Harley-Davidson Strategic Audit

History of the Strategic Audit Firm

            The genesis of the Harley-Davidson motorcycle can be traced back to 1903 in Milwaukee where the original founders Arthur Walter Davidson and Bill Harley developed a one-cylinder motorcycle (Gingerelli&Blattel, 2014). At the completion of the century, the world witnessed a new development in the motor industry; the gasoline engine.  Additionally, the one-cylinder motorcycle was initiated. The year 1901 was another remarkable year as far as the growth and development of the Harley-Davidson motorcycle was concerned. Indians are accredited for being the first to introduce motorcycles. In 1903, Merkel, Mitschell, and Yale followed suit. The motorcycles were initially developed for purposes of racing and were all powered by one-cylinder gasoline engine.

The company is accredited for building a one-cylinder motorcycle around 1903 in Milwaukee. The fully built motorcycle was not only beautiful, but also reliable. By 1905, the company had made remarkable progress in the development of motorcycles, considering the fact that by this time, they had developed a total of 11 motorcycles. By 1908, the number of vehicles that the company had produced rose to 154, compelling them to form a small company in a small wooden barn, which was initially built by the father of Davidson (Siegal, 2014).This small company grew and expanded speedily and as a result, William, who was another member of the company, joined them. From here, the company has made tremendous progress and it is now considered among the top motorcycle manufacturing companies globally.

Presently,Harley-Davidson, Inc. is a renowned company dealing in the manufacturingof motorcycles.  The company specifically manufactures designs, and markets motorcycles and the motorcycle parts, as well as its accessories. Additionally, the company offers retail and wholesale financing, as well as insurance programs to its esteemed customers and dealers in Canada and the United States.The company is also known for its extensive investment in e-commerce business through which the company offers accessories, motorcycle parts, and related services and products. The company’s products are often delivered through six platforms, including Dyna, Touring, Sportster,Softail, Street, and V-Rod.

Mission and Vision Statements Analyses

            The company is dedicated to satisfying dreams of individual freedom, which they not only consider their purpose, but also their passion to do so. The company it striving to foster commitment of unique customer experiences in everything they do right from their product innovation to their precision of their manufacturing (Harley-Davidson, 2016). The company has also heavily invested in their customers by ensuring provision of broadened motorcycle lines, services in certain selected markets, and branded products to the general public and cyclists.

The company is interested in nurturing happy clients to win their loyalty for life. The company’s vision describes them as an action oriented international company highly committed to developing good working relationship with its stakeholders. The company strongly believes that by empowering their employees and balancing their stockholder’s interest, their success is guaranteed. All in all, the company’s vision is to nurture an environment that can enable the company to maintain market leadership in California (Harley-Davidson, 2016).

Analysis of the Company’s Mission and Vision

The company’s vision read, “We fulfil dreams inspired by the many roads of the world by providing extraordinary motorcycles and customer experiences. We fuel the passion for freedom in our customers to express their own individuality” (Harley-Davidson, 2016). To begin with, any business organization willing to record success must extensively engage in the provision of value to its esteemed customers. Customers are highly interested on products that are of relatively high quality and would pay for any given amount (i.e., premium), provided they are assured that the goods and services offered are of high quality (Harley-Davidson, 2016).

There are a number of ways through which the effectiveness of the company’s mission statement can be evaluated. For instance, Andrew Campbell provided an evaluation method that could be used in the analysis of Harley-Davidson mission statement. Campbell specifically developed the Ashridge Mission Model, which is widely used in the assessment of the effectiveness of the company’s mission (Franzen, & Moriarty, 2009).  The model is documented below:

Figure 1: Ashridge Mission Model by Campbell


Based on the above model, it is clear that a good company’s mission should be able to integrate company values, strategy, examining the competitive position, company values, and finally, the standards and behaviour. These are considered pertinent elements that must be made part and parcel of the company’s mission. Therefore, in a scale of one through ten, the Harley-Davidson mission statement can be given a score of seven out of ten, a clear indication that the mission statement is superb, fully describing the business values and strategy of the corporation. Critical examination of Harley-Davidson shows that its culture of promoting extraordinary products, individuality, and customer service, has been accurately described.

Some have the opinion that firms having mission statements with unambiguous descriptions of the served customers, as well as technology used, often record a considerable growth compared to firms without such statements. As a result, a strong mission statement is critical in laying down a robust strategy, as well as building a culture that ensures that the set goals and objectives of the company are fully realised. In considering the effectiveness of the Harley-Davidson mission statement, I feel that there is no need to develop another statement and therefore recommend that the company should consider proceeding with the current mission.

