Harley Davidson Case Analysis
In 1903, William Harley-Davidson, Arthur Davidson, Williams Davidson, and Walter Davidson started Harley-Davidson in a 10x15 shed in their backyard in Milwaukee, Wisconsin. Production started with three motorcycles in 1903 and increased to 8 in 1908. In 1969, AMF Incorporated acquired Harley-Davidson Motor Company and expanded capacity from 15,000 to 40,000 motorcycles. Harley-Davidson, Incorporated was formed in 1981, when it was purchased from AMF Incorporated in a management buyout. In 1986, Harley-Davidson, Incorporated became a publicly held company. The new management installed a just-in-time inventory system to reduce inventories and improve total quality. With a new quality focus Harley-Davidson began to invest heavily in research and development. In one year the new Harley-Davidson management reduced the break-even point by 18,000 motorcycles. Management's focus on efficiency in production and improvements in quality resulted in increased demand and a production capacity of 100,000 motorcycles in 1995. Harley-Davidson operates in two segments Motorcycles and Related Products, and Transportation and vehicles segment. Total net sales for the first nine months of 95 were $1.3 billion, an i
Furthermore, the company adopted just-in-time inventory principles to minimize inventories of raw materials and work in process. By forming close partnership like alliances with a few quality conscious suppliers, Harley has been able to successfully implement the just-in-time inventory system. Harley frequently holds "in-house" training sessions, and plant evaluations with its key suppliers to ensure that suppliers share the same commitment to quality and production efficiencies. Overall, the new system has allowed Harley to react quicker to engineering design changes, quality improvements, and marketing demands within its existing manufacturing facilities. Although the close relationships with suppliers, and reliance with only a few key suppliers has been successful so far, there is a risk of significant interruptions in production if a particular supplier failed to provide the needed materials, or ceased operations. This gives the suppliers a relatively large amount of bargaining power, and is something Harley should be keenly aware of. · Gain entry in to the performance motorcycle industry and increase the sales of the newly acquired Buell Motorcycle Company. · External members consist of William F. Andrews, Richard G. Lefauve, William B. Potter, and Richard J. Herman-Taylor · Increase international market share by increasing the number of foreign dealers and improving the foreign channels of distribution.
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Approximate Word count = 11534
Approximate Pages = 46 (250 words per page double spaced)
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