Harley Davidson is a motorcycle industry that has been in operation since 1900’s. Even though its products were not yet familiar to many people, the company maintained the production of motorcycles. The company has gone through a number of challenges in its efforts to maintain a share in the market as well as producing goods that will be appreciated b y its clients. There has been a time when everything has been okay and the company was able to capture a substantial share in the market (Rafferty, 120). As the industry gained a lot of popularity among several other people, other companies that were producing similar products also came up. The company was hence experiencing a lot of competition which made its substantial share to reduce. During these early years, it was basically the only motorcycle company in United States. This hence meant that it had the back up f all the clients that were located in the United States. Such a monopoly was however not meant to last for long as the Japanese market entered into United States. It has since then not been easy for the company as the young people prefer to buy Japanese models rather than using the bikes produced by Harley Davidson.
The transformation process taken by Harley Davidson
The company has gone through various transformations from the time it was established up to lately. The transformations that have been experienced by the company were mainly to enable it adapt to the changes that are happening in the field of technology. There has also been a need for the company to counter attack the rising need of the motorcycles as well us maintaining its share in the market. The company performed pretty well till in 1970 when it almost went bankrupt. This was probably due to the fact that they had to produce more motorcycles even though they were not being bought at a similar grate. The company however managed to manoeuvre out of the situation and once more became a leader in US in terms of producing high quality motorcycles. The target market for bikes is the young people who are mostly below the age of forty. They take bike riding as fun ad the prestige of having a classic bike (Davidson, 58). According to the statistics tat were collected by the company, most of its consumers were aged below 35 years in the 1970’s. Things however changed when a similar research was done and it was revealed that most of the people that preferred the companies’ bikes were aged 47 years. His hence meant that the young generation had shifted their preferences from Harley Davidson bikes to other models of Japanese origin.
Comparison of Harley Davidson and Kawasaki
The main reason why Kawasaki was preferred over Harley Davidson’s models was because of its weight. The Kawasaki is lighter in weight and hence preferred due to their convenience. This served as a big lesson to the company as they realized that it did not matter how successful they were in the best. They still needed to work extra hard so that they gain a competitive advantage over their competitors. Times had changed drastically and it was not like in 1918 when the company was the best performing motorcycle company (Girdler, 90). The company has been up front in making improvements in the field of research and development. This ensured that the kind of products that were produced were reliable and also of high quality. The company was basically the only U.S manufacture and hence enjoyed monopoly.
The Kawasaki model compared to Harley Davidson has a reliable break system which can enable the rider to cruise anywhere with it. The passenger seat is also comfortable which is considered as best among the other seats. According to Held & McGrew, “The Kawasaki has 1552cc engine liquid-cooled with overhead cams that are fitted with four valves per cylinder compared to the Harley’s pushrod valve operation that has two valves in each chamber of combustion and hat it also has transmits power of five-speed to a shaft final drive compared to the Harley’s belt” (24). Held & McGrew also asserts that, “the bike uses adjustable shocks that are to suspend its rear end which is located alongside the rear wheel compared to the Harley Softail frames which are hidden under the bike, there is also a huge difference in price which is a ccontributing factors to the success of the company” (26).
Despite the challenges that the company has had to go through, there is certain credibility that the company deserve. The company has been in operation since 1903 yet it is still in the market. One thing that can be credited to its success is the investments that have been done in the field of research and development (Rafferty, 79). The company understood that unless in invests in this field, then it will be difficult for them to retain a share in the market. The company has been diligent in ensuring that modern technology is fitted into their systems. The management of the company employed measures that were aimed at ensuring that the needs of their customers were met. The company has had dedicated leaders who have never taken anything for granted. Despite the challenges that the company has had to go through, they have remained focused and optimistic that things will work out well. They have come together to identify a strategy that will ensure that the situation is out of control. The company maintained its line of production which made most of their loyal customers to keep coming for more.
The company has been open about its progress to their customers which in turn made them to trust them. When the company was not fairing on well, the company opened up to its customers but assured them that things will be okay. This was a clear indication that the company recognizes its customers as their big partners. They did this with the aim of deriving some advice from them which can make the company pick up. Most of the customers of the comp any are traders who are in close connection with their final consumers. They were hence regarded as a people that new more about what their customers needed and their advice would be helpful to the company. Their customers have been a big support to them without which they would not have gone far. In the season when the younger generation was going for the Hondas while the older generation still came back to the company for their products. The change in the age group of the customers that bought the motorcycles of the company revealed that there were loyal customers that grew with the products of the company. They had developed such a trust in the company that even the influx of the seemingly better motorcycles could not deter them from going back to their trusted ones.
