Business Level Strategies

Business-Level strategies
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Abstract
The purpose of this paper is to provide an analysis of cost-leadership and differentiation business level strategies as used by Harley Davidson Company. The business offers motorcycles and motorcycle accessories. The cost-leadership strategy involves implementing approaches in business areas like sales force and advertising that have minimal cost. Differentiation consists of providing unique products and services, buying experience, or focussing on a specific market segment. This paper shows how Harley Davidson used both cost-leadership and differentiation to gain high profits and competitive advantage. Through cost-leadership, the company can focus on meeting the heavyweight market that uses a motorcycle as a sport of luxury. Through differentiation, the company customizes the motorcycle designs according to the culture of chopper biking and ensure that managers wear biking leather. Also, the paper argues that the company should increase approaches of differentiation and reduce cost-leadership strategies being that the baby boomers are aging and millennial are sensitive on spending. The change will increase the company’s profits and competitive advantage.

Keywords: Cost-Leadership, Differentiation, Competitive Advantage
Business-Level Strategies
Harley-Davidson is among businesses that have gained from the cost-leadership business-level strategy. The strategy involves minimizing costs in crucial business areas like sales force and advertising.

The leader ensures that the prices of the business are lower than competitors (Wheelen, Hunger, Hoffman, & Bamford, 2017). However, the leader ensures that the profit is satisfactory. Harley-Davidson focuses on the heavyweight market because the customers in this category use their motorcycles as a product of luxury.
Harley-Davidson provides motorcycles products with unique features and customization. For example, through popularizing the chopper motorcycle style to attract the market segment that is interested in the culture of chopper biking. This enables a competitive advantage to the business (Wheelen et al 2017). Similarly, Harley-Davidson’s achieves differentiation through positioning itself as selling a lifestyle instead of transportation. Further, the employees and managers of Harley-Davidson identify with one another. For example, Harley-Davidson’s management wears biking leather.
Harley-Davidson should reduce the focus on the heavyweight market. During the 20th century, the strategy helped because of the culture of baby boomers. However, most of them are aging now and have stopped using heavyweight motorcycles. On the other hand, Millennials are conscious of spending especially after the 2008 recession (Schonberger & Brown, 2017). Therefore, the company needs to analyze the interest of millennials and formulate new cost-leadership approaches.
The company should increase its differentiation strategies. The management has admitted to maintaining the company’s positioning in the sport of motorcycling. However, most sports motorcycles are used within a particular period before being disposed of for a newer model. Therefore, Harley-Davidson should be increasing the differentiation strategies by offering the sale of used motorcycles at a lower price.
References
Schonberger, R. J., & Brown, K. A. (2017). Missing link in competitive manufacturing research and practice: Customer-responsive concurrent production. Journal of Operations Management, 49, 83-87.
Wheelen, T. L., Hunger, J. D., Hoffman, A. N., & Bamford, C. E. (2017). Strategic management and business policy. pearson.