Corporate Governance

Board of Directors (Harley-Davidson, 2016)

            The board of directors include:

  • Richard I. Beattie: He is a non-executive Chairman of the Harley-Davidson board of directors; R. John Anderson; besides being the chief executive at Levi Strauss & Co, he is also considered the former President; Michael Cave; is a former Vice President of an airline company by the name Boeing. He also doubles as the former Boeing Capital Corp. George H. Conrades is the Board Chairman. Donald A. James: is among the Co-Founder and a majority owner. Additionally, he is the CEO of FredDeeley Imports Ltd. Matthew S. Levatichis the CEO and the President of Harley-Davidson. Sara L. Levinson is the Director and also doubles as the Co-Founder. He is the former Executive, Clubmom, Inc. Thomas Linebargeris the Chairman and CEO, Cummins Inc. George L. Miles Jr, he is the Chairman Emeritus at Chester Engineers Company. James A. NorlingGlobalfoundries, Inc Board Chairman. JochenZeitz, The director, as well as Chairman of Sustainability Development Committee of Kering.


Senior Leadership (Harley-Davidson, 2016)

Matthew S. Levatich: He serves as the company’s President as well as the Chief Executive Officer (CEO). He had joined the company back in 1994 and is currently the CEO of Harley-Davidson. Levatich holds an undergraduate degree from the Polytechnic Institute in mechanical engineering. Additionally, Levatich holds a bachelor’s degree in marketing andas well as an MBA, organizational behaviour, finance, and engineering management from the University of North-western.

  • Joanne M. Bischmann; is the Vice President of communications. Bischmann is responsible for guiding communications for Harley-Davidson Motor Company, in addition to overseeing all the meeting and traveling services functions. Bischmann further plays the role of shaping the perceptions of stakeholders while at the same time creating advocacy programs through the so called targeted communication. This encompasses the entire external corporate communications and dealer, employee, shareholders, and supplies. Bischmann is also known as an innovative member of the leadership team of the company.
  • From the time Bischmann joined the company, she has served in different positions, including Director of Marketing, Promotions, Manager of advertising, and the Vice President of Licensing and Special Events.Bischmann graduated with a Bachelor of Arts in Communications from Colorado University.
  • Tonit M. Calaway; She is the Vice-President in the Department of Human Resources. And also doubles as the President ofHarley-Davidson Foundation. She has been tasked with the responsibility of supervising estimated 200 human resources employees across the globe, besides providing guidance in respect to compensation and benefits, leadership development, labor relations, and diversity. Having joined the company in 1998 as attorney, she is now tasked with coordinating all human resources issues. She graduated from the University of Chicago Law School and the University of Wisconsin.
  • Sean J. Cummings: Having joined the company in 2014, Cummings is currently serving as senior Vice President, Global Demand. As per his capacity, Cummings leads EMEA, Americas, as well as Asia-Pacific region teams. He is responsible for operations in the entire Americas. Cummings is also part and parcel of the Harley-Davidson leadership team. He currently holds a Bachelor Degree of Science from Wisconsin University and Masters in Business Administration from the North-western University, Kellogg Management School.
  • Lawrence G. Hund: Hund is not only the President, but also the Chief Operating Officer of the Harley-Davidson Financial Services (HDFS), which is a wholly-owned subsidiary of the company having joined the company in 2002.Hund holds a Certified Public Account, as well as a Bachelor Degree from Chicago University.Hund also holds a Masters Degree in Business Administration.
  • Paul Jones; Jones is the Vice President, General Counsel and the Secretary of the company (Harley-Davidson Motor Company). Besides serving as a member of the company’s leadership team, he also serves as a corporate officer. Jones has been tasked with managing Harley-Davidson Company’s legal department, in addition to overseeing the entire legal matters for Harley-Davidson. He also makes certain that the company ensures product integrity. Moreover, Jones serves as the company’s chief ethics responsible for ensuring that the set ethics are properly followed. Jones earned a Master’s in Business Administration from the school of Kellogg, a renowned management school. He is also a law student having graduated with an undergraduate degree from University of Wisconsin in political science.

John A. Olin: Olin is a Chief Financial Officer and at the same time senior Vice President atHarley-Davidson Motor Company. He is responsible for Financial Planning, Reporting, Treasury Tax, Information Systems, Investor Relations and Internal Audit. Olin joined the company in 2003. He holds a bachelor degree of science in accounting from the Indiana University. Additionally, he holds a bachelor’s degree in Financial Management from Chicago University.He is also a Certified Public Accountant and Associate Risk Management.

