Harley Davidson Case Essay

Business Case Discussion Case 3.1 - Harley Davidson

1. Company information - organization’s size and structure, its products or services, sales and financial results, etc. (at the time of case and currently, if available).

Startet in 1903 by Will Harley
IPO in 1986
Selling motorcycles (around 150k sold units in 1998)
6,000 employees and 600 independently owned US dealerships
Located and operated out of the US
Operates internationally - dealerships in 67 countries
Revenue in 1998 → 2,1 billion USD
Gross Margin in 1998 → 690 million USD
Net Income in 1998 → 230 million USD

2. Industry information – identify relevant industry information at the time of case, names of its most important players/competitors, etc.

Harley is competing in the heavy Motorbike industry
Competitive, main competitors are Japanese manufactures such as Honda, Yamaha, Suzuki and Kawasaki.

3. Overview of the situation described in the case, including any managerial, organizational, or technical factors pertinent to the situation being analyzed.

Focusing on long-term supplier relationship rather than vendor transactional one
Harley wants to implement a new ERP system and needs to choose an applicable partner
The overarching business goal is to improve the efficiency of the purchasing department by introducing an IT system that allows the Purchasing Department to better communicate with suppliers

Organizational structure has collaboration across departments
The committee is formed from representatives from each department in order to have a whole company decision on the ERP system

4. Verbal “presentation” by assigned group/team members (from their seats) of the response to the case question(s), and supportive rational. Team members should allow/promote open class interaction:

Q1: Discuss Harley's organizational structure and the role of its purchasing department in this self-directed team environment.

Organizational structure
Consist of three interlocking circles:
1. Create Demand (CDC) - Sales and Marketing
2. Produce Products Group (PPG) - Development and Manufacturing
3. Provide Support (PSC) - Legal, Financial, human resources and communication
Circles were heading by standing committees or circles of leadership
The Purchasing Department is part of the PPG
A leadership and strategy council, comprised from executives from each group provided oversight of the circles to ensure that an integrated vision of corporate direction was maintained
3 people shared the CIO position. Each represented a department/circle to make sure that all needs are met.

Role of its purchasing department in this self-directed team environment
A self-organized, semiautonomous small group of employees whose members determine, plan, and manage their day-to-day activities and duties under reduced or no supervision. Also called “self directed team” or self-managed natural work team. The Purchasing Unity Group composed of purchasing managers representing the different Harley sites + members representing the companies Maintenance, Repair, and Operations
All the purchasing managers had different methods for purchasing
Systems had be customized to meet specific needs of local sites
Decisions are made in the Purchasing Unity Group
If the supplier relationship went well, everything else would run smoothly. The strategy was to focus on purchasing as a foundation of the success of the company.
Role:
Ensure quality and functionality of purchased parts and that they were on-time
Communicate with sites to make sure they have what they need
Meet expectations of other departments
Can make decisions about IT investment and process improvement

Q2: Highlight

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