Problem Statement And Current Challenges Case Study Sample
The Victory Motorcycles are a wholly owned subsidiary of Polaris Industries. The company began making motorcycles in 1998. In the period of eight years, the company invested around US$ 100 million in the development of the motorcycles and till 2006 the motorcycle division became profitable for the first time. In 2009, the first decade of success was celebrated with sales over US$ 113 million, but the global recession, resulted in declining sales, profit and the company had to implement corporate restricting and layoffs.
The current challenges faced by the company were that with the global recession and the rising competition in the motorcycle field the change in consumer preference was rising, and the consumer base was changing dramatically. Along with this with the rising exposure to media and social media network, the motorcycle safety awareness was increasing among customers, and the competitors were offering a competitive price range that was another challenge facing the company. The main problem statement was that the company was experiencing stagnation due to the changing consumer base and preferences. This could be noticed from the fact that initially the company held 1 percent of North American shares in heavyweight motorcycles, but in the year 2012 and 2013 the sales declined by 10 percent and in on-road vehicles the sales declined by 3 percent. In the year 2012, the SEC filings, on road vehicles accounted for 8 percent of Polaris sales (Michelle, 2011).
Key Success Factors
Polaris wanted that Victory Motorcycles become a major driving and competitive force in the motorcycle industry and the most important segment of Polaris’s business. One of the main key success factors for the company was that Polaris had experience of over 44 years of development of recreational vehicles. It was well-equipped with talent and engineering facility with production capabilities and design to product different varieties of vehicles for example watercraft, ATV’s and snowmobiles along with producing personal engines for these vehicles. The biggest concern in this regard was that selling the features, advertisement and product features and benefits was easier rather than selling the image of the vehicle (Michelle, 2011).
The second key success factor of the company was that since Polaris already have a good amount of experience in motorcycle development it was able to comply with the industry standards of the product development and customer safety. With the rising awareness and exposure to the customer, this was an important key success factor for the company. The third key success factor was that since the company’s financial and production capabilities were strong it was able to develop and design new products according to the needs of the customers and reap economies of scale. The fourth key success company for the company was that it had access to every type of latest technology, techniques and latest equipment that were important to develop world class luxury motorbike that fulfilled the needs and requirements of the customer and provided the company with a competitive advantage. This factor was added to a skilled workforce that were able to design different prototypes and test the vehicle in every way before launch (Michelle, 2011).
Does Victory Meet the Key Success Factors?
The Victory Motorcycles were able to meet its key success factors with a lot of hard work and constant determination by the management and the workforce. The company was able to take over their main competitor Harley Davidson that was the main American icon. The company sales were risen to US$ 20.1 million in the year 2010 that was more than a fifty percent increase over the sales of 2009. The overall demand increased dramatically for the entire line of Victory motorcycles and significantly for the Cross Country Touring models and the Cross Roads vehicles (Michelle, 2011). The vehicles were able to establish their brand identity by being considered as technologically advanced, and high-quality bikes as compared to their main competitor Harley Davidson and the vehicles were offered at competitive pricing. Even though it was an overall success, but in order to prepare for the next decade, there was a lot that was needed to be done. The company had to expand in the new product line, with a focus on competitive pricing and new market segments to avoid the impact of the market stagnation. It needed new markets to penetrate in and maybe focus on market expansion or probably acquire the technology for electric bikes. It was important that the Victory Motorcycles launch a safe, new and lightweight electric motorcycle for a different market segment (Michelle, 2011).
Michelle Scott et al. (2011) Victory: The New Motorcycle Celebrate its First Decade on the Road, IOWA State University, College of Business.
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