Harley-Davidson’s Just-in-Time (JIT) Journey

Case Summary

This case is about the Just-in-Time (JIT) implementation at Harley-Davidson Motor Company. After World War II, they faced with competition from Japanese companies, which were able to produce better quality motorcycles at comparatively lower cost. Harley-Davidson found that there were three most important practices of Japanese companies, which differentiated their production process from that of others: JIT manufacturing, employee involvement, and statistical process control. Harley-Davidson adopted those three principles and formulated different strategies to make this move possible and to make its manufacturing processes as efficient as that of its Japanese counterparts.

The company finally succeeded in achieving its goals of reducing the cost of production, improving quality, and increasing its market share. With the company again getting into hard times, this case presents how it was trying to focus on “continuous improvement” in a bid to bring itself back into profits. Question #1: Why has continuous improvement been so successful at Harley Davidson? Continuous improvement is ongoing effort to improve products, services or processes.

These efforts can seek “incremental” improvement over time or “breakthrough” improvement all at once.

Under continuous improvement, a task or series of tasks were identified as the problem area in the business process, manufacturing operations, and product development where improvement could be made. Harley-Davidson required the active participation and commitment of its employees to help in eliminating unnecessary steps and complexity for the process and to bring more flexibility into the system. Continuous improvement helped the company identify savings opportunities and put those mechanisms into places, also improved the quality standards and the reduced the waste in the forms of cost, time and defects.

Therefore with a year, all Harley-Davidson’s manufacturing operations were being converted to JIT: components and sub-assemblies were “pulled” through the production system in response to final demand. Question #2: Considering the road ahead, what specific actions can Harley Davidson take that will move them toward their goals? Harley Davidson could keep doing “continuous improvement.” Take a closer look at its operations in a bid to get its cost structure right and manage shipments consistent with the expected slowing of consumer spending.

For continuous improvement, it’s begins with identify the current process and take a vote on which process would most benefit from improvement, then map out the existing process using a project board like A3 report. After fully understand the process, identify areas of opportunity surrounding the mapped process, to do this teams should analyze the current process and scrutinize areas that may be streamlined. Finally, the team will decide on a new process. In order to reduce excess capacity or costs and gain efficiencies, the company has consolidated some of its production facilities, and parts, accessories and general merchandise distribution operations to improve its overall process. The company also made it a high priority to manage supply in line with demand. In addition, the company started restructuring its production process to reduce complexity and create the flexibility to produce multiple product families on the same assembly line every day at the beginning of 2009.