Due: January 8, 2014
In 1903 two young men, Arthur Davidson and William Harley, started building motorcycles in a shed. By 1920 Harley Davidson motorcycles was the largest manufacturer of motorcycles in the world. After almost filing for bankruptcy in the 1980’s, Harley Davidson made a goal to “dramatically increase production” by 2003, Harley Davidson’s one hundredth anniversary. Harley Davidson conducted thorough internal analysis and decided they needed a procurement system that could be used in all of their manufacturing facilities to improve their supply chain management and ultimately reach their goal of increasing production.
Problem/Opportunity Harley Davidson currently does not have one universal procurement system. Each of their locations use a different system for procurement; out of Harley Davidsons 6,000 employees 2,000 are directly involved in the procurement process. After breaking down the procurement professionals time by activity. (Refer to appendix habitat 1) only 10% of their time was spent on suppliers they wanted to increase this to 70%. In order to do so Harley Davidson needed one system for procurement in order to store and access the entire supplier information.
Harley Davidson did an amazing job approaching potential software providers. Understanding many technology projects fail due to: unclear project goals, poor communication among customers developers and users, inability to handle the projects complexity, poor development and testing practices, and inaccurate estimates of needed resources (affecting the total cost of ownership). In order to lessen the threat of failure Harley Davidson developed clear descriptions of what they needed and expected from the providers, they emphasized the need for communication with the provider, analyzed the total cost of ownership for each provider and eventually viewed demonstrations of different scenarios. Eight providers responded to Harley Davidson and submitted a RFQ and a self-evaluation checklist provided by Harley Davidson. The providers were separated into two groups based on the fit test provided by Harley Davidson: the providers that fit above 90% and the providers that fit below 90%. After presentations were given five providers were eliminated. Harley Davidson made a visit to each of the remaining three providers. During the visit the providers demonstrated their product using different scenarios. Provider 1 was very well prepared for Harley Davidson, and understood what they needed and expected. Although they do not have web enablement they have provided a possible solution to integrate into the system (this would add to the total cost of ownership). Provider 1 understands the culture at Harley Davidson and seems to have a similar laid back work culture that would partner well with Harley Davidson making collaboration and future interactions easy and straight forward. Provider 2 is a very well-known supplier; although they have a very consultant type attitude to business they scored the highest on the functionality check list (fit test) at 98.7% (refer to appendix habitat 2). They offer web enablement and meet many important criteria (refer to habitat 2 and habit 3) provider 2 does not address the organizational or training needs for the employees. Provider 3 currently supplies another system for Harley Davidson; the political and economic benefits could be huge for Harley Davidson. Provider 3 was poorly prepared for Harley Davidson and not on the same…