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Tips for profiling companies: understand the ‘case study’

Posted by: Latin Brains
Category: All, Best practices

In works of narrative, conflict is the challenge main characters need to solve to achieve their goals. The same applies for understanding a company. Many believe that providing ‘intelligence’ on a company is a fact-finding exercise where the analyst merely compiles recent key events. As a result, the value of the time needed to analyze the company and ‘connect the dots’ is often underestimated.

Let’s begin with a quick example! In March 2020, Harley Davidson announced its new strategy which is based on three key pillars: 1) Focus on 50 markets; 2) Cut its model range by 30%; and 3) Increase manufacturing efficiency. Most times, a simple report explaining and detailing these pillars is enough for a business development manager looking to win new clients for their organization.

This is where the value of our analysis comes through. An analyst cannot just stop at identifying these pillars, they must ask themselves ‘why?’. A successful report must dig deep and understand the firm’s ‘case study’, and when this is achieved, the reader will then not only understand the facts, but they will also understand the ‘conflict’ within that organization.

Each firm has a conflict. This conflict can be positive (“I am growing in a number of areas, but I am not sure which should be prioritized”) or negative (“I am under performing in several areas”). A conflict can also be both positive and negative!

Often, this conflict is ‘as clear as daylight’. But many times, the analyst must dig deep to find the conflict and understand it. But how does the analyst do it? This is down to their knowledge of the industry (including its trends and challenges), as well as knowing the company’s recent history.

Going back to our example, Harley Davidson is in the middle of a ‘perfect storm’. Its loyal consumers, the lovers of loud and fuel-hungry motorbikes are getting old. This had been generating steady falls in yearly revenues. Facing this conflict, former CEO Matthew Levatich announced the ‘More Roads to Harley Davidson” strategy in 2018. This was a very ambitious initiative that aimed to grow Harley Davidson’s consumer base by launching new products (e.g. electric motorbikes) and expanding geographically.

At a first glance, this strategy seemed logical; by expanding the consumer base in terms of products and geographies, sales would grow. However, two years later this strategy was deemed a failure, even without taking into account the COVID-19 crisis. In simple words, we can say that what failed was that those potential new customers were ‘eco-friendly’ (compared to Harley Davidson’s core customers) and even though Harley Davidson launched e-bikes, they were not lured by a brand that had always been seen as polluting and lacking cultural diversity.

As a result, losses continued to grow and CEO Levatich was replaced by Jochen Zeitz in February 2020, who, in March 2020, launched the new strategy: ‘The Rewire’. The aim of the new plan is to exit loss-generating geographies outside of the core markets of North America, Europe and parts of Asia Pacific and curtail discounting to improve margins and returns.

Harley Davidson’s strategy is based on the pillars we explained. However, by explaining the ‘whole story’ the reader can then approach a call or meeting better positioned: “I understand your conflict, I understand the pros and cons of your strategy…I am thinking about your business and how to help you”.

This is the real ‘value’ of business intelligence. It is not a mere summary of data, facts and key events but the analysis and explanation of the relationship between these. Understanding the causes allows one to anticipate the possible courses of action the client could take.


Author: Latin Brains