Category: Honda

Executive Summary

This report has been aimed at examining Honda Corporation in terms of its relationship with employees and community. While discussing this issue, we relied on the Stakeholder theory which explains how an enterprise can be influenced by various external and internal forces. Findings of this report indicate that on the whole, Honda Corporation invests heavily in its stakeholders and particularly and promotes their wellbeing.

The ethics program at Honda Corporation is such that all employees are treated equally and are provided with the same at-work benefits even wearing the same uniforms regardless of their position with the corporation. Behavioral guidelines include provisions and requirements for mutual respect among employees and management.

Apart from that, this report has demonstrated that Honda Corporation greatly contributes generously to community and education programs. Nonetheless, this study has also identified the key problems, faced by the company, especially in its relations with the stakeholders. In particular, the company should not pay more attention to the demands of trade unions whose representatives argue that the company very resists unionization of the workers. Additionally, it is crucial that this company will establish better relations with the consumer unions which attract the public’s attention to the fact that the company does not provide full information about their products.

Introduction

This work has reviewed a large volume of literature relating to the Honda Corporation and its ethical policies and corporate social responsibility principles and the way in which they impact Honda stakeholders, in particular, the community and the employees. This discussion will be based on the stakeholder theory which explains the relationship of an organization with the employees, customers, governmental organizations, and so forth.

This theoretical framework explains how corporate social responsibility can contribute to the overall success of an enterprise. While discussing Honda Corporation we focused on such parameters as transparency of HR policies, the willingness to comply with consumers’ demands and governmental regulations. This analysis will enable to us to point out those areas which require improvement. Yet, at first, it is vital for us to discuss the concept of stakeholder and how this person or organization can shape the performance of the company.

The role of stakeholder

Such approach as the stakeholder theory has become extremely popular among modern managers. The representatives of this approach urge the business administrators not to forget that the concept of a stakeholder should not be limited only to those people, who own the stock of the company since such a view overlooks the role of customers, community, and certainly employees (McWilliams et al, 2006).

It should be that the interests of various stakeholders do not always coincide with one another, and the management of the company must be able to reconcile them. Overall, it is possible to argue the relations between a private business and its stakeholders can be described as a form of interdependence. Furthermore, the existing research shows that corporate social responsibility should not be viewed only as some moral obligation imposed from outside; more likely it is a necessary condition for the survival of the organization.

Overall, it is possible to argue that Honda is an example of company that does care about its stakeholders. As a matter of fact, it is rather difficult to point out those areas which require improvement, and the record of this company seems always impeccable.

Findings

Honda’s relations with the employees

Strengths

The investment in the individuals and their community is critically important to Honda’s stakeholder strategy. A primary part of the compliance and ethic program at Honda Corporation is the company’s ‘Egalitarian’ culture characterized by:

1. All employees wearing the same uniform and being addressed as ‘associates’;
2. All employees eating in shared cafeterias and all employees parking in the same parking area with no reserved parking spots;
3. Managers at Honda are located on the production floor with offices being well-planned in an open design with no designation of high rank employee workstations. (Gupta, et al, 2010, paraphrased)

Honda reports that it is key to “promote accessibility across the company by removing physical and social barriers, thereby eliminating the natural intimidation employees often feel when they wish to speak with their managers.” (Gupta, et al, 2010 p.1). On the whole, the existence of these strategies indicates that the management of Honda Corporation does care about the needs of its employees and attempts to prove that they personnel is the most valuable asset of the company. To a great extent, the HR policies of Honda Corporation resemble that one of Toyota Motor Company.

Weaknesses

Certainly, Honda always tries to pursue honest policies in its relations with the personnel, however, in some cases even they infringe upon their rights. In particular, one has to bear in mind that the company resists unionization of the workers and such an attitude can be regarded as a violation of their rights (Bybee, 2008, unpaged).

It seems by restricting the rights of these people, Honda only compromises its reputation and public image. It should be mentioned that the management refused to acknowledge the existence of the trade union in Great Britain (Clement, 2001). Apart from that many critics of the company believe that the company’s hiring policies are marked by racism (Bybee, 2008, unpaged).

In particular, they maintain that they avoid employing African-Americans and the unionized employees (Bybee, 2008). These are the key issues to which the management of this enterprise should pay attention to. Again, we have to emphasize an idea that these accusation of racism may result of a misunderstanding.

The thing is that the company hires only those people who live within a certain radios from the factory. Many critics believe that in this way the management tries to exclude the black or unionized workers. This is why the company should take a closer look at this issue.

Honda Corporation and its interaction with the community

Strengths

It should be mentioned that the concept of community includes a great number of components, for instance, people, living in a certain area, governmental and non-governmental organizations, environment protection group, and certainly customers.

Honda has as its fundamental approach in business ethics the goal of earning the trust of customers and society and toward this end they have frameworks in place “to ensure a systematic approach to compliance and risk management” along with the “formulation of behavioral guidelines and procedures for self-assessment.” (Gupta, et al 2010) (p.1) A group governance system establishes behavioral guidelines that serve to “guide the behavior of all employees through conduct guidelines” in combination with “division wise specific guidelines according to specific attributes.” (Gupta, Priy, Kundu, and Dixit, 2010)

President and CEO of Honda Corporation, Takeo Fukui states that Honda Corporation is “sharing dreams with people everywhere, striving to become a company that society wants to exist.” (Gupta, et al, 2010) (p.1) This is stated to be based on corporate activities focused on “…creating value, expanding value through globalization and realizing its commitment to the future.” (Gupta, et al, 2010) (p.1) Findings in this report on the impact of Honda Corporation on its Community-Stakeholders includes the Honda pursuit of daily business interest under the principles stated as follows:

1. Honda will strive to “recycle materials and conserve resources and energy at every stage of our products’ life cycle;
2. Honda will strive to minimize and find appropriate methods to dispose of waste and contaminants that are produced through the use of Honda products and in each stage of the life cycle of these products;
3. Honda associates, as members of the company and society will focus on the importance of making efforts to preserve human health and the global environment and will do what they can to ensure that the company as a whole acts responsibly.
4. Honda will consider the influence that corporate activities have on the regional environment and society, and strive to improve the company’s social standing. (Honda, 2010, North American Environmental Report) (p.1)

It was reported by Market Research World that Honda “…ranks top in UK companies for corporate social responsibility” (Market Research World, 2006) (p.1) in a study that was carried out for the purpose of understanding the public perception of automotive companies in respect to compliance and “contribution towards corporate, social, environmental and philanthropic activities.” (Market Research World, 2006) (p.1) Key practices of Honda Corporation include:

• product planning and development;
• manufacturing;
• recycling and green guiding;
• communication. (Honda, 2010, North American Environmental Report)

Honda is reported as having been a consistent leader in fuel-efficiency technology and specifically with its commitment to advancing internal combustion engine fuel efficiency including VTEC and Variable Cylinder Management along with an expansion in Honda hybrid technology. (Market Research World, 2006) (p.1)

Honda is reported to have “…gone beyond development new vehicle technologies including: (1) development of photovoltaic solar cells which are reported to “significantly reduce the energy and CO2 emissions in the manufacturing phase1.; (2) FFVs- Flexible fuel system; (3) Bio-fuel; and (4) MCHP or micro-combined heat and power cogeneration bringing about a 30 percent reduction in energy use and associated CO2 emissions.” (Honda Corporation, 2011) (p.1)

One example of community commitment is illustrated in the actions of Hero Honda Motors, a retail Honda dealership who has reported “…taking considerable pride in its stakeholder relationships, especially ones developed at the grassroots.” (Hero Honda, 2006) (p.1) Hero Honda relates that the foundation has “adopted various villages located within vicinity of the Hero Honda factory at Dharuhera for integrated rural development”. (Hero Honda, 2006) (p.1) These initiatives include:

1. installing deep bore hand pumps to make the provision of clean drinking water;
2. construction of metaled roads and connecting these to the National Highway;
3. renovation of primary school buildings and making the provision of hygienic water and toilet facilities;
4. ensuring a proper drainage system at each of these villages to prevent water-logging;
5. promotion of non-conventional sources of energy by providing a 50 percent subsidy on biogas plants. (Hero Honda, 2006, paraphrased)

American Honda Motor Company reports being committed to running an enterprise “of real and continuing value to society.” (Hero Honda, 2006) (p.1) The corporate objectives pursued by the American Honda Foundation toward this end include the following corporate objectives:

• To apply to the Foundation’s grantmaking program the same professionalism and creative management processes that characterize the other activities of American Honda Motor Co., Inc. Resources used in this program are reported to have come from capital revenues which will be invested with care and planning;
• Identification of activities for contributions that provide special emphasis;
• Operation of the Foundation in a manner that is flexible and responsive to the changing needs of society and to provide momentum for innovation and leadership;
• Complementing rather than substituting the role of public institutions and funds;
• To provide contribution funding that is reflective of American Honda Motors Inc. level of success;
• To make sure the grants of the Foundation accomplish the most possible good. (American Honda Foundation, Contributions Policy, nd) (p.1)

The American Honda Foundation states that the grantmaking it will engage in will be consistent with characteristics as follows related to youth and scientific education:

1. Programs dedicated to making the human condition better;
2. Programs that are managed properly and administered by individuals who are “enthusiastic and dedicated”;
3. Programs that look to the future;
4. Programs that are innovative and creative;
5. Programs with a broad scope, intent, impact, and outreach;
6. Programs that have a great potential for success;
7. Programs that operate from a position of financial soundness;
8. Programs that urgently need funding and which are important to the public; and
9. Programs that “represent a minimal risk in terms of venture capital investment”. (American Honda Foundation, Contributions Policy, nd) (p.1)

Weaknesses

When speaking about the problems in relations with the community, we need to discuss its relations with consumer unions. Some of them accused the management of the failure to inform about the faults in their vehicles (Skrzycki, 1998). Certainly, the company has already made numerous recalls and each of them was aimed at protecting the lives of customers throughout reforms. In fact, the company filed a lawsuit against several consumer unions charging them with defamation. The key objective of the management is to establish better relations with these unions since they have a profound effect on the customers’ opinion.

Conclusion

Overall, these findings indicate that Honda does tries to managing the interests of different stakeholders. This enterprise attempts to act as a company which creates value for the customers, stockholders, the employees, community, and environment. The key problems, are connected with the following areas: attempts to stop with the unionization of workers; 2) accusation of alleged racial discrimination, and unwillingness to acknowledge the faults or defects in the products.

Recommendations

On the basis of this discussion we can make a set of recommendations which can improve the company’s interactions with the stakeholders. They are as follows: 1) the management should take a more lenient stance toward trade unions, the attempts to stop the unionization of workers usually only spoil the public image of the company.

Moreover, the employees may be forced into belief that the management tries to subdue them. The top executives must prove that there is no need for trade unions, instead of trying to forbid them. 2) The second step which must be taken is the evaluation of hiring policies. The company has to make sure that that there is no loophole for the discrimination against employees on the basis of their sex, age, or race. 3)

The third recommendations is to establish a better partnership with customer unions which represent a large part of the community. Namely, the management should prove to them that Honda does everything possible to eliminate any risks for the customer’s health or life. These strategies can strengthen the company’s reputation of a responsible corporate citizen.

References

American Honda Foundation Contributions Policy. Web.

Bybee Roger. (2008) Whitewashing Honda. Multinational Monititor pp 8 – 9.

Clement Barry. (2001) Honda workers vote for union recognition. The Independent.

Company Information (2010) Honda Motor Company Limited. Web.

Corporate Social Responsibility (CSR) Report (2010). Web.

CSR Report (2006) Honda Corporation. Web.

Environmental Technology (2011) Briefs and Reports – News & Views. Honda Corporation Website. Web.

Gupta, A., et al (2010) Honda: The Power of Dreams. Docstoc. Web.

Honda (2010) North American Environmental Report. Web.

Honda in the UK (2008) Corporate Social Responsibility Report. Web.

Honda Motor Co., Ltd. Annual Report (2009) World Honda. Web.

Honda Ranks Top in UK for Corporate Social Responsibility (2006) Market Research World. Web.

Stakeholder Ties at the Grassroots (2006) Corporate Social Responsibility. Hero Honda. Web.

Working Together with People and Communities Honda Motor Workers (2010 ) Docstoc. Web.

Accountability and Business for Social Responsibility (with Brody Weiser Burns), (2003), Business and economic development: The impact of corporate responsibility standards and practices.

Burke, E. M. (1999), Corporate Community Relations: The Principle of the Neighbor of Choice, Westport, CT: Quorum Books.

Business respect—CSR—Dispatches#13. (2001). Web.

Dunphy, D., Griffiths, A., and Benn, S. (2003), Organizational Change for Corporate Sustainability, New York: Routledge.

Merrifield, M. (2003 Fall), “Corporate America’s latest act: Juggling corporate social responsibility” Baylor Business Review, 21, pp. 1-5, 8-9.

Muirhead, S. A., Bennett, C. J., Berenbeim, R. E., Kao, A. and Vidal, D. J. (2002), Corporate Citizenship in the New Century: Accountability, Transparency, and Global Stakeholder Engagement, New York: The Conference Board, Inc.

Prahalad, C. K. (2004), “Face Value: Profits and Poverty, The Economist, p. 54.

Skrzycki, Cindy. (1998) The Washington Post [Washington, D.C] 01 May 1998: The Center for Corporate Citizenship at Boston College and US Chamber of Commerce Center for Corporate Citizenship. (2004), The state of corporate citizenship in the US: A view from inside 2003-2004, Chestnut Hill, MA: Author.

United Nations Industrial Development Organization. (2002), Corporate social responsibility: Implications for small and medium enterprises in developing countries. Vienna: Author.

Waring, P., and Lewer, J. (2004), The Impact of Socially Responsible Investment on Human Resource Management: A Conceptual Framework, Journal of Business Ethics, 52, 1, 99-108.