Michelle A. Kumbier: She is a senior Vice President of this company. She plays acrucial role in this company due to the fact that she is responsible for providing strategic oversight and direction while ensuring that the company’s products are available globally, including Parts and Accessories, Motorcycles, and the General Merchandise. She graduated from Lakeland College with a Bachelor of Arts in Marketing and Masters in Business Administration from University of Wisconsin.

External Environment: Opportunities and Threats



O1 Commonness of the Racing Bike 0.1 2 .2 Escalated Demand for company’s products leading to increased sales and profitability.
O2 Escalated Internet use by the youths .05 2 .1
O3 Relatively large market for young riders and women .15 4 .6
O4 Growth in the emerging markets .2 5 1
T1 The aging Population .15 5 .75 Reduced demand
T2 Future Market regulations .05 2 .1 Skewed profitability
T3 Seasonality of the motorcycle Market .1 3 .3 Reduced demand leading to reduced sales and profitability
T4 Reduced consumer’s purchasing power because of less disposable income .2 4 .8 Reduced product demand
  TOTAL SCORES 1.0   3.85  


            Analysis of the opportunities and threats of Harley-Davidson are relatively average. The rating of the company is 3.85 out of 5. Critical opportunities for the company include expansion overseas. Additionally, the market for young riders and women has tremendously opened up more opportunities for Harley-DavidsonCompany.For instance, India formed a prospective market making the company to expand its operations there.

            Despite the fact that the company has greater expansion opportunities, the threats are menacingto the future success of the company and need to be efficaciously addressed. Some of the pertinent threats affecting the company include the seasonality of the motorcycles, as weather significantly impacts sales. Besides the seasonality of motorcycles, the aging population is also a great threat impacting the success ofHarley both locally and internationally.Harley may employ the available opportunities to maximise its profitability while at the same time minimizing or lowering the threats in the market.

Internal Environment: Strengths and Weaknesses




S1 Widening loyal customer base .15 5 .75 Critical in boosting organizational profitability
S2 Stronger brand image .20 5 1 Enhanced sales and, thus heightened profitability
S3 Research and Development .10 4 .40 Boosting sales
S4 Striving to develop brand awareness .05 3 .15 Enhanced product awareness leading to escalated sales volume.
W1 Declining quality .10 3 .30  

Weaknesses negatively impacting profitability.

W2 Escalating Debt Burden .10 3 .3
W3 Marketing efforts in the past .15 3 .45
W4 Reducing cash reserves .05 2 .10
  TOTAL SCORES 1.0   3.7  

The internal strengths and weaknesses of the company listed in the above table can be described as being average. On the rating scale, the company is rated at3.7. The company’s strengths are muchstronger, and hence vital in the success of the company. A stronger brand image coupled with loyal customer base, based on the table above, is rated as the most critical strengths of the company. Despite the internal strengths, it is also significant to acknowledge internal weaknesses threatening to curtail the operations of the company, including the declining quality image. Though the company enjoys stronger brand awareness, it is prudent that the company place additional emphasis on their quality to further strengthen their brand because the declining quality is more likely to negatively impact the profitability of the company.

Analysis of Strategic Factors- Swot Matrix

            The strategic factors for Harley-Davidsonhave been rooted from the results of SWOT analysis documented in the external and the internal factorstable above. The strength, which are critical to the development of Harley-DavidsonCompany, include Research and Development, stronger brand image, and the widening loyal customer base. Admittedly, having a broader loyal customer base is critical in the success of a business organization.Additionally, stronger brand image is also critical because it attracts more clients into the business organization leading to increased sales volume, which later translates to higher profitability. Harley-Davidson should continue putting more effort to ensure that the company’s brand image remains stronger than before (Amason, 2011).

Minimising the weaknesses that the company is currently experiencing is also critical to avoid losing the organizational strengths that the company currently enjoy.  The escalating debt burden coupled with the declining cash reserves is a pertinent weakness that the company must be able to address in the best way possible.Declining quality is also a big threat that the company must address in good time if it is to maintain its current customer’s base. Customers are very sensitive to quality, and therefore, are likely to shift allegiance if the quality problem is not addressed sufficiently. Therefore, it is imperative that the above weaknesses are sufficiently addressed to maintain success in the market. Addressing the above weaknesses is critical to the future progress of the company.

            The expansive market for young riders and women is also critical to the success of the Harley Company and, therefore, the company must ensure that they adequately explore this market. Additionally, the company ought to consider expansion in other areas to attract more customers to widen its customer base.Expansion overseas is vital to realising increased market share and sales volume, which further translates to escalated profitability. Harley must ensure that these opportunities are adequately exploited (Amason, 2011).Some of the strategic threats that are threatening to bring the company down include the seasonality of the motorcycles and the aging population. The seasonality of the motorcycles implies that the profitability of the company will also be rendered seasonal. Additionally, the aging population is also threatening the company’s profitability.

