...Case Study | Ducati: | | | | | Content 1. Summary 1 2. The Problem 1 3. Cast of Characters 2 3.1. People 2 3.2. Institutions 2 4. Chronology 3 5. Issues 5 5.1. SWOT analysis 5 5.2. Porter’s generic strategies analysis 8 6. Options 9 6.1. Focus on their core business 9 6.1.1. Advantages 9 6.1.2. Disadvantages 10 6.2. Expand to the leisure market 10 6.2.1. Advantages 10 6.2.2. Disadvantages 10 7. Recommendation 11 7.1. Focusing on their core business 11 7.2. Reasoning and Rationale 11 8. Plan of Actions 12 8.1. Invest in technology 12 8.2. Focus on their design 12 8.3. Make the sport a culture 12 8.4. Invest in the brand 12 8.5. Branding towards children 13 Summary Ducati is an Italian racing-motorcycle manufacturer whose products are characterized by unique engine features, innovative design, advanced engineering and overall technical excellence. In its 80 years of history, the company has won eleven of the last thirteen World Superbike Championship titles and many more individual victories. Ducati produces motorcycles in four market segments which vary in their technical and design features and intended customers: Superbike, Supersport; Monster and Sport Touring. The motorcycles are sold in more than 40 countries worldwide, with a primary focus in the Western European and North American markets. Despite its success in racing and products, the company went almost bankrupt in 1996 when it was taken...
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...Ducati was a company that was on the verge of going bankrupt in 1996 but took a turn for the better when it was acquired by Texas Pacific Group, driven by Abel Halpern, who then appointed his close friend, Federico Minoli, as CEO of Ducati. When Federico took over, he made it clear that the fundamental economic logic was “the idea that everything should be continuously re-discussed is still the way I look at things.” Ducati had the qualities of a profitable company but was lacking the right management. Minoli made it clear that he had two goals in mind: double-digit growth, and equaling Harley-Davidson’s profit level. If these goals were accomplished, Minoli believe he could “turnaround” the near demise of Ducati and look for continued growth and profitability. Minoli’s “Turnaround Program” would be seen as a successful plan in reinventing Ducati as a global brand and broadening its spectrum of customers. By looking at exhibits 1 and 3 in the casebook, we can see how Ducati’s market share (in its relevant market) nearly doubled from 1996 to 2001. Despite its small scale, Ducati was able to effectively create a strong global brand. We also see a steady growth of sales in every product line Ducati offers in exhibit 8. This was the road Ducati took to become the second most profitable motorcycle maker in the world. But in 2001, Minoli was at the end of the turnaround and needed to make a decision on how to keep expanding Ducati’s growth and profitability. To keep...
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...DUCATI CASE 1. How did Ducati become the second most profitable motorcycle maker in the world despite its small scale? Through out what we call a “Turnaround program” leaded by the Italian Federico Minoli. I believe his experience in turnaround management during his stay in Bain & Co. and his previous jobs in Procter & Gamble and McKinsey gave him a tremendous background to manage a company such as Ducati. However, as we have seen in the case, the Italian firm has nothing to do with other motorcycle companies. Ducati is unique because of its culture and huge potential that was hidden before Federico’s arrival. As he said, “I accepted [the chance] to run Ducati because I saw a company that, beyond its liquidity crisis, needed to be radically changed in order to fully exploit its enormous potential.” In this sense, it had to be an Italian CEO the one in charge of a strategy that ended up in what “The World of Ducati” is today. Minoli stablished from a good mission statement an even better vision statement. He had clear ideas of what his goals were and started from the very basis. This was by putting together a talented group of engineers that felt the companies as theirs. These people were “the Ducati’s soul” (as Minoli used to call them). In my opinion, this principle is something that every person who runs a business should take into account. A good manager is one who is surrounded by others better than him, and if these people perform in a company...