World Business Council for Sustainable Development, (2000), Corporate social responsibility: Making good business sense, Conches-Geneva, Switzerland: Author.

World Business Council for Sustainable Development, (1999), Meeting changing expectations: Corporate social responsibility, Conches-Geneva, Switzerland: Author.

World Economic Forum, (2004), Global governance initiative: Executive summary 2004, London.

Introduction

Value chain in a company consists of activities that aim to take in inputs and convert them into outputs that are of high quality in order to cater for the needs of the end consumer. Value chain activities are important to an organization because they add value and quality to the end product so that a consumer can use the good/service and obtain satisfaction (Kourdi 2009, 133).

Value chain activities are often conducted by numerous departments which all work together to produce quality products and services. Some of the departments that work together in order to add value to raw materials/goods as they move down the industry value chain include; the exploration department, manufacturing department, inbound and outbound distribution department, sales and marketing department, after sales department and the administration department (Worthington & Britton 2009, 45-50).

The need for creating value along the distribution chain has forced supply chain management managers to integrate planning and use proper strategies to ensure that raw materials, work in progress and finished goods reach where they are needed at the right time and in good quality (Wisner et al 2008, 22). Additionally, supply chain experts need to develop contingent strategies and tactics that will alow their distribution networks obtain high degrees of flexibility as goods move either forward or backwards.

The company

The Automobile Industry is a good example of an industry that uses supply chain management activities to add value to vehicles and automobile parts and come up with a diversified range of products that can be used by various consumers in a wide range of industries (na, 2011).

The level of investment and capital required to run activities in the automobile industry is quite high and it thus becomes necessary for careful planning to be incorporated so that goods and services can flow from vendors, the factory floors where cars are assembled to automobile showrooms around the world.

Honda is an Automobile manufacturing company that operates in over 150 countries and produces close to14 million internal combustible engines annually making it the world’s largest internal combustible engine manufacturer and motor cycle manufacturer.

The company has been in existence for over 60 years and has built one of the largest global networks in the automobile industry and is now the worlds 6^th largest automobile maker. The company currently has over 180,000 employees and made over $ 120billion in gross revenues in 2010, the company’s expansion and operations have been able to run smoothly due to the abundant assets and owners’ equity that the company has to finance it expansion activities (Andrew 2010, 91-94).

Structure of the Organization

The company has its headquarters in Minato, Tokyo, Japan, which coordinates the company’s activities with its branches and car dealerships. The Headquarters serves as the central decision maker with all leader functional units being located in Tokyo. The company uses regional heads who are well experienced business executives to communicate the intentions of the corporate heads and coordinate all supply chain activities where the company has vested interests.

These business executives then head all other regionalized functional units within their regions such as China, United States, Pakistan, Canada, England, Japan, Belgium, Brazil, New Zealand, Indonesia, India, Thailand, and Turkey.

Figure 1 Typical example of supply chain activities within the automobile industry.

Vision, Mission & Strategic objectives

Vision

Honda plans to being the most respected, responsible and best performing among automobile manufacturers in the world by building vehicles and engines that are highly reliable and of high quality. Honda further aims to produce highly efficient, reliable and environmentally friendly automobiles and engines.

Honda desires to become the most recognized automobile company that will not only become competitive but also a successful force for progress within the automobile industry. Honda’s mission is to fundamentally make a difference in the world and especially the Automobile industry.

Mission

Honda has defined its mission as an organization which intends to operate from a global viewpoint. Honda is dedicated to supply products of the best quality, yet at a sensible price globally to satisfy all of its clients. Honda’s mission is to build good reliable automobiles that will be used across the world to meet consumer needs and initiate satisfaction (Worthington & Britton 2009, 77).

The company maintains that in order to produce high quality and dependable motor vehicles the company must always advance with ambition and youthfulness, value sound theory and continuously build up fresh ideas (Taylor 2008).

Strategic objective

Honda believes that in its day to day operation it will incorporate strategies and tactics which will ensure the company is Performance Driven because this fact will ensure that the company will fulfill its promises through continuous improvement in the use of more safer, dependable operations within the automobile industry that will develop superb vehicles and engines.

Success of the organization

The last decade has seen Honda grow from an average automobile manufacturer to a respected one. The acquisition of a good corporate leader and strategic reliance has seen the company overtake Nissan to become the 2^nd largest manufacturer in Japan and overtake Chrysler to become the world’s 6^th largest manufacturer worldwide.

The company through its Acura brand, which is considered a very good luxury car model the company has penetrated the American market and is a successful brand in North America. The company has also expanded its business and entered into the Aero engine industry making it a more attractive company worldwide, increasing its marketing share, revenues, profits and improved the company image worldwide (Mohamad 66-71).

PESTEL analysis

Political-legal Analysis

The largest markets of Honda are in Japan, North America and Europe they are considered politically stable and the fact that Japan is among the G8, has paved way for the penetration of Japanese products into these markets due to good political relationships between Japan and the governments of these regions (Allison & Kaye 2005, 133-140). The good political relationship between Japan and these countries has created less legal hurdles in the path of Honda.

Social-Economic analysis

The success of Honda can be attributed to the fact that the company creates luxury vehicles that target mostly developed countries and regions such as Europe and North America. These regions are known to be economically stable. Also the citizens have high disposable income and good family structure that is favorable to Honda as an automobile manufacturer.

Technological environment

Japan is one of the most advanced countries in terms of technology enabling the country increase output and produce products that are highly dependable and of high quality. Project management and operations management technology from Japan is a key component that has lead to success of Honda in the Automobile industry.

Competitive intensity

Threat of new entrants – Barriers are placed by existing companies and regulatory authorities to prevent new entrants from making abnormal profit flows for existing companies some of the threats include government policies, exploiting cost advantages, access to distribution and capital requirements. In this case, the Automobile industry is known to be very capital-intensive since acquisition assembly plants and equipment can be very expensive.

Intensity of competitive rivalry among existing firms – firms within the same industry always compete for the available market share either through powerful competitive strategies, innovation, structure of industry costs, switching costs or degree of product differentiation and so on. There are many car manufacturers worldwide thus increasing the level of competition in the industry.

Threat of substitute products or services – consumers opt to go for substitute products if quality is better, price is relatively better or the cost of switching is favorable. There are relatively fairly many substitutes for motor vehicles except for motor cycles, airplanes, trains and Ships. This therefore means that the Automobile industry becomes more competitive for Honda.

The bargaining power of customers – the bargaining power of buyers depends on the number of buyers within the industry who purchase from the available suppliers, differentiation of products, and the profit margin of buyers especially if they are resellers, switching costs that are associated with switching brands and the importance quality and service to the buyers. Currently, there are very many brands of automobiles thus increasing bargaining power of buyers and increasing the intensity of competition.

The bargaining power of suppliers – Suppliers who provide raw material can determine the profitability and viability of an industry by setting prices of implements which in turn affect the profit margins. The concentration and number of suppliers affect their bargaining power, the importance of the industry to them, the ability of suppliers to integrate forward and the role of quality and service in the industry, but the ability of Honda to produce some of its raw materials increases its competitive advantage (Stadtler 2008, 74).

SWOT analysis

Strength

Honda has a considerably good corporate culture; a culture of quality, reliability and innovation that has enabled it to become a global manufacturer of automobiles. The company also has good leadership structures and leadership that is capable of steering the company into the future.

The availability of adequate resources has also contributed to growth and expansion (Kourdi 2009, 66). Honda has one of the most sophisticated internal combustible engine technologies in the world. The company has the capacity of building over 14 million engines annually, which is way above many manufacturers in the industry.

Thus, it can produce and deliver many automobiles giving it an advantage over other companies which cannot match up and do the same (Douglas 2008, 146). Not only can Honda produce many engines but the company also has a well developed quality control system that has enabled it rise the levels of quality within the company’s products.

Weaknesses

Although the company has adequate resources, its resource base is not enough to compete with the likes of Toyota, Volkswagen and General Motors and this limits Honda’s ability to compete equally within the industry. Due to the capital intensive nature of this industry companies like Toyota have been able to pursue their expansion strategy more effectively (Wheelen & Hunger 88).

Opportunity

The company is yet to penetrate the Asian market especially India and China but through mergers and strategic alliances, the company can double its sales in Asia and boost its position in the global Automobile market (Wheelen & Hunger 2002, 61-62).

Threats

More established automobile makers like Toyota, Volkswagen and General Motors are more likely to react to the actions and recent success of Honda and develop strategies that may hinder or affect Honda’s business. Thus, it is necessary that the company undertakes continuous research to improve their business (Michael 81-83).

Key Drivers for change

The competitive nature of the industry can be used by the management as the key driver of change; this is because when other competitors decide to take on Honda it will require the company also to retaliate by intensifying competition. Parameters such as sales, market share and company image can be used by management as key performance indicators that may be of use to detect if changes are needed (Kourdi 2009, 216).

Conclusion

Consumers and buyers today purchase value and attributes of products and therefore it is necessary that all activities of the integrated supply chain industry be geared towards increasing value for the resellers and end consumers. Honda being the 6^th world’s largest Automobile manufacturer has a long way to go if the company is to realize its vision. Thus, it is necessary for the company to continuously improve the functions of each functional department in order to satisfy its customers and have a sustainable business.

References

Allison, M. & Kaye, J., 2005. Simplified strategic planning: a no-nonsense guide for busy people who want results fast. Worcester, MA: Chandler House Press.

Andrew, H., 2010. The definitive Handbook of Business Continuity Management. New Jersey: John Wiley and Sons.

Douglas, L., 2008. Supply chain management: processes, partnerships, performance. New York: Supply Chain Management Inst.

Kourdi, J., 2009. Business Strategy: A Guide to Effective Decision Making, 2 editions. New York: Economist books.

Michael, P., 1990. The competitive Advantage of Nations. Northampton, MA: The Free Press.

Mohamad, J., 2009. Inventory Management: Non classical views. Florida: CRC Press.

Na, 2011. Honda Worldwide, History. Honda. Retrieved from www.World.honda.com

Stadtler, H., 2008. Supply chain management and advanced planning: Concepts, models, software, and case studies. New York: FastBook Publishing.

Taylor, A., 7 March 2008. America’s Most Admired Companies: Honda. CNNMoney.com. retrieved from www.CNNMoney.com

Wheelen, T. & Hunger, D., 2002. Strategic management and business policy. New Jersey: Prentice hall. 2002. Print

Wisner, J. et al, 2008. Principles of Supply Chain Management. New York: Cengage learning.

Worthington, I. & Britton, C., 2009. Business environment, 6th edition. Melbourne: Pearson Education.

Introduction: A Look at PT Kereta Api Indonesia

Prior to 2009, PT Kereta Api Indonesia was considered as one of the worst managed companies in Indonesia:

• Lack of sufficient reliability.
• Aging Equipment.
• Inefficient Staff.

Issue that Caused the Need for Organizational Change

Due to mismanagement, the company experienced a financial disaster which resulted in lossed amounting to IRD 38 billion in 2007 and more than 82 billion in 2008 (Anggadwita & Dhewanto, 2013).

In-depth Look at PT Kereta Api Indonesia

Where do the companies problems stem from?

The main problem the company was experiencing was severe is management of its operations which resulted in issues cropping up in multiple operations. Not only that, the company was also experiencing a significant resistance to change from within its own organization due to the years of neglect which created a complacent business culture. It is the combination of these factors that contributed to the financial disaster that the company experienced in 2007 and 2008.

Organizational Change that Took Place

• In 2009, a new manager, Ignatius Jonan was put in charge of he company.
• New innovative practices were introduced on every level of the company resulting in improved performance.
• Currently acknowledged as a successfully run company.

Why did the Methods of Jonan Work?

The leadership style of Jonan initially focused on a top-down approach wherein changes to the company’s operations were unilaterally dictated by him. The reasoning behind this was due to the complacency that was present in multiple departments that required significant interference from an outside party to revitlize them (Anggadwita & Dhewanto, 2013). As a result of Jonan’s unilateral actions, the company was able to slowly recover resulting in significant gains in three years.

What Factors Contributed towards the Success of the Strategy of Jonan

The success of the strategy was based on the increased level of autonomy and power that was given to Jonan at the start of his tenure with the company. The endemic mismanagement of operations could only be resolved by completely revitalizing the system and this was only possible if a “top-down” leadership style was implemented. While horizontal company leaderships are ideal, the sheer amount of issues the company was experiencing at the time could not implement such a method without there being considerable resistance to change within the company.

Comparative Case: A Brief Look at Honda

• Started operations in World War 2.
• Currently one of the largest motor vehicle manufacturers in operation.
• Experienced significant organizational change.

Issues that Caused the Need for Organizational Change

• Experienced decline in sales due to Japan’s loss at the end of World War 2.
• Inventory did not match the needs of a cash strapped populace.

Organizational Change that Took Place: Honda’s Case

• Made adjustments in its product lineup and introduced cheaper and more price competitive moto vehicles.
• Focused on quality goods and expansion into new markets (ex: the U.S.).

Methodology

• Study will utilize qualitative surveys to examine the employees of PT Kereta Api Indonesia.
• Surveys will focus on change readiness, life experiences of the employees, values and will examine the type of leadership style desired by the employees.

Limitations of the Project

• Surveys will be limited to PT Kereta Api Indonesia.
• Since only one company will be examined, there will be a limited number of responses to be compared.

Process of the Study: Comparative Approach

• Comparison of the process of organizational change between Honda and PT Kereta Api Indonesia will be conducted.
• Comparison will reveal the impact of change management strategies and what factors can influence it.
• Results will reveal potential methods that PT Kereta Api Indonesia could implement.

Factors for Resistance

Examination of survey results will help to determine the factors for resistance, what employees desire and, as such, this will impact the type of leadership strategy that will be recommended.

