IFAS STRENGTH

Weight 0.04 0.1

Rating 4 4

Weighted Score 0.16 0.4

Strong market position and brand image Harley Davidson in the only major American motorcycle manufacturer Harley Davidson operates in two principal business segment; motorcycles&related products and financial service The Harley Owner Groups (HOG) is the industry largest company sponsored motorcycle enthusiast organization Proven product quality Harley Davidson is one of the main manufacturer and user of V-Engine configuration Harley Davidson have a wide variety of products according to standard, performance, Touring & custom Strong relationship built on trust and respect with supplier and dealers Harley Davidson has a strong marketing department CSR (Breast Cancer Network) Harley Davidson offers customers the opportunity to customize their bikers More diverse lifestyle, creating many Harley Davidson Clubs and academies around the globe like Riders Edge Robust Cash Flow WEAKNESS The top Board of Directors for Harley Davidson are all a men Difficult to attract and retain talented employee Unfunded employee post retirement benefits Declining financial performance Poor credit rating High price category TOTAL

0.03 0.04 0.06 0.1 0.03 0.07 0.09 0.03 0.03 0.05 0.04

3 2 3 4 2 3 4 3 4 4 4

0.09 0.08 0.18 0.4 0.06 0.21 0.36 0.09 0.12 0.2 0.16

0.03 0.04 0.02 0.1 0.03 0.07 1.00

2 2 2 4 2 3

0.06 0.08 0.04 0.4 0.06 0.21 3.36

EFAS OPPORTUNITY

Weight

Rating

Weighted Score

Alliances with Ford Motor Company or other automobile manufacturers are possible Global recession is effecting economies world wide therefore HD has to sustain its position in the market The international heavy weight market is growing and now is larger than the U.S. heavyweight market Asian Economy is booming, China or India is the only place not effected by global recession Increasing demand for bikers in U.S markets New interest from different demographic groups outside U.S Younger riders are increasing becoming interested in bikers Customer value perception through a good quality parts maintaining loyalty The dealer of Harley Davidson was not enough The Harley Davidson has consolidated supplier THREATS Legislation effects of Helmets for motorcyclist forcing all riders by law International importing tax The expiration of U.S government initiatives to stabilize credit markets programs could have a negative impact on capital markets and limit the companys access to capital market funding The increase in prices for many key raw material in manufacturing GDP per capita trend in the past five years is not severe variation High rise in the oil prices Average purchaser of a U.S Harley Davidson motorcycle is a married male in his mid-forties More technological advancements because customer looking for energy efficient and technologically advanced bikes now a day Threat new entrants The Harley Davidson is a luxury bike so, there are very few substitutes. Compete with Japanese Company TOTAL

0.05 0.05 0.06 0.05 0.05 0.04 0.05 0.04 0.05 0.05

2 2 2 2 2 1 2 1 3 2

0.1 0.1 0.12 0.1 0.1 0.04 0.1 0.04 0.15 0.1

0.05 0.06

2 3

0.1 0.18

0.05 0.05 0.05 0.06 0.03

2 3 2 3 2

0.1 0.15 0.1 0.18 0.06

0.04 0.03 0.03 0.06 1.00

2 2 2 3

0.08 0.06 0.06 0.18 2.20

QSPM STRENGTH

Weight 0.035 0.045 0.025 0.025 0.04 0.045 0.025 0.02 0.03 0.02 0.02 0.015 0.015 0.01 0.02 0.01 0.03 0.01 0.025

Cost Leadership Weighted Rating Score 4 4 3 4 4 4 3 3 4 2 3 2 2 2 2 2 3 2 3 0.14 0.18 0.075 0.1 0.16 0.18 0.075 0.06 0.12 0.04 0.06 0.03 0.03 0.02 0.04 0.02 0.09 0.02 0.075

Strong market position and brand image Harley Davidson in the only major American motorcycle manufacturer Harley Davidson operates in two principal business segment; motorcycles & related products and financial service The Harley Owner Groups (HOG) is the industry largest company sponsored motorcycle enthusiast organization Proven product quality Harley Davidson is one of the main manufacturer and user of VEngine configuration Harley Davidson have a wide variety of products according to standard, performance, Touring & custom Strong relationship built on trust and respect with supplier and dealers Harley Davidson has a strong marketing department CSR (Breast Cancer Network) Harley Davidson offers customers the opportunity to customize their bikers More diverse lifestyle, creating many Harley Davidson Clubs and academies around the globe like Riders Edge Robust Cash Flow WEAKNESS The top Board of Directors for Harley Davidson are all a men Difficult to attract and retain talented employee Unfunded employee post retirement benefits Declining financial performance Poor credit rating High price category
OPPORTUNITY

