Harley-Davidson (H-D) mission is “fulfilling dreams of personal freedom with its

Question

Harley-Davidson (H-D) mission is “fulfilling dreams of personal freedom with its purpose and passion and bringing commitment to innovation and manufacturing of its products” (Harley-Davidson, n.d.). Harley-Davidson values independence, authenticity and the passion for being on the open road, and welcome anyone who share the same values. The company’s 2027 strategic goals are to;

“Build 2 Million New Riders in the U.S.

Grow International Business to 50% of Annual Volume

Launch 100 New High Impact H-D Motorcycles

Deliver Superior Return on Invested Capital (Financial returns to shareholders)

Grow the business without growing an environmental impact” (Harley-Davidson, Inc., n.d.).

Stakeholder Analysis of Harley-Davidson

P.E.S.T. analysis is an important way to capture the general forces that affect industries and companies. Another way to obtain a more comprehensive perspective of the general ecosystem that a company like Harley-Davidson works within, is to identify, as explicitly as possible, all the stakeholders that have an interest in a given business.

Elements of P.E.S.T. analysis (Political (Legislative) and Legal Elements, Economic Elements, Societal Values and Ethics, Technology Elements, and an important and too often forgotten element: Demographic Changes, General Ecosystem Stakeholders, Industry Level Stakeholders, Internal Stakeholders, and Potential New Stakeholders)  

Harley-Davidson’s corporate social responsibility (CSR) programs prioritize stakeholders groups as follows, arranged according to significance:

Customers (top-priority stakeholders)

Communities

Environmentalists

Suppliers

Employees

Political Factors Affecting Harley-Davidson’s Business

The political climate affects markets where Harley-Davidson operates. Governmental influence on companies is evaluated in this component of the PESTEL/PESTLE Analysis. The following external political factors significantly affect Harley-Davidson’s remote or macro-environment:

Free trade agreements (opportunity & threat)

Increasing support for e-commerce (opportunity)

Improving inter-governmental support for patent protection (opportunity)

Harley-Davidson benefits from free trade agreements, which facilitate the company’s global expansion. However, such a political external factor threatens the business by increasing the influx of cheaper products or substitutes that compete against Harley-Davidson. On the other hand, the increasing support for e-commerce creates opportunities for the company to improve its market reach through online media. Harley-Davidson also has better patent protection for its products, based on intergovernmental efforts on patent law. This component of the PESTEL/PESTLE Analysis indicates that the current political external factors in the remote or macro-environment brings opportunities for Harley-Davidson’s global growth.

Economic Factors Important to Harley-Davidson

Harley-Davidson must address the economic aspect of the motorcycle market. This component of the PESTEL/PESTLE Analysis examines the economic aspect of the remote or macro-environment of the firm. The economic external factors relevant in Harley-Davidson’s business are as follows:

Economic stability of major markets (opportunity)

Economic growth of developing countries (opportunity)

Stable credit accessibility (threat & opportunity)

The economic stability of major markets presents opportunities for Harley-Davidson to stably grow its business in its core markets, especially in the United States. In relation, the company has opportunities for rapid growth and expansion in some high-growth developing countries where there is demand for chopper motorcycles. On the other hand, the stable credit accessibility could support competitors, which threaten Harley-Davidson. Nonetheless, the company can capitalize on its economies of scale to protect its business from competition in the remote or macro-environment. The economic external factors in this component of the PESTEL/PESTLE Analysis shows that Harley-Davidson has significant opportunities for domestic and international development.

