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Being a motorcycle company that produces high performance, highly successful racing motorcycles, as well as motorcycles for the commercial market, has proven to be a winning strategy for Ducati. This case focuses on Ducati Corse, a subsidiary of Ducati Motor Holding S.p.A. that manages racing teams, bike development, promotions, and sponsorship areas of the company. Ducati Corse is a relatively small organization that encourages cross-departmental integration with its internal teams to achieve the best motorcycle design and racing outcomes as possible.
Ducati started racing in the new MotoGP Circuit during the 2003 race season. With unexpected positive racing results, Ducati took the data collected from the 2003 racing season and changed too many aspects of the bike in 2004. The 2004 racing season proved to be far worse partially because Ducati failed to test all changes made. Looking forward to the 2005 season, Ducati is debating whether to switch to a modular design for their racing motorcycle that would, over time, lead to grander designs for Ducati.
Question 1: What is the organization trying to achieve?
Ducati is after a competitive advantage, via learnings from previous races, which has produced a new product design process that will allow modularity of their racing motorcycle. With success on-track, Ducati believes they can achieve increased commercial sales through a popularity increase, which comes from the surge of interest following a winning race or season. Ducati engineers collect and use enormous amounts data from previous races and tests along with rider feedback to build a winning combination of bike attributes that are specifically tuned to the nuances of the ride.
Question 2: How would you describe their operating environment?
The Ducati operating environment is informal and small when compared to competitors. With most departments under one roof, the company has a siloed feel to it. Ducati has hired top graduates, who have an intense passion for motorcycles. Ducati encompasses three main principles: a data-driven approach to problem solving, a clear priority in solving problems, and frequent face-to-face communication. The importance of face-to-face communication cannot be underestimated and Ducati Corse, being a small operation, can seize the advantage of having a small floor plan, more direct personal relationships, and close geography to push operations that are more efficient.
Question 3: Who are their customers and how does this affect their decision?
Ducati’s customers are in-market, sport motorcycle enthusiasts looking for a high performance bike. They also have customers, likely race fans, who may one day consider a Ducati for purchase, but may not necessarily be in the market for one now. Customer-wise, Ducati has a primary focus on the Western European and North American markets. If Ducati can win on the track, marketing has additional opportunities for promotion via traditional and non-traditional media. It is crucial that Ducati performs well on-track to give customers additional assurance and confidence when applying purchase rationale that they are buying a high performance machine.
Question 4: What at this point is the current dilemma?
The current dilemma is whether or not to take a modular approach to their GP5 design for the 2005 race season. In the past two years, they applied an integrated design approach, which had made small design changes very expensive, but resulted in high performance. This pushes Ducati Corse to evaluate the risk of taking a modular approach, which offers ease of manufacturing and the ability to change one aspect of the bike at a time, but could result in a compromise of performance.
Question 1: What accounts for Ducati’s success?
The perceived performance of the street bikes was positively influenced by successes on the track, which was intimately intertwined with sales. The two played well together because Ducati realized increased off track sales as they continued to win on track. Ducati’s success was a combination of Ducati engineers’ passion for their work, their detailed attention to the design process, and a well-defined, developed method called the “Ducati Method.” The “Ducati Method” helped lead to modular design via extensive use of CAD and simulation technology to optimize the design before physically developing the components followed by intense testing to validate the design.
Question 2: How did Ducati use data?
Processing, interpreting, and using real-time data is a complex task which the Ducati engineers employed with the help of other departments. They utilized rider feedback from the races, videos of each race, track tests, data on race performance, and functional data acquired by on-bike sensors. Ducati used the data from the track to identify problems that could not be detected in simulation. This type of data is excellent for measuring relative performance, evaluating structural stress loads, drivetrain torque, and system temperatures. However, it can be greatly influenced by the driver and environmental conditions. Data of this volume proved difficult to sift through, and additional staffers were hired to tackle it for the 2004 season.
Question 3: What is your assessment of their approach?
