Just-in-Time at Harley Davidson
By
Jhonattan Brena
Saint Mary’s University of Minnesota
Schools of Graduate and Professional Programs
MBA 609, Operations Management
Dr. Jon Stambaugh, Instructor
February, 2023
Introduction
A manufacturing philosophy and method called Just-In-Time (JIT) aims to
produce the right number of products at the right time with the least amount of waste
and expense. In order to deliver products to customers without delay or storage, it
entails only receiving and producing goods when they are needed and in the precise
quantity needed.
JIT is often implemented in a pull-based production system, where the
production process is driven by actual demand, rather than a forecast or a push-based
system. This means that components and materials are only ordered and delivered as
needed, and finished goods are only produced in response to customer orders. As a
result, inventory levels are kept to a minimum, excess inventory is kept at a lower cost,
and there is more flexibility and responsiveness to demand changes (Banton, 2022).
JIT has been widely embraced by a variety of industries, including the
automotive, electronics, and consumer goods sectors. It has advantages like lower costs,
lower inventory, more efficiency, better quality, and better customer service. However,
JIT requires a high degree of coordination, cooperation, and communication among
suppliers, manufacturers, and distributors, and may face challenges related to logistics,
quality control, and supply chain disruptions.
Brief history and background of Harley Davidson
Harley Davidson is an American motorcycle manufacturer that was founded in
Milwaukee, Wisconsin, in 1903. William S. Harley and Arthur Davidson founded the
business, which initially made motorcycles for racing. Harley Davidson quickly gained
a reputation for producing strong, dependable motorcycles that were well-liked by both
racers and regular riders (Las Vegas Harley-Davidson, 2019).
The open road and American culture have come to be associated with Harley
Davidson over the years, making it an iconic brand. Throughout its history, the
company has encountered many difficulties, such as the Great Depression, World War
II, and shifting consumer preferences. Nevertheless, it has thrived by adjusting to
shifting market conditions and carrying on with the production of high-quality
motorcycles.
With increased competition from foreign manufacturers and declining sales,
Harley-Davidson faced significant market challenges in the 1980s. The business started
a significant reorganization in order to maintain its competitiveness, which included
implementing JIT manufacturing techniques.
Harley-Davidson was able to enhance operations and boost market
competitiveness by implementing a JIT system. Today, Harley Davidson is a wellknown brand all over the world for its timeless designs, strong motors, and distinctive
sound. The business has a devoted following made up of both serious riders and casual
enthusiasts, and it keeps innovating and changing to satisfy its clients' changing needs.
Definition of the problem that created the need for the
system implementation
The manufacturing processes used by Harley-Davidson in the past were not as
effective as they could have been. The business was carrying a lot of inventory, which
pushed up storage costs and required significant amounts of space. Additionally, there
were lengthy lead times for both finished motorcycles and component deliveries in the
company's manufacturing process. Due to these issues, Harley-Davidson found it
challenging to compete with Japanese motorcycle producers who were able to offer
more affordable products of higher quality (Muthukumar et. al., 2011).
Planned vs actual timeline for implementation
The implementation of JIT at Harley-Davidson was a multi-phased project that
lasted for several years. It was intended for the initial implementation to be finished by
1994, but due to unforeseen problems and delays, it took until 1996 to be finished
(Muthukumar et. al., 2011).
Richard Teerlink, the newly appointed CEO of Harley-Davidson, started a JIT
adoption strategy in 1985 with the goal of increasing the company's competitiveness. In
York, Pennsylvania, a new factory was established in 1986 with the intention of
becoming a JIT facility. However, the company didn't start to take the implementation
of JIT seriously until 1990.
The implementation process was broken down into several phases, with the
first phase, which was finished in 1992, focusing on the implementation of a new
materials management system. The second phase, which was finished in 1994, was
centered on the introduction of a new production system. The third and final phase,
which was finished in 1996, was centered on the adoption of a new dealer system.
Resistance from suppliers and workers to the production process changes was
one of the main factors contributing to the delay. The result was that the
implementation process took longer than expected, which put the business behind
schedule. The business also had issues with its old IT systems, which needed to be
updated and integrated with the new systems for production and materials management.
The complexity of the JIT system itself could have contributed to the
implementation taking longer. It may take some time to implement JIT correctly
because it calls for significant adjustments to the company's culture and processes.
Companies must also make sure that their suppliers can deliver materials and
components in a JIT environment, which may necessitate further negotiation and
cooperation.
Unanticipated barriers to program implementation
Changing the corporate culture was one of Harley-Davidson's biggest obstacles
to overcome during the JIT implementation process. Employees were resistant to the
new system because the company had a long history of manufacturing practices that
were not JIT-friendly. In addition, Harley-Davidson had to work with suppliers to
ensure that they could meet the new delivery requirements. This was not always easy,
as some suppliers were resistant to change (Muthukumar et. al., 2011).
Degree of success in implementing the new system
Harley-Davidson eventually had success implementing JIT in spite of the
delays and difficulties. The company was able to significantly reduce its inventory and
production lead times, which led to significant cost savings and quality enhancements.
The company was also able to better meet the changing needs of its customers and saw
improvements in its relationships with suppliers (Muthukumar et. al., 2011).
Definition of positive changes resulting from the
implementation
With the implementation of JIT, Harley-Davidson experienced a number of
beneficial changes, including increased productivity, decreased waste, and betterquality products. Harley-Davidson was able to lower costs and increase competitiveness
by utilizing the JIT system to cut lead times and inventory levels. Along with
streamlining its supply chain and lowering costs associated with procurement, the
company was also able to cut back on the number of suppliers it used.
JIT's enhanced quality control was another advantage. Harley-Davidson was
able to raise the general level of its products' quality by lowering the number of flaws
and the amount of rework necessary. Higher customer satisfaction and greater brand
loyalty resulted from this, both of which helped the business keep its competitive edge
in the market.
Lessons learned from the implementation of JIT
The success of Harley-Davidson's JIT implementation offers several valuable
lessons for other companies looking to improve their operations. Some of these lessons
include the importance of:

Including all interested parties in the planning process.

Establishing achievable deadlines and milestones.

Ensuring that all employees understand the project's goals and objectives.

Being ready for unforeseen difficulties and delays.

Keeping lines of communication open with all parties involved.

Maintaining a constant eye on and assessing the JIT system's performance.
Advice for a classmate planning a similar project
It is crucial for any business planning to implement a JIT system to be aware
that the process can be difficult and necessitate careful planning and execution. All
stakeholders should be included in the planning process, and it's crucial to make sure
that everyone on staff is aware of the project's goals and objectives.
Setting realistic deadlines and milestones is also crucial, as is being ready for
unforeseen obstacles and delays. Companies can improve their chances of success when
implementing a JIT system by having a strong project plan in place and by keeping
open lines of communication with all stakeholders.
Case studies of similar implementations
In addition to Harley-Davidson, a number of other businesses have adopted
JIT systems to enhance their operations and boost their level of competitiveness. For
instance, Dell Computers adopted a JIT strategy in 1994, enabling it to shorten lead
times, lower inventory levels, and better meet customer demand (Joshi, 2020).
Similar to this, Caesar's Casinos adopted a JIT system for its food and
beverage operations, which resulted in improved quality, lower costs, and higher client
satisfaction. Caesar's was able to boost its profitability and acquire a competitive edge
in the market by streamlining its supply chain and reducing waste.
Conclusion
In conclusion, Harley Davidson's adoption of JIT proved to be a crucial
decision that resulted in appreciable increases in production effectiveness and cost
savings. With careful planning, the right leadership, and a strong commitment to the
program, the company overcame its initial implementation challenges.
JIT allowed Harley Davidson to improve product quality overall while
streamlining workflows, streamlining production processes, and reducing waste. It is
clear that JIT is more than just a manufacturing system; it's also a way of thinking
about how to enhance business processes. The company's success with JIT underscores
the importance of effective implementation strategies and the need for strong leadership
to manage the change process.
References
Banton, C. (2022). Just-in-Time (JIT): Definition, Example, and Pros & Cons.
Investopedia. https://www.investopedia.com/terms/j/jit.asp
Joshi, V. (2020). How Dell pioneered the Just in Time to gain market share? The
Strategy Story. https://thestrategystory.com/2020/11/24/dell-just-in-time/
Las Vegas Harley-Davidson. (2019). History of Harley-Davidson. Las Vegas HarleyDavidson. https://www.lasvegasharleydavidson.com/history-of-harley-davidson/
Muthukumar, R, Purkayastha, D & Afshan, N. (2011). Harley-Davidson's Just-in-time
(JIT) Journey. IBS Center for Management Research.