Honda Technology Research Institute Company is a Japanese multinational corporation known as one of the world's biggest manufacturers of motor

vehicles. It has a world wide market spreading from Asia to North America, Europe and other parts of the world. One of the reasons for Honda current success is that it used Japanese methods to build a proper production system in the UK. Producing a car from thousands of parts is a complex and difficult task. One small change in the production schedule will lead to a disastrous effect on the whole system. Traditionally, In October 1946, Soichiro Honda established the Honda Technical Research Institute in Japan, to develop and produce small motorbike engines. Two years later, Honda Motor Company was born, and in 1959 Honda opened its first storefront in Los Angeles. Honda has a long history of environmental leadership, including the introduction of America's first mass- produced hybrid, the Honda Insight, and the first vehicle to meet California's low-emission vehicle standards, well in advance of regulatory requirements. Since the birth of Honda Motor Company, it historic timeline has been very active; after the opening of the first storefront in Los Angeles, Honda Motor begins sales of the Honda Dream, Bentley and Honda 50 small motorcycles. In the sixties American Honda created a new image of fun and friendly motorcycling in the Americans minds with the memorable You meet the nicest people on a Honda ad campaign. Twenty years later Honda Motors starts launching low emission natural gas powered and the gasoline electric hybrid automobiles. Nowadays, American Honda Motor marks 50 years of operations in United States and committed to exceed the expectations of the society. Also American Honda released the Dream the Impossible documentary series, a collection of web vignettes that focus on the core philosophies of Honda. In this last decade, Honda demonstrated commitment to Britain by creating 700 new jobs it proves the Hondas long term commitment to the British manufacturing. Honda is the 6th biggest carmaker globally. Like Toyota, Honda also has interests in many areas. In the UK Honda has a plant near Swindon which has halted production for 4 months due to falling demand for cars in the UK, Europe and across the globe. With sales down around 30%, Honda initially planned to cut vehicle production by 56,000 units. Significantly Honda has been affected by the global downturn, despite having some of the most efficient manufacturing processes in the history of car making - and indeed some of the most desirable cars on the market today. Its extremely high level of efficiency and high brand profile means that Honda should be well positioned for the upturn, when it eventually comes.

1)a)Obviously, when we talk about economic and business progress, we think about the porters five forces that have a big signification in the Honda Industry, which are the framework of the business strategic analysis and development. Porter's five forces include the threat of substitute products, the threat of established rivals, and the threat of new entrants, the bargaining power of suppliers and the bargaining power of customers. But these forces are just a part of complete strategic models, as the value chain which means a powerful analysis tool for strategic planning; the delivery of a mix of products and services to the end customer will mobilize different economic factors, each managing its own value chain. Porters five forces of Honda: Bargaining Power of Suppliers: The automobile supply companies have limited bargaining power. There are so many supply firms and there are so many parts that are required to produce an automobile, requiring numerous suppliers, one would think that the automakers would be at the suppliers mercy. However, the suppliers really have very little power. The suppliers tend to rely on one or two automakers to purchase the majority of their products. If the automaker decides to change suppliers, the effects to the supplier would be devastating. With the JIT (Just in Time) manufacturing methodology Honda utilizes, there is a push-pull mechanism. This warrants a strong relationship between manufacturer and suppliers. This also can be quite profitable for both organizations. Bargaining Power of Buyers: The automotive industry is highly competitive, therefore buyers have some degree of Operations management is a deliberate change process. It consists of a series of transformation to change resources into products or services ready for consumers. Consumers have the greatest power in the relationship in the fairly standardized nature of the automotive commodity and the low switching costs associated with selecting from competing brands. Honda has a history of delivering high quality and fuel efficient vehicles. With the increase in fuel cost and the state of the economy, the consumers are seeking the best product for a good price. Honda has been a leader in producing fuel efficient and low emissions vehicles. As the world has a greater awareness of the need to protect the environment and to go green, Honda continues to improve the vehicles produced with this focus. In 1977 and 1983 the Honda Civic model ranked first in U.S. fuel-economy tests. Honda has introduced hybrid vehicles such as Insight, Civic, and Accord. In 2006, the Honda Insight was listed as the most fuel efficient car. These are just some of the examples of how Honda works to meet the demands of the consumers. In the past... The intensity of competitive rivalry: for most industries this is the major determinant of competitiveness of the industry. its based on price, quality &innovation. This competitive rivalry is high