Social/Sociocultural Factors Influencing Harley-Davidson’s Business Environment

Sociocultural changes can impact the remote or macro-environment of Harley-Davidson’s business. In this component of the PESTEL/PESTLE Analysis, social conditions are considered. The following sociocultural external factors are important to Harley-Davidson:

Increasing attitudes about leisure (opportunity)

Increasing involvement of women in chopper biking (opportunity)

Increasing attitudes about green technology (threat & opportunity)

Harley-Davidson must include social issues in strategy formulation based on the company’s remote or macro-environment. For instance, the increasing attitudes about leisure create opportunities for the firm to market its products as leisure motorcycles. Also, the increasing involvement of women in chopper biking presents an opportunity for Harley-Davidson to increase its marketing efforts to target female customers. The increasing attitudes about green technology are a threat to the company because most of its products have combustion engines with significant emissions. Nonetheless, Harley-Davidson can improve the green technologies in its products to address this concern. This component of the PESTEL/PESTLE Analysis points out the significant opportunities for marketing and product development based on the effects of sociocultural factors in Harley-Davidson’s remote or macro-environment.

Technological Factors in Harley-Davidson’s Business

Technologies are an essential aspect of Harley-Davidson’s products and business operations. This component of the PESTEL/PESTLE Analysis evaluates the impact of technological changes and trends on the company’s remote or macro-environment. In Harley-Davidson’s case, the following technological external factors are relevant:

Increasing availability of green technologies (opportunity)

Moderate R&D investments in the motorcycle industry (opportunity)

Increasing use of computing technology in vehicles (opportunity)

Harley-Davidson has the opportunity to improve its products by integrating green technologies. This opportunity can boost the company’s performance because most chopper motorcycles do not have high green-technology ratings. Also, Harley-Davidson can increase its research and development (R&D) investments to develop features of products or technologies as a major selling point. Moreover, the firm can integrate additional computing technology features to make its products more attractive. The technological external factors in this component of the PESTEL/PESTLE Analysis indicates that Harley-Davidson has opportunities to improve its products’ features to boost business performance in the remote or macro-environment of the motorcycle industry.

Ecological/Environmental Factors

Harley-Davidson’s business performance responds to ecological conditions. The effects of ecological trends and changes are considered in this component of the PESTEL/PESTLE Analysis. The following ecological external factors are most notable in Harley-Davidson’s remote or macro-environment:

Increasing interest in business sustainability (opportunity)

Low-carbon lifestyles (opportunity)

Climate change (threat & opportunity)

Current ecological trends emphasize business sustainability. Harley-Davidson can address this concern through changes in its business operations for higher sustainability ratings. Also, the company can highlight the environmentally friendly features of its products to attract customers with low-carbon lifestyles. However, climate change can reduce the attractiveness of Harley-Davidson’s products, which tend to have mediocre emissions ratings. Nonetheless, the company has the opportunity to improve the fuel efficiency of its products to attract environmentally conscious customers. This component of the PESTEL/PESTLE Analysis shows that Harley-Davidson must consider changing its business processes and product features to address the effects of ecological external factors on the remote or macro-environment.

Legal Factors

Harley-Davidson must satisfy legal requirements. This component of the PESTEL/PESTLE Analysis outlines the influence of legal or regulatory conditions on the firm’s remote or macro-environment. Harley-Davidson must address the following legal external factors:

Expanding emissions regulations (opportunity)

Environmental protection laws (opportunity)

Loopholes in international patent laws (threat)

Harley-Davidson has the opportunity to satisfy and exceed the requirements of emissions regulations. In relation, the company can improve its sustainability policies as well as contributions to environmentalist programs. Despite intergovernmental efforts, some loopholes in international patent laws threaten Harley-Davidson through weak protection against imitation, which also affects other firms in the remote or macro-environment. Based on the legal external factors shown in this component of the PESTEL/PESTLE Analysis model, Harley-Davidson can improve its business processes and products to satisfy environmentalist regulations.

QUESTION

As it pertains to a Strategy Playbook, give an evidence-based and cohesive set of specific and actionable recommendations for actions (based on P.E.S.T analysis), that Harley-Davidson can take that will clearly enable the organization to achieve its strategic goals, sustain and grow its business, and remain viable and healthy.

Also, give a related set of metrics that will enable Harley-Davidson to measure the effectiveness of your recommended actions.

Explanation / Answer

Recommendations to Harley Davidson based on PEST Analysis:

The metrics, which will help the company to measure the effectiveness of the above recommendations:

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