The Castiglioni Family and MV Augusta – Motorcycle Art Harvard Case Solution & Analysis

The Castiglioni Family and MV Augusta – Motorcycle Art Case Study Solution


A family oriented business is defined as two or more family members were involved in business activities, and most of the ownership lied in a family. A family structure business is a traditional form of business in early stages as a shopkeeper worked in the same building where helived, and his family members granted him in carrying the business activities, but a modern approach is quite different from others as businesses are considered as separate entities.From both aspects financial and non-financial a family oriented business rewards many fruits.

Most of the family-owned businesses have entrepreneurial structures which initiate quick decision making, goal congruency and a faster response to the changes in the environment. But it can also limit the growth of non-family employees, small economies of scale and the most important is rivalry among relationships such as father and son, brothers, husband and wife. These competitions can cost a lot to a family owned businesses, and also possible inadequacies can appear if the family owners promote family members instead of promoting anon-family worker who deserves to go up in the hierarchy.

Conflicts among the members or in employees is another big problem which has been increasingly faced by the businesses in which most of the ownership come from the one tribe. In today’s era family owned business has a significant role to play in a world economy. According to the statistics, almost 90 % of businesses are owned by family members. These are the problems faced by Castiglioni Family under which, a similar issue raised to proceed the business in the long-term considerations.


Getting success in business is always a difficult task, and once the success is lost after going, it can be quite difficult to attain it again. In this particular case, Claudio Castiglioni, a famous motorcycle entrepreneur wanted to regain its fame and business success, and for that purpose, they acquired MV Augusta, the legendary motorcycle brand. But regaining the mark is not an art of science, and the motorcycle industry has been shrinking dramatically over the past ten years. Also, the economic and financial position of Italy has hardly hit in three years. So, now a question arises as for how a new and young CEO of a firm will deal with these challenges as they need a successful turnaround as well as a quick movement in the industry.


In this particular studies, modern day techniques, models and theories such Total Quality Management (TQM), Just in Time (JIT), World Class Manufacturing, Porters Value Chain, Business Process Re engineering, functional analysis and the balanced scorecard would allow analyzing the current situation of Claudio. And how it would be able to increase the demand and regain the market value through the help of these theories.

The Castiglioni Family and MV Augusta – Motorcycle Art Harvard Case Solution & Analysis

Total Quality Management is a program which seeks to ensure that goods and services that are provided by high quality. TQM has two principles first one is getting the things in right time and the second one is looking for continuous improvement. Successful implementation of TQM requires following things to be managed efficiently

  • Total Commitment.
  • Get the things right the first
  • Get close to the customers to respond with more flexibility.
  • Continuous improvement in everything.
  • Understand the pervasive nature of customer-supplier relationships.
  • Implement a company’s overall improvement process.
  • Agreed performance standards for each customer and employee.
  • Make quality a way of life
  • Recognize the achievement.
  • Measure the cost of quality mismanagement and the level of firefighting.
  • Measure the performance level achieved.

Just in time will help MV Augusta to save ordering and warehousing cost of raw materials. JIT is a pull system in which products or components are only manufactured when they are needed for the next stage. This process can only be worked when MV Augusta has the same demand pattern for their products. It also requires following points to be managed effectively:

  • Diversified and multi-tasking labor force.
  • Process should be incorporated into product line
  • Infallible information system
  • Get the things right thefirst
  • Strong supplier relationships.

World Class Manufacturing is a modern approach to quality in which those factors which cause problems are identified and detect at earlier stages of production rather than waiting for them to occur and then determine it. It is a proactive approach towards manufacturing which will save cost and time of the management.

Business process re engineering is a redesign of those business processes which does not add value. It can be a complex task, and not all of the members will support it because of technophobia.

Porter’s value chain represents the complete process of an organization from the procurement of raw materials to the delivery of finished goods to the final consumer. It is divided into primary and secondary activities. Primary activities include inbound logistics, operations, outbound logistics, and sales and after sales service while secondary activities include infrastructure, technology, procurement and human resource management. To achieve a useful contribution from these activities, an organization needs to identify a perfect integration between the activities...................

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