Honda Motor Company Limited Commerce Essay Example
Honda Motor Company Limited Commerce Essay Example

Honda Motor Company Limited Commerce Essay Example

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  • Pages: 12 (3282 words)
  • Published: July 10, 2017
  • Type: Case Study
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"The Art of War, written by Sun Zi, is an esteemed ancient Chinese text that focuses on military operations. It is the oldest existing military treatise and holds great importance as a cultural legacy of China. Sun Zi's Art of War continues to be a authoritative source on military operations and has significant influence today. In this renowned book, Sun Wu presents essential principles for successful military campaigns. He emphasizes the ultimate excellence of achieving victory through strategic means without engaging in battle or overpowering the enemy. Additionally, he highlights the advantage of attacking unprepared enemies who are caught off guard, emphasizing swift triumph over prolonged campaigns. Understanding oneself and the enemy is crucial for participating in battles without fearing defeat. These enduring principles are essential in modern global military strategies. The Art of War consists of 13 systematic essays


addressing specific issues but forming an inseparable whole.This influential work extends its relevance beyond military operations into various fields such as commercial affairs, management, and sports competitions."Soichiro Honda, a renowned figure in the Japanese motor industry, established Honda Motor Company Limited with the aim to improve piston ring manufacturing methods. Despite starting as a small company producing piston rings, Honda had a vision of creating superior quality products (Wee, 2003). In 1949, Honda Motor Company Ltd launched the D-Type Dream motorcycle to provide affordable transportation options to people (Honda Motor Company Ltd, 2012), ultimately leading them to become the largest motorcycle manufacturer globally. The demand for transportation post-World War II in Japan was crucial due to overcrowded public transit and limited gas resources. Soichiro Honda founded Honda Motor Company at the age of 41 in

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1948 and joined forces with financial expert Takeo Fujisawa to build an empire. While Fujisawa focused on enhancing engine innovation for increased sales and funding purposes, Honda recognized the potential for his racing ambitions through more powerful engines. By the late 1950s, they achieved tremendous success and secured prestigious motorcycle racing awards worldwide. In 1958, they introduced the innovative Honda 50cc Super Cub which featured automatic clasp technology, three-speed transmission, automatic starting motor functionality, as well as a safe design. The affordability of this product was primarily attributed to its lightweight yet high-horsepower engine. The success of Super Cub in Japan encouraged Honda's expansion into markets beyond Southeast Asia where previous attempts had failed in 1957 and 1958Fujisawa made the decision to shift Honda's focus from the European market, where popular mopeds dominated, to the U.S. market. This decision was influenced by the dominance of European manufacturers in Europe and their well-known low-cost, low-horsepower mopeds. In 1962, Honda launched an advertising campaign with the slogan "You meet the nicest people on a Honda" in order to challenge the stereotype that motorcycles were only meant for tough individuals. This campaign successfully appealed to a wider audience and made both Honda and motorcycling more appealing overall.

In 1967, Honda expanded its business by entering car and truck production. Additionally, they diversified their product line by manufacturing portable generators, power tillers, lawn mowers, pumps, and outboard motors during this time period. However, two lightweight rider cars introduced at this time did not perform well in either Japanese or U.S. markets.

Everything changed in 1973 when Honda introduced their game-changing model called the Honda Civic. This release established Honda as a

major player in the international car market. The success continued in 1976 with the launch of a higher priced model called Accord which experienced rapid sales growth particularly in the United States.

The U.S. market for Japanese cars saw significant growth starting in 1982 which led to increased sales of Accord models. Then in 1986, Honda achieved substantial sales success both in Japan and America with their introduction of Acura brand vehicles.
Honda, one of the world's top car manufacturers, solidified its position by the end of the 1980s. After the death of Soichiro Honda in 1991, Nobuhiko Kawamoto led a comprehensive reorganization. In 1992, Honda established its first joint venture for motorcycle production in China to enter the lucrative Chinese market.

To stay competitive in the automotive industry, Honda prioritized research and development efforts. They explored alternative power sources for cars and produced a large custom bike in the US. This led to their victory in the World Solar Challenge, earning them recognition as winners of the world's largest solar car race.

Expanding globally, Honda started new manufacturing operations for various products in India, Vietnam, Turkey, Indonesia, and Brazil within just one year - 1997. In 1998, they signed another joint venture agreement in China to manufacture and sell cars.

