...Unit Reading Leenen, S. & Jelassi, T. 2005, 'Ducati (Italy) vs. Harley-Davidson (USA)', in Strategies for E-Business, ed.T. Jelassi & A. Enders, Pearson Education Limited, Harlow, pp. 366-398. Ievisia-1111-1311 _. .. . .. _...__...__._ . . . ..___. _. . . ll I 1..-_. .. ..._._. . ._._ _ . __.. _ ._..._ __ i"“ Ducati (Italy) vs. Harley-Davidson (USA) Innovating business processes and managing value networks In 2001, as Ducati celebrated its 75th anniversary, Group (TPG) and Deutsche Morgan Grenfell Capital some executives wondered whether the recent corporate restructuring had repositioned the company (Italy). A new management team initiated a turnaround programme aiming at increased production efficiency, net sales and profit. ‘Since 1996, we were really working against a backdrop that wasn’t so far successfully. As part of this, the Italian motorcycle manufacturer had adopted a new focus on R&D, marketing and sales, moving away from its initial manufacturing strength. In addition, the company removed from bankruptcy’, said Carlo di Biagio, Chief Executive Officer of DMH. ‘Now our situation is different. Sooner or later, we think investors will see that.’ By 2001, the company had restructured its value chain activities, outsourcing 90% of its production and, in order to decrease costs, introducing a platform strat- had embraced the Internet, deciding in Ianuary 2000 to sell its new motorcycle, apparel and accessories exclusively online...
Words: 1485 - Pages: 6
...the CEO of Ducati in order to lead the company into a new era of profitability and to establish Ducati as a brand to contend with in the sports motorcycle segment. In the years preceding the revolutionary turnaround, the company changed hands a number of time which resulted in a lack of overall strategic direction. Minoli was faced with a company which, despite having a team of top engineers, had gained a reputation for average quality as a result of inefficient production and poor management. Until 1996 it was driven by the imaginations of its engineers rather than by goal-oriented strategic decisions. Minoli described Ducati’s top management as operating in “a structured chaos” (Gavetti, 2004, pp.861). He believed that by incorporating certain basic structural changes and by redefining company’s strategic goals, it could be turned into a profitable brand-driven company. Ducati’s turnaround focused on brand building which was supported by the reconfiguration of a number of activities ranging from increased efficiency in the production process to broadening its customer base. Having almost doubled its market share in 2001, Minoli wanted to find new sources of growth. Among others he considered the cruiser market, currently dominated by Harley Davidson. His goal was to compete directly with Harley Davidson in Europe by introducing a cruiser that combined Ducati’s high performance engine with its own unique design. This essay will begin with a SWOT analysis of Ducati as it stands...
Words: 3191 - Pages: 13
...For the exclusive use of Z. Xu, 2016. 9-701-132 REV. MARCH 8, 2002 GIOVANNI GAVETTI Ducati By the end of 2000, Federico Minoli had won his battle. Over the past five years, the “turnaround i artist” -- as Forbes magazine dubbed him –- had transformed a company on the verge of bankruptcy into one of the most profitable motorcycle manufacturers in the world; a mechanical concern into a global brand; a fast motorcycle into a symbol of Italian design and tradition, extreme performance, and technical excellence. Under Minoli, Ducati had enjoyed explosive growth and profitability. Revenues had quadrupled since 1996; EBITDA had grown from 33.4 million Euros in 1997 to around 60.0 million Euros in 2000; the market share had gone from 5.1% in the sport bikes segment in 1997 to 6.7% in 2000 (see Exhibit 1). Despite this success, Minoli was concerned with the future of the company. He knew that Ducati could not grow indefinitely, and was struggling with what strategy might overtake these bounds. Minoli and the rest of Ducati’s top management team were considering different alternatives. One alternative was to attack Harley Davidson’s niche with a Ducati interpretation of a cruiser. Was this broadening of Ducati’s traditional niche the right move to sustain the profitable growth of the company? The Market for Motorcycles in 2001 The roots of the motorcycle industry date back to 1868, when Louis Perraux installed a steam engine on a rudimentary bicycle. In 1894...
