Business Policy and Strategy: Harley-Davidson Case Study Analysis

This case study analyzes Harley-Davidson's business policy and strategy, focusing on its response to the 2014 recession and shifting demographics. The report examines the company's adoption of a focused differentiation strategy, its long-term business strategy, and product development strategies. It explores the challenges faced due to financial turmoil and an aging customer base, including declining sales. The analysis highlights how Harley-Davidson restructured its business operations, improved manufacturing processes, and shortened product development lead times to enhance profitability and expand its customer base, including strategies implemented to overcome the recession. The document concludes by summarizing the effectiveness of these strategies and their impact on the company's market position.

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BUSINESS POLICY AND STRATEGY

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Contents
Introduction......................................................................................................................................3
Corporate Strategies adopted by Harley Davidson to enhance profitability and productivity........4
Analyze of focused differentiation strategy.....................................................................................4
Issues and challenges faced by the Harley-Davidson due to the financial turmoil and shifting
demographics...................................................................................................................................5
Analysis of Harley-Davidson’s strategic plan.................................................................................5
Conclusion.......................................................................................................................................7
References........................................................................................................................................8

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Introduction
Harley Davidson is an American motorcycle manufacturer, founded in 1903 by William
S. Harley and Arthur Davidson. Harley is one of the largest motorcycle manufacturers in the
world. It has headquartered in Wisconsin, U.S (Harley Davidson, 2018). Companies adopt
different type of strategy depending on the problem. Based on the case study, the report will
explain the several strategies made by Harley to overcome from the problems of recession and
financial challenges (Harley Davidson, 2018). It will explain the long-term business strategy and
product development strategy of the Harley Davidson that was used by the company during
recession. Further, the discussion will be carried on the challenges faced by Harley due to the
ageing customer base in US. To overcome from this problem, the focus differentiation strategy
has been analysed that benefitted the company to target its customer base. At the time of
recession and financial turmoil, the company suffered a huge loss. In order to overcome from
this problem, Harley made a strategic plan that will be focused in the report.

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Corporate Strategies adopted by Harley Davidson to enhance profitability and
productivity
In October 2016, Wandell announced a long-term business strategy which is referred as
"Delivering Results through Focus" to handle the recession in the economy and to enhance the
profitability and productivity. The vital component of this approach was to accelerate growth by
concentrating on the power of the Harley-Davidson trademark and to improve development in
the business and manufacturing concerns for continuous growth in the long-term. Through this
strategy, the company restructured the business focusing on their investment in such a way that
will help the company in strengthening their brand, to foster the continuous improvement, and
lower their cost (Catulli, Cook, & Potter, 2017). In 2014, with the onset of recession in the
economy, the company launched the strategy whose objective was to enhance the profitability
and productivity through improvement in their business operation.
The second strategy that Harley Davidson has adopted is product development strategy,
which focused on the continuous improvement across the organization processes (Siegal, 2014).
Harley Davidson adopted this strategy in order to manage challenges that will occur in the future.
Analysis of focused differentiation strategy
In 2014, the ageing customer base and economic recession proved to be a huge decline in
Harley’s sales. In order to alleviate this problem, company launched a long-term business
strategy to overcome from the recession period and increase the brand loyalty.
In this strategy, Harley Davidson focused on improving profitability and productivity by
improvement in manufacturing process. In the manufacturing process, Harley made the
significant changes to make the products according to the customers demand. At this time,
Harley focused on specific group of customers by offering them customized product. Besides
this, Harley put emphasis on reducing the product development time so that customer demand
can be fulfil in shorter time duration. With the reduction in timing for product development, it