Strategic Alternatives and Recommended Strategy

            The management of Harley-Davidson can adequately use the provided opportunities to widen its market share. The company can widen its operations overseas to expand its market because doing so will lead to increased sales volume, translating to higher profitability. Additionally, the company should intensify marketing to reach the population. The women and young riders also forma prospective market for Harley, hence the management must devise newstrategies to ensure that this targeted market is adequately exploited (Krauss).

To further solidify the market, re-engineering is necessaryto make the bikes unique and hence highly attractable leading to higher sales. The company’s stronger brand image is an added advantage that it can consider exploiting to successfully expand in the overseas market. The company ought to heavily invest in Research and Development. Research and Development is critical to ascertaining the market and the targeted customer’s needs, and then tailor the company’s products based on the market needs. Therefore, strengthening its opportunities and strengths and minimising on weaknesses and threats is critical in the future success of the company.

        Internal Factors



External Factors


Ø  Widening loyal customer base

Ø  Stronger brand image

Ø  Research and development

Ø  Striving to develop brand awareness





Ø  Escalating debt burden

Ø  Declining quality

Ø  Reducing cash reserves

Ø  Intensified market efforts


Ø  Commonness of racing bikes

Ø  Large market for young riders and women

Ø  Intensified Use of the internet by youths.

Ø  Growth in the emerging market





SO Strategies

Ø  Intensifying marketing activities towards women and young riders

Ø  Developing a stronger brand image for purposes of marketing the motorcycles

Ø  Focus on overseas market expansion.



WO Strategies

Ø  Focus on building quality image of Harley’s products.

Ø  Use the internet to market Harley’s products to attract large market.




Ø  Market regulations

Ø  The aging population

Ø  Seasonality of the motorcycle market

Ø  Reduced consumer purchasing power






ST Strategies

Ø  Intensify sales promotion and advertisement to loyal customers.

Ø  Develop a stronger brand image to concur the motorcycles sales seasonality.

Ø  Employ the use of lean manufacturing techniques to limit wastage and hence offer products at a relatively low cost to overcome the problem of reduced consumer purchasing power.

WT Strategies

Ø  Escalating the quality of motorcycles sold to do away with the risks associated with future regulations.

Ø  Lowering the cost of motorcycles to attract more customers, more so during recession.




Implementation of Recommended Strategy

            The ability of the above documented recommendations to spur positive organizational progress depends on the effectiveness of their implementation. An important recommendation made concerned expanding overseas to widen market coverage.  To implement this strategy, it is imperative that the company conduct a feasibility study to ascertain the efficacy of expanding in the said market.  Conducting a feasibility study can enable the company to ascertain the market gaps and needs to be able to eventually come up with the best strategy for entering the market (Verweire, 2014).

Heavily investing in Research and Development is also critical, in terms of addressing the weaknesses and threats that the company might be facing. Engaging in research and development will enable Harley-Davidson to come up with the best ways of addressing the threats and weaknesses affecting the future progress of the business. This strategy can be implemented by employing experts in this area who are able to effectively conduct research and come up with the best ways of overcoming the challenges that are impacting organizational progress.


            In conclusion, despite the fact that Harley-Davidson Company is on the right path to success, it is vital that it address its threats and weaknesses to guarantee its future success. For instance, declining cash reserves and escalating debt burden are significantly threatening the success of this noble company. With a broader loyal customer base coupled with stronger brand image, the company can be able to overcome its threats and weaknesses, and to maintain stronger sales with the implementation of efficacious marketing methods. Therefore, it is important that Harley-Davidson heavily invest in research and development to ascertain how the company can positively move forward.



Amason, A. (2011). Strategic Management: From Theory to Practice, U.S.A: Routledge.

Franzen, G., & Moriarty, S. E. (2009). The science and art of branding. Armonk, N.Y: M.E. Sharpe.

Gingerelli, D., &Blattel, D. (2014). Art of the Harley-Davidson motorcycle. U.S.A: Motorbooks.

Harley-Davidson. (2016). About Harley-Davidson. Retrieved from http://www.harley-davidson.com/content/h-d/en_US/company.html.

Harley-Davidson. (2016). Harley-Davidson Leadership. Retrieved from http://www.harley-davidson.com/content/h-d/en_US/company/leadership.html.

Siegal, M. (2014). Harley-Davidson: A history of the world’s most famous motorcycle. U.S.A: Shire Publications.

Verweire, K. (2014). Strategy implementation. U.S.A: Routledge.

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