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...Case Questions: Ducati 1) How did Ducati become the second most profitable motorcycle maker in the world despite its small scale? What is the fundamental economic logic of Minoli’s turnaround. The operational effectiveness was the key factor to gain the second most profitable motorcyclae maker. Platform based approach to production caused more effecincy with economic of scale Standardizing of products using two crank cases and three cylinder heads creates efficiency gains in manufacturing. Play the strategy of outsourcing about 87% of production activities related to spare parts while maintaining core competencies activates like R&D, design, quality control, and key trade market component machining in house resulted in flexibility in new part productions Establishing a quality control system focused on improving reliability and overall quality. The fundamental economic logic of Minoli’s turnaround was as follow Identified the capabilities and core competencies to start the turnaround. Refresh and recapture Ducati brand and expand the customer base which used to be limited to the expert rider. Improve the production process Improve motorcycle design. 2) Can Ducati sustain its position in the sport segment? Can Honda and the other Japanese manufacturers stop its growth in this segment? Yes, Ducati can sustain its position in the sport segment of motorcycle if the management keep the current trend for theses reasons Ducati has a...
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...9-709-462 REV: JANUARY 15, 2010 JUAN ALCACER DAVID COLLIS MARY FUREY The Walt Disney Company and Pixar Inc.: To Acquire or Not to Acquire? In November 2005, Robert Iger, the newly appointed CEO of the Walt Disney Company, eagerly awaited the box office results of Chicken Little, the company’s second computer-generated (CG) feature film. He knew that, for Disney as a whole to be successful, he had to get the animation business right, particularly the new CG technology that was rapidly supplanting hand-drawn animation.1 Yet the company had been reliant on a contract with animation studio Pixar, which had produced hits such as Toy Story and Finding Nemo, for most of its recent animated film revenue. And the co-production agreement, brokered during the tenure of his predecessor, Michael Eisner, was set to expire in 2006 after the release of Cars, the fifth movie in the five-picture deal. Unfortunately, contract renewal negotiations between Steve Jobs, CEO of Pixar, and Eisner had broken down in 2004 amid reports of personal conflict. When he assumed his new role, Iger reopened the lines of communication between the companies. In fact, he had just struck a deal with Jobs to sell Disneyowned, ABC-produced television shows—such as “Desperate Housewives”—through Apple’s iTunes Music Store.2 Iger knew that a deal with Pixar was possible; it was just a question of what that deal would look like. Did it make the most sense for Disney to simply buy Pixar? Walt Disney Feature Animation ...
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...Kevin Cota Business 109 1/28/16 Case 3: Ducati 1. Product - > Desmodromic valve distribution system, Ducati 750 Super Sport, L-shape desmo engine, Formula Uno-derived tubular trestle frame. Operation - > Purchased by Cagiva, due to financial problems was sold to the Texas Pacific Group. Strategy - > Bring market share to 10%, invest heavily in the products and rationalize production processes, develop a global brand that would appeal a broader spectrum of customers. Distribution - > New strategy to take control of distribution and marketing in strategic markets by establishing totally owned sales and marketing subsidiaries, re-organization of the network of dealers, creation of “Ducati Stores” 2. Ducati can sustain its position in the sport segment, with its new business strategy it an remain an important part of the market. Other companies like Honda cannot stop its growth in the segment, however they can compete with them by imitating their strategies and improving their own companies. As long as Ducati maintains their recent success, they will be an important part of the market. 3. Minoli considered entering the cruiser market which was dominated by Harley Davison. This segment of the industry was highly profitable. In order to enter, Ducati would have to invest up to 43 million Euros. 4. Like Harley did with their brand, I would recommend Ducati to establish their brand as a lifestyle rather than a simple motorcycle bike. A lifestyle...