Another aspect that has contributed to the success of the company is the fact that they are willing to learn. The management has displayed an attitude of willing to learn from their counterparts with the aim of wanting to correct on their wrongs. When the Japanese motorcycles were gaining a lot of popularity in United States, the company sought to find out why they were dong well in the US market. The company reached a point when it had to admit that they were loosing their customers. Before they faced such competition, the company assumed that everything was okay and probably they did not need to learn anything from their counterparts. The competition however served as an eye opener which revealed to them that they needed to improve on their management skills. One of the lessons that they learned was not to concentrate on quantity but quality. On their visit to one of the companies in Japan, they realized many things which were a clear indication why they were not performing well. The company came back with a willingness to change for them to capture the market back.
The company has been dealing in a unique model of motorcycles which it maintained for a long time. Their motorcycles are heavy weight while those of Kawasaki, Suzuki and Honda are light weight. Despite the fact that the younger generation preferred the lighter motorcycles, there were a group of people that preferred the heavy models. This hence made the company to retain a good number of customers. The company did not choose to compete with the other models by producing similar bikes. It was this uniqueness that was adapted by the company that made it to retain a share and hence performing well. The company’s uniqueness was so much celebrated that a Japanese company decided to compete them on the same. Instead of producing the light weigh motorcycles, the company started producing the have weight ones. This was a clear prove that not all customers loved the light weight bikes; the heavy ones had a bigger capacity to handle fuel. The company bikes were also being used by the police and other models which made people do have a positive attitude towards them. It enhanced the picture of the company and the quality of products that they produced.
Contributing factors to the failure of the company
One of the most contributing factors of the failure of the company was the high competition it experienced from the Japanese models. Until when the Japanese models gained popularity in US, the company was performing well. The people of America had the bikes as their only alternative but when they saw the Japanese models, their attitude changed abruptly. The company remained only with their older customers who formed a smaller portion of American bike lovers. Bikes were mostly loved by the young people and hence the older ones that the company remained with could not earn then a substantial income. The company was also not willing and ready to counter attack the competition by producing lighter motorcycles. It is usually expected that when a certain product is being preferred over the ones that are being produced by the company, they should adapt similar ingredients so that they effectively suit into the competition. The company however maintained their style of bikes which made the younger generation that was hungry for change go for the Hondas.
The company was using a production mechanism that made it to suffer heavy losses. It was mainly engaged in quantity production without necessarily considering the future trend of the market. Probably the company though that the more bikes it has, the more people will be attracted to them, and this was however disapproved when the people showed their preference for other models and hence making their stock to move at a slower rate. Most of its capital had been invested in the production of the bikes which were now not selling (Mitchel 48). This hence meant that the company did not have an operating income that would enable them to pick up. The company mostly relied on the income from their bikes for their continued production and when there was slow movement, they basically had no activity to be involved in. the company also compromised on the quality of the bikes that they produced. This was done with the aim of counter attacking on the competition that it was receiving. The company had already lost a lot and was looking for an urgent means out of the situation. The option that remained was to use the lesser facilities that they have to produce more bikes. When it was discovered that their bikes were of low quality, the situation was worsened and the company lost most of their customers. The company mainly invested in high productivity without having to think about how the same will have an impact on the reputation of the company. There was nothing much that the company would have done to prove to its clients that their products were of good quality.
The failure of the company could also be attributed to the fact that there was poor organization of its products. This was revealed when the company visited a similar company in Japan that was doing comparatively better then Davidson. The organization of their products was enough to attract more customers their way compared to the company which had almost everything in one place. Whenever a client visits a shop they expect to find some commodities neatly arranged on the shelves which will form a basis of their attraction. This may be one comparison that their customers made even as they visited the Japanese showrooms. The arrangements of the products lured them to make purchases and were hence not attracted to go back to Davidson. When the company visited such companies they were amazed and shocked of how they had organized the parts of their products. Their showrooms were also less congested as they produced bikes according to the orders that they received from their clients.
Compared to similar Japanese products which engaged in production after receiving orders, Harley Davidson engaged in high scale production without receiving prior orders for the same. This hence made the company to suffer losses when their products were not purchased. Before engaging in mass production, a company should have analyzed the market ad seen the possibility of the products performing better (Held, 35). Failure to predict and plan the future may render the production useless which may make the company to sell the products at a cheaper rate. The company failed to realize that there would be a lower demand for its products due to their immergence if the Hondas. Being the main company in the United States may have made that company think that I will still benefit from the young generation whom the love for bikes was growing more and more. The company should have involved the assistance of an economist who would have advised them accordingly. They would have been informed to make wiser decision and hence making the necessary preparation.
