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Case Study Presentation Harley Davidson Conducting Business Electronically Presented By Najam us Saqib [BT Case Study Presentation Harley Davidson Conducting Business Electronically Presented By Najam us Saqib [BT – 02 – 01] Shoaib Javed [BT – 02 – 24] Ghazal Zaheer [BT – 02 – 44] Ahtasham Rizvi [BT – 02 – 47] BBA – IT (6 th Semester) 2002 – 2005 Institute of Management Sciences BZU - MULTAN

Introduction To Harley Davidson Mission & Vision Statements Time Line (The Ups & Downs) Introduction To Harley Davidson Mission & Vision Statements Time Line (The Ups & Downs)

Mission & Vision Statements • Mission – We fulfill dreams through the experience of Mission & Vision Statements • Mission – We fulfill dreams through the experience of motorcycling, by providing to motorcyclists and to the general public an expanding line of motorcycles and branded products and services in selected market segments • Vision – To continuously improve our mutually beneficial relationships with stakeholders (customers, suppliers, employees, shareholders, governments and society) 3

Company Profile • Works harder to build genuine relationships with their customers • Has Company Profile • Works harder to build genuine relationships with their customers • Has created loyalty through a pattern of steadfast interactions with its customers • Reinvents the customers’ experience in ways that would strengthen the sense of affiliation that the customer has with the products and services • Our values are the heart of how we run our business – Tell the Truth – Be Fair – Keep Your Promises – Respect the Individual – Encourage Intellectual Curiosity 4

Company Profile • Since going public in 1986, Harley has increased earnings at an Company Profile • Since going public in 1986, Harley has increased earnings at an average annual rate of 37 percent • Without the shadow of any doubt, HARLEY DAVIDSON is a brand that has achieved cult status and outstanding financial performance • That's what makes the story of Harley-Davidson so interesting. We want to know how they got there. And the answer is not in one story but in three. 5

The 3 fascinating Stories! • Beginnings & Survival – 1903: William Harley & Arthur The 3 fascinating Stories! • Beginnings & Survival – 1903: William Harley & Arthur Davidson started the company [ output only 1 Motorbike ] – 1909: introduced its trademark bike; a 2 cylinder, v-twin engine (the fastest motorcycle at that time) – 1910: Sold 3200 Bikes [since 1903] – 1917: brought World War I to the United States and Harley sold twenty thousand motorcycles to the U. S. Army 6

The 3 fascinating Stories! • Beginning & Survival (cont. ) – 1920: Depression in The 3 fascinating Stories! • Beginning & Survival (cont. ) – 1920: Depression in economy hit everybody hard but it devastated motorcycle companies • Two companies, Harley-Davidson and an Indian, manufacturing motorcycles in the United States survived. [Total motorbikes sold that year total 6, 000 ONLY] – 1939 To 1945: World War II revitalized Harley's fortunes. The company sold almost 100, 000 of their WLA model to the US military – 1947: Introduced the classic black motorcycle jacket. It was the start of the Wild One Era and Harley's second story 7

The 3 fascinating Stories! • The Wild One Era – 1947: That same year The 3 fascinating Stories! • The Wild One Era – 1947: That same year a gang of motorcyclists rode into the town of Hollister, California and simply took it over (On Harleys). The police lost control and the motorcyclists ran amok. Even the law could not stop the two-wheeled warriors. – 1962: Honda began importing its smaller and light motorcycles into the United States • And stated: Our bikes are for the nice people, not outlaws. They told their story in one of the most effective advertising campaigns of all time, "You meet the nicest people on a Honda. " – 1969: American Machine and Foundry (AMF) bought Harley • Those days, managers believed that they could manage any kind of company even without knowing much about the business. That's where third story begins. 8

The 3 fascinating Stories! • The Near Death Experience – Competition was hurting sales The 3 fascinating Stories! • The Near Death Experience – Competition was hurting sales and the Harley was in hands of immature management. Harley faced bad quality management – 1981: 13 senior executives of the Harley-Davidson Motorcycle Company signed a letter of intent to buy the company from AMF – The company then put in a restructured plan, incorporating management principles adopted from the Japanese, new marketing strategies, and manufacturing techniques [That’s where things started getting changed] 9

The 3 fascinating Stories! • The Near Death Experience (cont. ) – 1983: Harley The 3 fascinating Stories! • The Near Death Experience (cont. ) – 1983: Harley introduced the Harley Owners Group (HOG) – 1986: The company went public – 1987: Got listed in New York Stock Exchange – 1995: Jumps into E - Business – 2000: Re-established independence from AMF – Today, Harley has not only improved quality and won the long battle to regain its market share but has also achieved cult status with customers – Their customers simply think it is not only the greatest motorcycle in the World but the greatest vehicle 10

The New Business Model Change in Business Methodology H-D in E – Business: The The New Business Model Change in Business Methodology H-D in E – Business: The Success Continues Financial Performance