We feel that Ducati’s approach was ineffective due to the lack of a structured plan with clear priorities. Ducati Corse tried to solve more problems than they were able, which seemed to result in missed opportunities even though each team member was hungry for success. They were overconfident with the positive results of the 2003 season, and that proved faulty for 2004. Ducati did not give themselves enough time to test everything and should have researched why they performed so well in 2003. Their decision to make big changes to GP3 in order to make GP4, despite initial success of GP3, is not comprehensible. The company should have taken an incremental approach to design changes to improve the design.
Question 4: What options do they have to improve the performance in both the short and long term given their capabilities?
What are the strengths and weaknesses of these options? In the short term, the company can continue to do parallel testing and make incremental changes to the design rather than making big changes. The strength in this is that improvements would be progressive in nature, but the downfall could be that you cannot always predict or assure riders’ confidence levels and it would not simplify the design process. In the long term, they should continue with the modular design development. They cannot effectively pull off an entirely new modular design in-between seasons. The strength in this is that calculated steps toward better performance will more so guarantee movement in the right direction.
Since this would be a new, large-scale design approach, it would require more testing, analysis, and validation before it could be successfully implemented. Question 5: Should they go to a modular approach…what should they do? The modular approach is a positive change for Ducati. With it, they have the opportunity to build a greater amount of flexibility in the engineering framework in order to provide higher results on track. This change would allow them to more easily make greater strides in performance with less effort and effect on other systems – all of which could translate to higher off track sales.
Question 1: What do you want to do?
Ducati should strive to accomplish a modular design for the 2005 racing season, while working on evolutionary improvements to the current bikes as a backup plan. Ducati might want to consider re-weighting the importance of data that delivered via the riders during the race season. Perhaps focus their feedback on ergonomic features of the bike, while taking hard data from engine and subsystems to measure the performance of the bike. This will help to fine tune the changes and deliver an increased amount of on-track victories moving forward. Finally, we would need to consider the design options from commercial standpoint and will only support those design changes that can be implemented in commercial bikes.
Question 2: What will it take and what approaches, tools and techniques will help?
Leaving enough time to analyze the data from the current and previous racing seasons will help Ducati to use the information to the best of their ability. Improvement of this nature will take many calculated improvements. The continued use of concurrent engineering and computer-aided design will help Ducati to stay on top of technological changes in the marketplace. The use of classic engineering tools: team structure, design reviews, effective accelerated testing, careful planning, utilize Plan Do Check Adjust and lean the problem solving. Also, more component level testing needs to be done before full system level testing is done because the eventual use of the models will be in the commercial motorcycle industry. Thus, the engineering team should collaborate with manufacturing and follow the concurrent engineering model.
Question 3: How will this impact decision making, product development, and operating structure?
Switching to a modular design will help Ducati in their decision making process by focusing on the advantages and disadvantages of each individual change as opposed to many all at once. The modular design will allow for smaller development teams which can work more independently and possibly even have competing teams develop variants of a given component. The product development process will become more integrated company-wide even though the product itself will be less integrated and more modular. The operating structure of the Ducati environment will effectively remain the same.
Question 1: What can you take away from this case study?
There are a few overall takeaways with this case. First, effective communication done with respect is of utmost importance to effective engineering operation. Second, the need to use tools, systems, along with human feedback, provides a balance of the use of human and mechanically collected data and is most beneficial when analyzing an operation. Finally, a proper root cause analysis of any problem must be done before designing a solution.
Question 2: What can you take away from the decision making approach?
Ducati benefited from taking a step back and altering their approach, moving from integrated to modular design. It is not easy to be without a robust design, or a product that can function over a broad range of conditions, but Ducati kept their organization flexible enough to be able to do so quickly and have it based on real-time results. Management is making decisions and changing approaches based on learnings from past mistakes and what competitors are doing, which will only serve to enhance their product offerings in the future.
Ducati was already a successful company before taking the brave step of altering a process that had been in place for years. They had always brought in top talent, with the passion to make the company a force on the track and extremely desirable to consumers off the track. It was time to take the company to the next level and deliver consistent results on track. The engineering approach and internal collaboration led to a modular design and a more flexible approach. This renewed way of design and manufacturing is a sign that Ducati will be successful for years to come not only because they can change, but because they have the leadership and personnel who are willing to take risks and put the company ahead of any personal interests.