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...Unit Reading Leenen, S. & Jelassi, T. 2005, 'Ducati (Italy) vs. Harley-Davidson (USA)', in Strategies for E-Business, ed.T. Jelassi & A. Enders, Pearson Education Limited, Harlow, pp. 366-398. Ievisia-1111-1311 _. .. . .. _...__...__._ . . . ..___. _. . . ll I 1..-_. .. ..._._. . ._._ _ . __.. _ ._..._ __ i"“ Ducati (Italy) vs. Harley-Davidson (USA) Innovating business processes and managing value networks In 2001, as Ducati celebrated its 75th anniversary, Group (TPG) and Deutsche Morgan Grenfell Capital some executives wondered whether the recent corporate restructuring had repositioned the company (Italy). A new management team initiated a turnaround programme aiming at increased production efficiency, net sales and profit. ‘Since 1996, we were really working against a backdrop that wasn’t so far successfully. As part of this, the Italian motorcycle manufacturer had adopted a new focus on R&D, marketing and sales, moving away from its initial manufacturing strength. In addition, the company removed from bankruptcy’, said Carlo di Biagio, Chief Executive Officer of DMH. ‘Now our situation is different. Sooner or later, we think investors will see that.’ By 2001, the company had restructured its value chain activities, outsourcing 90% of its production and, in order to decrease costs, introducing a platform strat- had embraced the Internet, deciding in Ianuary 2000 to sell its new motorcycle, apparel and accessories exclusively online...
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...Ducati Corse, a subsidiary of Ducati Motor Holding S.p.A, was responsible for managing the activities of the Ducati racing teams. Historically, Ducati had been the dominant force in the Superbike Circuit winning 13 titles since 1990. Until recently, Ducati was only part of the World Superbike series. But a recent rule by FIM (in 2001) permitting the use of 4-stroke engine in bikes as against 2-stroke engines, which was a mandate earlier (for MotoGP) prompted Ducati to get into MotoGP. Despite the fact that high costs were involved and Ducati faced the risk of being a late entrant into MotoGP, the Ducati team was highly enthusiastic about this new development. Ducati had a fairly successful first season (2003) but the 2004 campaign turned out to be disappointing. Determined to come back strongly, Filippo Preziosi, (Technical Director) and the team decided to move from an integrated design approach to a modular design for its next generation bike (GP5). Why did Ducati Corse succeed in its first year of MotoGP competition? Even though Ducati entered the MotoGP arena in 2003 as underdogs with very limited experience, they literally made their presence felt. They went on to achieve 14 front-row starts, 9 podium finishes, 3 pole positions, and even tasted one victory. One of the key reasons that I believe led to their success was the inner zeal, commitment and passion that the Ducati engineers displayed in designing the first GP bike. Few of the other important reasons for their...
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...Trocquet Ducati Case Analysis A worldwide motorcycle icon that had been in business since 1926 was on the verge on bankruptcy in late 1996 before it was purchased by the Texas Pacific Group. Frederico Minoli was widely known as being a turnaround experience expert, and he already had previous experience with a Texas Pacific Group partner named Abel Halpern. Minoli’s reputation and Halpern’s previous involvement with Minoli made it a seemingly easy decision to bring Minoli on as the CEO of Ducati. Minoli started at Ducati with two precise goals: he wanted to attain double digit growth and he wanted to rival Harley Davidson’s profit level of around 20%. When Minoli took over as CEO of Ducati, there was a clear absence of a strategic plan as well as non-existent functional divisions within the company. This lead to what Minoli termed “a structured chaos” and was not a foundation for a successful company. Despite these conditions, Minoli found that Ducati had good products, top-notch engineers in both the retail and racing divisions, and very large potential. Before talking about Minoli’s strategy for the Ducati turnaround, I think it is appropriate to perform an industry analysis on the motorcycle industry using the Porter five forces model. The threat of new entrants which would be large enough to cut into the profits of the motorcycle industry is fairly low considering how much startup capital is necessary to produce bikes. The end of the case mentions that for Ducati to...