in Honda motors, because most countries manufacturing own brand vehicle. E.g. maruthi by India. Not only that the international automobile companies are also the competitors for Honda motors. The threat of substitute: The existence of products outside of the realm of the common product boundaries increases the propensity of customers to switch to alternatives. Threat of substitute is high for Honda because the availability of non Honda products is in the market. So its lead the customer for more option about the product. Threat of new entrants: Profitable markets that yield high return will attract new firms. This result in many new entrants, which eventually will decrease profitability for all firms in the industry. Unless the entry of new firms can be blocked by incumbents, the abnormal profit rate will fall towards zero. Though the Honda motors leading the market at the present, its market share was affected by the new entrants Toyota &Nissan, in early days. On the other hand Honda struggled when it was tried to land in the European market. Now the threat of

1)b)The positioning principle states that the outcome of any process should be flawless so that further tasks that depend on elder tasks are not burdened with having to correct errors or wait for reworks both of which would cause production delays and increase operational costs and increase the costs of lost opportunities of sales earned from customers who prefer not to wait and switch to other brands. The focus is as on operational efficiency by not wasting time and other resources by increasing productivity. It also allows for more accurate inventory control well further saving costs. If this principle is repeated throughout the series of sub-transformation tasks, the final overall transformation tasks would also be error-free. In this sense, the importance of the positioning principle is more focused on process related capabilities. Developing internal resources focuses on ensuring the effectiveness of the performance of transformation activities into tasks. The measures of effectiveness are customer-defined standards of performance. This is achieved by breaking down the aggregate standards of performance measures as expected by consumers to more granular metrics in each sub activity so that value-adding can be realized at every step of the way to give a bigger accrued value by the time the operations process reaches its end. This not only saves costs, but may exceed the consumers expectations. In this sense, build in quality emphasizes more on product-related capabilities that are ultimately measured by the consumers. Reconciling Dichotomies Basically , innovative strategy of Honda represents process of `reconciling

dichotomies . This section will elaborate three dichotomies they are planning vs . learning , market positioning vs . developing internal resources , and product-related core competencies vs . process-related core capabilities . The dichotomies explore the two poles that influence an organization like Honda. There are dichotomies in buyer-supplier relations like vertical integration and market relationship, work organisation like efficient and humane , product developement process and business strategy like cost and differentiation . all this dichotomies are important because Honda discover a new method for developing new ideas about traditional management problems A recognized source of competitive advantage for Honda has been its core competence in the advanced internal combustion in the advanced internal combustion engines,which power the whole range of its products . But Hondas product strength goes far deeper, a dichotomy-reconciling approach characterizes both the mental process of technology research and the philosophy behind the actual product designs. The technology and design features of Honda products are the embodiments of successful reconciliations of dichotomies which deliver direct and immediate competitive advantage. Due to economic reasons such as stagnating levels of income, with a high inflation at the same time. Other factors include that people can drive their cars longer as quality goes up and cars last longer. The cars manufactured today last longer and the streets are getting better which can make a major impact. Concerning the automobile industry , i will discuss economic profile of the industry . In addition, i will also elaborate some issues such as the way economy affects the success of automobile industry and economic influences that can affect the industry in a negative way . Prior to the discussion , we will elaborate current position in global automobile industry to assess the economy relations to particular markets where automobile industry gain success . Economy and Automobile Industry, Automobile Sales and Households Income . The particular economy condition has significant impacts towards the particular economy condition has significant impacts towards the number of sold cars in a country . This is because when the country 's economy is favorable, people tend to buy cars or motorcycles . In addition, Kobe (2002 ) reveals there is fact that when U .S . economy grows , many vehicle transactions represent the purchase of second and third cars in the U .S . households . In other findings , the increase in households ' income also drives people to buy new cars or change the cars with the latest models . 1)c) Global Automobile Industry In global economy point of view , the sales of automobile products depend on automaker 's strategy to deal with the particular country 's ondition . For example , the world 's second largest automaker , Toyota , conducts appropriate strategy by