Stages of Resistance to Change

• Stages to resistance to change are denial, commitment, resistance and exploration.
• Each company has different reactions to resistance to change resulting in varied outcomes (Burke, Lake & Paine, 2008).
• PT Kereta Api Indonesia has a considerably different resistance to change compared to Honda resulting in the financial issues it experienced.
• Based on the evaluated factors that will impact the resistance to change, the strategy that will be developed to resolve it will follow the stages of diagnostics, planning, and preparation.
• The stages of implementation, assessment, and maintenance of change will be stated from a theoretical perspective since this would require PT Kereta Api Indonesia to actually implement them.

Change Model

• The change management model in the next slide will be the primary tool utilized to examine changes within the organization.
• It will be utilized to evaluate the activites entered into by PT Kereta Api Indonesia and will be useful in determining where the company is in terms of successful changes that been implemented in its operations.

Methods of Handling Resistance

• Acknowledge that resistance will occur – this equates to being open-minded regarding the possbility of some employees not being willing to change.
• Determine the source of the resistance – examine what factors exployees specifically do not like about the changes taking place.
• Enagage the right managers within the office – this involves talking to influential people within the company who can help in the transition process.

Techniques for Managing Change

Possible strategies that Will be Recommended:

• Get employees involved in change management to ensure that the proper processes are implemented (Weiner, 2009).
• Understand why resistance to change occurred in the first place (Cawsey, Deszca & Ingols, 2011).
• Emphasize new standards of performance and the rewards that come with them.

Proactive/Reactive Factors

• Proactive stances to resistance to change means implementing methods to stop resistance before they can occur within the employee population (Combe, 2014).
• Reactive stances means responding to changes as they occur within the company rather than implementing processes to prevent them in the first place (Jones, 2012).
• Each method has its own pros and cons depending on the type of organization that the company embodies.
• Study will examine whether a pro-active or reactive stance is more appropriate for the changes that need to take place in PT Kereta Api Indonesia.
• Comparisons will be made with the case of Honda to examine what methods they utilized (proactice or reactive) and the resulting changes that took place in the company as a result.

Conclusion

Companies do not operate within a vacuum, they need to take into consideration the market forces that can impact them on a daily basis. The case of Honda is a prime example of what a company can do when it comes to adjusting to changes in the market and responding to it in a positive way. PT Kereta Api Indonesia can potentially adopt similar changes, but it would need to examine its current workforce and utilize proper change management strategies to bring about the needed changes to its operations.

Recommendation

Based on the information that has been gathered, it is the recommendation of this study that PT Kereta Api Indonesia utilize a “maximizer” leadership style to build upon the gains that have already been achieved under the leadership of Jonan. Dealing with the resistance to change from the workers can be accomplished by asking them what they find wrong with the desired changes, what sort of change they would recommend and negotiate with the workers based on this information.

Change is necessary for the company but it should not compromise the relationship that the company has developed with its workers. Lastly, future studies that investigate this topic may want to examine how the local business culture within a particular country impacts the resistance to change of its employees. The case of Honda’s organizational change may not be replicable if it is dependent on the business culture that is inherent in Japan.

Future researchers investigating organizational change may want to take this into consideration since there is no such thing as a “one size fits all” process when it comes to changing internal operational processes.

Reference List

Anggadwita, G., & Dhewanto, W. (2013). Service Innovation in Public Sector: A Case Study on PT. Kereta Api Indonesia. Journal of Social and Development Sciences, 4(7), 308-315.

Burke, W. W., Lake, D. G., & Paine, J. W. (2008). Organization Change: A Comprehensive Reader. Hoboken, NJ: Wiley & Sons.

Cawsey, T., Deszca, G., & Ingols, C. (2011). Organizational change. Thousand Oaks, CA: SAGE Publications.

Combe, M. (2014). Change readiness: Focusing change management where it counts. Newtown Square, PA: PMI.

Jones, S. (2012). Change management: A classic theory revisited. Web.

Weiner, B. J. (2009). A theory of organizational readiness for change. Implementation Science, 4(67).

Abstract

This paper demonstrates the use of real financial performance data to investigate environmental sustainability in the operations Honda Motors Company. The objective is to carry out a broad environmental friendliness analysis and future sustainability. It explores the various techniques and tools used in environmental audit analysis. In the analysis, we use financial data for Honda Motors Company for two years period from 2009 to 2010. The study is based on a comparative analysis of historical data of the Corporation. The study concentrates on the statistical highlights of the Corporation, ratio analysis, and environmental issues surrounding its functionality. In addition, percentages are used in the analysis to monitor changes over time. Graphs are also used to portray the trend of various variables in the study over the two year period. Finally, the results are interpreted based on ideal situations, and recommendations are made based on the findings.

Introduction

Honda Motors Company is one of the largest motor car manufacturers in Japan. Despite the constant economic swings characterized by hyperinflation and depression, Honda has managed to stay afloat and profitable due to stringent financial models, the top management has assimilated into its operations. Reflectively, in manufacturing, the company has always been active in customizing its products to suit every class from which the company has cut a market niche (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.67). As part of the operation strategy, the company revolves around the philosophy of joyful, creating, selling, and buying. Besides, this philosophical alignment aims at getting and keeping customers through value for their money (Honda Motors, 2011d, p.18). As a result, Honda has an extensive and tight market across the globe, from the third world countries to the developed economic territories (Campbell, 2005, p.23). In the first quarter of the 2010 financial year, Honda Motors has surpassed the forecasted financial performance due to an organization of business operation bundles such as cost-cutting, promoting efficiency, environmental consciousness, and streamlining operations (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.67).

As compared to the last six quarter financial earning, the performance for 2010 has been higher in the product range. In the process of achieving the current financial status, the company outperformed the arc rival, the Toyota Company, in sales at an impressive figure of ¥8,579,174 million (Honda Motors, 2010a, p.06). In a bid to stay relevant and improve on its products, the company has come up with complete combustion engines running on gasoline and hybrid gasoline-electric engines (Honda Motors, 2011d, and p.6). This model of the engine is environmentally friendly and cheaper to maintain than the ordinary model. Though still not fully introduced into the market, the company is in the process of developing biofuel and hydrogen driven fuel cell engines. In appreciation for their continuous environmental concern, Honda Motors was awarded the prestigious honor of being the best environmental sustainability friend for their category in the world (Honda Motors, 2011b, p.15). As shown below, these figures reflect the performance of Honda Motors between 2007 to 2010 financial years.

Summary of financial performance from 2007-2010

Table 1. Summary of financial performance from 2007-2010

Source: Honda 2009 annual report

From the above table, it is apparent that Honda has had an erratic financial performance over the last four years. Despite the threat of declining performance, none of the financial years reported loss. Total revenue peaked at 12, 003 in the FY2008 after which it declined to lowest performance at 8, 579, in the FY2010. Operating income was at its lowest of 190 Yuan in the FY2009 and at the peak of 953 Yuan in the previous financial year. Despite the poor performance in the FY2009, in terms of the net income, FY2010 is characterized by a stabilizing net income, operating income, and total revenue (Wall Street Journal, 2011, p 16).

The graph below shows the relation in terms of sales between Honda Motors Company and its competitors.

From the above graph, it is of the essence to appreciate the fact that Honda Motors has remained relatively stable, with the existing discrepancy almost negligible. Though the performance slowed down in the month of January, gains made in the second financial session reflected an upward trend, which assumes a normal curve for the preceding years. Though the competitors may seem to be performing better in their sales, their forecasting orientation is not very stable as compared to that of Honda Motors (Wall Street Journal, 2011, p.04).

Objective of the Study

The objective of this research paper is to comprehensively carry out environmental audit analysis for Honda Motors and draw informed inferences from the results achieved. Specifically, this analysis will concentrate on the outstanding performance of Honda Motors for a two year period of 2009-2010. From the outcome of this analysis, the paper will identify Honda Motor’s sustainable and environmentally friendly production position as a function of Product Development Domain, Purchasing Domain, Production Domain, Transportation Domain, Sales, and Services Domain, Product Recycling Domain, Administrative Domain, and efficiency. In addition, a recommendation would be presented on the viability of investments in the Honda Motors Company based on the final findings.

Literature Review

Honda Motors Company responds to environmental concerns with different comprehensively reviewed policies depending on the geographical location of its plants, national environmental bodies, and business ethics (Ito, 2010, p. 11). For every global operation carried out by this company, environmental sustainability has been its major priority on the facets of sustainable productivity and energy conservation through efficiency. In the contemporary business environment, resource problems, climate change, energy problems, biodiversity, waste management, and pollution control are substances of concern in operating self-emission initiatives (Ito, 2010, p.21). Honda supplies different products form its long chain of departments across the global market. Since most of these products are ranked in the category of mobility products, Honda regards issues on climate change with great concern. In the production chain, greenhouse gas emission is associated with climate change as a result of global warming (Honda Motors, 2010a, p.22).

An in-depth life cycle analysis reveals that the apparent emission of carbon gases contributes to the largest damage as compared to other gases. In response, Honda Motors Company has set up targets for carbon dioxide reduction across its main domains and geographical regions of operation. Besides, Honda Company has been at the forefront of impact assessment research and alternative production approach to function optimally within the acceptable pollution limits (Honda Motors, 2010b, and p.13). Across the major domains of Honda Motor Company’s operations, specific initiative have been internalized and fully embraced by their management system through quarter plans which embrace Hi-efficiency production in their engines, Innovative production of hybrid products supported by environmentally friendly technology, and revolutionized green and renewable energy sources(Honda Motors, 2010a, p.18). These policies work concurrently to boost performance standards and incorporate the need for ‘going green’ and ‘appreciating nature’ as reflected in the company’s goal of joyful production to satisfy the customers’ needs.

Environmental Issues analysis/ Life cycle Assessment

The outstanding long-time commitment of Honda Company towards the protection of the environment through the production of environmentally friendly products has seen this company earn the prestigious award of being the best eco-friendly manufacturing company. This status resulted from the development of the hybrid CVCC model. The process of maintaining sustainability demands that a company should embrace a life cycle assessment approach to understand and review issues of environmental concern (Honda Motors, 2010d, p.11).

Product Domain Development

Honda Company has a high turn over in terms of the products it produces annually. In the process, pollution as a result of carbon dioxide emission is eminent if not properly managed. To address this concern, Honda company, through its top management team has initiated several initiatives aimed at producing fuel-efficient automobiles, reducing the intensity and volume of exhaust emission, developing green alternative energy fuels products, reducing noise pollution and adopting the 3R design(Reduce, Reuse, Recycle)(Honda Motors, 2011d, p.18). The success of Honda Company in the 2009-2010 financial years can be attributed to the introduction of the hybrid engine model as part of its assembly of products. This model is affordable, highly efficient in fuel consumption, and produces very low carbon dioxide gases in combustion. In addition, this model has a safety enhancement feature with full manual to its user (Honda Motors, 2011c, p.23).

As a policy resolution, Honda has successfully gone through the ISO certification and a clean bill of health in line with the international environment management protocol for manufacturers (Honda Motors, 2011a, p.07). In appreciation, awards and accreditations have been given to Honda Motors Company, such as UCS greenest carmaker in America in 2007, the best economy rating for EPA fuel in 2005, and the 2010 category for the greenest automobile. Alongside the hybrid engine, Honda company has incorporated electric mechanism in the hybrid engine to enable their customer have an option of switching ignition to charged electric cells to save fuel. In the findings of the National Renewable Energy Laboratory, in a study conducted in 2005, Honda Company score 62% in the efficiency category of Toyota’s 64% (Simpson, 2006, p. 32).

Also, as the world leading producer of internal combustion engines, Honda has reaffirmed commitment and fully subscribes to the set environment regulation protocol in a continuous environmental impact influence aimed at reducing the quantities of carbon dioxide emitted into the atmosphere across its manufacturing plants. In the 3R, Honda has succeeded in maintaining along history of recycling and activities aimed at building harmony as part of the local communities who form part of their market niche (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.77). Tracing back from as early as 1960, the community forests initiative have successfully created a permanent impact on the locals and has encouraged them to adopt effectively in resource use and reuse. This is part of their third priority activities in the year 2009 which categorically states that “We will work to reduce environmental impacts and ensure the effective use of resources through efficiency improvement” (Honda Motors, 2011c, p.02). In addition, Honda Company has contributed towards biodiversity development and conservation following the adoption of technological disseminators of next generation engine development, self-energy producing automobiles, and fuel efficient CVR models.

Purchasing and Production Domain Development

In the production process, raw materials used include water, and other components which at the end become wastes. Waste disposal challenge is a reality for most heavy manufacturing companies. Honda Company has adopted green purchasing as alternative production efficiency. In the management segmentation, environmental management has been created to monitor products supplied by their suppliers who have to sign a ‘zero emission initiative’ pack before being associated with its production line. Besides, Honda has established green factories using solar powered machines like the one in California. As part of the product domain, energy is considered key in the production and system maintenance. In the words of Honda CEO, Takanobu Ito, the company is planning to refine its brands especially the hybrid model to incorporate the new technological changes and increase the models to five (Ito, 2010).

Figure 2. The progress of waste and greenhouse reduction initiative. Source: Honda Motors, 2010b.Over the 2010 financial year, the progress of green gas reduction has been very.

Successful as indicated in the above graphs. Reflectively, carbon dioxide emitted during production process reduced from 93.5% in 2010 to 70 percent in the following year. This can be attributed to the numerous environmental strategies adopted in the same year. The same applies to the amount of carbon dioxide released in the transportation domain. Steadily, the amount water used in production has also reduced due to conservation as a sustainability strategy.

Transportation Domain

Transportation of raw material, finished products, and experimental models demand a fair amount of resources in the form of logistic support and energy. In the process, the automobiles contracted to do the transportation releases green house gases and other environmental unfriendly waste. Thus, there is an immediate need for management of this process within the set environmental business operations protocol. In a bid to handle this challenge, Honda company through the transportation and audit departments have embraced transportation efficiency improvement by lessening packaging material, proper maintenance of the company’s transportation fleet and designing a model which uses the best alternative whenever the company has to transport either raw materials or finished products (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.65).

