Case Study Description of Honda Canada (A): Tsunami and Communications
Honda Canada was coping with a communications and supply chain crisis after a triple disaster - an earthquake followed by a tsunami and a nuclear meltdown - that hit Japan in March 2011. Honda's worldwide supply chain was characterized by a just-in-time, single-source approach, wherein the supplier for each component provided the best quality at the lowest price. The approach normally ensured economies of scale but now, in an abnormal time, Honda's supply chain was vulnerable. In the short term, Honda Canada had to manage the chaos through effective communication with its stakeholders. In the long term, it had to ensure checks and balances in its supply chain. See supplemental case B.
Authors :: Mary Weil, Dina Ribbink, Ramasastry Chandrasekhar
Swot Analysis of "Honda Canada (A): Tsunami and Communications" written by Mary Weil, Dina Ribbink, Ramasastry Chandrasekhar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Honda Honda's facing as an external strategic factors. Some of the topics covered in Honda Canada (A): Tsunami and Communications case study are - Strategic Management Strategies, Manufacturing and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Honda Canada (A): Tsunami and Communications casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, supply chains are disrupted by pandemic ,
technology disruption, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Honda Canada (A): Tsunami and Communications
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Honda Canada (A): Tsunami and Communications case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Honda Honda's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Honda Honda's operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Honda Canada (A): Tsunami and Communications can be done for the following purposes –
1. Strategic planning using facts provided in Honda Canada (A): Tsunami and Communications case study
2. Improving business portfolio management of Honda Honda's
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Honda Honda's
Strengths Honda Canada (A): Tsunami and Communications | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Honda Honda's in Honda Canada (A): Tsunami and Communications Harvard Business Review case study are -
Ability to recruit top talent
– Honda Honda's is one of the leading recruiters in the industry. Managers in the Honda Canada (A): Tsunami and Communications are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Leadership & Managing People field
– Honda Honda's is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Honda Honda's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Honda Honda's is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Honda Honda's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Honda Canada (A): Tsunami and Communications Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Honda Honda's has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Honda Canada (A): Tsunami and Communications HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Honda Honda's is one of the most innovative firm in sector. Manager in Honda Canada (A): Tsunami and Communications Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Honda Honda's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Honda Canada (A): Tsunami and Communications Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Sustainable margins compare to other players in Leadership & Managing People industry
– Honda Canada (A): Tsunami and Communications firm has clearly differentiated products in the market place. This has enabled Honda Honda's to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Honda Honda's to invest into research and development (R&D) and innovation.
Analytics focus
– Honda Honda's is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Mary Weil, Dina Ribbink, Ramasastry Chandrasekhar can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Operational resilience
– The operational resilience strategy in the Honda Canada (A): Tsunami and Communications Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Organizational Resilience of Honda Honda's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Honda Honda's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Honda Honda's in the sector have low bargaining power. Honda Canada (A): Tsunami and Communications has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Honda Honda's to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Honda Honda's is present in almost all the verticals within the industry. This has provided firm in Honda Canada (A): Tsunami and Communications case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses Honda Canada (A): Tsunami and Communications | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Honda Canada (A): Tsunami and Communications are -
Low market penetration in new markets
– Outside its home market of Honda Honda's, firm in the HBR case study Honda Canada (A): Tsunami and Communications needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Honda Honda's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Honda Honda's supply chain. Even after few cautionary changes mentioned in the HBR case study - Honda Canada (A): Tsunami and Communications, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Honda Honda's vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Honda Honda's products
– To increase the profitability and margins on the products, Honda Honda's needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Honda Honda's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Honda Canada (A): Tsunami and Communications can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Honda Honda's needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Aligning sales with marketing
– It come across in the case study Honda Canada (A): Tsunami and Communications that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Honda Canada (A): Tsunami and Communications can leverage the sales team experience to cultivate customer relationships as Honda Honda's is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Honda Canada (A): Tsunami and Communications, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Honda Canada (A): Tsunami and Communications has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Honda Honda's 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Honda Canada (A): Tsunami and Communications HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Honda Honda's has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Honda Honda's is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Honda Honda's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Honda Honda's to focus more on services rather than just following the product oriented approach.
Opportunities Honda Canada (A): Tsunami and Communications | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Honda Canada (A): Tsunami and Communications are -
Building a culture of innovation
– managers at Honda Honda's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Developing new processes and practices
– Honda Honda's can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Honda Honda's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Honda Honda's is facing challenges because of the dominance of functional experts in the organization. Honda Canada (A): Tsunami and Communications case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Honda Honda's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Honda Honda's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Honda Honda's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Honda Honda's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Buying journey improvements
– Honda Honda's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Honda Canada (A): Tsunami and Communications suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Better consumer reach
– The expansion of the 5G network will help Honda Honda's to increase its market reach. Honda Honda's will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Honda Honda's in the consumer business. Now Honda Honda's can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Honda Honda's can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Honda Honda's can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Learning at scale
– Online learning technologies has now opened space for Honda Honda's to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Honda Canada (A): Tsunami and Communications External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Honda Canada (A): Tsunami and Communications are -
Shortening product life cycle
– it is one of the major threat that Honda Honda's is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Honda Honda's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Regulatory challenges
– Honda Honda's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Leadership & Managing People industry regulations.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Honda Honda's in the Leadership & Managing People sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Honda Honda's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Environmental challenges
– Honda Honda's needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Honda Honda's can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Honda Honda's can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Honda Canada (A): Tsunami and Communications .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Honda Honda's needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Increasing wage structure of Honda Honda's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Honda Honda's.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Honda Honda's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Honda Honda's can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Consumer confidence and its impact on Honda Honda's demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Honda Canada (A): Tsunami and Communications Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Honda Canada (A): Tsunami and Communications needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Honda Canada (A): Tsunami and Communications is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Honda Canada (A): Tsunami and Communications is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Honda Canada (A): Tsunami and Communications is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Honda Honda's needs to make to build a sustainable competitive advantage.
