Evaluating strategic management inside Honda Motors Essay

Honda is a Japan- based cars company. It is a good known company for the production of autos and bikes.

Honda car company offers assorted assortments of vehicles, runing from compact, fuel efficient autos to SUVs, minivans and trucks. It is one of the top car makers in the universe and is good known for bring forthing low-cost and dependable signifiers of transit.This study contains a comprehensive survey of Honda cars. It looks at the current schemes of Honda cars, that how they put their schemes to implement their aims. The chief intent of the study is to analyse the concern Honda cars and how they compete with their rivals.

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0 Aims

To research into the current strategic place of Honda motors.To critical analyze the external and internal environment of Honda motors.To plan a choice of strategic option using the internal and external analysis

3.0 Company Overview

In the planetary market scenario, Honda is the universe ‘s largest engine maker and market leader in Automobile. Honda has been runing 120 fabrication installations in 29 states and employs 167,231 people worldwide. Honda has expanded in chief markets following old ages i.

e. In 1959 Honda established its first abroad subordinate, American Honda Motor Co. Ltd, 1964 Honda established its first Asiatic subordinate in Thailand, Asiatic Honda Motor Co. , Ltd. 1965 Honda ( U.K. ) Limited established in London ( the first market of Honda in, Europe ) 1971 Honda Motor does Brazil Ltd. established in Sao Paulo ( soon Honda South America Ltda.

)The cardinal point lead to Honda ‘s success is the uninterrupted invention that was found by Mr. Honda as a footing. In today ‘s cars universe Honda is a largest maker of bike and it stands at a 9 largest car maker in he universe. The market portion of Honda until now is 10.2 per centum and it is ranked as No.5 in UK ( the most particular/fastidious market ) . In United Kingdom, North America and Asia ‘s car industries, Honda Company becomes a technological force in the bike sector.


1 Mission and Vision:


“ Keeping a planetary position point and we are dedicated to providing merchandises of the highest quality, yet at a sensible monetary value for world-wide client satisfaction ” .


“ Endeavoring to be a company society wants to be ” .The chief focal point of Honda is on the developing a engineerings and merchandises in the two countries, electro-motive engineering and bikes to make discovery for the hereafter.


2 Strategy of Honda Motors

3.2.1Enterprise Scheme

Honda wants to hold its operation in worldwide to provide the highest quality of merchandises at a sensible monetary value, with a dedication of consumer satisfaction. With new challenges in chase of quality, engineering and enterprise, Honda is prosecuting their vision by endeavoring a company society who wants to be through making the new value, globalisation and committedness for the hereafter. Furthermore, Honda wants to take new challenges with the chase of Initiative, Technology and Quality.

3.2.2 Corporate Scheme

Honda ‘s portfolio includes three concerns: Automobiles concern, Motorcycles concern, Power concern. Even though stepping into Automobile industry instead tardily at 1963, Honda rapidly leads the industry with features like superior fuel economic system, optimal safety, and driving pleasance. Honda ‘s gross revenues and production in this industry turn out successful steadily non merely in U.S. but besides in many parts worldwide.Meanwhile, bike concern is the first concern of Honda, from 1963 with the event of the first abroad works in Belgium, Honda has devoted in one basic regulation: “ physique merchandises near to the client ” .

Now Honda has its Research and Development operations in many states like U.K, U.S, Italy, China, Germany, Thailand and India.

In the hereafter they will make a really promising and possible Honda.

3.2.3Business Scheme

R & A ; D is sharpening the concern advantage of Honda, together with the ferocious competition between Honda and rivals, and they all define the concern scheme of Honda. One of the proudest things about Honda is its R & A ; D system. With the systematic manner of nearing, focal point on lastingness, dependability and basic public presentation to set up a originative and advanced proficient foundation.

With the sagely attack to the hereafter, the Honda merchandises do care about the economical, environmental, and societal issues. Honda maintaining affecting in the research and development that benefit people in the hereafter through leading-edge engineering and committedness to invention that opens up new possibilities in mobility.With aˆ•The Joy of Selling- The franchise of Honda is besides one of its strengths. Through making merchandises and services that provide the nucleus values that make Honda unique, the Honda ‘s associates around the universe maintain making such inspiring experience for its client.


4 Operational Scheme

Honda operates in the worldwide market – with 134 production installations in 28 states and at 31 R & A ; D installations in 15 states, approximately 167000 Honda employees and associates serve 23 million clients worldwide yearly. Honda ‘s planetary operations are divided into 6 administrative parts responsible for operating. Hiring and prosecuting the people and beneficent enterprises locally in the communities that Honda operates. Honda is forcing the independency of their local direction and gross revenues operations, at the same clip with incorporating and advanced program for each part.