Sales and Services Domain

To survive the unstable economic times, as predicted by financial analysts of the Wall Street, Hondas has responded by concentrating in motorcycle manufacturing as a means of accessing relative and competitive advantage over its competitors. In addition, efficiency has been enhanced in engine production department through continuous technological research, innovation, and streamlining overhead costs. As the new technology embrace the motor market, Honda is not left behind especially on the facets of producing green energy and hybrid engines guaranteeing optimal energy utilization at manageable and environmentally friendly levels (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.67). To minimize the waste associated with service delivery and sustainability, Honda Motors Company has internalized environmental management chart which periodically reviews and make recommendation on technological research breakthrough. The company sells, maintains and may recall any automobile noticed to be performing below the expected. Before the customers access their order, Honda Company has put in place parameters for measuring fuel consumption, efficiency, and performance (Campbell, 2005, p.11). Specifically, this initiative has contributed positively to Honda Company in California where tax exception is practiced for companies producing goods at minimal pollution levels (Harrison & St. John, 2010, p.45).

As presented in the chart below, the figures are drawn from the Honda Motors Company website for their 2010 net sales of the different products produced by the company.

From the pie chart, it is apparent that sale of Automobile soared at 76.7% as compared to the motorcycle department sharing 14.1% of the total sales. Besides, power product controlled 3.4% of the annual sale. In the preceding quarter after the first successful segment of the financial year, the profits decline by 56% to 54.2 billion yen mainly as a result of the impact of reduced overall sales of units for the same period. Despite the variance in profits realized, the company adopted efficiency in operations to cover up for the decline. Besides, it hybrid model was sold at zero percent tax as the economic laws dictated.

Product Recycling Domain

In the product recycling domain as part of the environmental concern, the issue of the end of usefulness of a product arises. When such a product disintegrate to unusable level, it becomes a waste is likely to be damped by its final user (Alsop, 2002, p. 19). Such damped automotive parts pollute the environment and is a threat towards sustainable co-existence between mankind and his activities (Gelder, 2005, p.45). Sometimes, the rooting parts of such damped wastes may become a health hazard. Faced with this challenge, Honda Motors Company has formulated a reuse policy for such types of wastes. For instance, it would reward an end user with financial gain when the used up automobile or machines are returned to the plant for recycling (Foster, 2002, p.23). For Honda Company, parts recovery is not limited to the metallic parts only. Rather, the rubber, aluminum, among others is included in the list of reusable parts. These parts, irrespective of their condition can be recycled and reused for other purposes. Reflectively, this practice has substantially reduced the quantity of harmful disintegrated engine and body part which originated from Honda plants (An & Sauer, 2004, p. 35). For the parts which cannot be reused, the company has developed an initiative and an awareness campaign aimed at enlightening customers on the need for proper disposal of end-of-life products. Depending on the material from which such a product was made of, Honda has established several disposal plants for its end-of-life products. In these disposal plants, the company has recruited experienced technical support team on environmental sustainability and conservation.

Administrative Domain

This domain consists of the management and personnel who are informed and knowledgeable on international environmental conservation protocols in business environment. As a matter of fact, Honda has periodic training sessions for its employees on environmental sustainability and efficiency (Harrison & John, 2010, p.32). United under the umbrella of continuous knowledge on impact assessment, this team is active in functionality of the company’s green offices, energy conservation and optimal use, environmental management, resource use and reuse, and community outreach programs on environment (Cogan, 2006, p.21). As part of social responsibility, Honda Motors Company has in the past 40 years contributed over twenty million dollars in community based initiatives such as the ‘community forests’ and training sessions (Harrison & John, 2010, p.34).

Internal Environmental Audit of Honda Company

To optimize from the favorable business climate created by China, Honda Motors has established an assembly branch which makes good use of the available cheap labor offered by the Chinese government (Bremmer & Stewart, 2011, p. 67). In the first place, Yuan currency is stronger in China and competes fairly with other major currencies like the Euro and the dollar due to economic functionality influence the Chinese government has created to attract trade in Yuan currency (Harrison & John, 2010, p.34). Besides, several export processing zone are allocated to foreign investors of which Honda Motors is one of them. In a partnership affiliation, Honda Company has established a rapidly growing relationship with Guangzhou SOE to manufacture engines in this region (Ito, 2010, p.65). To create an optimal and sustainable business environment, governments across the globe are in the first late to implement and review business policies to match with the need for environmental sustainability. In response, and to avoid the excessive fines imposed upon exceeding a carbon emission limit, Honda Company has fully embraced green manufacturing techniques which are convenient to its customers (Campbell, 2005, p.54).

Since most of the products form Honda Motors is as a result of customer oriented research, its success have been contributed by the satisfied customers who seem to accept Honda products as social favorite commodity as their expectations are met in the design, operation, and maintainability(Welsh, 2009, p.45). Further, majority of states across America have legalized the need for healthy environment and reduced pollution from carbon emission. As a motivating factor, tax exemptions, clear environment certificates and clear bill of health is issued to agents who have these interests at heart. From the California hybrid plant, Honda Motors has incorporated ethanol production and environment friendly structures in America (Welsh, 2009, p.45). Since the future of automobile manufacture business is inclining towards sustainability and friendliness to the environment, Honda Motors Company has indicated intentions to invest in technological research and development in line with the forecasted business operation environment. Besides, the company has commenced its strategic plan of remodeling the quality assurance and control to suit the current cyclones of the financial market (Honda Motors, 2010b, p.16). These efforts are geared towards creating a self sufficient production system which can survive in the international market trade.

Honda’s Competitive Ranking

As indicated in the above graph, despite these numerous efforts to stay competitive with it hybrid model, Honda’s Hybrid model remains uncompetitive to Toyota’s model. To reverse this, Honda Company seems to embrace functional strategies which consist of sustainable mapping framework, sweep spot analysis, and Triple bottom line functionality (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.57). In the first strategy, the company has since identified alternative and efficient energy consuming models for their next generation of the hybrid models expected to come in five different types (Honda Motors. 2011d, p.29). In the sweet spot strategy, Honda has endured to customize its products as required by clients who would prefer efficient and affordable models. Over time, Honda has managed to survive competition due to support form clients who have always approved of their efforts. Since its inception, Honda Company has managed to hire highly skilled engineers who have overtime combined research, skills, and creativity to come up with exiting models have ensured profit, approval from the people, and friendly to the planet (Shook, 1988, p. 58).

Market Segmentation

In order to remain competitive, Honda Motors Company has considered the possibility of joining the aviation industry as a mean of spreading operation margins and capture new market in line with its expansion goal. Thus this strategy is expected to bring success considering the fact that Honda model has maintained international standards in product quality as expected in the aviation industry (Honda Aircraft, 2011, p.7). Reflectively, market segmentation is also vital in ensuring sustainability (Have, Have, Stevens, Elst, & Pol- Coyne, 2003, p.67). When portfolio balance is maintained within manageable level, the end result is commonly referred to as optimal productivity within minimal cost constraints.

Conclusion

Since its establishment, Honda Motors Company has remained relevant, efficient, and outstanding manufacturer of automobiles and other machines. In the 2010 financial year, the recorded profit stood at over ¥8,500,000 due to the company’s adopting of diversification of products from motorbikes to generators. Besides, the hybrid model whose engine is composed of gasoline and electric functionality was major success among customers shopping for efficiency and performance. Following the approval form American environmental regulation body, Honda has experienced additional unit sales for customers who would wish to associate with the friend of the environment. Introduction of the hybrid model has secured the future survival of Honda Motors Company as the contemporary world slowly but steadily embrace green biodiversity. Unfortunately, the hybrid model is very expensive to majority of the targeted customers.

Recommendations

As global warming grows into a disaster, manufacturers are faced with the dilemma of operating efficient systems in these environments. Manufacturing business has become very expensive and proper strategic planning is of essence. At present, Honda Company is faced with the dilemma of maintaining environmental friendliness production within limited resources and more challenges. Besides, its hybrid model is non competitive to that of Toyota on performance and cost. As the need for environmental system ability hits the climax, Honda Motors Company should heavily invest in alternative energy efficient automobile research and development as forecasted by financial experts. Besides, the appearance of the Honda insight hybrid should be furnished to appeal to many customers as the current model is just but a prototype. Proper training of staff is a vital aspect of growth for any company. Thus, Honda Motors Company should invest in training of its work force in line with the modern technological know how so as to remain competitive and relevant. Apart form the current range of products, the company should spread its operations to include heavy mining machinery, water boats, aero plane parts, and electric trains.

Reference List

Alsop, R., 2002. “Perils of Corporate Philanthropy tuiting Good Works Offends the Public, but Reticence Is Misperceived as Inaction”. The Wall Street Journal An, F. & Sauer, A., 2004 Comparison of Passenger Vehicle Fuel Economy and GHG Emission Standards around the World. Web.

Bremmer, I. & Stewart, T., 2011 China’s State Capitalism Poses Ethical Challenges. Web.

Campbell, D., 2005. Organizations and the Business Environment (2 ed.), Elsevier: Butterworth- Heinemann.

Cogan, D., 2006. Corporate Governance and Climate Change: Making the Connection. Boston: Ceres.

Foster, M. S., 2002 Nation on wheels: the automobile culture in America since 1945. Michigan: Wadsworth Publishing.

Gelder, S., 2005 Global brand strategy: unlocking branding potential across countries, cultures and markets, London: Kogan Page.

Have, S., Have, W., Stevens, F., Elst, M, & Pol- Coyne, F. 2003 Key Management Models, New York: Financial Times/ Prentice Hall.

Honda Aircraft, 2011 Assembly of conforming aircraft begins. Web.

Honda Motors, 2010a Honda to Build Second Motorcycle production Plant in India Web.

Honda Motors, 2010b FY, 2011 Japan targets and progress Web.

Harrison, J. & St. John, C., 2010 Foundations in strategic management Ohio: South Western Cengage Learning.

Honda Motors, 2011a Company overview Web.

Honda Motors, 2011b News & Views Web.

Honda Motors, 2011c Honda CSR report Web.

Honda Motors, 2011d. Initiatives & Awards.Web.

Ito, T., 2010. Honda CEO speaks at the 27th Thailand International Motor Expo. Web.

Shook, R., 1988 Honda: An American Success Story: Revolutionizing the Art of Management. New York: Prentice Hall.

Wall Street Journal, 2011 “Auto Sales”. Web.

Welsh, J., 2009 “Car Compare: 2010’s Toyota Prius vs. Honda Insight.” Wall Street Journal. Web.

Introduction

The Honda Motor Company is among Japan’s top motor vehicle producers and has over 200,000 thousand employees with three major branches: motor cycles, automobiles and power products (Frank 2003). In 2007, Honda was ranked third among top passenger car producers in Japan with a market share of 13.8% behind Nissan (18.6%) and Toyota (45.8%) (Shimbun 2007). The company held position three with a similar percentage in small-sized car production with Suzuki and Daihatsu taking position one and two respectively. However, Honda led the park among the top motorcycle producers in Japan at 55.5% (Shimbun 2007). In 2010, Honda motor company was ranked at position two with 600,157 units being sold in Japan alone. It was also ranked at position six among the world’s top motor vehicle manufacturers and was the second Japanese exporter to the USA and the rest of the world trailing behind behind the Toyota motor company (JETHRO 2010)

During the second quarter of the 2010 financial year, the company recorded a reduced profit of 54.2 billion yen which was a 56% decline when compared to the financial year 2009 (JETHRO 2010). This decline in the profit margin has been attributed to the fall in vehicle sales and the depreciation of the US dollar against the Yen. The company’s motor cycle sector has been pivotal in stabilizing its financial standing in the down turn in the auto industry. Focusing on small fuel efficient models has enabled the company resist the global economic slump thus putting it ahead of its rivals. Its hybrid vehicles are designated tax free in Japan (Gruden 2003).

FY2009 income data, in billions of Japanese Yen

Source: Honda 2009 annual report

Environmental Preservation

Honda motor company was among the first motor companies to position itself in the reduction of CO₂ emissions which is a major issue that affects the environment. Advancing the hybrid car technologies has been used extensively by the company to cut on the carbon emission. The production of electric motorcycle is in line with the company’s goal of environmental friendly models which run on batteries and have a zero CO₂ emissions (Sengupta & Jammalamadaka 2003).

With the Japanese automobile manufacturers coping with environmental stiff policies and regulations, Honda motor company has been in the frontline in environmentally conscious management surpassing its rivals. During the 2009-2010 financial year, the company cut its CO₂ emissions by 12.6% in the automobile industry, 14.4% in power sports products and 10.8% in power equipment (Honda Environmental Annual Report 2010).This was in part possible due to public campaigns for the replacement of vehicles and other CO₂ reduction measures (Honda Environmental Annual Report 2010).

Government Regulations

With rising concern over environmental pollution and the fact that motor vehicle are the leading emitters of the green house gases, several governments in the world have imposed strict environmental regulation on the exhaust gases from vehicles (Basshuysen & Schafer 1995). These regulations have in turn encouraged motor vehicle manufacturers to make innovation for environmental friendlier products. The Muskie Act (1970) in the USA passed stringent regulations requiring the motor industry to produce vehicles which would cut green house gas emissions to one-tenth (Mytelka & Boyle 2005).

However, this act faced fierce opposition from car makers in the USA resulting to in delay in its implementation. One year before this act was passed in USA, a similar act in Japan was proposed but because the Japanese carmaker were less vocal on environmental policymaking than their USA counterparts, obliged and in response concentrated on technological innovation (Mytelka & Boyle 2005). Competition among the vehicle manufactures and domestic public pressure were the major for the Japanese compliance. Following this move, Honda became the first company to comply with this regulation in its motorcycles and smaller automobiles. A new type of engine, the CVCC was developed.