Alliances with Ford Motor Company or other automobile manufacturers are possible Global recession is effecting economies world wide therefore HD has to sustain its position in the market The international heavy weight market is growing and now is larger than the U.S. heavyweight market Asian Economy is booming, China or India is the only place not effected by global recession Increasing demand for bikers in U.S markets New interest from different demographic groups outside US Younger riders are increasing becoming interested in bikers

0.025 0.025 0.025 0.025 0.03 0.035 0.03

3 3 3 3 4 3 3

0.075 0.075 0.075 0.075 0.12 0.105 0.09

Customer value perception through a good quality parts maintaining loyalty The dealer of Harley Davidson was not enough The Harley Davidson has consolidated supplier THREATS Legislation effects of Helmets for motorcyclist forcing all riders by law International importing tax The expiration of US government initiatives to stabilize credit markets programs could have a negative impact on capital markets and limit the companys access to capital market funding The increase in prices for many key row material in manufacturing GDP per capita trend in the past five years is not severe variation High rise in the oil prices Average purchaser of a U.S Harley Davidson motorcycle is a married male in his mid-forties More technological advancements because customer looking for energy efficient and technologically advanced bikes now a day Threat new entrants The Harley Davidson is a luxury bike so, there are very few substitutes. Compete with Japanese Company TOTAL

0.02 0.02 0.02 0.02 0.025

2 2 2 2 3

0.04 0.04 0.04 0.04 0.075

0.02 0.03 0.03 0.04 0.02 0.025 0.01 0.015 0.045 1.00

2 3 3 3 2 3 2 2 4

0.04 0.09 0.09 0.12 0.04 0.075 0.02 0.03 0.18 3.05

Differentiation Weighted Rating Score 4 4 3 3 4 4 3 2 3 2 2 2 2 2 2 2 3 2 3 0.14 0.18 0.075 0.075 0.16 0.18 0.075 0.04 0.09 0.04 0.04 0.03 0.03 0.02 0.04 0.02 0.09 0.02 0.075

3 3 3 3 3 3 3

0.075 0.075 0.075 0.075 0.09 0.105 0.09

2 2 2 2 3

0.04 0.04 0.04 0.04 0.075

2 3 3 3 2 2 2 2 2

0.04 0.09 0.09 0.12 0.04 0.05 0.02 0.03 0.09 2.81

STR S1 S2 S3

INTERNAL FACTOR EXTERNAL FACTOR

S4 S5 S6 S7 S8 S9 S10 S11 S12

OPPORTUNITY O1 O2 Alliances with Ford Motor Company or other automobile manufacturers are possible

SO STR
1 2 3 4 5

S13

Global recession is effecting economies world wide therefore HD has to sustain its position in the market The international heavy weight market is growing and O3 now is larger than the U.S. heavyweight market Asian Economy is booming, China or India is the only O4 place not effected by global recession O5 Increasing demand for bikers in U.S markets New interest from different demographic groups O6 outside US Younger riders are increasing becoming interested in O7 bikers Customer value perception through a good quality parts O8 maintaining loyalty O9 The dealer of Harley Davidson was not enough O10 The Harley Davidson has consolidated supplier THREATS T1 T2 Legislation effects of Helmets for motorcyclist forcing all riders by law International importing tax 1. 2.

T3

T4

The expiration of US government initiatives to stabilize credit markets programs could have a negative impact 3. on capital markets and limit the companys access to capital market funding The increase in prices for many key row material in 4. manufacturing

T5 T6 T7 T8 T9 T10 T11

GDP per capita trend in the past five years is not severe variation High rise in the oil prices

5. 6.