Despite its success, Honda had weaknesses that needed attention. The company's global reputation for efficiency is attributed to its expertise in research and development advancements and widespread presence. Interestingly enough, Honda sells more cars internationally than domestically; particularly successful models are Civic and Accord.The Sun Zi Art of War, a concise book written in classical Chinese, consists of 13 chapters that provide principles applicable to warfare and modern business

strategies. In our assignment, we specifically delve into Strategic Attack, Disposition of the Army, Forces, and Variations and adaptability. According to this ancient text, thorough study and examination are vital in warfare as they can determine life or death. Success in battle planning necessitates consideration of five factors: moral influence, conditions, terrain, generalship, philosophy and law.

Maxis Communication Berhad must evaluate its position against competitors like DiGi, Celcom, and U-Mobile to assess their evolving status and sales achievements for gaining a competitive advantage. Maxis must consider seven crucial factors during their planning process to achieve this advantage. By adhering to twelve strategic planning guidelines outlined by Sunzi's teachings, Maxis can enhance profits and obtain an edge over rivals within the telecommunication industry. The importance of detailed planning emphasized by Sunzi underscores its significance for Maxis' success in terms of sales and reputation.

When venturing into new markets or developing new products, organizations need to adapt their culture accordingly. Through analyzing consumer demand and tailoring products based on clients' culture, environment,and preferences; costs can be minimized by avoiding unnecessary advertising expenses while simultaneously increasing the likelihood of success.KFC's introduction of Flaming Crunch chicken in Malaysia exemplifies the importance of maintaining original elements. This chicken is specifically designed for Malaysians who have a love for spicy food, as it is coated with crunchy cornflakes and spicy powder.

Chapter 4 of the Army Disposition emphasizes that skilled warriors can avoid defeat by seizing opportunities. Self-reliance plays a critical role in preventing defeat, while victory hinges on taking advantage of the right moment. Being well-prepared with factors like financial and material support is crucial when an opportunity arises.

Strategic decision-making has the power

to bring organizations significant profits and market penetration at the click of a button. Apple Inc serves as an example of how emerging as a market leader can be achieved, even without being the first to introduce multimedia downloader technology. They dominate in pricing, products, advertising policies, and location selection. This showcases how success can be attained through effective strategies and measures that lead to triumph while avoiding mistakes.

Apple Inc succeeds by competing against rivals who are already positioned for defeat. Successful individuals possess foresight in predicting future trends and actively shaping the market based on these predictions. On the other hand, Diamond Multimedia lacked mature timing and an accurate forecast for their future despite being pioneers in this area.They also did not have effective policies or strategies to capture the market. However, a few years later, Apple Inc introduced similar technological products like the iPod and gained more popularity than Diamond Multimedia. This shows that Apple Inc sets trends that drive organizational growth and maximize profits. Although following trends may benefit organizations, it does not necessarily lead to profitability. Chapter 5 Forces emphasizes the importance of employing direct and indirect strategies, forces, and tactics to ensure a military force can withstand enemy attacks without succumbing to defeat. When concentrating forces for an attack on the enemy, it is important to do so with unwavering strength, much like solid rocks being hurled at fragile eggs.

The text suggests that organizations must possess creativity and innovation in order to effectively compete with their rivals. They should be willing to make necessary changes to their processes, structure, culture or product offerings. Starbucks serves as an industry leader due

to its constant menu innovation and wide range of drink options available. Recently, Chinese pearl milk tea brands such as Chatime, Ochado, and Gong Cha have surged in popularity.Despite enduring long queues, people patiently wait for their cup of pearl milk tea.Surprising both competitors and consumers alike are Starbucks' introduction of the Green Tea with Red Bean Frappuccino and Hojicha with Tea Jelly Frappuccino drinks.This strategic tactic aims to solve problems and retain customer loyalty. It also suggests enticing the enemy with something they desire while secretly undermining them. In business situations where the adversary is driven by greed for small advantages, it is recommended to offer incentives that lure them inwards. Humans naturally have greedy traits, as seen through AEON members enjoying up to 70% discounts within 24 hours. As a result, consumers may become greedy for these benefits and go over their budget.

Chapter 8, titled "Variations and adaptability," highlights the importance of being adaptable to change and considering preparedness. Embracing happiness sooner by adapting quickly and letting go of the past helps us profit at a faster rate, as shown in everyday life examples.

