Topics: Motorcycle, Quality control, Brand Pages: 2 (747 words) Published: February 21, 2011
Federrico Minoli’s successful turnaround of Ducati was focused on brand creation which was supported by the reconfiguration of a number of activities ranging from increased efficiency in the production process to broadening its customer base. This turnaround can be attributed to two strategic changes that Ducati implemented; firstly Ducati increased its global reach and expanded its offerings within the sport segment and secondly it transformed itself from being a manufacturing company to an entertainment company e.g. the brand Ducati was not about just motorcycle anymore, but it was also about experiencing and enjoying various aspects of Ducati (Ducati Stores, Ducati Owner Clubs, Events, Museums etc.).

Furthermore, this successful rebound can be explained using Porter’s different frameworks. Porter believes that to gain a competitive advantage a company must compete on either overall cost leadership, differentiation, or a focused strategy. He reiterated that companies that do not choose one of these strategies will be stuck in the middle and find it hard to remain competitive. In the past five years of it turnaround, Ducati choose a focused strategy by competing in only sport bikes segment. In this perspective, the company is reinforcing to their customers, prospective customers, as well their members in the Ducati Owner’s Club that they specialize in sport bikes. This is area they have comparative advantage. Another economic logic behind this success story lied in reduced costs (12.4%), increased productivity (15%), improved quality and higher reliability. This was achieved by massive standardization of critical components, by increasing the outsourcing of production activities to 87%, by adopting a rigorous quality control process, by maintaining a tighter grip on the suppliers and by increasing the production efficiency through adoption of platform process. Technology superiority has long been a part of Ducati. The introduction of the Desmodronic valve...
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