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extended the customer base globally. This strategy helped the company in increasing the sales of
motorcycle in 2017. Harley was successful in getting through the recession by adopting this
strategy. In spite of overcoming from the problem of recession, it also helped the company in
building its reputation in the market in long run.
Issues and challenges faced by the Harley-Davidson due to the financial turmoil and
shifting demographics
In 2014, the demand for Harley’s motorcycle decreased, due to economic downturn. This
affected the growth of the Harley because people were not willing to spend money on luxury
items that time (Seeaner et al, 2016). There were only few purchasers of their products, which
was the major challenge Harley was facing to increase its customer base. Due to this downturn,
the revenue of company decreased by 2.3%, that was the major fall for Harley Davidson. Besides
this financial downturn, the sales of the company felled more by 7%.
The business of Harley in US was not success due to its demography. The most of the
people in US is aged. The major challenge for the company was its aged customer’s base. The
majority of the customers who were from the baby boomers were aging (Sizemore, 2013). In
this case, it was the major challenge in front of Harley is to fascinate those young riders, who
favoured their sports bikes.
Analysis of Harley-Davidson’s strategic plan
Due to the recession and demographic changes, the sales of Harley affected too much. To
recover from this situation, Harley segmented the market according to the needs of the
customers; this helped Harley in bringing back to its previous position. In the competitive
market, it is essential for the company to target the market. At this stage, Harley adopted focus
differentiation strategy in which it targeted specific customers in the target market.
When the needs for the product changed in market, Harley focused on heavy
customization to fulfil the needs of the customers for luxury item (Basin, 2017). Harley was

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facing threat from the recession and changing customer’s expectations. The economic situation
in various countries was not fruitful, due to which Harley was facing decline in their growth. The
focus differentiation strategy with long-term implementation proved to be positive in increasing
the sales and get through the situation of recession. By implementing focus differentiation
strategy, it is able to attract various new customers for the Indian market as well.
The biggest weakness of the Harley was in its pricing system. The higher prices of Harley
products were negatively affecting the company. Besides this, it was not paying attention on the
increasing number of female riders. Due to this, the company suffered 90% loss. In order to
recover from these situations, company focused on its manufacturing processes that helped the
company in increasing its sales (Grademiners, 2018).

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Conclusion
Through the above discussion, it can be concluded that Harley Davidson is the best
manufacturing company in the world. The corporate strategies made by Harley Davidson were
fruitful in the company at the time of recession. Product development strategy of the company
proves to be successful in meeting the challenges in future. Through the implementation of focus
differentiation strategy, company focused on specific group of customers with customized
product that resulted in attracting many customers. It was successful in fulfilling the customer
needs within shorter time duration through this strategy. Although the company has faced
problems due to the changing demographics and financial turmoil but the company was
successful in meeting these challenges from its strategic plan.

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References
Basin, H. (2017). Marketing Strategy of Harley Davidson – Harley Davidson Strategy. Retrieved
from: https://www.marketing91.com/marketing-strategy-of-harley-davidson/
Catulli, M., Cook, M., & Potter, S. (2017). Product service systems users and Harley Davidson
riders: The importance of consumer identity in the diffusion of sustainable consumption
solutions. Journal of Industrial Ecology, 21(5), 1370-1379.
Das, K. K., & Ara, A. (2014). 'Harley Davidson'Success Speaks-Brand Image and Culture: An
HR Perspective. Bonfring International Journal of Industrial Engineering and
Management Science, 4(2), 48-56.
Grademiners. (2018). Strategic plan of Harley Davidson. Retrieved from:
https://grademiners.com/free-papers/managment/strategic-plan-of-harley-davidson
Harley Davidson, (2018). History of Harley Davidson. Retrieved from: https://www.harley-
davidson.com/us/en/museum/explore/hd-history.html
Seeanner, J., Brooks, J., Mossey, M., Jenkins, C., Venhovens, P., & Truesdail, C. (2016). The
Riding Habits and Technology Use of Aging Motorcycle Riders. Retrieved from:
https://www.sae.org/publications/technical-papers/content/2016-01-1440/
Siegal, M. (2014). Harley-Davidson: A History of the World’s Most Famous Motorcycle.
London: Bloomsbury Publishing.
Sizemore, C. (2013). Blame Harley-Davidson's Downfall On Baby Boomer Demographics.
Retrieved from: https://www.forbes.com/sites/moneybuilder/2013/11/13/harley-
davidsons-downfall-baby-boomer-demographics/#6fc46a28751d