Toyota and Nissan on the other hand achieved the target by creating a new catalyst instead of making modification with their engines (Gupta 2006). The company later adopted other clean vehicle technologies such as electric hybrid and fuel cell vehicles. More regulations enacted in USA in 1990s also had impacts on the Japanese auto makers as they depended so much on US market for their exports (Mytelka & Boyle 2005).During this time, the California air resource base in the United States enacted the low-emission regulation which demanded that general motors, Ford, Chrysler, Toyota, Nissan, Honda and Mazda include in their total sales, a small number of zero emission vehicles (ZEVs) as a means to mitigate environmental degradation. This percentage has been rising over the years from the initial 2% in 1998 to 10% in 2003 (Mytelka & Boyle 2005).

Many motor companies at the time argued that the policymakers lacked the knowledge that the alternatives to the traditional gasoline engines too presented similar challenges to both the technology and the infrastructure. Nonetheless, this regulation came into force at the end and in the process prompted the manufacturers to develop the ZEVs. In Japan, the drafting and environmental implementation for automobile emissions was delegated to the environmental agency, the ministry of environment and Japan’s ministry of international trade and industry (Jaffe, Lerner, & Stern 2004)

Main Drivers for Technological Changes

Pressure has been mounting on the motor vehicle manufacturers to produce vehicle designs distinct from the current internal combustion engine (ICEV) that pollute the environment. The battery powered electric vehicles, hybrid electric vehicles and the fuel cell electric vehicles have been the most discussed alternative vehicle models with the compressed natural gas vehicles, ethanol and methanol-fuelled vehicles also receiving similar popularity (Cowan & Hulten 2000). Due to the lock-in arising from the fierce competition in the internal combustion engine vehicle that is delaying developing of alternative design, the government of Japan has taken measures to support the development of efficient and environmental friendly vehicle designs.

The government of Japan has shifted its focus from a supply push strategy such as funding research and development and is nowadays focusing on the demand portion and on how scientific discoveries are being utilized in the society (Max 2004). This modern technical change theories followed by the Japanese government is influenced by social technical trajectories and acts as a guide. These social-technical trajectories bar other alternative technologies such as the internal combustion engine vehicle lock-in effects. The technical-change theory replaces the sequential linear model with a model in which both learning and interaction are at its core.

This model in which learning process and interaction is at the core of technical theory requires support at all levels of development and at the same time (Gulliksen & Herning 2008). For the interactive model to work, government acts as organizers of strategic niche market and modulates the market through taxes, legislation and the niche market legislation. Such a model creates a feedback to the research and development and in the process guide research. Thus, the concept of the interactive model that is based on voluntary agreements and soft compliance is to act as a modulation for the technical change towards the desired direction.

When choosing a technology to use in the linear model, the basic level is considered while determining the field of science to support. In linear model of technology development, the market guides the other levels of development ranging from demonstration to diffusion and requires no government intervention (Anderson & Anderson 2010). This model does not acknowledge all those other factors that bar the introduction of a new technology such as low infrastructure, lack of information and the high initial costs.

The sequential linear model on the other hand put into consideration barriers such as inadequate information, the split incentives and even the lock-in effects for the introduced technology, this motivates the government to support the new technology in all stages of development including diffusion (Gulliksen % Harning 2008). However, this model involves making very strategic technical choices such as deciding which technology should receive continued support especially the development and the deployment stages. Thus, for the right choice, perfect foresight in technical development and future market demands should be made.

The third model of technical change, the interactive model, does not clearly define the technological choice (Max 2004). However, it is obvious that governments cannot fully support all the experiments with all possible technologies; it has to prioritize on which technology to support. Path dependency is acknowledged as a natural development for the new technology in the interactive model, the model’s objective is to drive this path towards the right direction (Ison, Peake & Wall 2002). The new technology chosen is assumed to contain a natural path that is accepted by all the active companies, the governments and the other participants. The choice of the new technology thus is assumed to rise from experience gained from government-initiated experiments. Government acts as a trustee for the interest of the general public in the development process (Chandra 2006).

The Interactive model allows the established and large controlling companies to have a very important role resulting in their lack of making radical changes (Max 2004). As a check, it is important that regulatory approaches based on principles set by environmental policies be considered. Doing this allows outsiders to step in with more radical innovations. This principles need to be set ahead of time in a bid to promote innovation; it is a ‘technology-forcing advancement’. Such a strategy is the one being used by the California zero emission vehicles mandate which relied on setting standards rather than picking the winners (Max 2004).

Government regulation plays a major role in driving technological changes in the Honda motor company. Its support of the battery powered electric vehicles (BPEV) chosen by the ministry of international trade and industry and the establishment of a basic market expansion plan to expand BPEV development has seen the company embark on the development of vehicles with reduced emissions and low oil-dependence. The support offered by the government included the removal of trade barriers through technical development, revision of laws and taxes, erecting new standards and creating a fuel infrastructure (Dogobert & SAE 1995).

By 1997, MITI had altered its expansion plans to include under clean vehicles not only BPEVs but also hybrid electric vehicles, CNGVs, methanol fuelled vehicles and the fuel cell electric vehicles. This move has resulted in Honda coming up with three green vehicle models; insight (2001), civic hybrid (2004) and Accord hybrid (2004) (Honda Environmental Annual Report 2010). Technological advancement in Honda has been attributed to the general trend in the Japanese motor vehicle industry, the strength of the Honda lying in its ‘ultra capacitors’. Since the amendment of the Zero emission vehicle in 1996, there has been an increase in research and development and the production of series hybrid vehicles in Honda. By 2005, Honda had sold up to 48,000 hybrid cars (Anderson & Anderson 2010).

Study shows that Honda started conducting research and development in 1980’s although nickel metal hydrate batteries were produced first in 1990 in a joint venture with the Matsushita battery company (Anderson & Anderson 2010). The first electric vehicle by Honda was introduced in the Californian market in 1997. The insight hybrid models were first sold in 1999 and were closely followed by the civic and the accord models in the North American markets such as in California. The FCX-V1 and FCX-V2 models by the Honda motor company were the first fuel cell vehicles introduced in 1999 (Max 2004).This vehicles are based on methanol reformer and fuel cell stack. The FCX-V3 fuel cell model was out by mid 2000. Their FCX-V4 built in 2001 combined a high pressure hydrogen tank and the Ballard’s fuel cell stack.

The government of Japan has been increasing its foreign direct investment in China and especially in the manufacturing sector. This move has been motivated by the availability of cheap labour in china and in other foreign countries and is associated with relocation. The government has helped in the establishment of Honda’s affiliate part production in china thus creating new FDI cluster in the process. During the Japanese ‘bubble economy’ of 1990s; over borrowing and low interest rates led to faster growth in automobile industry. During the period 1990-2000, the government of Japan put together physical stimulus packages that have helped revive the motor industries (Flath 2000).

Environmental Policies

In 1990, the Californian ZEV mandate came into force and coupled with concerns over global warming and issue affecting energy, there was renewed interest in battery power electric vehicles (IEA & OECD 2004). This mandate made Japanese government to take a step and become a role model in environmental sustainability. There was a view that the Californian market should be taken seriously, following this, the Japanese car makers entered the battery power electric vehicle development race with seriousness. There was a need for new technology for any BPEV to enter into the Californian market by 1998. This period saw the introduction of permanent-magnet motor with more developments in the development of power traction.

Batteries were produced in large numbers with new developments being added to make them more efficient. The purchasing incentive program of 1997 saw the introduction of 117 BPEV where vehicles for export to the Californian market were equipped with NiMH batteries and permanent-magnetic motors. By 2000, the BPEVs became unaffordable to local people. A memorandum of agreement between the Californian state and major vehicle manufacturers including Honda and Toyota gave rise to a boom in the production of BPEVs in 1998. After the fulfilment of this agreement, production of the Honda EVplus ceased (Diane publishing company, 2004).

Following the failure of BPEV future market, MITI started the ACE program in 1997 (Cowan & Hulten 2000).This program too failed following the introduction of Prius by Toyota. Hybrid electric vehicles are today part of commercial option to ICEVs in Japan. However the HEVs account for only 1% of vehicles in Japan prompting authorities to shift focus to development of new concepts such as neighbourhood vehicles (Diane publishing company, 2004). The government of Japan through the MITI has for a long time used innovation as means of mitigating global warming and environmental pollution. It has identified the development of electric vehicles as a channel towards achieving its long term goal (Diane publishing company 2004).

The Honda top management has also rallied behind the government in the preservation of the environment. In June 1992, the company released its environmental statement and laid bare its commitments and guides to address environmental issues (Williams & Good 1995). In this statement, the company promise to preserve the environment and to make efforts to contribute to the human health thus ensuring a future for both the company and the entire world. Its principles sought to recycle materials, conserve energy, proper waste disposal, preserve human health and global environment (Williams & Good 1995).

Honda’s Environmental Compliance

Honda is aware of its responsibility to environmental preservation due to the impacts generated by its activities and its products. It has thus identified target to be met for its activities aimed at minimizing environmental impacts. Its major initiatives include fuel economy improvements, exhaust emissions reduction, alternative energy products and noise reduction (Guibet & Birchem 1999). To reduce the depletion of the ozone layer, the company has aimed at green purchasing, a process that touches on environmental management, saving of energy resources and the embracing of the ZEVs.

It reuses, recovers and recycles parts and practices proper waste disposal to tackle soil erosion (Honda Environmental Annual Report 2010). During the year ended 31^st march 2010, the company’s major concern was addressing global climate change which saw Honda strongly reaffirm its continued commitment to innovation and the development of new products that are environmental friendlier (Cowan & Hulten 2000). According to the Honda 2010 environmental report for the North America (2010), the company in 2009 joined the USA and other carmakers in committing developments in fuel economy passenger vehicles for the period between 2012 and 2016.

The company launched a new Honda CR-Z sport in august 2010 and intends to launch a Honda Civic in 2011; all these vehicles are having increased fuel efficiency. The natural gas powered civic GX was also introduced in the North American market and the number of FCX Clarity-a fuel cell electric vehicle was also increased. January 2010 saw the start of operation for a solar hydrogen station at Los Angeles centre which utilizes solar cells to produce electricity used in reformation of hydrogen fuel from water (Honda Environmental Annual Report 2010). The company too aimed at reducing production of green house gases from their production plants in North America (Busshuysen & schafer 1995).

Awards

The Honda motor company’s environmental commitment has not gone unnoticed as the Honda’s Marysville and East liberty auto plants in Ohio, USA were awarded the energy star award from environmental protection agency (EPA) of the U.S. for running energy efficient plants (Anderson & Anderson 2010). In 2006, Honda’s four greenest vehicles earned recognition from the American council for an energy efficient economy (ACEEE) (Anderson & Anderson 2010). The company’s Honda civic and civic hybrids also appeared among the twelve greenest vehicles.

The union of concerned scientists (UCS), a science based non-profit making environmental friendly body, too recognised Honda’s commitment to environmental preservation and in 2007 named it greenest vehicle of the year. Honda’s ‘insight’ earned the highest EPA fuel economy rating in the year 2005 while accord hybrid sedan won Kiplinger’s best fuel economy in the $30,000-$45,000 category in 2006 (Honda 2010). Thirteen out of the company’s sixteen Honda branches in North America have achieved the ISO 14001 certification for environmental management systems while other branches aimed to achieve this certification by the end of 2010 (Honda Environmental Annual Report 2010).

Conclusion

Regulations, strengths and weaknesses in Honda has helped it shape the choice of its technological direction and the speed with which it moves towards this direction. Among the most influential foreign regulation was the Californian air resource board that exercised a tough influence on car manufacturers and was pivotal in shaping key market for the motor vehicle companies. The Honda motor company, with its diversified production, from the beginning invested heavily on the electric and hybrid vehicle technology. Among the company’s driving force in vehicle designs has been the government environmental policy and regulations. Rising environmental pollution concerns have forced various governments in the world to regulate emissions from motor vehicles.

As a result, automakers are encouraged to invest in innovations in environmental friendly vehicles. Acts have been enacted in many parts of the world especially in California to regulate environmental friendlier vehicles. The government of Japan has been following various innovation systems to support and control vehicle models with considerable environmental damage. Among these models are the interactive, linear and the sequential linear approaches. The sequential model takes into consideration barriers such as inadequate information and the split incentives. Interactive models do not define technological choice.

From its inception in 1948, the Honda motor company has lived true to its commitment for environmental preservation put forward by its founder. Following this, the company has introduced a number of green vehicles in the American markets and other markets in the world. The company has heavily invested in measures and projects aimed at reducing carbon dioxide emissions and the company’s efforts are bearing fruits as demonstrated in the year 2009-2010 in which the company reduced carbon emissions by an average 11%. Major initiatives by the company to reduce environmental pollution include fuel economy improvements, reduction of exhaust emissions, alternate energy products and noise reduction. Several models and designs of vehicle have been produced by Honda such as the Honda CR-Z sport, Honda civic and introduced in the Californian markets with increased fuel efficiency. The company’s environmental policy has won a number of awards beginning with the ISO14001, the UCS, the EPA and ACEEE.

Recommendations

The company should focus on the developing countries and develop components that are crucial for the advancement of electric vehicle. In these countries, Honda should make efforts hybrids and fuel cell vehicles and further create links with suppliers to whom it should provide with conventional gasoline vehicles. Further, the company should aim at improving batteries, motors, inverters and control systems and in effect advancement in electrical and electronic technologies which are pivotal in the production of hybrid vehicles.

Honda should strive to invest heavily in ‘drive-by-wire’ technology which is currently gaining ground due to the rise in the use of electronic technologies in power-trains in the hybrid vehicles. Under this technology, the mechanics of automobile are controlled in electronic manner. The new models of vehicle to be produced by motor vehicle manufacturers should have embedded soft wares more complicated to go hand in hand with complicated systems. Because companies have accumulated considerable knowledge on battery manufacturing, they should establish learning opportunities in developing countries to tap on the unexplored markets.

The company must make efforts to reduce product recalls such as the emissions-related recalls. This will make sure that the company reduces loses while the extra costs saved could be channelled towards further environmental conservation. This could be arrived by making accurate long term planning.