In recent years, Kopitiam has experienced rapid growth. Well-established brands like Old Town White Coffee, Pak Hailam Kopitiam, Georgetown White Coffee, among others have contributed to this expansion. Notably, Old Town White Coffee alone has opened over 130 outlets across Malaysia. This new concept poses a threat to traditional kopitiams with potential replacement.

Similarly, grocery stores are gradually being replaced by convenient shops like 7-eleven and 99speedmart. Supermarkets such as Aeon, Tesco Carrefour, and Econsave offer a wide range of products at lower prices.Aeon offers a wide range of products, including

clothing, electronics, vegetables, and everyday consumer goods, all conveniently available in one store. The advancements in technology have resulted in the widespread use of smartphones and smart televisions. Samsung's Galaxy S3 is an example of how they responded to consumer demands and became market leaders. These technological developments have also allowed telecommunication companies to create data plans that generate increased profits. To stay competitive and successful in the market, these companies must regularly assess their plans. In today's society, people highly value convenience and simplicity.

Korea and Taiwan have introduced a new concept called wallpaper as an alternative to paint. This innovative approach enables individuals to personalize their wallpaper with preferred colors, designs, or images while saving time, money, energy and avoiding inconvenience.

In Chapter 10: Terrain from Sun Zi's teachings about war strategy, he explains the importance of different types of land during battles and the associated strategies. Similarly, within Maxis Sdn Bhd's business context competing against rivals, top management plays a significant role similar to that of a general in war. The senior manager is responsible for creating an effective strategy that will be implemented by middle management throughout Maxis' business process.

Chapter 13 discusses intelligence and espionage according to Sun Zi's teachings. It explores five types of undercover agents who possess the skills needed to gather enemy information effectively and put it into practical use.Maxis Berhad may direct its employees to research competitors using reliable sources such as annual reports, warrants, news feeds, and press conferences. This will assist Maxis Berhad in analyzing its strengths and weaknesses to gain a competitive edge over rivals.

In Chapter 3 of the strategic attacks discussion, Sun Zi highlights the

importance of capturing a whole state intact rather than destroying it during war.

Honda Motor needs to develop different strategies and approaches to address challenges from competitors in the automotive and motorcycle industry. In 2001, American Honda's associate acquisition and organizational development group conducted a comprehensive evaluation of their training approach. They assessed what was offered, why it was offered, who it was offered to, and how it was delivered.

One aspect of this assessment focused on strengthening the emphasis on internal service quality within support and service departments. The development group aimed to improve employee training while minimizing time spent away from work for training purposes. They also sought to leverage expanding technological capabilities and infrastructure while ensuring a tangible transfer of skills that would elevate internal service quality.

To enhance their service quality further, Honda Motor has implemented a learning management system (LMS) for training scheduling, distribution, and tracking.Honda utilizes a customized LMS to offer various types of training, including instructor-led courses, online classes, and blended learning programs. This allows Honda employees and managers to define and manage personalized training programs. They can enroll in courses, track progress, and complete curriculum through a learner-specific Web portal. Implementing the LMS has helped Honda provide superior customer service and establish a positive reputation among competitors. Honda's company development and human resource department focuses on employee development by providing on-the-job training tailored to each job description. These comprehensive programs include qualitative and quantitative assessments to encourage skill development and managerial growth while allowing supervisors to evaluate potential in subordinates. In addition to on-the-job training, Honda offers off-the-job options such as language learning opportunities, distance education, and exchanges with other

industries for knowledge acquisition and personal growth.Honda's holistic approach strengthens its organizational capabilities and aligns with Sun Zi's philosophy of self-reliance to avoid defeat and seize success. To achieve this, Honda must exert better control over pricing, policies, and market positioning. Thorough market research is essential for the organization's leaders to develop effective strategies that capitalize on competitors' weaknesses and oversights. In the automotive industry, Honda competes with Toyota, offering different prices on their merchandise. For instance, in 2002, Honda introduced the Honda Civic Dx sedan priced at $13,800 while Toyota had the Corolla CE sedan priced at about $13,900 around the same time. Buyers seeking similar product quality would compare prices between these two competitors. Currently, the Honda Civic is cheaper than the Toyota Corolla which leads most consumers to choose it over Toyota's car. This demonstrates Honda's effective control over pricing and their ability to profit from this opportunity. Sunzi's Art of War Chapter 5 emphasizes the importance of organizing forces effectively to overcome organizational challenges both large and small.
Honda relies on formations, communications, and signals among its worldwide organizations to effectively face challenges. With 134 production facilities in 28 countries and 31 Research and Development facilities in 15 countries, Honda faces the task of managing a large organization. To address this challenge, Honda has divided its global operations into six administrative parts: Japan, China, North America, Latin America, Europe and the Middle East and Africa, Asia and Oceania. Each part takes responsibility for its own operations and engages with local communities. The objective is to promote autonomy within local management while implementing integrated plans for each region. Behavior guidelines assist member companies

