategic path for enhancement.

Challenging Analytical Tool in Harley-Davidson’s Strategic Management

The SWOT tool would be the most challenging to use in the analysis of Harley-Davidson’s business environment. While this approach has many advantages, it is important to note that reviewing external and internal factors using it has some drawbacks. First, the quality of information used in SWOT represents the opinion of just a few respondents, which makes it challenging to achieve a meaningful analysis of Harley-Davidson’s objectives. Unreliability of information is also common due to bias from staff opinions.

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From a personal standpoint, the identification of the four elements of SWOT analysis is often difficult. As a result, some opportunities may be perceived as threats, resulting in the planning and execution of a wrong strategy. Besides, the application of the SWOT tool in a big company such as Harley-Davidson may face numerous challenges as researchers fail to notice some challenges in its overseas branches, leading to a generalization of issues affecting it. The tool also follows the same process to address all problems facing the company. It is essential to note that the complexity of Harley-Davidson’s management challenges cannot be addressed using a universal solution due to the diverse business climates in which the company operates.

Conclusion

This essay discussed the specific processes that have made Harley-Davidson thrive in the automobiles industry. Strategic management is a critical approach to creating sustainable processes that help organizations to achieve their objectives. Harley-Davidson should focus on further analysis of its micro and macro factors that have continued to influence its production and supply of motorcycles to diverse international markets. This essay has highlighted various strategic management tools that have contributed to the sustainability of the firm. It has also explained the unsuitability of SWOT analysis in establishing weakness areas that affect Harley-Davidson’s performance, especially in overseas markets. As such, there is a need to adopt more apt strategic management tools that provide lasting solutions for the firm’s business challenges.

References

Academy of Management Executive. (1990). Concentrated growth strategies. Web.

Bradley, C. Hirt, M. & Smit, S. (2011). Have you tested your strategy lately? Mckinsey. Web.

Brinker, S. (2014). Strategy, marketing, and technology are all intertwined. Chiefmartec. Web.

Greenspan, R. (2020). Harley-Davidson SWOT analysis. Panmore Institute. Web.

Pearce, J. A. (1982). Selecting among alternative grand strategies. UMGC. Web.

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Rumelt, R. (2011). The perils of bad strategy. Mckinsey. Web.

Thompson, A. (2017). Harley-Davidson PESTEL/PESTLE analysis & recommendations. Panmore Institute. Web.

Tita, B. (2020). Harley-Davidson’s U.S. motorcycle sales drop for fifth straight year. The Wall Street Journal. Web.

Triwastuti, R. (2017). Market entry strategy of multinational enterprise (MNE): A case study of Harley Davidson. The International Journal of Applied Business, 1(2), 113-123. Web.

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