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...3830 – Case 2 September 24, 2013 Ducati Motorcycles Analysis In order to understand the potential decisions and trade offs available for Ducati to organize its strategic plan, a thorough analysis of the motorcycle industry was essential. In 1996, Ducati Motorcycles operated in a highly unattractive industry. The forces of competition were strong. The high bargaining buyer of buyers, the moderate bargaining power of suppliers, threat of substitutes, and the threat of new entrants fueled this situation. Ducati competed with other notable firms that manufactured similar bikes that were comparable in price and quality. These factors lowered the switching costs for buyers and created an intense rivalry among competitors. While all of the manufacturers relied on a large amount of suppliers for their production needs, this emphasized a great responsibility for the manufacturing firms to consistently manage their suppliers. Ducati motorcycles have historically differentiated themselves from their competitors due to a respected excellence racing and in its niche market, sport bikes. While only manufacturing a small amount of motorcycle, Ducati bikes were easily recognized by their sleek, unique design, distinct sound, and advanced technology. While any company could choose to produce a motorcycle, it was a difficult market to enter, due to heavy weight competitors that had an established brand loyalty with their customers. Frederico Minoli discovered a way for Ducati to reinvent...
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...luxury segment of the motorcycle market Luxury good market: • US 25% • Europe 38% • Japan 12% • China 3% • India ? • Russia 5% Harley trades on its image and nostalgia to sell its traditional bikes Harley is seen as a symbol of the freedom of the open road and has a loyal and passionate following Harley lags behind its competitors but is intentional. Harley relies on traditional styling in its status and image, not technology. Heavyweight bikes constituted 55% of the US motorcycle market in 2008 Harley has led the mc industry in domestic unit sales of heavy weight bikes for 20 straight years. In 2008, Harley manufactured 46% of the heavyweight mcs sold in the US European market is comprised of performance bikes such as the Ducati at 70%. So the V-Rod competes in this market segment. COMPETITORS Price is the competitive issue, and joint ventures between domestic companies and international motorcycle manufacturers like Honda and Kawasaki product affordable motorcycles of good quality. Australia and New Zealand are strong markets for Harley Competition in heavy weight is based on price, quality, reliability, styling, product features, customer preference, and warranties The company emphasizes quality, reliability,...
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...Hi-Res Case Study: Ducati Motor Holding HIGH ROAD TO WORK ORGANISATION CASE STUDY Ducati Motor Holding (Bologna, ITALY) Alessandra Pistani & Matteo Boemi Nomisma December 2001 Abstract Ducati is a world leader in the production of high-powered sport motorcycles. Since 1996, following acquisition by the Texas Pacific Group, an American investment fund, the company has undergone an intense relaunch process involving several aspects of its organisation. This case aims to describe the change that has occurred in the reorganisation of production and the benefits that the new system has brought to the company. Hi-Res Project 2001. Page 1 Hi-Res Case Study: Ducati Motor Holding Hi-Res Case Study: Ducati Motor holding Sector Nace Code , high powered sport motorcycles. Key Words Interaction with suppliers; Outsourcing; leaning organisation. Table of Contents Abstract Keywords Sector 1. Background Information 2 Drivers for change 3 Characteristics and Process of change 4 Obstacles to change 5 Risk analysis 6 Benefits of change Conclusions 3 3 4 5 5 6 2 © Nomisma 2001 Hi-Res Project 2001. Page 2 Hi-Res Case Study: Ducati Motor Holding 1. Background Information The history of Ducati began in 1926 when the Ducati family and other investors in Bologna founded the ‘Società Scientifica Radio Brevetti Ducati’. The company initially produced industrial components for the growing field of radio transmissions, based on Adriano Ducati’s patents....