Words: 9920 - Pages: 40
...9-701-132 REV. MARCH 8, 2002 GIOVANNI GAVETTI Ducati By the end of 2000, Federico Minoli had won his battle. Over the past five years, the “turnaround i artist” -- as Forbes magazine dubbed him –- had transformed a company on the verge of bankruptcy into one of the most profitable motorcycle manufacturers in the world; a mechanical concern into a global brand; a fast motorcycle into a symbol of Italian design and tradition, extreme performance, and technical excellence. Under Minoli, Ducati had enjoyed explosive growth and profitability. Revenues had quadrupled since 1996; EBITDA had grown from 33.4 million Euros in 1997 to around 60.0 million Euros in 2000; the market share had gone from 5.1% in the sport bikes segment in 1997 to 6.7% in 2000 (see Exhibit 1). Despite this success, Minoli was concerned with the future of the company. He knew that Ducati could not grow indefinitely, and was struggling with what strategy might overtake these bounds. Minoli and the rest of Ducati’s top management team were considering different alternatives. One alternative was to attack Harley Davidson’s niche with a Ducati interpretation of a cruiser. Was this broadening of Ducati’s traditional niche the right move to sustain the profitable growth of the company? The Market for Motorcycles in 2001 The roots of the motorcycle industry date back to 1868, when Louis Perraux installed a steam engine on a rudimentary bicycle. In 1894, the Hildebrand brothers and Alois Wolfmüller produced...
Words: 10151 - Pages: 41
...have? The objectives of HDI include increasing sales, increasing market share in Europe, and achieving a sustainable competitive advantage. So, HDI is seeking to penetrate the market as well as engaging in market development, which in this case means attracting a new demographic segment of younger and European customers it has not yet attracted before due to several reasons such as the price and the appeal of the Harley Davidson brand as being a motorcycle “an old guy would drive”. As stated in the case study, HDI does not and will not have cost leadership in the industry it competes in. The huge gap between Honda which produces over 5 million bikes annually and HDI, which produces slightly over 200.000, allows Honda to benefit from economies of scale and therefore offer their products at lower prices than HDI. The relatively small size of HDI limits its ability to invest in technology and new products, which means that HDI neither has the most advanced technology, nor superior performance. However, as the company recognizes, it is not selling motorcycles, it is selling the “Harley Experience”. This lifestyle and spirit, which no competitor has been able to copy or even beat so far, is the competitive advantage and USP of HDI. Harley Davidson motorcycles are not primarily a transportation vehicle, but a statement of style. The HDI image and the brand loyalty among its consumer base are the company’s strongest assets. As the demand in Europe is increasing, HDI should consider...
Words: 2894 - Pages: 12
...TASKS You are required to read the attached case study thoroughly. Harley-Davidson, Inc.: Troubled Times Increase H-D’s Reliance on International Sales Task You are required to write a term paper answering the below-mentioned questions based on the given case-study. Question 1 With reference to Porter’s Generic Strategies, which generic strategy is Harley Davidson using? Illustrate your answer with relevant theory or case scenario information. (10 marks) Question 2 Critically evaluate the effectiveness of the strategy you identified in Question 1) above for all the countries described in the case. You need to use case scenario information or relevant theory to illustrate/support your answer. (15 marks) Question 3 (i) Perform a Porter 5 forces analysis on each of the geographic areas where Harley Davidson faces its international competitors....
Words: 459 - Pages: 2
...Harley Davidson Case Study Case study of Harley Davidson Alan Potrus California Baptist University Author Note: This paper was made for Professor Joe Putulowski in accordance to week 6 assignment instructions for The Harley Davidson Case Study. Intro CEO Jeff Bleustein had his work cut out for him at the end of 2003 when he reviewed the company’s financial statements for the year. It was Harley Davidson’s 100 year anniversary and there were many festivities set out for that year that would eventually attract millions of participants. Sales and profits had broken previous records for the eighth consecutive year. HD has been performing so well it made a 180 degree turn in comparison to its numbers in the early 80’s when it was putting out 40,000 bikes a year and struggling with a mountain of debt. Jeff now had to figure out how to continue the uprising of profits. Because of this, Bleustein had little opportunity to reminisce about Harley’s 100 year celebration. Jeff set a target of 400,000 motorcycle sales by 2007. Jeff knew that in order to achieve this goal he needed to set a prestigious strategy plan that would accommodate the market for motorcycles and possibly attract new customers into the motorcycle market. Harley-Davidson’s Strategy Bleustein began preparing a strategy review with his top management team. They discussed the different forces that would cause HD to fall off course. It is interesting...