Plug-in hybrids will require a lot of experience on the working of hybrids, this might be very important in the future as this technology will not be expensive since they will not require infrastructure of hydrogen, this is despite the fact that in the long run, fuel-cell vehicles are considered clean vehicles.

Reference List

Anderson, D, & Anderson, J., 2010. Electric and Hybrid Cars: A History. London, McFarland.

Basshuysen, R., & Schafer, F., 1995. Reduced Emissions and Fuel Consumption. London, Springer.

Chandra, V., 2006. Fundamentals of Natural Gas: An International Perspective. London, Pennwell Books.

Cowan, R., & Hulten, S., 2000. Electric Vehicles: Socio-Economic Prospects and Technological Challenges. New York, Ashgate.

Degobert, P., & SAE. 1995. Automobile and Pollution. Paris, TECHNIP.

Diane publishing company, 2004. Industry, technology and the environment: competitive challenges and business opportunities. Derby, DIANE publishing.

Flath, D. 2000. The Japanese Economy. Oxford, Oxford University press.

Frank, A., 2003. Honda Motor Cycles. London, Motorbooks International.

Gruden, D., 2003. Traffic and Environment. London, Springer.

Guibet,J., & Birchem, E., 1999. Fuels and Engines: Technology, Engine, Environment. Paris, TECHNIP.

Gulliksen, J., & Harning, M., 2008. Engineering Interactive Systems: EIS 2007 Joint Conferences EHCI 2007, DSV-IS 2007, HCSE 2007, Salamanca, Spain, March 22-24, 2007. Selected Papers. Salamanca, Springer

Gupta, H., 2006. Fundamentals of Internal Combustion Engines. New York, PHI Learning Pvt. Ltd.

Honda Environmental Annual Report, 2010.

International Energy Agency, OECD, 2004. Hydrogen and Fuel Cells. Paris, OECD publishing.

Ison, S, Peake, S., &Wall, S. 2002. Environmental Issues and Policies. Michigan: Financial Times prentice hall.

Jaffe, A, Lerner, J., & Stern, S, 2004. Innovation Policy and the Economy. New York, MIT press.

Max, A, 2004. Government Policy and Environmental Innovation in the Automobile Sector in Japan. Cambridge, Cambridge University Press

Mytelka, L. K., & Boyle, G. 2005. Making Choices about Hydrogen: Transport Issues For Developing Countries. California, IDRC.

Sengupta, D., & Jammalamadaka, R., 2003. Linear Models: an Integrated Approach. New York, world scientific.

Shimbun, K. N., 2007, market share ranking in Japan, Web.

Williams, D., & Good, L, 1995. Guide to the Energy Policy Act. New York, Fairmont press.

Introduction

It is important for a potential buyer to compare different car models before the actual purchase. Many such buyers compare prices only while disregarding other important factors. While price is so basic a factor, other factors must be well known and used to make the last decision. This essay seeks to show how hard it is to choose between the 2013 Toyota Camry and 2013 Honda Accord based on different considerations.

Cost

All in all, the most basic factor is cost. Cost here refers to the Manufacturer’s Suggested Retail Price (MSRP). When MSRP is the basis on which to base our considerations, Toyota Camry is relatively cheaper than Honda Accord. The MSRP for the former ranges between 22,235 to 30,465 US Dollars while the later is in the range of 21,680 to 33, 430 US Dollars. However, there is no difference when comparing their Destination Charge – the cost of transporting the car from the dealer to the buyer (Newcars.com).

Comfort

In regard to comfort offered by the vehicles, Toyota Camry has more space for passengers than the Honda Accord. Their headroom and legroom are not any much different (newcars.com). A closer look, however, reveals that Toyota Camry has unsupportive front seats while the Honda Accord have improved support for the back besides better bolstering. The Honda Accord beats Toyota Camry in offering a better outside view (Halvorson).

Fuel Economy

Fuel economy is another critical factor. On this front, Toyota Camry wins over Honda Accord. This arises from the fact the Camry Hybrid is easily available and has accomplished gas-distance ratings of 43 mpg city, and 39 on the highway (Halvorson).

Road Noise Reduction

It is such an awesome experience to drive a car with reduced road noise. The Honda Accord is the clear winner where noise insulation is concerned. The Honda manufacturer has installed Active Noise Control and Active Sound Control which goes a long to eliminate road noise (Halvorson). However, this is only comparatively and does not imply that the Toyota Camry is very noisy on the road.

Dimensions

When compared to the Honda Accord, the Toyota Camry is a little bit slender in the width dimension. As such, it is a lot easier to move into and out of a tight parking bay when driving Toyota Camry (newcars.com). In effect, this means that it would not be so easy for one to park the Honda Accord in a similar situation. However, where the length of the cars is concerned, the difference is negligible especially when thinking about the garage.

Drive train

Every driver desires a powerful car. According to Dictionary.com, Drive train is “the power train of an automotive vehicle consisting of all the components between the engine and driving wheels and including the clutch and axle, as well as the components of the driveline. Where drive train is concerned, the Honda Accord is better compared to the Toyota Camry (Newcars.com). This is informed by the fact that the Toyota Camry has a lower vortex which hinders it from conveying capacity to the wheels in comparison to the Honda Accord.

Handling

It is easier to make a circular turn or the commonly called u-turn while riding the Toyota Camry than when riding the Honda Accord. In other words, the Toyota Camry has a lesser turning radius than that of the Honda Accord (newcars.com). A turning radius refers to the constricted turn that a car can make. It therefore becomes easier for one to navigate tight spots while using Toyota Camry. Honda Accord has a bigger turning radius than Toyota Camry.

Overall safety

Safety is of utmost importance to everyone riding a car at any given time. Under safety, when the two are compared, they “offer some sophisticated advanced safety technology, including Forward Collision Warning” (Halvorson). They serve to warn the driver of the host car of an impending collision in front of the vehicle. It is important to note that Toyota Camry has ten basic airbags for increased safety. It has also brought impressive crash-test results. All in all, the Honda Accord got better crash-test ratings than the Toyota Camry.

Utility

The higher the number of seating a car has, the better. However, both Honda Accord and Toyota Camry tie on this aspect. They both accommodate the same number of passengers. Precisely each model carries five passengers seated comfortably. Over and above, both carry the same amount of shopping items (Newcars.com).

Connectivity

In regard to connectivity, Honda Accord wins over Toyota Camry. Both models cater for connectivity. They both have basic “Bluetooth hands-free calling, Bluetooth audio streaming and a USV port” (Halvorson). All in all, Honda has slightly surpassed that by “including SMS text capability, Pandora audio streaming, dual-zone climate control and an eight-inch i-MID display” (Halvorson 2013).

Speed

Though it is hard to say what speed is comfortable, in comparison, Toyota Camry is slower than the Honda Accord. This is explained by the fact that the Toyota Camry has less horsepower compared to the Honda Accord (Newcars.com). The Honda Accord is rated at 185 horsepower while the Toyota Camry has a horsepower of 178. All in all it is worth noting that the 2013 Toyota Camry handles pretty to satisfaction and accelerates in a responsive manner. Handling in Honda Accord is crisp and inspires enough confidence.

Warranty

Both models come with warranty. On this front, both models win. Included in the warranty are the following: basic warranty of 36/36,000, Power train warranty of 60/60,000, unlimited corrosion perforation warranty, roadside assistance of up to 25,000 miles, maintenance up to 25,000 miles and accessories up to 36,000 miles (Halvorson 2013).

Styling

Where Toyota Camry and Honda Accord are concerned, the buyer is advised not to expect either of the models to excite the senses in a great way. However, the Honda Accord looks more appealing and better in proportion on the outside than the Toyota Camry. In addition, the Honda Accord has a more premium look from the interior.

Features

Toyota Camry has got upper trims a well as base trims which are so valuable. Honda accord affords the customer the traditional preferential treatment. It’s up to the customer to debate on features, depending on own preferences (Halvorson).

Quality

In regard to quality, the Toyota is quiet, has enough space and the riding in it is so smooth. The Honda Accord has cabin appointments.

In conclusion, it is important to note that the two models are both American made. As such, the manufacturers are likely to look at what each is doing. The differences might not be so pronounced. It boils down to the customer’s preference.

Works Cited

Halvorson, Bengt. “Toyota Camry Vs. Honda Accord: Compare Cars Page.” The Car Connection. 18 February 2013. Web. <https://www.thecarconnection.com/news/1074026_toyota-camry-vs-honda-accord-compare-cars>.

Newcars.com. “2013 Toyota Camry vs. 2013 Honda Accord Review.” n.d. Web.. <https://www.newcars.com/reviews/honda-accord-vs-toyota-camry-sedan.html>.

Summary of the Case Study

This is a comprehensive case study which clearly explains historical, human resource management issues in the company – HMSI. HMSI carried out its management functions by basing on the two key beliefs. These beliefs are the respect for differences of individual labourers and what the company termed as the “three joys”. The company aimed at using these tools for promoting all its members.

Just like many other firms that are managed through the modern human resource management principles, HMSI also carried out performance appraisals on its employees. Workers were graded basing on a certain grade after which they were rewarded according to the respective grade scored. The study also explains the development of unionization activities in the company.

These activities emerged because of the differences between the employees and management as regarding the human resource policies and implementation. The union activities took a long course. They resulted in attempts to use dispute resolution methods like reconciliation to resolve the problems. However, some of these problems escalated to violent confrontation.

This forced the intervention of the government to stop the violence and provide a strong foundation on which a mutual agreement was built.

The study explained how the unions and management of the company adapted and coped after the agreement of stopping hostility between employees and management of HSMI was reached. Finally, the study discusses the lessons that were learnt by the company and how it can utilize these lessons as it focuses on the future management.

Analysis of the Case Study of HMSI

Company data, history and records; are distinguished when it comes to betterment of the existing human resource management policies (Malonis, 2000). This study gives a deep insight of the management activities in HIMSI since its inception. When a firm faces challenges, the management should make decisions which will help in sorting out the constraint facing the firm.

The decisions that are made need to be well thought and widely consultative; otherwise, they are likely to cause more friction in the organization. Any change in an organization must be followed by restructuring decisions to aid in enforcing it. A clear example is the decisions that were made by the president of HMSI in the year 2005 when the company.

The president wanted to see the company embarking on an expansion program that was a bit aggressive which could see the company regains its operation as was before the constraints (Saini, Management Development Institute (Gurgaon), and University of Hong Kong, 2006).

Confrontation in organizations can be as a result of the failure to attend to the seemingly small grievances which later escalate to crises. One of the major functions of the management of companies is the identification of issues from either within or without the company which can result to divisive conflict in the organization.

Crisis results in the loss of productivity (Moffitt, Bordone and Program on Negotiation at Harvard Law School, 2005). The 2005 conflicts in HMSI resulted in the loss of sales of up to 1.3 million Rupees (Saini, Management Development Institute (Gurgaon), and University of Hong Kong, 2006).

More often than not, restructuring is used to regain the image and the grounds of the organization more so in the aftermath of a crisis. Restructuring aims at having a total overhaul of the organization by changing a number of operations and organizational identities for instance changing the name, logo, packaging and branding of products among many other strategies.

As mentioned earlier, the restructuring strategies must be systemic and deliberated on by the entire organization. Failure of doing so by the management is likely to escalate the problem already at hand (Armstrong, 2006).

The management of firms increasingly understand the need to expand the operational capacity of their firms by expanding into new operational areas by way of opening subsidiary firms. HMSI began its operations in the year 1999 as a subsidiary firm of the Honda Motor Company Limited which is headquartered in Japan. The subsidiary firms often operate basing on the operational principles of their mother companies.

As part of its expansion programme, HMCL has opened more than 130 firms across the world HMSI being one of these firms. Performance appraisal has become an integral part of managing employees in organizations.

It is one way of making employees feel appreciated by the company for their efforts. HMSI recognized the need for this and put in place such a system. However, this system had its own flaws which mostly resulted from the way it was implemented (Armstrong, 2006).

Lessons from the Case Study

Most management of companies come up with different initiatives, which aim at improving the performance of their organizations. With the realization that workers are often the most significant assets for firms, the initiatives of management mostly centre on workers. When workers are satisfied with the organization, they raise their input, which automatically spills over to the general output of the firm.

However, all human resource initiatives in organizations must be employee centred. The employees must be actively engaged and or involved in formulating these policies or initiatives as these initiatives directly affect them (Robert, 2011).

Failure to engage employees in the plans of the organization is likely to have grave consequences in the organization just as was the case with HMSI management and its employees. Before a performance appraisal programme is run by the organization, employees must be notified and trained on the assessment procedures and the importance of such a programme.

Most modern labour laws allow employees to join labour unions. These unions act as tools of negotiation with the management of organizations. Organizations must recognize these unions and formulate proper channels of negotiating with these unions in order to avoid bitter confrontations (Robert, 2011).

Dispute resolution has thus become a vital part of the function of management. Organizations, with the aim of surviving in the competitive industry must be aware of this. They must craft exhaustive channels of resolving disputes with their employees.

Communication is a vital entity for the management of firms especially so the subsidiaries. Cultural noise can negatively hinder the performance of a firm in the country where it is located because of cultural disparities that come in between communication.

Thus, it is important for the company staff to receive mentorship on the culture of the business destination. The company will have to consider this as it expands into new destinations globally (Marieke & Hofstede 2010)

The Hofstede theory helps in the understanding of how culture impacts on the company activities in foreign countries. The main Honda mother company has good employee relations because it operates within a single culture. When a company chooses to enter new markets it has to formulate and follow an adaptation strategy. This strategy helps in the blending of different cultures in order to have a good working relationship.

The Honda Motors Company has Japanese cultures. Since it is operating in different cultures in foreign countries, there will be a need for the adoption of cross-cultural models of management. The adaptability to culture determines product development and thus it is important for the company to capture the different dimensions of culture which include individuals and business location among others (Mooij & Hofstede, 2010).