Average purchaser of a U.S Harley Davidson 7 motorcycle is a married male in his mid-forties More technological advancements because customer looking for energy efficient and technologically 8 advanced bikes now a day Threat new entrants 9 The Harley Davidson is a luxury bike so, there are very few substitutes. Compete with Japanese Company

WEA Strong market position and brand image Harley Davidson in the only major American motorcycle manufacturer Harley Davidson operates in two principal business segment; motorcycles & related products and financial service Harley Davidson changed from non-formal to formal organization with functional structure Proven product quality Harley Davidson is one of the main manufacturer and user of VEngine configuration Harley Davidson have a wide variety of products according to standard, performance, Touring & custom Strong relationship built on trust and respect with supplier and dealers Harley Davidson has a strong marketing department CSR (Breast Cancer Network) Harley Davidson offers customers the opportunity to customize their bikers More diverse lifestyle, creating many Harley Davidson Clubs and academies around the globe like Riders Edge Robust Cash Flow W1 W2 W3 W4 W5 W6

WO STR
1. 2. 3. 4

Market penetration (S1;O5) Increase amount of dealer or after sales service (S9;O8;O9) Strategic alliances (S2;S4;O1) Diferentiation focus (S12;O5;O7) Product Development to Increase Sales (S11;O2;O4)

ST STRATEGIES
Continous improvent quality to compete with import (S5;S6;T2) Differentiation product (S7;T4;T5) 1. 2.

Develop brand community to increase brand awarenes (S12;T7;T9) 3

selective to long-term debt (S13;T3;T10)

Buttress business related product and financial service to support R&D (S3;S10;T8) Cost leadership with supplier and increase service in dealers (S8;T6;T11) Safety Helmet Campaign (S10;T1) Vertical Integration (S13;T3;T4) Closing the Financial Service (S3;T3)

The top Board of Directors for Harley Davidson are all a men Difficult to attract and retain talented employee Unfunded employee post retirement benefits Declining financial performance Poor credit rating High price category

Market research to next trend from men's and young riders view (W1;O3;O7) Expand market to increase financial performance (O6;W4;W5) Cost leadership with the supplier (W6;O10) Vertical Integration (W5;O1)

WT STRATEGIES
Reward system for talented employee (especially to handle legislation effect) (W2;T1) Outsourcing for R&D for employee post retirement benefits (W3;T8;T11) Closing the Financial Service (W2;W5;T3)

1. 2. 3. 4. 1. 2. 3. 4. 5. 6. 7 8 9

SO STRATEGIES Market penetration (S1;O5;O7) Increase amount of dealer or after sales service (S9;O8;O9) Strategic alliances (S2;S4;O1) Diferentiation or product development (S11;O2;O4) ST STRATEGIES Continous improvent quality to compete with import (S5;S6;T2) Differentiation product (S7;T4;T5) Develop brand community to increase brand awarenes (S12;T7;T9) selective to long-term debt (S13;T3;T10) Buttress business related product and financial service to support R&D (S3;S10;T8) Cost leadership with supplier and increase service in dealers (S8;T6;T11) Safety Helmet Campaign (S10;T1) Vertical Integration (S13;T3;T4) Closing the Financial Service (S3;T3)

Marketing Market penetration (S1;O5) Increase amount of dealer or after sales service (S9;O8;O9) Diferentiation focus (S11;O2;O4) Differentiation product (S7;T4;T5) Develop brand community to increase brand awarenes (S12;T7;T9) Market research to next trend from men's and young riders view (W1;O3) Expand market to increase financial performance (O6;W4;W5) increase service in dealers (S8;T6;T11) Finance Strategy selective to long-term debt (S13;T3;T10) Closing the Financial Service (S3;T3) Strategic alliances (S2;S4;O1) Buttress business related product and financial service to support R&D (S3;S10;T8) Closing the Financial Service (W2;W5;T3)

1. 2. 3. 4 1. 2. 3

WO STRATEGIES Market research to next trend from men's view (W1;O3) Expand market to increase financial performance (O6;W4;W5) Proposed "Special" Price with the consolidated supplier (W6;O10) Vertical Integration (W5;O1) WT STRATEGIES Reward system for talented employee (especially to handle legislation effect) (W2;T1) outsourcing for R&D for employee post retirement benefits (W3;T8;T11) Closing the Financial Service (W2;W5;T3)

Operation Strategy Proposed "Special" Price with the consolidated supplier (W6;O10) Continous improvent quality to compete with import (S5;S6;T2) Vertical Integration (W5;O1) Vertical Integration (S13;T3;T4)

HR Strategy Reward system for talented employee (especially to handle legislation effect) (W2;T1) outsourcing for R&D for employee post retirement benefits (W3;T8;T11) Safety Helmet Campaign (S10;T1)