They operate under the behavior guidelines that help member companies and associates in measuring and pull offing hazards, following with Torahs and ordinances, maintaining a high degree of transparence in operational degree, that ‘s all to maximise the worldwide client satisfaction.

3.2.5 The Individual Strategy

This scheme reflects the Honda ‘s values – “ the three joys ” . That is “ The joy of purchasing, the joy of merchandising and the joy of bring forthing ” . The single scheme of Honda is reflected through the Honda ‘s doctrine – aˆ•The Three Joyaˆ-The Joy of purchasing, the joy of merchandising, and the joy of bring forthing. With the joy of purchasing, the Honda ‘s associates must seek their best to transcend the clients ‘ outlook.

Meanwhile, with the joy of merchandising, which concern non merely about the relationship between the traders and their clients, but they besides feel the pride of holding a positive relationship with their clients. And the last one, the joy of bring forthing comes from fabricating, research and developmentaˆ¦ by bring forthing quality merchandises that satisfy clients worldwide, the Honda ‘s employees can see pride in transcending the outlook of their clients. That all bring the schemes of Honda from their endeavor degree, through corporation, concern, operational degree, to single scheme degree, that spread the Honda ‘s strategic spirit throughout the company.


In 2009, Honda able to constructing their merchandises closes to the clients. Honda delivered 23 million units to the client round the six different parts worldwide. Honda ever conscious about its operations, that they do non hold any impact on the environment. In concern with all these things, Honda started working on the environmental stableness around the universe.

4.0 Market Analysis:


1 SWOT Analysis:


Producing high quality of merchandisesHaving the Pioneer technology in intercrossed engineeringBuild merchandises which are ever near to the client.


In non luxury vehicles, monetary values are much higher as comparing to other car companies.Do non hold a strong offering in a truck line.Merchandise are reasonably trade name and unoffending in footings of styling.


Company have to work on work on the low emanation vehicles and other alternate power beginnings.An offering in a truck line concern would be profitable, because these sorts of vehicles have the highest net income border among anyone else.


a-? Changes in the authorities regulations and ordinancea-? Credit crunch

4.2 Competitive Advantage

Honda posses a big figure of advantages in the car industry that makes it the most running trade name in the market among a big figure of consumers.


Honda ‘s attempt towards the edifice up of its quality has maintained its top place in the market. Its merchandise quality can be easy tested from the fact that a big figure of older Honda cars are still running excellent on the roads.

Fuel efficiency

Honda is merely non merely planing and showing varied theoretical accounts but is most significantly take a firm standing on the fuel efficiency. Honda is the lone trade name that has launched the construct of Hybrid vehicles to salvage the consumers pocket while basking luxury.


Honda has been known for its offering a complete merchandise to the clients in footings of value for money whether you go for luxury section or athleticss.

5.0 External Analysis:

5.1 PESTEL Analysis

Political/ Legal environment:

The assorted authorities regulations and ordinance imposed over car and power merchandise industries sing degree of pollution, noise pollution, fuel ingestion, vehicle emanation degree norms and nitrogen-bearing substances. This changes from clip to clip and is made stricter to follow.

Economic environment:

Honda ‘s operations are diversified throughout the Earth like Japan, Asia, Europe, North America etc. A bad impact over a states economic state of affairs ensuing because of assorted factors like recognition crunch, decelerating down of economic system, market hits due to recession and lifting fuel monetary values could take to diminish in a demand of Honda ‘s merchandise.

Technological Environment

Using the most advanced information engineerings, Honda has developed and innovated itself continuously.

The alterations in IT lead to about Honda ‘s operation were controlled more effectual.On the production procedure: by utilizing the invention means of production and manner of production, like the car fit machine, Honda can mass merchandise to cut down the cost, salvage the clip and increase the capacity

Natural environment:

The more industry develops, the more the environment is negative affected. Among the environmental jobs, Global Warming and Pollution Level are the jobs that take the most concern of community. Many Non-Government Organizations has requested industrial houses to cut down CO2 emanation and toxic wastes.

So, as to undertake these sorts of jobs, Honda is doing a uninterrupted attempt towards assorted research and development of new engineering and merchandise.

6.0 Industry Analysis:

6.1 Porters Five Forces:

The declared five environments above, Porter ‘s Five Forces is to analyse the concern and industries of a company. It encourages the directors and sellers non merely to look outside the current rivals but besides with their prospective rivals. Furthermore, it helps the company to understands what its clients want and command its provider more effectual.

Now we utilize the Porter ‘s Five Forces to analyse Honda Company.

The menace of replacement merchandises

That is defined as the being of close replacement merchandises increases the leaning of clients to exchange to options in response to monetary value additions ( beginning from Wikipedia.org ) .

