Santa Cruz Bicycles


Bicycle enthusiasts not only love the ride their bikes provide but also are often willing to pay for newer technology, especially when it will increase their speed or comfort. Innovating new technologies for bikes is only half the battle for bike manufacturers. Designing the process to manufacture the bikes is often the more daunting challenge.
Consider the case of Santa Cruz Bicycles. It digitally designs and builds mountain bikes and tests them under the most extreme conditions to bring the best possible product to its customers. A few years back, the company designed and patented the Virtual Pivot Point (VPP) suspension system, a means to absorb the shocks that mountain bikers encounter when on the rough terrain of the off‐road ride. One feature of the new design allowed the rear wheel to bounce 10 inches without hitting the frame or seat, providing shock absorption without feeling like the rider was sitting on a coiled spring.
The first few prototypes did not work well; in one case, the VPP joint’s upper link snapped after a quick jump. The experience was motivation for a complete overhaul of the design and engineering process to find a way to go from design to prototype faster. The 25‐person company adopted a similar system used by large, global manufacturers: product life cycle management (PLM) software.
The research and development team had been using computer‐aided design (CAD) software, but it took seven months to develop a new design, and if the design failed, starting over would be the only solution. This design approach was a drain not only on the company’s time but also on its finances. The design team found a PLM system that helped members analyze and model capabilities in a much more robust manner. The team used simulation capabilities to watch the impact of the new designs on rough mountain terrain. The software tracks all the variables the designers and engineers need so they can quickly and easily make adjustments to the design. The new system allows the team to run a simulation in a few minutes, representing a very large improvement over their previous design software, which took seven hours to run a simulation.
The software was just one component of the new process design. The company also hired a new master frame builder to build and test prototypes in‐house and invested in a van‐size machine that can fabricate intricate parts for the prototypes, a process the company previously outsourced. The result was a significant decrease in its design‐to‐prototype process. What once averaged about 28 months from start of design to shipping of the new bike now takes 12 to 14 months.
Santa Cruz has continued improving the technology of its bikes and it started offering a full range of high‐end bicycles for women through its sister brand, Juliana.
Discussion Questions
Would you consider this transformation to be incremental or radical? Why?
What, in your opinion, was the key factor in Santa Cruz Bicycles’ successful process redesign? Why was that factor the key?
What outside factors had to come together for Santa Cruz Bicycles to be able to make the changes it did?
Why is this story more about change management than software implementation?
Sources: Adapted from Mel Duvall, “Santa Cruz Bicycles,” (accessed February 24, 2008) and Santa Cruz Bicycles home page, (accessed March 16, 2019).
1 Adapted from S. Balaji, C. Ranganathan, and T. Coleman, “IT‐Led Process Reengineering: How Sloan Valve Redesigned Its New Product Development Process,” MIS Quarterly Executive 10, no. 2 (June 2011), 81–92.
2 Josh Fruhlinger and Thomas Wailgum, “15 Famous ERP Disasters, Dustups and Disappointments,”, July 10, 2017,‐resource‐planning‐10‐famous‐erp‐disasters‐dustups‐and‐disappointments.html (accessed March 14, 2019) and “Anatomy of an IT Disaster or How Woolies Spent $200 Million on SAP,” Financial Review, June 9, 2016,‐of‐an‐it‐disaster‐or‐how‐woolies‐spent‐200‐million‐on‐sap‐20160609‐gpfowf (accessed March 22, 2019).
3 Adapted from‐ERP‐Disasters‐Explained‐878312/ (accessed February 24, 2012).
4 Michael Hammer, “Reengineering Work: Don’t Automate, Obliterate,” Harvard Business Review 68, no. 4 (July–August 1990), 104–12.
5 For more information about TQM and Deming’s 14 Point approach to quality management, see the ASQ (formerly known as the American Society for Quality), a global community of experts on quality and the administrators of the Malcolm Baldrige National Quality Award program,‐about‐quality/total‐quality‐management/overview/overview.html (accessed August 26, 2015).
6 (accessed August 27, 2015).
7 Q. Bui, “Increasing the Relevance of Enterprise Architecture through ‘Crisitunities’ in US State Governments,” MIS Quarterly Executive 14, no. 4 (2015), 169–79.
8 Ibid.
9 Peter Weill and Stephanie Woerner, “What’s Your Digital Business Model?” Harvard Business Review Press (2018).
10 Adapted from‐item/enterprise‐rent‐car‐goes‐live‐appian‐enterprise/ (accessed August 27, 2015).
11 The Y2K problem was of great concern at the end of the 1990s because many old systems used two digits instead of four digits to represent the year, making it impossible to distinguish between years such as 2000 and 1900.
12 See (accessed August 27, 2015).
13 M. Lynne Markus and Cornelis Tanis, “The Enterprise System Experience—From Adoption to Success,” Framing the Domains of IT Management: Projecting the Future through the Past, ed. R. Zmud (Cincinnati, OH: Pinaflex Educational Resources, 2000), 176–79.
14 Amit Basu and Akhil Kumar, “Research Commentary: Workflow Management Issues in e‐Business,” Information Systems Research 13, no. 1 (March 2002), 1–14.
15 Albert Pang, et al. “Top 10 CRM Software Vendors Market Forecast 2017–2022,”‐10‐crm‐software‐vendors‐and‐market‐forecast/ (accessed February 8, 2019).
16 Hau Lee and Seungjin Whang, “E‐Business and Supply Chain Integration,” Stanford University Global Supply Chain Management Forum (November 2001).
17 Larry Rohter, “Shipping Costs Start to Crimp Globalization,” The New York Times, World Business, August 3, 2008, (accessed August 27, 2015).
18 For additional examples of IT failures in general and enterprise systems failures in particular, visit the blog written by Michael Krigsman,
19 T. Wailgum, “Why CEOs and CFOs Hate It: ERP,”, April 8, 2009, (accessed February 14, 2012).
20 Panorama Consulting 2014 Report, “Organizational Issues Number One Reason for Extended Durations,” http://panorama‐‐releases/panorama‐consulting‐solutions‐releases‐2014‐erp‐report/ (accessed February 26, 2015).
21 Ibid.
22 Markus and Tanis, “The Enterprise System Experience,” 176–79.
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