Assignment Subject: Management Principles Q.4 Case study With over 182,000 employees, 10,011, 241 million in annual revenues in 2009 coupled with upwards of $ 1370.1 million$ and 1896.4 in operating profits for the FY 2008 and 2009 respectively, Japan's Honda is easily the industry's biggest manufactures of motor cycles, besides being an among the leading automobile producers. Operating across the globe, Honda is involved in the development, manufacturing as well as marketing and distribution of motor cars, motor cycles and a range other power products (Honda Ltd, 2010).It was founded in 1946, by Soichiro Honda and subsequently incorporated two years later, followed by years of success and growth as a motor cycle maker. Away from its core business, the company's 105 affiliates and 396 subsidiaries across the world provide financial services to thousands of its clients. It operates a four tier business model which includes the financial services division, motorcycle, automobile as well as power products (Honda Ltd, 2010). Besides multi wagons, Honda also produces a range of passenger cars, SUVs, mini vans, passenger cars, mini vehicles as well as sports coupes among others. Honda's flagship car and motor cycle models include the Accord, Civic, Legend, Insight, Acura CSX and Acura RL, CR-V, Cross Road, ASIMO Robots as well as the scooters among many others. The company recorded sales of over 10,114,000 units mainly in Japan, North America and Europe, representing an 8.5% rise over the previous year's figures. Its sales have been on the rise despite through the global economic down turn that hit its American competitors, and largely driven by Toyota's PR woes over alleged flaws in the breaking system in its flagship Prius model. This success is largely attributable to the company strategic preparedness. Case in point, in 2002, it launched a hybrid car model to tap into the ever growing environmentally conscious clientele, besides launching the Environmental Learning Center (based in Texas), while in 2004, the company entered into a strategic partnership with GE, that led into the development and production of a trail blazing light jet engine, suited for business jets. Sethi and Swanson (1984), commencing in the year 2000, the company has embarked on an ambitious program to set up production plants in the emerging car and motor cycle markets, notably China, Argentina, Russia and the motor bike hot spot, Vietnam. The company prides itself with the twin principles of respect individuals and the Three Joys Principle i.e. buying, selling as well creating. These values reflect the company does wish to build on each person's unique abilities and its endeavor to ensure that everyone who comes by purchasing the products or by other means should have a great/joyous experience. Honda ensures this by relentlessly, lead in the creation of value, innovation, new products at accessible prices. Honda ltd's strategic innovation is founded on a process of dichotomies reconciliation which include both learning and planning, positioning on the market vs. internal resources development and lastly, core competencies related to the product against the core capabilities related to the processes. These three dichotomies do representing divergent strategies etc that drive Honda as a company since its establishment and through years of exemplary growth and expansion. De Wit & Meyer (2010), assert that a critical look at Honda's strategies points especially its successful entry and dominance of new markets raises questions as to whether, Honda's strategy and subsequent decision making is solidly based on a meticulous, analytical and rational planning or whether its strategies are a direct result of the some decisions/ strategies reached at by the company, which evolved or became modified due to the environmental influences of the industry in which the company operates. While designing its strategies, the company has consistently followed a rational approach based on a critical analysis of the market and the industry environment. This strategy hinges on and it suited for a seasoned industry player such as Honda, since it seeks to build on, and exploit the company's immense experience in the automotive industry (Johnson et al., 2005). As a strategy, this is an important bottom up strategy that uses the already gained knowledge to optimize the company's needs. Planning takes into consideration both the company's resources as well as the environmental factors, as such will most likely utilize the company's set objectives within the constraints. Honda's largely seen as having successfully employed the planning strategy while entering into new markets notably while launching into the US motor cycle industry. Its recent strategic alliances with GE as well as its design and launch of innovative new products and expansion of manufacturing plants, in the ultimate attainment of huge scale economies and extremely law costs represent examples of internal planning. Planning is largely apparent from an outsider's point of view. However, interviews with the company's top management reveal a far different picture that suggests at best a company that is far from an overly rational, academic planning seeking to impose its corporate values and policies on the market and the industry, but rather a company, with a management structure that is at all times willing to learn. It is evident and widely accepted by many observers that Honda's strategies have evolved, without a clear plan or analysis of the industry. Case in point, the huge success attained by the company's 50 cc Supercab surprised everyone including the company's management. Mintzberg et al. (1998) observe that though the company's strategy may have looked analytical and well thought out, the management did blunder severally up until the market gave them the correct formula. Rational planning on its own is hardly, suited to many organizations and is in fact removed from the day to day running of a business as compared to learning, which permits management to continually develop and adjust their policies and strategies as they are implemented, in the light of new experience (De Wit & Meyer, 2010). Honda's development of hybrid vehicles and energy efficient models e.g. the Honda Civic Sedan, in the wake of Toyota's success in the same field represent examples of learning from the environment. Honda has as well launched joint ventures in R&D with other companies. Using both strategies gives the company an advantage, not least because it only allows the formulation of strategies that best meet both the internal resources as well as the environmental factors prevailing in the industry. Questions: (Any one) (1 20 = 20) 1. The Honda Company followed which rational approach based on a critical analysis of the market and the industry environment? 2. Give brief about Honda's production.