in managing risks and complying with laws while maintaining transparency for customer satisfaction worldwide. Unlike other global businesses where top managers centralize authority, Honda involves responsible individuals such as the Board of Directors in decision-making. This decentralization allows for flexibility and diversity in adapting to changes in the global market.The group decision-making approach employed by Honda has been highly effective overall. This scheme aims to enhance innovation and reduce biased thinking, offering a theoretical advantage. Ultimately, this strategic leadership style has led Honda to its current success.

One aspect that sets Honda apart in global operations and competition is the organization of its Board of Directors or Board of Auditors. It includes both internal employees and external appointees. By having external company appointees overseeing each board, their performance is improved compared to boards composed solely of internal company employees. This strategy ensures a fair and strong working environment without questionable collaboration.

Honda manages its employees through programs, principles, and policies that support its organizational human resources. By meeting people's needs, they become highly motivated and more willing to contribute to the organization. Honda goes beyond satisfying basic needs and also addresses higher-level needs of employees. As a result, Honda effectively motivates its people compared to other companies, resulting in efficient performance from both employees and the company as a whole.

Chapter 8 delves into variations and adaptability within a company because these qualities are the most valuable asset for an organization's ability to adapt and accommodate fluctuations.A company that prioritizes adaptability will continue progressing, anticipate the future, and effectively address present situations. This characteristic allows the company to improve its products and services, explore new opportunities, and introduce

market-driven innovations.

In 2011, there was a decrease in car production at Honda's UK factory due to a shortage of parts following an earthquake and tsunami in Japan. To handle this issue, Honda temporarily reduced daily production levels at its US and Canadian plants. This decision allowed Honda of the UK Manufacturing (HUM) to maintain production using their flexible working policy while ensuring pay for all employees. The reduced production volume will be quickly recovered through banked hours once operations return to normal.

Ken Keir, executive vice president of Honda Motor Europe, emphasizes that reducing production at HUM minimizes any negative impact on customers, dealers, and employees. Once parts supply stabilizes and full production is planned again, Honda will promptly create a customized production schedule for European clients.

Another example of Honda's decentralized decision-making is seen when changes occur in the American market; the local company has autonomous decision-making authority that enables them to adapt quickly without wasting time or resources while minimizing risk exposure.Improved communication among associates has resulted in more efficient and effective information exchange at Honda. In Vietnam, Honda has noticed a growing preference among younger individuals for stylish and expensive scooters and fashion accessories. To meet this demand, they introduced the Air Blade Scooter in April 2007, which combines features from sports and fashion models with fuel-efficient engine technology. The introduction of the Air Blade Scooter has been successful, with 950,000 units sold. As Sun Zi wisely stated, analyzing weaknesses allows businesses to leverage strengths and succeed. Therefore, thorough analysis and planning are crucial for companies like Honda Motor before launching new products. By conducting studies and research, Honda can identify market demands and

improve product quality to ensure success. Following Sun Zi's advice on strategic management, it is essential for a product to differentiate itself from competitors to avoid rejection. Thus, Honda should introduce a unique product that stands out from rivals such as Toyota and Nissan while focusing on surpassing competing offerings in the market. Maintaining confidentiality is imperative to prevent competitors from obtaining knowledge of Honda's plans for this new product proposal.Honda can achieve great success by introducing its new product covertly, becoming the first mover in the market. By understanding and addressing the needs of their employees, Honda Motor Company can maintain control and influence over their competitors. Offering technology training programs can help develop new products and increase Honda's competitive advantage. Motivating employees fosters better cooperation, higher productivity, and effective communication with managers. Recognizing high-performing employees through rewards maintains performance and motivation while showing appreciation for all workers encourages dedication and harder work, contributing to smoother company operations.

In accordance with Sun Zi's principles of war, reducing operating costs is crucial in achieving victory quickly rather than prolonging conflict. Therefore, Honda should focus on selling the 'SPEED' construct specifically targeting INTEL, UPS, and DHL while also working towards reducing operation time to minimize expenses. Shortening operation time improves productivity, market value, and grants a competitive advantage to the organization.

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