Harley Davidson Firm’s Value Chain as Core Competency

The value chain activities that may be considered to be core competencies are:

  1. Purchase and storage of raw material: H-D is known to use cast iron in the production of motorcycle rims and hubs. The materials used for this process are not found easily and Harley Davidson recently acquired a majority stake in Castalloy, a maker of cast wheels. This ensures that they gain a competitive advantage as the plant allows the company to perform in a more superior manner than its competitors who have to purchase from other cast producers. The company also has a modernized inventory management system that allows them to reduce on overproduction of parts and hence fewer storage costs (Davidson, 2002).
  2. Quality assurance operations: The firm has ensured that strict standards that have been set are followed to the letter. This gives the company a competitive edge as the bikes that are assembled are of high quality. The tradition of high quality has always been followed and is part of the culture of the organization. Several companies have tried replicating the model but have been unsuccessful.
  3. Marketing and promotions: Harley Davidson is known for its cross-world wide appeal and this has been greatly influenced by marketing decisions and promotional activities geared towards popularizing the Harley Davidson brand. There have been events that have been organized to increase sales and also to increase the value to customers by making them feel special. This has led to an active community of bike lovers. The Harley Davidson brand stands out among its competitors
  4. Outbound Logistics: Harley Davidson has used its warehouse and other storage facilities for the assembly of its bikes, the location of the warehouses have assisted the company in moving nearer to its customer’s and this has created value to the end consumer. This has also made the company have a regional and international customer base.
  5. Order Processing: Using the latest technology that has been incorporated together with its Inventory management system, the company can reduce the time it takes to process orders from customers up to the time the motorbike is delivered to the customer.
  6. Conduction of market research: The Company has invested in teams that go around the world collecting information on what the customers want and need. The same team is also responsible for making sure that set standards are upheld in all its assembly plants worldwide.
  7. Compensation and development: The company has come up with various compensation plans that ensure that all the employees benefit from staff development programs. These compensation and staff programs are used by the company to build up the morale of the employees.
  8. Equipment maintenance: The company recently moved to another plant that houses one of the most modern pieces of equipment used for motorcycle assembly. This gives them the competitive edge as they can assemble more machines in a shorter time span.

Harley Davidson has been able to compete and maintain its market share in both National and International markets due to the characteristics of its core competencies. Its core competencies have allowed the company to create value for its clients in a manner that its competitors cannot achieve. Harley Davidson also has the distinguishing factor of having a historical heritage combined with social complexity that makes the brand and any human requisite dynamics difficult to imitate (Davidson, 2002). This is just one of the reasons why competitors have not been able to compete away the core competencies of H-D. Another reason that the manufacturer has continued to flourish where its competitors are supposed to have taken the lead is that the motorbike is considered a luxury brand. This was manifested through its increase in growth in the International markets amidst the gloomy economic predictions and the global recession that hit the world. The last and final reason is that the manufacturer has come up with a three-plan strategy that is aimed at increasing market dominance in areas it deems weak. The strategy involves investing back into the brand, reducing cost overheads by restructuring operations, and coming up with enough funds to run the Harley Davidson Financial Services.


Davidson, Willie. (2002). 100 years of Harley-Davidson New York: Bulfinch Press.

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