Restructured Business Model • BANKRUPTCY KNOCKS! – Transformation is the Answer! • Restructuring Plan Restructured Business Model • BANKRUPTCY KNOCKS! – Transformation is the Answer! • Restructuring Plan by CEO Richard Teerlink • Extending the Plan- jumping into E – Business • Major objectives of the E – Business dimension – Solving warranty claims problems – Employ Direct Marketing Strategy – Gathering 1300 dealers on a single platform [ B 2 B ] – Moving with time: Adopting new technologies [ Proactive EC ] – Customer Relationship Management 12

Transformation: E - Business • Revolutionized marketing procedures • Gained company good will by Transformation: E - Business • Revolutionized marketing procedures • Gained company good will by fulfilling customers’ warranty claims – Previously claims handling took more than a week – Now only 2 days • Helped to refine Manufacturing Process [JIT] • Helped in cutting down the Marketing and Operational costs 13

E - Strategy • Diverse features and services on its website • Efficient on-line E - Strategy • Diverse features and services on its website • Efficient on-line purchase – Purchase! round the clock, round the globe – HD Credit Card – HD online memberships • Universal client capability • Building an HD culture by creating community of customers And all this contributed to pull through the leader position of Harley-Davidson in Bikes industry 14

EC Benefits: CRM • Customization & Aftermarket – Every Harley bike is extensively designed EC Benefits: CRM • Customization & Aftermarket – Every Harley bike is extensively designed keeping in view the ideas, requirements and enthusiasm shown by the consumer – HD always wanted customer to get involved in product design that gives consumers a sense of individuality and freedom of expression • Pride & Proximity – HD community gives customers a sense of pride – Sending Gifts to the strengthen relations and friendship – HD Gatherings & Events • Customer E – Loyalty – CRM basically enabled the company to grasp the individuality of customer in much more easy and efficient manner a reason to stay loyal to HD 15

EC Benefits: Financial Growth Sales Net Income -Notice the slope of 1985 – 1995 EC Benefits: Financial Growth Sales Net Income -Notice the slope of 1985 – 1995 and 1995 – 2005 -Harley made debut to E – Business in 1995 -Reduction in Operating and Advertising expenes 16

HD Relations: Investors Stock Price Stock Split Info H-D vs. S&P 500 Stock Tracker HD Relations: Investors Stock Price Stock Split Info H-D vs. S&P 500 Stock Tracker Stock Lookup Financials Annual Reports Financial Statements SEC Filings Capital Expenditures Financial Factbook 17

HD Services: Career Development 18 HD Services: Career Development 18

HD Services: Rentals & Tours 19 HD Services: Rentals & Tours 19

HD Culture: Events & Racing 20 HD Culture: Events & Racing 20

Business to Business • HD Authorized Dealers – The symbiotic relationship – HD provides Business to Business • HD Authorized Dealers – The symbiotic relationship – HD provides the virtual interface of dealers while dealers provide the physical interface of the company – HD has gathered 1300 dealers under the umbrella of one HD site – From becoming a dealer to being a triumphant dealer • Major Buyers – The Fire & Police Department buy HD fully loaded bikes in bulks, customized according to their operational requirements. – Special POLICE and Fire Fighter accessories • Speed Guns • Sirens • Special Lights • Speed Boosters – A real need while on an emergency mission • Fire Extinguisher 21

Harley Davidson: Police • The Law Enforcer! • Catch the bad guys out there Harley Davidson: Police • The Law Enforcer! • Catch the bad guys out there in streets! 22

Harley Davidson: Fire Fighters • Help protect from Fire! 23 Harley Davidson: Fire Fighters • Help protect from Fire! 23

Harley Davidson: Cop Training • Training the Cop for perfection! 24 Harley Davidson: Cop Training • Training the Cop for perfection! 24

Products & Accessories Harley Dream Bikes Harley Motor Clothes Merchandise Products & Accessories Harley Dream Bikes Harley Motor Clothes Merchandise

Products & Accessories • Five categories of Dream Bikes – Sporster – Dyna – Products & Accessories • Five categories of Dream Bikes – Sporster – Dyna – VRSC – Softail – Touring 26

Harley Davidson: Sportster • The ULTIMATE FUN! • Lighter and Sportier than most Harleys Harley Davidson: Sportster • The ULTIMATE FUN! • Lighter and Sportier than most Harleys • Length: 88 inches • Weight: 500 lbs app. Price: around $10, 000 Rs. 6 Lacs Pak. 27

Harley Davidson: Dyna • This classic Harley chopper • Length: 94 inches • Weight: Harley Davidson: Dyna • This classic Harley chopper • Length: 94 inches • Weight: 630 lbs Price: $13, 000 to $18, 000 Rs. 8 Lacs To 11 Lacs 28

Harley Davidson: VRSC • Cool H-D! • Your companion on Special Adventures! • Length: Harley Davidson: VRSC • Cool H-D! • Your companion on Special Adventures! • Length: 94 inches • Weight: 600 lbs Price: $19, 000 Rs. 12 Lacs 29

Harley Davidson: Softail • The bad guy partner! • Watched Terminator 2? Yes? Must Harley Davidson: Softail • The bad guy partner! • Watched Terminator 2? Yes? Must be knowing Softail! • Length: 95 inches • Weight: 650 lbs Price: $14, 000 to $19, 000 Rs. 8 Lacs To 12 Lacs 30