This does intend that when a Honda ‘s rival can bring forth with high public presentation and economical monetary value instead than Honda ‘s. This merchandise will replace Honda ‘s merchandise in the market. Hence, coincident cut downing the market portion and net income of Honda are the consequences. For illustration, the merchandise line of athletics minibike, R6 of Yamaha is the close replacements of Honda ‘s F4. If Yamaha can accomplish an modernism to bring forth R6 with the lower monetary value against F4, It can in fact replace Honda ‘s F4 on the market because clients have the same chance with both the two merchandises.

The menace of entry of new rivals

The conjectural significance is that in marketing with many bing rivals, the net income of each company will be lower than the maximal degree. For illustration, in American Market the Ford and Honda is uncompromisingly fight together in this market to acquire the proper attending of the client.

Honda can non acquire the upper bound net income in this market because of the policies of American Government protective domestically Company. Furthermore, Honda has to pass money on accessing to distribution in American market. Furthermore, it besides finds troubles in following the civilization differences, etc. Those grounds will cut down the Honda ‘s net income degree.

Rivalry among bing rivals:

The above five features is important to the cars industry to analysis the competitory competition. The 3 chief challengers that Honda has to vie violently are Toyota Motor Corp. ( TM ) , Ford Motor Co.

( FM ) , and General Motor ( GM ) . However the alterations in the attack of one of those rivals will be influences on the public presentation of Honda. Honda every bit good as its three challengers ever keeps on innovating, bettering, researching and developing to vie efficaciously in this car industry.

For illustration, whenever one of these four company releases a new theoretical account, the others will catch up and have similar merchandises to vie. Like when Honda merely comes with a new engineering that is “ FCX CLARITY ” , the fuel cell vehicle in the following coevals, GM Motors come with a Chevy Equinox SUV and put their fuel cell platform into it.A well-known theoretical account of Honda, Accord, has been disputing with its head challenger, Toyota Camry since its first visual aspect. Since Accord was released in the market in 1976, and until 1983, Toyota has launched its saloon i.e. Camry. Since so, these two theoretical accounts have kept on viing with each other.

GM Malibu and Ford Fusion are besides two theoretical accounts that GM and Ford usage to vie with Accord and Camry. For, Toyota, and GM all can replace Honda in this car industry. So, what Honda has to make is seeking to better its engineering, research and development to make a competitory advantage, possibly as a Greenest automake

The bargaining power of clients

In concern, if a company wants to be it must make a good relationship with clients. Honda is a planetary company, it means Honda have a batch of rivals. So clients will confound when they make determination for what Brand will be the best pick. It depend non merely the celebrated company but besides the monetary value and quality.

For illustration, Honda introduced Air Blade Scooter with maps like athletics and manner theoretical account, more fuel-efficient engine engineering. It quickly attracted the young person ; the supply was non plenty for demand. Then it made the deficit of Air Blade in the market and pushed monetary value higher. Customer want to purchase it must order and delay about one to two months.

No thirster after, Suzuki has utilized maximise the advantage of its rivals to its merchandise. Suzuki introduced new theoretical account – Hayate Scooter – that have the same maps of Air Blade but set the astonishing monetary value ( lower than 23 % ) and client can take their merchandise instantly. As a consequence, many clients change of their head, hence the market portion of Honda to shrivel.

The bargaining power of providers

One of the factor helps the company competes against with other companies is the ability to cut down the cost.

Therefore, providers plays an of import function to do the company ‘s success. Suppliers may decline to work with the house or increasing monetary values for alone resources. Recognizing the serious component, Honda purchases natural stuff, constituents and parts, from legion external providers.

Furthermore, Honda relies on some chief providers for the points and natural stuff that usage in the industry of it merchandises.There are some cardinal providers of Honda in term of Metal Stamping Part: Takao Kinzoku Kogyo Co. , Ltd ; Hirata Technical Co. , Ltd ; Hongo Co. , Ltd ; Kikuchi Co. , Ltd ; Marujun Co.

, Ltd, aˆ¦Among these companies, Kikuchi Co. , Ltd trade with non merely the provider of Honda but besides Nissan ‘s provider. If Nissan was willing to buy with higher monetary value or had some benefit publicity than Honda, Honda might be affected on the capacity and increase the cost.

7.0 Fiscal Analysis

As comparison to financial twelvemonth 2007 there was an addition of 8.3 % in the net gross revenues at the terminal of financial twelvemonth 2008.This addition is fuelled by the higher gross revenues of cars concern. This was besides due to the addition in the power merchandise gross revenues in Asia and from the consequence of the foreign currency alterations.

8.0 Conclusion and Recommendations

The aims of the company have been met, and so the schemes of the company that are followed are correlated with concern environment and industry.


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