Words: 1068 - Pages: 5
...Despite their conception in 1903, Harley-Davidson and the motorcycle industry as a whole didn’t really take off until after the Second World War. Many people rode motorcycles during the war, with Harley-Davidson themselves supplying almost 90,000 motorcycles for the U.S. military during this time. Many veterans chose to purchase motorcycles upon returning home, as they enjoyed riding during the war and wanted to continue riding in their civilian life. This generation known as the "baby-boomers" quickly became the main target audience for many of Harley-Davidson’s marketing efforts. With sales increasing and the industry growing, many "motorcycle clubs" and "rallies" were introduced. Unfortunately, due to the lewd behavior displayed by most people associated with these clubs and rallies, bikers typically had an image of being disorderly and raucous. Harley-Davidson’s image itself took a big shot due to the Hells Angels. This was a motorcycle gang wishing to become notorious for "drug trafficking and other organized crime activities," who used only Harley-Davidson motorcycles. All of this combined to lead to a decline in demand and sales throughout the entire industry during the 1960’s. The industry was really helped out with the release of the Hollywood film Easy Rider in 1969. This film helped change the public’s perception of bikers and sparked an increase in motorcycle demand which has lasted to this day. The motorcycle industry offers products which can be viewed as luxuries...
Words: 1802 - Pages: 8
...raucous. Harley-Davidson’s image itself took a big shot due to the Hells Angels. This was a motorcycle gang wishing to become notorious for "drug trafficking and other organized crime activities," who used only Harley-Davidson motorcycles. All of this combined to lead to a decline in demand and sales throughout the entire industry during the 1960’s. The industry was really helped out with the release of the Hollywood film Easy Rider in 1969. This film helped change the public’s perception of bikers and sparked an increase in motorcycle demand which has lasted to this day. The motorcycle industry offers products which can be viewed as luxuries or wants as opposed to necessities. When concerning Harley-Davidson, most motorcycle owners have purchased their bikes as a second vehicle, using them more during weekends and off-time instead of during the work week. This implies that the motorcycles serve for recreational purposes and thus are an item which can be expendable at times. This has hurt the industry recently with the slight recession the United States economy is facing. Another interesting thing to note about the motorcycle industry is the different appeal bikes carry in different global regions. In the United States for instance, Harley-Davidson has had much success because of the market trends and tastes people enjoy. Harley-Davidson has benefited from a U.S. market which enjoys casual and recreational riding. This isn’t necessarily the case overseas, as in Europe the trendy...
Words: 2696 - Pages: 11
...Case Study: Harley-Davidson -Analyse Harley-Davidson resources and capabilities, and identify its key strengths and weaknesses - Analyse the international competitive environment in which Harley-Davidson is operating to identify its main threats and opportunities. Recommend a forward strategy for Harley-Davidson, which addresses these issues. International Management Individual Assignment Table of Contents 1. Introduction 3 2. Harley Davidson Overview 4 2.1. Harley-Davidson Current Strategy 4 2.2. Resources And Capabilities 5 3. Industry Analysis 6 3.1. Porter’s Five Forces Model 6 3.2. International Competitive Environment 7 4. SWOT Analysis 9 5. Forward strategy recommendation for Harley-Davidson 10 6. Conclusions 12 6. References 13 1. Introduction This report is based on Harley-Davidson, Inc., case study. The aim of this report is to analyse industry and international competitive environment where Harley-Davidson is operating in. One must apply and fully analyse theoretical concepts and frameworks in order to fully comprehend how Harley-Davidson is differentiate itself in the international competitive environment and what strategies is using to achieve higher market share. The empirical material is being analysed by exploring the general information of Harley-Davidson company itself, following by the industry and competitive environment analysis, review of SWOT theoretical framework. Finalising with the recommendations of forward...
Words: 3108 - Pages: 13
...Low Like any automobiles, Harley-Davidson's industry requires large manufacturing facilities and equipments to enter. New Entrants would have to have a large amount of capital is start in this industry. Already established firms such as Harley-Davidson, Honda, Suzuki, Kawasaki, Yamaha, and Ducati have the advantage of brand recognition from all over the world. These companies also established customer loyalty, especially Harley-Davidson. This means that any new entrants trying to enter the industry have to spend tons of money in advertising and promotion to receive the same amount of brand recognition and customer loyalty that these powerhouse companies in this industry already have gained. With the lack of brand recognition and customer loyalty, retailers would be afraid to carry such product because of the risk it carries if it doesn't give you profit. Threat of Substitutes: Low Motorcycles are seen as leisure products and don't take much out of one's income. Some substitute items for a motorcycle is a motor scooter and dirt bikes. Customers will switch to the substitutes if price increases and purchasing a cheaper substitute will be the bette... Threat of New Entry: Low Requiring high capital investment to enter the business because of the scale economies in production, research, marketing and service of this industry is high. Brand Identification of Harley Davidson has been strongly established for...