producing affordable MPV (multi purpose vehicle ) in some Asian countries . The situation leaves European and American automakers that rarely launch MPV products in price range that Toyota plays. 2- Strategic management as a field of study has developed impressively over the past few decades and several theories and models that are based from empirical research and background knowledge from related fields of study have been advanced . Strategic management is diverse in nature and applicably ranging from financial , marketing human resource management , customer relationship management among others predominantly , strategic management concerns itself with finding best practice for firms that facilitate achievements of success (Andrews , 1971 . Strategic management arose from the need to respond to the changing nature of business environment need for growth by organizations ( Honda) and competition among other reasons . This is on strategic management and particularly classical model of strategic management and its usefulness in understanding the process of strategic development in Honda . Classical model and rationale behind it . This model is interchangeably referred to as the Harvard school to thought as advanced by Kenneth Andrews and others . The formulations of classical model of strategic management felt that strategy should be a deliberate , conscious and controlled action taken by top managers to influence out come of a company in a positive way . Honda also felt that in order for strategies to be effective, it had to be uniquely distinguished from the ones used by other companies at this gave a competitive edge (Ghemawat , 2002 . In spite of uniqueness Honda also posited that strategies should still retain simplicity and informality attributes so that the risk of getting lost in between designing , formulation and implementation of strategy was eschewed . Classical model or rather the design school believed that strategy was the out come of a fully developed design process whose success was also dependant on the implementation of the strategy after its formulation , of course there were other strategic management ideas that arose after the classical view for example those from Ansoff and planning school Sloan , chandler , Henry Fayol , Max Weber , human relations theories among others (Whittington , 2001 . Most organizations in the business are profit oriented and thus their strategies are designed to meet this end. The variables that influence success of a business say external environment competitors and internal factors such as strengths and weaknesses of the organization . Given that the main focus of engaging in business is to make profit and following from the fact that strategic management is a practical subject where there are no definite answers to problems , then classical model becomes very helpful in understanding this development in organization . Classical model views rational thinking as the way to achieving profit maximization . The concept of strategy is separate from execution of strategy . This means that it is not in the place of operations to formulate polices rather operations decomposes strategy to actionable task and carry them out . Alfred Sloan was a staunch follower of this model and he helped in developing the return on investment criteria and of policy from day to day operations classical model have great influence in strategy development .

Personnaly i like to apply the Classical school of thought in the context of strategy developement at Honda Motors because Nowadays the word management can be heard
from the representatives of every walk of life . Indeed , it seems that the task of finding ways to properly employ management principles for the maximal benefit has become the backbone of modern organizations . Therefore , it may be useful for many to remember that this state of affairs was not always the same . In fact , what can be viewed as the formal study of management as a set of coherent principles of organization that can be controlled and made more effective commenced only a little more than hundred years ago , in the end of the nineteenth century . Since then , the level of elaboration of principles of management has significantly evolved , and by today we have several branches within management thought usually separated by scholars into five major theoretical schools that in combination constitute a rich field for study , which is very relevant from the practical point of view as well . These schools are the classical school , the behavioral school , the quantitative school also known as management science , the contingency school , and finally Theory Z school of management . What is important in this respect is that even though some of those schools are viewed as classical , and some were born relatively recently , each of those schools contains useful insights that can be of great use in today`s complex environment in which we face constant and apparently accelerating changes . With these points in mind , let us trace the evolution of management principles from the classical school of management theory and management practices to the present , and try to relate one or more of them to my current work environment . The Classical School of Management the first approach to the formalization of management thought , and its origins can be traced to the end of the nineteenth century . This school of management thought was mostly interested in finding ways of more efficient and productive management of organizations , and work in general . Within this scholarly approach three more specific fields of concern can be discerned , such as scientific management , bureaucratic management , and administrative management . Scientific management was the response to the slow pace of work characteristic to the nineteenth century , and to what was increasingly viewed as arbitrary , unjustified , and unsystematic process of decision-making , which inhibited development of organizations . In such circumstances , scientific management emerged as the systematic examination of various work methods that could increase efficiency . It was based on several main principles . Firstly , it demanded the adoption of strict methods of science to find the best ways of doing each type of work.

3- Honda's strategy has been used to illustrate and support apparently contradictory positions on a series of conceptual dichotomies, namely analytical planning versus learning, market positioning versus resource-based and, within the last of these, core competencies versus core capabilities. A critical analysis of this literature reveals empirical inaccuracies and a focus on Honda's strategic successes to the neglect of its failures. More significantly, explanations and general strategy implications are couched in terms of reductionist one-sided theories, a tendency which is only deepened when strategy thinkers debate the meaning of Honda . This theoretical approach is particularly ill suited to Honda, an important strategic capability of which appears to be precisely the reconciliation of dichotomous management concepts. Western strategy thinkers have therefore missed the opportunity to develop a more appropriate and productive paradigm for learning from Honda.