Ducati Case

In: Business and Management

Submitted By nidhipatel2908
Words 3191
Pages 13
Student #: 14025147, 11209559, 14027895, 14024392

Introduction:

“…everything should be continuously rediscussed…” Frederico Minoli (Gavetti, 2004, pg.861)

In the summer of 1996 Frederico Minoli was appointed as the CEO of Ducati in order to lead the company into a new era of profitability and to establish Ducati as a brand to contend with in the sports motorcycle segment. In the years preceding the revolutionary turnaround, the company changed hands a number of time which resulted in a lack of overall strategic direction. Minoli was faced with a company which, despite having a team of top engineers, had gained a reputation for average quality as a result of inefficient production and poor management. Until 1996 it was driven by the imaginations of its engineers rather than by goal-oriented strategic decisions. Minoli described Ducati’s top management as operating in “a structured chaos” (Gavetti, 2004, pp.861). He believed that by incorporating certain basic structural changes and by redefining company’s strategic goals, it could be turned into a profitable brand-driven company. Ducati’s turnaround focused on brand building which was supported by the reconfiguration of a number of activities ranging from increased efficiency in the production process to broadening its customer base. Having almost doubled its market share in 2001, Minoli wanted to find new sources of growth. Among others he considered the cruiser market, currently dominated by Harley Davidson. His goal was to compete directly with Harley Davidson in Europe by introducing a cruiser that combined Ducati’s high performance engine with its own unique design. This essay will begin with a SWOT analysis of Ducati as it stands at the end of its turnaround program. The analysis will bring to light Ducati’s strategic position in the industry as well as any potential that the company may…...

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...|PROBLEM STATEMENTS/WEAKNESSES/STATISTICS |STRENGTHS/STRATEGIES IN PLACE | |What can be Ducati’s strategy for long-term growth? |Motocycles evoke” rebellion, freedom, desire, sex, mobility, design, technology, engineering, innovation, | |Was broadening of Ducati’s traditional niche the right move? |speed, and death” | |Should Ducati attack Harley Davidson’s niche with an interpretation of a cruiser? ** Ducati’s |Cruisers are big motorcycles with an upright riding position. Design emphasized styling over comfort and | |unexplored market segments include Off Road/Dual Purpose, Cruiser and Touring (Exhibit 5 – page 17) |speed., and preferred by many American riders. = this design will definitely not cater to European and Asian | |Ducati’s Fixed Sales Cost in 2000 is 3 times as that of HD (14.5Million vs. 5million). |customers. | |EBITDA – is a measure of a company’s cash flow before certain deductions. It is not a realistic view |Desmodromic engine ...

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...|PROBLEM STATEMENTS/WEAKNESSES/STATISTICS |STRENGTHS/STRATEGIES IN PLACE | |What can be Ducati’s strategy for long-term growth? |Motocycles evoke” rebellion, freedom, desire, sex, mobility, design, technology, engineering, innovation, | |Was broadening of Ducati’s traditional niche the right move? |speed, and death” | |Should Ducati attack Harley Davidson’s niche with an interpretation of a cruiser? ** Ducati’s |Cruisers are big motorcycles with an upright riding position. Design emphasized styling over comfort and | |unexplored market segments include Off Road/Dual Purpose, Cruiser and Touring (Exhibit 5 – page 17) |speed., and preferred by many American riders. = this design will definitely not cater to European and Asian | |Ducati’s Fixed Sales Cost in 2000 is 3 times as that of HD (14.5Million vs. 5million). |customers. | |EBITDA – is a measure of a company’s cash flow before certain deductions. It is not a realistic view |Desmodromic engine ...

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