Words: 2238 - Pages: 9
...CASE STUDY I.2 Manchester United: still trying to establish a global brand Manchester United (abbreviated as ManUtd, www.manutd.com) has developed into one of the most famous and financially successful football clubs in the world, being recognized in virtually every country, even those with little interest in the sport. Real Madrid has displaced ManUtd from the pole position in Deloitte’s football money league. The list, which has been running for the last 9 years, identifies the top 20 clubs in terms of revenue. The top five in 2008 were: Real Madrid with 3365.8 million, Manchester United (3324.8 million), FC Barcelona (3308.8 million), Bayern Munich (3295.3 million) and Chelsea (3268.9 million) (Deloitte, 2009). Having won the Premier League and Champions League in 2007/08, United would have overtaken Real Madrid at the top of the Deloitte Football Money League had it not been for the depreciation of the pound. The top 20 clubs now generate more than three times the combined revenue of the clubs in the first Money League publication in 1996/97. The most valuable US sport teams, the National Football League’s Washington Redskins and baseball’s New York Yankees, are both worth somewhat more but more than any US sports team, ManUtd has built a global brand. Since the mass commercialization of football in 1992, Manchester United has unquestionably been the team to beat. In the past 16 seasons, it has collected 10 Premier League titles, four FA Cups and two Champion League trophies...
Words: 8610 - Pages: 35
...they were first introduced to the riding public in 1998. With the development of the new Vision, a luxury touring bike, and the steady release of aggressively-styled cruisers, the company had continually innovated throughout its first decade in business. Yet Blackwell pondered the recurring questions facing Victory Motorcycles and Polaris. He wondered if the initial decision to diversify into heavyweight motorcycles was the right road to take. He realized Polaris took a big risk by moving into motorcycles and going up against the recognized powerhouses in the industry. He questioned if Victory could continue successfully competing against the Japanese giants, new energetic and innovative motorcycle companies, and their closest rival Harley-Davidson. Victory began making motorcycles in 1998. From 1998 to 2006 Polaris had invested over $100 million in motorcycle development and by 2006 the division was profitable for the first time. Victory sales were $113...
Words: 12306 - Pages: 50
...1 SH VIETNAM GROUP Product Analysis Report SH VIETNAM Pham Thu Trang – s3269619 Dinh Thi Huyen Huong – s3255419 Cao Huong Giang – s3275900 Nguyen Phuc Tuan Anh – s3259027 Nguyen Phi Hung – s3258221 Lecturer: Ellen McArthur 2 SH VIETNAM GROUP TABLE OF CONTENT Executive Summary ................................................................................................................................................................ 3 Introduction ............................................................................................................................................................................ 4 Company founder and its current status ............................................................................................................................ 4 The company’s principal products ...................................................................................................................................... 4 Major rivals and current situation ...................................................................................................................................... 5 Target Market and Positioning .............................................................................................................................................. 6 Primary target market for SH Vietnam ............................................................................................................................... 6 Potential...
Words: 4359 - Pages: 18
...1. Renault Duster Case Study 2. 2. Renault India • Renault came to India in 2005 in a JV with Mahindra and launched the Renault-Mahindra Logan • Within a short span of 5 years, Renault ended its JV with Mahindra and planned to strengthen its network in India by launching new cars by 2011 • Fluence became the first car launched by Renault in India • Expanded it portfolio by launching Koleos and Pulse • However, it was 2012 which proved to be a tipping point for the company when it launched its iconic compact SUV Renault Duster 3. 3. Dacia Duster • Duster was officially launched at the Geneva Motor Show, by the Romanian based Dacia group • Dacia is one of the Romania based automobile company founded in 1966 • It was later acquired by Renault in 1999 with an ambition to make Romania the automobile hub for Europe and Central Asia • Duster positioned as the ‘shockingly affordable car in Europe is considered as one of its most successful launch 4. 4. SUV Market in India SUV’s MUV’sVehicle Categories in India Renault’s Category Innovation Compact SUV A SUV that married the comfort of a sedan, to the rugged strength of a SUV 5. 5. Renault Duster “Made in India” • Globally sold as Dacia Duster, it was sold as Renault Duster in India due to higher brand awareness among Indian consumers for Renault • Globally positioned as the ‘shockingly affordable’ car it was re-positioned as ‘for the unstoppable Indian” • Highly Localized, carrying 60 per cent localized parts 6. 6...
Words: 1297 - Pages: 6