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...Creative Brief Client: Ducati Motor Brand: Multistrada 1200 Date: April 2010 Description: 1st Semester Campaign – New Brand Introduction What is The Brand? The Multistrada 1200 is a motorcycle manufactured by Ducati since 2010. The engine is a retuned version of the Testastretta from the 1198 superbike, now called the Testastretta 11° for its 11° valve overlap (reduced from 41°). All models include throttle by wire, selectable engine mapping (full power with sensitive or relaxed throttle response, and reduced power with relaxed throttle response) and traction control adjustable through eight levels. S models also include ABS (optional on standard model) and electronically adjustable suspension. The S Sport model features carbon fiber air intakes, cam belt covers and rear hugger, while the S Touring model comes with heated grips, hard luggage and a center stand. Product Manufacturer Background Based in Bologna, Italy, Ducati was a radio manufacturer before entering motorcycle production after the end of the Second World War. Known at first for its sporty line of lightweight single-cylinder bikes, Ducati hit its stride in the early 1970s with its V-Twin sportbikes that were the pinnacle in their era. Following some financial instability in the 1990s, Ducati currently produces several desirable racing-inspired motorcycles. All current Ducatis are built with signature steel trellis frames and 90-degree V-Twin motors. It also has a rich racing history with particular...
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...1. HECHOS Y PERSONAJES Ducati es una empresa italiana fabricante de motocicletas, fundada en 1926 en Bolonia (Italia), quienes en 1952 diseñaron su primera motocicleta. Actualmente se considera una de las marcas más importantes en el sector del motociclismo comercial y deportivo. Ducati fue fundada en 1926 como una empresa familiar y otros inversionistas para producir equipo para radio. En 1954, Fabio Taglioni, un ingeniero visionario, empezó a producir motos, las cuales estaban avanzadas estética y técnicamente. Esto hizo que Ducati se posicionara en el mercado de las motos. Las carreras de motos empezaron justamente luego de que las motos fueron inventadas, las cuales estaban categorizadas por el tamaño del motor. A finales del 1990, empezaron los rumores que dentro del circuito de Grand Prixincluirían una categoría mayor, llamada MotoGP, los cuales se hicieron realidad en 2000 cuando anunciaron formalmente el circuito. Ducati, no se unió inmediatamente a otras empresas como Honda, quienes empezaron a desarrollar nuevas motos para competir en dicha carrera, a pesar de que dicha carrera podía darles otra oportunidad para construir y competir con una nueva moto, pero consideraron que era riesgoso y caro. A pesar de ello, en 2001, Ducati anunció que participarían en el circuito de MotoGP, empezando en el 2003 a partir de lo cual empezaron a crear la moto para dicha carrera, tomando en cuanta diferentes factores de diseño, velocidad, y tecnología. ...
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...European energy markets. - Ongoing research in General Management, Organizational Behavior, Technology and Operations Management, and Entrepreneurial Management. - ERC case interviews and field research in Austria, Belgium, Denmark, France, Spain, Sweden, and Switzerland, Selected events: Glocoll Program on campus; MBA events in Munich, Frankfurt, Paris and London; the European Area Conference; CSR Conference in Brussels; EAB meeting in Milan; L'Etudiant Conference in Paris; ELC Meeting in Geneva. It is with mixed feelings that we say farewell to our Research Associate, Mr. Karol Misztal. Karol first joined the ERC in 2010, and quickly became a valuable member of our team. We are thankful for his contributions to our organization and, undeniably, he will be deeply missed. Please join us in wishing Karol the very best of luck and success in all his future endeavors. We were also very fortunate to welcome two outstanding Harvard College students to the ERC team for a two-month internship: Ms. Nina Chen and Mr. Roland Yang. We would like to thank them for their great work and we wish them all the best for their future careers! br> And to all of you, Happy Holidays and best wishes for 2014! Newly Released Cases Case study "FX Risk Hedging at EADS" Co-authored with Professor Carl Kester, FIN, this case describes how, in 2008, EADS, the European aerospace group that owns Airbus, was faced with the decision of how best to hedge against the risks stemming from a large and...
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