Another contributing factor to the failure of the company is the fact that it had enjoyed monopoly for quite sometime. The company was hence in a comfort zone also considering than there was no other American company engaged in the production of motorbikes. The company was hence feeling comfortable in many areas ad hence not bothering to make some of the expected changes and improvements. The invasion of the Japanese bikes into the market may have caught the company by surprise. The minimum time that they had was not adequate for them to employ measures that would put the situation under check. It was also a time when the company had also invested in mass production yet the people had changed there interests for their bikes. The company hence lacked a mechanism of adapting to the situation faster and hence suffering the losses. If there was another similar company that was giving it competition may be the company would have known how to respond. Their response towards the same indicated how inexperienced they were in relation to managing competition. They had to learn everything the hard way which was quite hectic for them.
The biggest hit on the company that made it even loose the little it had was when the Japanese company imitated their product. The company had maintained its production of heavy weight bikes which some group of people loved. The company decided to also invest into the production o similar bikes that were being produced by Harley Davidson. This therefore meant that the uniqueness that was distinguishing the company from the others was taken away, making it having nothing unique to present. The company could have earlier on though of patenting their models so that they are protected from duplication. This was something they probably did not think of and thought that no other company would engage in such similar production. If the model had been patented, the company would have sued the Japanese company ad seek legal address. Since there were no such prior arrangements, the company had to suffer losses due to such tight competition.
Recommendation for the company
Considering the hustles that the company has had to go through to maintain some share in the market, it needs to apply some mechanisms that will enable it to attract and maintain more customers. Being an automobile industry there is still hope which can make the company to regain its previous prestige. The company should first consider its performance in the current market to see if it can manoeuvre through. The company should always look out for certain changes in the market and implement the same. If the company has tried up on something that seems not to work out, it would be better if it gave up on the same and adapt a different style that would work for them. There times when a certain line of production may not work well for the company and hence raising the need for it to adapt a new style. The company should also consider adapting a new management style which will enable it to perform better.
In case the company makes a new invention that it desires to apply, they should patent it to protect it from any kind of duplication (Dregni, 67). The market has become very tight and the competition very real. There are currently a number of companies that are looking out for new idea and features that will enable it to perform better. Any idea that has not been legally protected could easily be adapted by another company which may probably implement it before the other company does it. This is hence likely to cost the company a lot if appropriate measures are not taken. It is also important for the company to be involved in extensive market research. This will enable it to ascertain the current needs of the customers and hence adapting to the same. Market research will also make the company to be in direct contact with the customers and hence being able to know what they want and what they don’t want. They will be able to ask questions and receive clarifications on what was not clear to them. Having a direct contact with the customers will enable the company to produce what they want.
The company should also work hand in hand with other companies that are performing better to ensure that they benefit from their expertise. Technology is growing at a higher rate which requires the company to grow at a similar rate. This will require it to employ workers that have such technical expertise. This will however not mean that the company gets rid of its current workers; they may also be trained to ensure that they are at oar with the current developments in technology. The company will on the mother hand need to invest more in the field of technology to ensure that their products are of modern inventions. It may require the company y to make extra investment which may cost them much. However as long as the investments will earn the company a substantial income, they should go for it. In considering the kind of investment to make, the company should consider the log term benefits rather than the current costs. Considering that the Japanese companies are performing better, the company should consider getting its machineries from the country. This will ensure that the company maintains a substantial share in the market.
Harley Davidson could not be the only company that has had to face such stiff competition from foreign companies. Influx of foreign goods into the market has coasted a lot on domestic companies. The younger generation tends to prefer foreign products as they consider them to be mire classic and of high quality. There is a prestige that the people derive from using foreign products which makes tem have a competitive advantage. The only thing that can make domestic companies beat the competition is to raise their standards. They should also be on the look out to find out why the other products are performing better among consumers that they have had for long (Rafferty, 68). A part from their foreign nature, there could be something else that makes such products to be loved by the people. They should hence try their best to ensure that such features are included in their products. Several governments have assisted their domestic companies from invasion by minimizing on the influx of foreign products. This has been a procedure which is considered in cases when the country wants to promote internal trade.
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Held, David & McGrew, Anthony. Globalization/anti-globalization: beyond the great divide. London: Polity, 2007.
Mitchel, Doug. Harley-Davidson. London: MBI Publishing Company, 2007.
Rafferty, Tod. Complete Harley Davidson: A Model-by-Model History of the American Motorcycle. Crestline Imprints, 1997.
Rafferty, Tod. Harley-Davidson: the ultimate machine. New York: Courage Books, 2002.