Reference List

Armstrong, M 2006, A handbook of human resource management practice. Kogan Page: London.

Malonis, J A 2000, “Human Resource Management (HRM). “Encyclopedia of Business, Vol. 1. Web.

Marieke de Mooij and Hofstede, Geert, 2010, Applications to global branding and advertising strategy and research. International Journal of Advertising, vol. 29, No. 1. pp. 85–110.

Moffitt, M L, Bordone, R C, and Program on Negotiation at Harvard Law School 2005, The handbook of dispute resolution, Jossey-Bass, San Francisco, CA.

Robert, L M 2011, Human resource management: Essential perspectives. South-Western, Division O., New York.

Saini, D S, Management Development Institute (Gurgaon) and University of Hong Kong 2006, People management fiasco in Honda Motorcycles and Scooters India Ltd., Asia Case Research Centre, University of Hong Kong, Hong Kong.

Abstract

The world of business has always been an environment known for rapid, frequent, and sometimes unpredictable change. In order to stay in competition and preserve the advantage, the businesses are to remain flexible and responsive to the changing environment and situation in the market. This presentation explores the case study of Honda throughout several decades since the 1940s. The main subject discussed is change management, the need for change, and how Honda could adjust its strategy to become a stronger competitor in the market.

Introduction

This presentation includes:

• A summary of the Case Study about the development of Honda and its successful expansion in the USA market.
• The drivers of this marketing success in terms of change management and flexibility.
• The performance of Honda compared to its primary competitors of the time (Yamaha, Kawasaki, Suzuki).
• The discussion of concepts of change and change management and the need for constant change in business.
• The other concepts such as resistance to change, sustaining change, and change paradigm in relation to the Honda Case Study.

Case Summary

• Honda Motor Company (founded by Soichiro Honda in Japan before the World War II).
• Devastation after the War resulted in the forced downsizing of the company.
• Honda manufactured motorcycles that were in demand in Japan due to their convenience and easy maintenance.
• Honda Technical Research Institute – focused on engine improvement.
• First A-type, 2 stroke engine presented in 1947.
• In the 40s Honda faced mainly weak competitor with cheap equipment, unreliable materials, and limited capacities.
• Honda expanded at the beginning of the 50s. Objectives:
  • create a multiproduct line;
  • become leaders in innovation;
  • search for marketing opportunities for mass production.
• End of the 50s – huge success, a new popular model (50cc Honda).
• Result: Investment in the future production plan and decision to penetrate the US market.
• Honda became the world’s largest motorcycle manufacturer ($55 million revenue).
• Honda’s light-weight models gained more success then local ones. The company gradually expanded throughout the US. Costs: regional advertising.
• Main competitors: Yamaha, Kawasaki, Suzuki.

Analysis of Honda’s Approach

• Honda’s advantage and fact growth in the American market is viewed as stimulated by their “marketing philosophy” based on market share and sales volume as key contributors to success.
• Focus on long-term benefits, but not short-term gains.
• The sales plan is built based on the market share and potential growth opportunities.
• Goal: increase the company’s sales volume faster than the competitors do.
• Product changes are defined by market threats and opportunities.
• Prices are adjusted to gain larger market share.
• Effective and focused marketing wherever there is serious competition.
• Short-term costs are outweighed by long-term advantages.

Performance of Honda and its Competitors

The performance of Honda in every aspect (including investment and expenditures) is more active than that of Yamaha, Kawasaki, and Suzuki.

Analysis and Commentary

As seen from the chart:

• Honda outperformed all of its competitors in each sector.
• All of the Japanese motorcycle manufacturing companies adhered to the same strategy.
• However, Honda has demonstrated more aggressive advertising campaigns seeking for larger market share.
• Honda’s investment in the production and advertisement are larger than those of the competitors.
• Conclusion: Honda was better at planning and implementing change, more flexible, and responsive to the shifting market environment.

Why change management is highly essential

• Business is one of the fastest developing spheres of knowledge where new concepts, strategies, experiences, and techniques appear every day.
• As a result, to remain successful in the world of business one is to learn and self-improve on the ongoing basis.
• This tendency involves both people and companies.
• A company’s presence in the market is characterized with constant change of environments (economic conditions, customers’ preferences, competition).
• In response to the change of the environment, a business is to adjust employing its own change strategies in order to survive.
• Honda went through major change developing new models of motorcycles and then expanding to a foreign market with new environment, demand, and conditions.

How change integrated with management development?

• Change has two primary aspects – technical and people (Prosci, 2016).
• Readiness for change is required in both aspects – a company is to have enough capacities and resources to accomplish the change technically, and the staff it to be ready to embrace the new policies, practices, duties, and goals (Prosci, 2016).
• The main spheres where Honda had implemented change were sales, manufacturing, market research, communication, investment, advertising – in other words, basically, the change occurred at every dimension of the business.
• For Honda, change was connected to serious risk as the company had to make a massive investment and produce the motorbikes for the new market which could have been reluctant to purchase them.

How did Honda start to change?

• The change at Honda began even before the company started to expand to a foreign market.
• Honda improved its performance in the domestic market prior to expansion.
• In Japan, devastated by war, the competition was weak.
• The clever market research allowed Honda to identify the need of the consumers for light-weight motorcycles of higher quality and with more efficient engines.
• Having produced a model favored by the buyers, Honda managed to increase its revenue.
• In turn, as the demand grew, Honda supplied more motorcycles increasing the rate of production. As a result, the sale revenues went up very fast.

What did Honda change?

• As the financial resources of the business increased – Honda obtained versatile opportunities: the business could have started to produce new models or switch to luxury category.
• However, the economy of Japan did not promise many customers for expensive motorcycles.
• Japan decided to turn to a country with a large population whose economy remained strong.
• The risky change involved adjustments at each level – the packaging, shipping, distribution, research of the new market and culture, developing appropriate advertisements and prices, Learning about the threats and opportunities.
• Honda made a huge investment and prepared for this bold change.

Why to change?

• Compared to the success of the three main Japanese competitors marketing similar products, Honda had the biggest success in the US.
• This tendency can be explained by the company’s deep understanding of the areas of change and the reasons why it had to be implemented.

The aspects that encouraged change for Honda:

• The presence of strong competition and similar products.
• The need to sell more motorcycles compared to the competitors.
• The need to appeal to the Western market and the consumers with a cultural background different from the Japanese.

Resistance to change

Change may happen gradually and at one dimension at a time (evolutionary), or rapidly and everywhere at once (revolutionary) (Jones, 2012). The latter kind of change is likely to face more resistance (Jones, 2012).

Honda’s change was revolutionary and required readiness among people and technical abilities of the company.

• People changes:
  • demand for more productivity;
  • change in salaries and benefits;
  • training of staff to orientate them at work with the new market;
  • hiring and selection caused by expansion.
• Possible resistance areas:
  • clash of cultures;
  • lack of desire to work more;
  • reluctance to learn new skills.
• Technical changes:
  • larger financial resources;
  • need for more materials;
  • supply chain change;
  • logistics of transportation (shipping and packaging).
• Possible resistance areas:
  • failure to gain enough revenues to continue investing;
  • inability to find affordable materials in sufficient quantities;
  • difficulties sending the products to the new market.

Change agents

• Initially, the strategy chosen by Honda for expansion was successful.
• The main drivers of change were the increased productivity and aggressive advertising.
• Honda’s advertising expenditures exceeded those of its competitors (8.1 million dollars spent by Honda versus 4.2, 2.2, and 3 million dollars spent by Yamaha, Kawasaki, and Suzuki respectively).
• Finally, Honda’s expansion within the USA was driven by the market share variables primarily as the main determinant of the future growth potential and sales revenue.

Sustaining change

• Having won the competitive advantage in certain regions, Honda was focused on its maintenance.
• The company ensured fast manufacturing of the new motorcycles by raising salaries of the employees.
• Moreover, every year, the models sold by Honda experienced a decline in price over time.
• The company was producing enough revenue to cover the growing salaries as well as the declining prices.
• The main contributor of this stability showed at the initial stage of the change management – its planning.
• Namely, the planning of potential rates of sales in every area to which the company expended was the most significant element of Honda’s success in the USA.

Measuring and Leading Change towards Innovation

• Having a clear plan of the perceived sales revenue for a region, the management of change would gain a clear guidance as to the future work.
• Clear goal is one of the most important aspects of change implementation.
• Besides, having a goal meant being able to measure the performance of the company based on whether or not the goal revenue was reached.
• Accordingly, the adjustments were made as soon as the perceived threats (such as stronger competition, or dropping demand) or opportunities (growing demand) appeared.
• In order to lead change towards the goal, Honda employed price changes and advertisement.
• Future opportunities: As said in the case, the American consumers were buying the Japanese light-weight motorcycles along with purchasing heavier and more powerful model of local production. Turning to innovation and adding more powerful models would be Honda’s best way to increase its market share. However, this change requires time and even more investment and planning in order to defeat strong American manufacturers.

Conclusion

• Even though the Case Study of Honda is mainly orientated at marketing strategies, it also demonstrates a company’s risky expansion to a foreign market that was based on revolutionary change that could have jeopardized the whole organization if its plan was flawed or insufficient.
• Honda’s Case Study emphasizes the importance of planning and setting clear goals for the marketers and manufacturers needed to maintain sales and defeat the competitors.
• Also, the case in an illustration of flexibility of Honda, and its determination to grow.
• Of course, the expansion required large costs in a form of investment, but the company’s focus on the long-term outcomes and not the short-term expenditures helped it break through.

References

Jones, S. (2012). Change management: A classic theory revisited. Web

Prosci. (2016). Integrating change management and project management. Web.

Introduction

In an era prevalent with global competition, it is widely recognized that the rapid changes in technology and competition has transformed numerous traditional rules that orient economic activities towards economic accessibility to enable firms compete from anywhere across the globe (OECD, 2007). The term globalization has increasingly become loaded with some people associating it with almost every contemporary change evident in the world today that spells out progress and prosperity while others associate it with deprivation and disasters (Scholte 2000). Globalization in this context concentrates on the integration of the world’s economy. This generally means that the world economies are integrated into one market which constitutes interdependent means of production, consumption of relatively similar goods and unified responses to similar impulses (Williamson 1998).

Globalization is represented by the movement of goods and services, capital, and labour across the globe in managed and coordinated institutionalized networks, which involve establishment of global associations that ensure efficient utilization of the scarce resources at the disposal of mankind (Milward 2003). In the modern society, the term is commonly used to refer to the process of expanding the world’s markets of consumption, investments, and production on a global scale as well as expansion of social relations and social activities across different nations of the world (Milward 2003).

Globalization is evidenced by the remarkable growth achieved in the world trade as a proportion of the world output where the gross world product grew from 7% in 1938, 10% in 1970 and above 18% in 1996 (Williamson 1998). These trends have remarkably escalated ever since. Further, the foreign direct investments in developing countries have increased from 2.2 billion in 1970 to $154 billion dollars in 1997 (Williamson 1998). Globalization has further resulted in integration of the national capital and financial markets and the amount of foreign exchange taking place on daily basis has reached remarkable heights.

Clearly, the availability of cheap and reliable means of communication is the key driving force for globalization efforts which not only facilitates the integration of international capital markets but also promoting growth in multinational corporations (Williamson, 1998). Good communication and means of travel facilitates exchange of goods and services as well as promoting labour mobility across the globe. In addition, stable political condition is a necessary determinant for effectiveness of globalization.

International cohesiveness induces economic agents to exploit the opportunities presented by globalization while political instabilities and regional disagreements discourage such efforts. International integration efforts have therefore played an important role in promoting globalization. Further, trade liberalization programmes exposes domestic consumers producers to foreign competition and may force them to expand output consequently reaping benefits from economies of scale (Greenaway 2008).

Globalization enables companies to avail their goods on almost every region of the world while standardizing the manufacturing technology across all locations of production. In various regions of the world, the automotive sector has been a key source of employment as well as a major source of linkage between other sectors in the global economy (Organization for economic cooperation and development 2007). Policy makers in this industry are aware of the current changes that have taken place in the automotive value chain.

These changes constitutes considerable shifts in the production and consumption cycle whereby a higher value added is increasingly placed on the components of the automobile design and innovations in engineering and less of the actual manufacturing of automobiles (Organization for economic cooperation and development 2007). The changes have prompted regional authorities to formulate strategies through which they assist the process of restructuring and adjusting the automotive sector as well as the global economy as a whole with major focus on labour market policies and extensive training in leading technologies (Organization for economic cooperation and development 2007).

Honda motor company has developed a multinational organization strategy which stems from globalization efforts (Schick & Book 1997) and the company is the leading global automobile manufacturer dealing with development, manufacturing and marketing general purpose engines, motorcycles and sports cars among other automobile products (Infogrok automotive 2010). The company has a decentralization organizational structure and develops its products in all the regional markets in which it operates (Herbert 2009).

Honda Company has over 500 subsidiaries across the globe and is headed by an executive council based in Japan (Herbert 2009). Its operations are divided across six regions which facilitate the company to sell products most suited to the preferences of each region. In addition, manufacturing vehicles in various regions by the company increases the local consumer confidence on the products hence increasing sales and profitability of the company due to existence of a large consumer base (Herbert 2009)

Handling Environmental Issues

The structures of international systems have significantly changed with the onset of the process of globalization leading in changes in production and finance (Kutting 2004). The world is constantly interacting at various levels resulting in negative effects associated with such interactions. Although the point of interaction between the environment, trade and economics is not clearly defined, the relationship between the two remains a major contentious issue facing both economists and environmentalists (Lofdahi, 2002).

Some of them have argued that if a country makes the choice to proceed with manufacturing processes that promote environmental damage, then that should be treated as its prerogative. On the other hand, economists argue that such countries should be penalized for engaging in such activities while the environmentalists totally disagree with such reasoning and advocate for complete conservation of the environment (Lofdahi 2002).

