Harley-Davidson’s Operations Management: 10 Decisions, Productivity

Harley-Davidson 10 strategic decisions of operations management, productivity decision areas case study and analysis motorcycles
A Harley-Davidson motorcycle at the Voorschotense Oldtimer Vereniging Show in the Netherlands. Harley-Davidson’s operations management satisfies the 10 strategic decision areas to support optimal productivity. (Photo: Public Domain)

Harley-Davidson’s operations management (OM) ensures that the company maintains effective and efficient business activities to support resilience and competitiveness. Harley-Davidson’s managers must determine the best options for the 10 strategic decision areas of operations management. These 10 decisions cover the key business areas that involve suitable operations management approaches. To optimize the productivity of its facilities, Harley-Davidson continues to develop its operations management practices to suit evolving business needs. For instance, motorcycle designs are regularly tested to determine satisfaction of customers’ expectations and regulatory requirements.

An evaluation of Harley-Davidson’s operations management actions for the 10 strategic decision areas highlights brand image and customers’ needs. This focus helps Harley-Davidson manufacture high-quality premium motorcycles with a strong brand image.

Harley-Davidson’s Operations Management, 10 Decision Areas

1. Design of Goods and Services. Harley-Davidson motorcycles are known for their unique and handcrafted designs. In this strategic decision area of operations management, the company’s objective is to support its brand image based on available resources. This brand image emphasizes Harley-Davidson motorcycles’ quality and high-end chopper design.

2. Quality Management. The objective in this strategic decision area is to maintain operations management practices to maximize output quality that matches the Harley-Davidson brand image and customers’ expectations. The company has strict requirements for suppliers to ensure high quality motorcycles.

3. Process and Capacity Design. Harley-Davidson’s operations management approach for this strategic decision area involves high quality and new technologies. Optimal production process is an objective in this decision area. At Harley-Davidson, operations managers automate processes for maximum efficiency in producing motorcycles and related products. Also, the company’s production facilities address demand and cost considerations in the global market.

4. Location Strategy. Most of Harley-Davidson’s authorized dealers are located in town and city centers. Many of these dealers are involved in deciding the location of the dealerships. Thus, Harley-Davidson’s operations management addresses this strategic decision area through partially decentralized decision-making for dealership locations. In addition, the locations of the company’s warehouses are based on the locations of authorized dealers to optimize the transportation efficiency of Harley-Davidson motorcycles and related products.

5. Layout Design and Strategy. This strategic decision area of operations management is concerned with optimal efficiency in the movement of people, materials, and information. For company-owned facilities like motorcycle production buildings, Harley-Davidson’s operations management approach for this decision area involves traditional models adjusted to suit the facility’s purpose. Also, a standardized set of layout design requirements are implemented for authorized Harley-Davidson dealerships.

6. Job Design and Human Resources. Human resource adequacy and capability are the main concerns in this strategic decision area of operations management. Harley-Davidson uses training programs and a participatory approach that empowers employees. To maximize career opportunities and optimally utilize talent, Harley-Davidson’s operations management implements a succession-planning policy where leaders share information about employees’ performance. These factors contribute to high quality motorcycles and related products from Harley-Davidson.

7. Supply Chain Management. Harley-Davidson maintains a Supplier Diversity policy to address this strategic decision of operations management. This decision area is concerned with optimized supply chain for the company’s growth. Harley-Davidson’s policy ensures optimal productivity and capacity of its supply chain based on the availability of a wide variety of suppliers.

8. Inventory Management. In this strategic decision area, operations managers focus on inventory adequacy and timeliness. Harley-Davidson addresses these concerns through automated inventory monitoring in company-owned facilities. The company also has an online system for orders and requests involving authorized dealers.

9. Scheduling. Harley-Davidson has streamlined schedules for its business activities. In this strategic decision area, operations managers focus on short-term and intermediate schedules to maximize capacity. Harley-Davidson addresses such concern through automated schedules for the supply chain and orders involving authorized H-D motorcycle dealers. Traditional operations management approaches are also used for scheduling employees’ activities at Harley-Davidson’s offices.

10. Maintenance. Reliability of processes is the objective in this strategic decision area of operations management. Harley-Davidson’s motorcycle production processes are standardized with redundancy measures. For example, the company coordinates the activities of production facilities, which minimize stockouts by supporting each other during demand peaks. Harley-Davidson also has maintenance teams for buildings and equipment.

Harley-Davidson’s Productivity

Harley-Davidson’s operations management approaches are partly aimed at maximizing productivity. Operations managers evaluate productivity levels based on a number of measures or criteria. Some of these productivity measures at Harley-Davidson are as follows:

  1. Revenues per sales employee (H-D Dealership employee productivity)
  2. Supply stockout rate (productivity of Harley-Davidson’s suppliers)
  3. Motorcycles per day (productivity of H-D production facilities)
References
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  • Harley-Davidson, Inc. Form 10-K, 2015.
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