The History of Ducati

The history of Ducati has been met with times of success and failures. Since its beginning in 1926, Ducati enjoyed decades of success. Around the times of the 1980's however, the future of the Ducati motorcycles became unclear. Even after the takeover of Ducati by Cagiva, the motorcycle company still couldn't get its finances in order and faced bankruptcy in 1996. Seeing potential in the company, Abel Halpern became the determining factor in acquiring a majority stake in the company, giving it the leg up it needed. Seeing that poor management has lowered the company's potential, Federico Minoli was appointed as CEO, soon after initiating "The Turnaround Program".

Federico saw the need for radical change throughout the company spared no expense to see it happen. He knew that in order to hit the profits that he desired, as well as the 7% market share, a number of elements had to be addressed. In attempts to reach this goal, a new management team was hired. Federico saw to it that the new team came without previous experience in the industry as well with a good passion for the company. He felt that this was crucial to bolster creativity within the company.

Faced with limited initial investments and many areas that could use the cash, Frederico sought to go down a less tangible road. Instead of fixing the leaking roof, he chose to embrace the culture of the company and pursue building Ducati as a symbol of passion and history through the building of the Ducati museum. This led to many additional strategic decisions that all would increase the intangible elements that would make Ducati the second most profitable company in its industry.

Federico began to hone in on many different areas of the company. With his newly dubbed branding strategy "The World of Ducati" in place, Federico sought what made up a Ducati motorcycle. While honing in on 5 key charactistics that identified a Ducati, Federico catered to each segment of the market through various models of their core bike. Due to the standardization of their products (such as the crank cases and cylinder heads), they were able to increase their motorcycles per worker from 76 to 87 in three years. To further save cost at no expense to quality, they outsourced many parts of the bike for production while keeping the key components in-house to ensure its quality.

Federico also looked to increase the quality of both their bikes and their connection to their customers. By adopting a stricter selection of procedures and careful quality control procedures within their supply chain (analogous to Starbucks CAFÉ practices), Ducati was able to increase both their quality of bikes and reliability of their supply chain, giving them an excellent competitive advantage. To further their connection with their customers, Ducati revamped they retail stores, effectivly creating a unique experience that contrasted them from their competitors.

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