Spread of environmental risks across the globe and the consequent migration of environmental policy is a key aspect of globalization (Speth 2003). Globalization in its economic understanding has considerable effect on the environment whereby the interactions between different regions of the world may cause harm to the environment as well as hindering sustainable development (Speth 2003). Environmental degradation is likely to occur as a result of widely shared resources and ecosystems and since the atmosphere and climatic system are essential for ecosystem survival there is increased need for preservation of environment from pollution (Held & McGrew 2002).

Automotive companies often receive criticisms as a result of environmental degradation that emanate from the automobiles they produce as well as the manufacturing processes of these products (Anonymous 2010). Increased criticisms have prompted the companies to take responsibility by formulating and implementing strategies that are aimed at improving the global environment. The automotive companies such as Honda motors and General Motors are now aiming at producing vehicles that utilize fuel more efficiently such as ethanol and hybrid versions (Anonymous 2010). The companies are also shifting to greener power supplies such as solar energy in attempt to conserve energy.

Honda Company was recently named the United States ‘Greenest automaker’ by the union of concerned scientists making it a five consecutive holder of the award (Honda 2010). This award is clear evidence that the company has achieved the lowest combined scores of smog forming and green house gas emissions in its US automobile fleet relative to other automotive companies in the country. The company constant efforts to improve fuel efficiency on its automobile products has seen the company gain 1 mpg in US corporate average fuel economy in 2009 (Honda 2010).

In order to achieve fuel economies, the company has introduced the insight as the world most cost reduced and affordable hybrid car and the CR-Z which is an electric automobile as the world’s first production sports hybrid coupe. Honda received remarkable increases in sales as a result of its adoption of environmental friendly policies since the policies were efficient and attracted public interests (Honda 2010). In the United States, the sales in hybrid cars has been increasing over time and in April 2008, the market share reached 25% which was the highest level that the company had attained since 2004 (Anonymous 2009). Further, by the end of 2008 fiscal year, the number of hybrid cars sold all over the world exceeded 250000 units (Takeo 2008).

Honda Company continues to produce alternative fuel vehicles. The Civic GX Sedan which utilizes natural gas had its retail sales expanded to various regions around the world such as Utah and Oklahoma (Honda 2010). The company also manufactures the FCX Clarity fuel cell electric vehicles. These models are among the world’s most advanced zero emissions vehicles as they have zero tail pipe emissions and fuel efficiency that is three times that of a gasoline powered automobile (Honda, 2010).

Earlier this year, the company unveiled a plan to introduce a battery electric car commuter sized vehicles and plug in hybrid technology for mid sized vehicles and larger vehicles in the country (Honda 2010). In addition, the company is developing its own infrastructure to the alternative vehicle equations. In early 2010, the company began operating the next generation solar powered hydrogen production and refuelling station in California. The station utilizes power derived from Honda developed and manufactured thin film solar cells to provide fuel for daily commuting in a carbon free energy cycle (Honda 2010).

Through the green factory initiative, the company aims at reducing the impact on environment by improving its manufacturing processes. The company has put on measures to reduce energy and water use, generation of waste materials, carbon dioxide and air emissions (Anonymous 2010). The company also encourages its suppliers to adopt the same mechanisms. Further more, the company is continuously looking for ways to make positive contributions to the communities where its consumer base lies. The company engages in community based environmental education as well as preservation and restoration efforts in form of corporate charitable foundation giving, in kind donations and company support of volunteer efforts by its employees (Anonymous 2010).

At the annual Earth Angel award ceremony which honours automotive companies that have well established environmental initiatives, Honda Company was honoured with the award of the most environmentally progressive automaker in terms of environmental initiatives in 1999 (Anonymous 2010). The American Honda Company motors Inc CEO, Testuo Iwamura confirmed that the company is working towards reduction of environmental footprint on their operations with the same passion as the one the company demonstrated in its efforts to develop new technologies that reduce environmental footprints of their products (Anonymous 2010).

The Kyoto protocol which is a United Nations protocol focusing on the convention on climate aims at global minimization of green house gas emissions in order to prevent global warming. The protocol aimed at minimizing the levels of green house gas emissions from by 5.2% from the levels that were prevailing in 1991. In 2009, one of the directors revealed that Honda had managed to reduce its motor vehicle emissions by 6% since 2000 through its adoption of green factory strategies (Honda 2010)

Globalization Effects On Health

The most fundamental resources for human survival and health comprises of the constituents of the ecosystem such as air, water land etc (Yach & Bettcher 1998). Rapid industrialization and increased connectivity through globalization has amounted to exploitation and destruction of resources such as energy resources and other non renewable resources towards their extinction. Through the waste products emitted during the industrialization process, human health as well as the life of other living organisms in the planet is adversely affected.

The entire domain of globalization includes numerous interrelated phenomena and risk factors that affect the well being and health sustainability of the populations in both developing and developed countries (Yach & Bettcher 1998). However, we should not completely dismiss globalization as negatively impacting on the health of society. If the continent would address the risks and negative aspects associated with globalization, it is possible to sustain the process of economic globalization by turning the risks into opportunities hence improving future health prospects (Yach and Bettcher 1998).

Energy is the most essential component for powering automobiles and most of this energy is derived from burning of fossil fuels in the automobile’s engine. (Pollution probe 2009). The waste products from the combustion process pollute the air and have devastating effects on human health. Scientists have argued that the green house gas emissions pose considerable threat to future generations (Kao 2009). Green house gases are composed of carbon dioxide which is generated vehicles, power plants, oil, and gas etc, carbon monoxide, and oxides of nitrogen among others.

These gases have the effect of warming the atmosphere which leads to the major problem of global warming (Kao 2009). Carbon dioxide is released from the combustion process and persists in the environment for more than 100 years. The process further releases volatile organic compounds that are also harmful to human health which include Oxides of nitrogen which when produced pose danger to human health by impairing lung functioning and lowering resistance to respiratory infections.

Inhaling nitrogen dioxide may result in coughing, shortness of breath and wheezing (Pollution probe 2009). Carbon monoxide on the other hand is released as a result of incomplete combustion and it inhibits the body’s ability to transport oxygen from the lungs consequently adversely affects people with heart diseases. The gas can cause immediate death and people with anaemia, pregnant women and children are highly vulnerable to its effects (Pollution probe 2009)

The federal clean air act which was passed in 1970 in the State of California in the United States to regulate national air pollution and control effects requires automotive companies to produce cars that emit one tenth the level of carbon monoxide and hydrocarbons as the existing cars by 1975 (George n. d). Honda was the first company to build a car model whose engine met the federal standards without using a catalyst converter.

The Honda civic 1500 was the first car to utilize the compound vortex controlled combustion engine that used two combustion chambers hence significantly reducing the amount of emission (George n. d). The companies further dedication to ‘commitment to the future’ is displayed in its announcement in 2003 annual report that it would make every effort to contribute to preservation of human health through development of safety technology that aimed at reducing emission and developing alternative forms of energy (Honda motors Co 2003).

Honda Company is also taking the necessary measures to ensure that its vehicles are safe for human utilization. Some people are under the implication that increased weight and size of a vehicle increase its safety but this is not true (Anonymous 2003). While large cars prevent people from being crashed in cases of accidents, they are more likely to loose control at high speed and may roll over more easily compared to small cars.

The Honda engineers have therefore designed car bodies that shaped and formed to be stronger and more stable without necessarily increasing their weight (Anonymous 2003). In addition, the company’s engineers biologically treat its industrial wastewaters and sludge to ensure efficient utilization of water resource (Honda annual report 2009). Honda Company cut its total water consumption in its manufacturing process by 12.2% in 2010 from its previous year while the average water utilization per unit of automobile production was reduced by 2.5% (Environmental leader 2010)

Further, Honda Company actively participates in community support programs hence promoting improved living conditions and health. In Australia, the company supports the light house foundation, an organization that provides stable family environment to the less fortunate youths (Honda n. d). In addition, the company also makes considerable donations towards disaster management such as the monetary assistance to the government to provide relief to the affected population (Honda n. d).

The company produces diesel powered vehicles. France and Austria have had a high preference of diesel powered vehicles due to their efficient fuel consumption. The diesel engines have lower fuel consumption costs and lower raw emissions relative to spark ignition engines (Anonymous, The hybrid catalyst, a new catalyst concept to improve utilization of exhaust gas energy and increase the efficiency of diesel catalyst system, n. d).

However, treatment of diesel engine emissions is made difficult by the existence of very low temperature resulting from large amounts of air and additional energy from exhaust gas extracted by the exhaust gas turbo charger (Anonymous, The hybrid catalyst, a new catalyst concept to improve utilization of exhaust gas energy and increase the efficiency of diesel catalyst systems, n. d). Diesel powered automobiles are popular in Europe and the trend has been increasing over the years (Honda annual report 2007). ). In 2000, high powered diesel cars accounted for 49.1 % of the company’s market share in France and 33.3 % Belgium’s market share and the trend has continued to increase over time (Anonymous, Honda in Europe, n d). This substantially promotes environmental conservation which is necessary for persistent of good health among the population.

Conclusion and Recommendations

The increasing need to protect the environment from the negative impacts of globalization has prompted Honda Company to develop environmental strategies aimed at conserving the environment. This positively impacts on the overall performance of the company since a lot of consumers in the modern world prefer to utilize products from companies taking up corporate responsibilities to protect and conserve the environment.

Further, the company has achieved remarkable efficiency in production through utilization of energy and water conservation methods as well as other environmental management efforts that have considerably cut costs in the company’s automobile production. As clearly established in our study, the company has gained considerable sales through its production and sale of automobiles that use alternative sources of fuel and utilization of green factory manufacturing process. The popularity of products has further been intensified by the numerous environmental awards that the company has received which has served to increase consumer confidence and loyalty.

Honda Company sets an example for other automotive companies by demonstrating corporate responsibility in environment conservation as well as promotion of human life. This is important because the automotive industry is one of the major industries believed to cause widespread environmental damage. Through its numerous efforts to conserve the environment, the company has not only gained increased recognition by various environmental groups but has also achieved remarkable heights in overall company’s performance.

In addition, the company has renewed consumers confidence and has significantly influenced their attitudes towards the automotive industry. Further, the company’s environmental strategies such as production of automobiles that are fuel efficient as well as its efficient water policies have significantly promoted the performance in the global market making it the leading automotive company.

I recommend other corporations in the automotive industry to learn from the efforts of Honda Company in conserving the environment. These companies should take responsibility of preserving the environment by ensuring that their manufacturing processes as well as the products they are selling to consumers are safe and cause minimal (if any) pollution to the environment.

Companies should adopt Green strategies which would help them in cost cutting especially in the hard economic times. Since the modern economy is characterized by widespread globalization which serves to expand and diversify company’s markets, these corporations should take the necessary measures to contain the environmental problems associated with globalization in order to conserve the environment for todays and future generations. In addition, Honda Company should continue implementing the strategies for environmental conservation in order to maintain its good performance.

Reference List

Anonymous, 2009, 2009 Dashboard: Honda on the Move [Online]. Web.

Anonymous, 2003, Honda: dream it and it will happen, Greenleaf publishing [Online]. Web.

Anonymous, n d, Honda in Europe [Online]. Web.

Anonymous, n.d, The hybrid catalyst, a new catalyst concept to improve utilization of exhaust gas energy and increase the efficiency of diesel catalyst systems [Online].Web.

Anonymous, 2010, Honda motor Company wins 2^nd annual earth angel award as most environmentally progressive automaker, Road and travel magazine [Online]. Web.

Environmental leader, 2010, Honda NA environment report: cuts waste to land fill 65%, Environment leader LLC [Online]. Web.

George, E. P. n.d, how the California air resources board works, howstuffworks Inc. [Online]. Web.

Greenaway, D., 2008, globalization and productivity, vol 1. UK: Edward Elgar publishing Held, D. & McGrew, G. A., 2002, Governing globalization: power, authority and global governance, Wiley Blackwell.

Herbert, S., 2009, Market strategy and organization structure: three companies, Scott Herbert [Online]. Web.

Honda, 2010, Honda marks a decade of environmental leadership with fifth consecutive “greenest automaker” award from union of concerned scientists, Honda Motors Co, Inc. [Online]. Web.

Honda, n.d, Honda Australia motorcycle and power equipment Ltd, Honda company ltd [Online]. Web.

Honda Motor Co., 2003, Annual report 2003: environment and safety [Online]. Web.

Honda environmental annual report, 2009, towards 100% recycled water systems [online] Web.

Honda annual report, 2007, targeting the world’s cleanest diesel engine, Honda motor Co ltd. [online]. Web.

Infogrok automotive, 2010, Honda motor company; company’s description, progressive innovations Ltd [online]. Web.Kao, W.Y R., 2009, Sustainable economy: corporate social responsibility. London, world scientific

Kutting, G., 2004, Globalization and the environment: greening global political economy. NY, Suny press.

Lofdahi, L.C., 2002, Environmental impacts of globalization and trade: a systems study. Massachusetts, MIT press.

Milward, B., 2003, Globalization: Internationalization and monopoly capitalism: historical processes and capitalist dynamism. Cheltenham, Edward Elgar publishing

Organization for economic cooperation and development, 2007, Globalization and regional economics: can OECD regions compete in global industries, OECD publishing.

Pollution probe, 2009, Emissions from automobile [Online].Web.

Schick, D & Book. A., 1997, Fundamentals of copy and lay out. New York, McGraw-Hill professionals.

Scholte, A. J., 2000, Globalization: a critical introduction. London, Palgrave Macmillan.

Speth, G. J., 2003, worlds apart: globalization and the environment, island press

Takeo, F., 2008, Honda annual report, Investor relations, Honda motor Company [Online].Web.

Williamson, J., 1998, Globalization: The concept, causes, and consequences, Washington DC: Peterson institute for international economics [Online]. Web.

Yach, D. & Bettcher, D., 1998, The globalization of public health, threats and opportunities, American journal on public health [Online]. Web.