The Honda Corporate Strategy Case Study

With reference to the Honda occurrence study and also drawing on other examples from the searing Issues course, what are the key theoretical and methodological issues in drawing commonplace lessons from case studies of success?History is subject to rendition so are business successes and failures. However ex-post justifications of the latter have proved more profitable. This essay explores the theoretical and methodological issues in drawing general lessons from case studies of success, with particular reference to Hondas successful penetration of the US securities industry in the 1960s.This essay offers a critical system and post modernist speak to. Critical theory questions the central features of much(prenominal) recipes for success, the historical and social contexts from which they emerged and the purposes and functions that it may serve up. grade modernism can be seen as an extension of critical theory but has added the dimension of power to knowledge and argues th at the two are no separable Foucault.In 1946, the Honda Technical Research Institute was established by Sochiro Honda and his partner, Takeo Fujisawa. Having succesfully established itself in the japanese market, Honda entered the US market in 1959. By 1960, its Supercub model was highly successful. They then created a highly effective as campaign establish on You Meet the Nicest People on a Honda. By 1964, it has dominated almost half of the US market. Later in that year, it required cash on delivery of shipments. As Pascale (1996) says, In angiotensin converting enzyme fell swoop, Honda shifted the power relationship from the dealer to the manufacturer.Hondas success has been analysed and three clean-cut explanations for its success emerged The most prominent is the Boston Consulting Group (BCG) Report. The report states that Honda maximised ascertain curve economies low costs at high production quite a littles. As a result, American and British motorcycle manufacturers withd rew from certain market segments. An wonder with six Honda executives by Pascale, led to his conclusion that Honda was successful in Japan because superior design skills led to a better product. Honda was also seen has a learning organisation that adapted and responded quickly. Prahalad and Hamel introduced the concepts of strategic intent, stretch and core competence. These they feel were the necessary factors for success. on that point are two competing views in scheme formulation (1) the planning school, and (2) the learning school. For the planners, strategy formulation is a deliberate, rational and linear process where ends are starting specified. In this case, structure follows strategy. The learning school takes an adaptive and incremental approach. Strategy is a non-linear and complex process. Structure and strategy formulation are intertwined.Formulating recipes for success based on past success presumes that the future perfectly emulates the past. Common consciousness will tell us that this may not necessarily be true. Rhetoric will also infer the same. In a dynamic and competitive business environment, factors that affect an organisation will not be static. Consumers tastes change. In the Post-Industrial era, consumers were more affluent. Hence, they demanded more than a standardised product produced by mass-production. Firms had to change from a product oriented approach, of the mass production era to one that is market oriented Ansoff, 1988. Thus as Ansoff says,whenever the future environment is pass judgment to be discontinuous, emulation of historical successes becomes dangerous pp.135A theory is form ideas or concepts used to describe the world to better understand it. Ideas and concepts cannot be free from bias as they are conceived by hoi polloi and people possess different ideologies, values, interests and preferences. What purpose does it serve? A theory is devised to serve certain purposes and functions. Theories on strategy are fo rmulated, to a certain extent, to hang on management consultants employed. There is a need to question the validity of such theories and the methodology employed to apply them.BCGs business portfolio analysis makes what is widely cognize as the experience curve assumption. This states that the costs of production should go down with accumulative physical output. Thus, the report reasons that because Honda has already achieved high production volumes in Japan, it had a cost advantage. But were Hondas production costs low because of high volume or because of it employed production methods that were more sophisticated?It also assumes that a business is a cash system, that is its cash flows depend on proportional market share and industry growth rate. This allows the classification of businesses or products into quaternary categories a star, a cash cow, a dog and a ?. It assumes that the classification is relevant and applies to all business. Under these two assumptions, its strateg ic analysis and recommendations will be valid.However, as all models, it self-selects the kind of data that is compatible with it in this case return on investment (ROI) and cash flows. The main problem with this approach lies with its narrow classification scheme, which may not capture the entire picture, such as the uniqueness and problems of a business Mitroff. ROI and cash flows represent yet the financial dimension of a company. Other factors such as technology, reputation and life of the organisation have to be taken into account.