Harley Davidson: Touring • The Travel Partner! Take every thing along you! • Length: Harley Davidson: Touring • The Travel Partner! Take every thing along you! • Length: 94 inches • Weight: 800 lbs Price: $19, 000 to $24, 000 Rs. 12 Lacs To 15 Lacs 31

H-D : Touring – Interior • Front – Cassette/CD/MP 3/AM/FM Player – Wind Protection H-D : Touring – Interior • Front – Cassette/CD/MP 3/AM/FM Player – Wind Protection Screen – Enhanced Speed Dials & Meters • Back – Comfortable Seat – Seats with Heating Capabilities – Back Trunk Panel 32

Harley Davidson: Accessories 33 Harley Davidson: Accessories 33

The Company’s Website! Introduction to The Store Front & Purchase Procedure The Company’s Website! Introduction to The Store Front & Purchase Procedure

Website: Main Page • Click on a country • Doing so, will let you Website: Main Page • Click on a country • Doing so, will let you see the information pertaining to that country 35

Website: Store Front • Loaded with latest information and news • Lets you navigate Website: Store Front • Loaded with latest information and news • Lets you navigate through various sections of the site 36

Purchasing: Plan! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: Plan! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 37

Purchasing: View! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: View! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 38

Purchasing: View! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: View! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 39

Purchasing : View! • View the bike through different angles • Have a 360 Purchasing : View! • View the bike through different angles • Have a 360 o view! 40

Purchasing: 360 o View of Bike 41 Purchasing: 360 o View of Bike 41

Purchasing: Features! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: Features! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 42

Purchasing: Specifications! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: Specifications! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 43

Purchasing: Compare! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: Compare! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 44

Purchasing: Colors! • Follow the procedure – Analyze bikes – Choose – Customize – Purchasing: Colors! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 45

Purchasing: Genuine Motor Parts • Follow the procedure – Analyze bikes – Choose – Purchasing: Genuine Motor Parts • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 46

Purchasing: Do The Numbers! • Follow the procedure – Analyze bikes – Choose – Purchasing: Do The Numbers! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 47

Purchasing: Need Financing? HD is there! • Follow the procedure – Analyze bikes – Purchasing: Need Financing? HD is there! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 48

Purchasing: HD is there! • Follow the procedure – Analyze bikes – Choose – Purchasing: HD is there! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 49

Purchasing: Contact Dealer! • Follow the procedure – Analyze bikes – Choose – Customize Purchasing: Contact Dealer! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 50

Purchasing: Find Dealer! • Follow the procedure – Analyze bikes – Choose – Customize Purchasing: Find Dealer! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 51

Purchasing: Find Dealer! • Follow the procedure – Analyze bikes – Choose – Customize Purchasing: Find Dealer! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 52

Purchasing: There You Are! • Follow the procedure – Analyze bikes – Choose – Purchasing: There You Are! • Follow the procedure – Analyze bikes – Choose – Customize – Budget? – Financing? – Find Dealer – Place Order 53

Purchasing: There You Are! Various Queries Customer Website Various Information Contacts Dealer Product 54 Purchasing: There You Are! Various Queries Customer Website Various Information Contacts Dealer Product 54

Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Product – Add to Cart – Shop More? Or Just checkou – Fill in your billing information 55

Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Product – Add to Cart – Shop More? Or Just checkout – Fill in your billing information 56

Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Product – Add to Cart – Shop More? Or Just checkout – Fill in your billing information 57

Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Purchasing: General Accessories • Follow the procedure – Find E - Dealer – Choose Product – Add to Cart – Shop More? Or Just checkout – Fill in your billing information 58

Process Flow Email to notify order delivery Customer Product Info. & Credit Card Info Process Flow Email to notify order delivery Customer Product Info. & Credit Card Info Website Order forwarded Dealer Email for Order Received Notification Product 59

Conclusion • A classic success story that captured the markets by the virtue of Conclusion • A classic success story that captured the markets by the virtue of E – Business. • But what makes HD case special is that the company was struggling for recovery from its bad era and E-business shored them up • HD management has shown a great deal of determination to let the company hit the sky right from the bottom line • While we can’t neglect that E-business was a mere extension of Richard’s RECONSTRUCTION PLAN (1985), it is interesting to find that although plan worked well right from the implementation and business started growing on financial charts in the first decade (1985 – 1995) but that the real pace was gained during the second decade (1995 – 2005) when the company moved to E – Business • So, we can see how E – commerce infuses the speed of internet into a business 60

Thank You! • References – Harley-Davidson at One Hundred: An American Story By Wally Thank You! • References – Harley-Davidson at One Hundred: An American Story By Wally Bock – Case Study on Harley-Davidson By Josef Schinwald – Harley-Davidson Business Practices By Reginald A. Bruce – Harley Davidson Review By “How Stuff Works” – Annual Report of Harley Davidson By Company Website – Various Links from the Company’s Web 61