3. 4.

a. b. c. Pro Pla

PURCHA 1. Mu 2. So 3. Pa (Two ma

LOGIST 1. Lo 2. Lo

ORGAN 1. Or a. b. c. d. e. 2. Or 3. Str

HRMS 1. Re 2. Co 3. Ca

I T STRA 1. Us 2. Fo

MARKETING STRATEGY 1. 2. 3. Market penetration strategy Market development strategy Product development strategy: a. Product modification strategy b. New product development strategy Product diversification strategy Product elimination strategy Pricing strategy: a. Skim pricing strategy b. Penetration pricing strategy

4. 5. 6.

c. Dynamic pricing strategy Multiple channel strategy Channel change strategy Advertising & Promotion strategy: a. Push strategy (Large money on trade promotion) b. Pull strategy (Much money on consumer advertising to build brand awareness) 10. Media strategy 7. 8. 9.

FINANCE STRATEGY 1. Capitalization structure strategy (i.e. A tracking stock) 2. Debt strategy (i.e. Leverage buy-out) 3. 4. Dividend strategy Assets management strategy: a. b. Cash management strategy Long-term assets management strategy

R & D STRATEGY 1. Basic R & D Strategy: a. Defensive R & D (More appropriate for functional product) Offensive R & D (More appropriate for innovative product) Technology development: b.

2.

a. b.

Technological leader Technological follower

PRODUCTION STRATEGY 1. Production system: a. Job shop b. Batch process c. Mass production/assembly-line d. Continuous process 2. Basic production strategy: a. Chasing strategy b. Output-level strategy c. Sub-contracting strategy 3. Product engineering strategy 4. Plant location strategy PURCHASING STRATEGY 1. Multiple sourcing 2. Sole sourcing 3. Parallel sourcing (Two major suppliers back up for each other parts) LOGISTIC STRATEGY 1. Logistic centralization 2. Logistic outsourcing

ORGANIZATION STRATEGY 1. Organization structure: a. Simple organization b. Functional organization c. Divisional organization d. Matrix organization e. Network organization 2. Organization restructuring 3. Strengthening the existing organization H R M STRATEGY 1. Recruitment strategy 2. Compensation strategy 3. Career path (vertical or zigzag?) I T STRATEGY 1. Using website 2. Follow the sun management

FUNCTIONAL STRATEGY
Objective
Marketing Strategy Increase Sales

Strategy
Market penetration Diferentiation focus on young riders

Increase Brand Awareness Increase Financial Performance Financial Strategy Increase Credit Rating Increase Financial Performance

Debt Strategy Assets management strategy

Increase Brand Awareness Operational Strategy Reducing raw material cost Reducing raw material cost Continous improvement quality Human Resources Strategy Continous improvement quality Increasing Financial performance

CSR

Consolidated Sourcing strategy Control Supply Chain Management

Compensation Strategy Recruitment Strategy

Program
Increase amount of dealer or after sales service Product Development Market research to next trend from men's and young riders view Develop brand community Expand market Selective to long-term debt Strategic alliances Buttress business related product and financial service to support R&D Closing the Financial Service Safety Helmet Campaign

Objective
Increase Sales

Increase Brand Awareness Increase Financial Performance

Increase Credit Rating Reducing raw material cost

Proposed "Special" Price with the consolidated supplier Vertical Integration

Continous improvement quality

Reward system for talented employee Outsourcing for R&D for employee post retirement benefits

Program
Increase amount of dealer or after sales service Market research to next trend from men's and young riders view Product Development Develop brand community Safety Helmet Campaign Expand market Strategic alliances Closing the Financial Service Buttress business related product and financial service to support R&D Outsourcing for R&D for employee post retirement benefits Selective to long-term debt Proposed "Special" Price with the consolidated supplier Vertical Integration Vertical Integration Reward system for talented employee (especially to handle legislation effect)

Timeline
1-5 years 3-6 Months 1 Year 3 Months 6-12 Months 1-5 Years 1 Year 3-12 Months 1 Year 6 Months 1 Months 2-4 Weeks 1-2 Years 1-2 Years 6-12 Months

Staffing
Marketing, Operational, HR & Finance Marketing

Marketing Marketing & Finance Marketing & Finance Finance & Operational Finance & HR Finance & R&D Human Resources Finance Operational Operational & Finance Operational & Finance Human Resources & Finance