Harley-Davidson Enterprise Software Selection 2016

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Harley-Davidson: Enterprise Software Selection

*History* William Harley and Arthur Davidson founded the Harley-Davidson Motor Company in 1903. By 1920, Harley-Davidson was the largest motorcycle manufacturer in the world. The company survived quality problems and financial issues in the mid 1980s and remains the largest motorcycle manufacturer in the US. Through the years, the Harley brand had developed into a spirit of youthfulness, independence, and recklessness. However these ideals are accompanied by a strong sense of community. The company structure captures this unique culture by utilizing self-directed work teams in an organizational structure of three interlocking circles  Produce Product (PPG), Create Demand (CDC), and Provide Support (PSC).

Consistent with this culture, through the years, Harley-Davidson encouraged site independence. However, when Gerry Berryman joined Harley-Davidson in 1995 as VP Materials Management, he recognized the strategic opportunity that existed in optimizing supplier relationships throughout the company. Therefore, in 1996, Harley-Davidson began the development of a corporate Supply Management Strategy (SMS) intended to move the company from a site-specific, transactional mentality to a long-term focus on supplier relationships. By July 1997, the initial planning meeting was held for an integrated procurement system, the supplier information link (SiLK).

Harley-Davidson followed a very thorough and rigorous process in implementing SiLK to allow the organization time to become comfortable with this new philosophy and to ensure engagement and enthusiasm for SMS. By November 1997, momentum had built to the point that procurement managers were will to provide several part-time resources to the SiL K project team. Their goal was to move the project from strategy to action. The next four months were spent mapping existing procurement processes to find commonalities across business units. Starting in April 1998, a reduced core team consisting of a smaller number of full-time resources started developing the desired future state ( to-be processes). This team also began work on the detailed specifications and actively managed expectations through frequent communications with the stakeholders. By the end of September 1998, the team had completed a functional specification for the SiLK system and distributed an RFQ to key stakeholders for review.

On October 16, 1998, the RFQ was sent to a short list of potential providers. These companies were invited to a provider conference held on November 5^th to review the RFQ. Eight suppliers submitted proposals along with a self-evaluation checklist. After this, seven formally presented their proposals to the SiLK team at Harley headquarters in

early December. At this time the list of suppliers was narrowed to three. The final evaluation step occurred in mid January as the SiLK team traveled to each of the three software providers  locations for an extended demonstration of the software processing ten scenarios provided by the Harley-Davison team.

At the conclusion of this case on January 30, 1999, the SiL K team sought to make a final decision on the selection of a software vendor for their integrated procurement system.

Problems and Opportunities Opportunity: Select the integrated procurement software provider who is best able to help Harley-Davidson reach their SMS strategic sourcing goals.

The SiLK team has the opportunity to direct the future of Harley-Davidsons supplier relationships through the selection of the best software provider for their integrated procurement system. In making the selection, the team must balance how well the software functionality meets the needs of the business processes with how well the provider team fits the culture of Harley-Davidson. This implementation is a crucial element in bringing about the culture change desired by Berryman. As procurement practices are centralized, it is important that the balance of independence and team spirit that makes the Harley brand and culture so unique not be changed. All Harley IS projects utilize the Business Integration (BI) model as a guide. The model is comprised of three elements  processes, people, and technology. Each must be considered as the SiLK team makes its decision.

Recommendations Recommendation #1:

Select Provider 1 for this project.

According to the SiLK strategic road map, the supply management strategy is driven 50-75% by people, 20-40% by process and 5-10% by technology. Let this be the guiding principle in selecting the integrated procurement system provider. Each potential supplier offers advantages and disadvantages. However, Provider 1 clearly paid the most attention to Harley values and represented the best cultural fit for Harley-Davidson. This will be absolutely critical for a successful implementation, training, roll-out, and adoption throughout Harley-Davidson. Provider 1s only drawback is that they could only meet all of the desired functionality by using a partner solution for web enablement. Provider 2 offered the best functionality with a 98.69% fit, but presented a very formal, consultant attitude that did not mesh well with Harleys culture. Provider 3 offers a potential technology advantage since they are engaged in another Harley-Davidson project at this time. However, their boilerplate functionality was unimpressive,

and the team was very poor at recognizing the social culture at Harley Davidson.

Recommendation #2: Keep the SiLK team intact with the existing members dedicating 100% of their time to the project through the implementation of the software.

I believe it is critical that the SiLK team continue the efforts underway to communicate with the stakeholders and manage the expectations and perceptions regarding the project. The team provides the vital link between the Harley-Davidson stakeholders and the software providers team. The team can monitor the company pulse and alert the provider to emerging issues. At the same time, as the designers of the new business processes, they are in the best position to explain the value of the process change, train the stakeholders in the new processes, and explain how the new software enables the new process flow.