Corporate strategy case study analysis


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Three integrating systems are vital: 1 technical systems, including IT, software, and data; 2 organizational tools of coordination, like dedication teams supported by specialists and intense data sharing; and 3 collaborative executive decision processes that champion novelty, innovation, and feedback [ 65 , 66 ]. Inoperability can come from seemingly mundane tasks, like loading supplies on a truck with different invoices, manifest requirements, and delivery times.

Separate and differing organizational processes inhibit deep collaboration. Inoperability arises from silo information flows and compartmentalization.

Corporate Strategy - Case Study - Google

Even with aspirational targets of decision-making, organizations acting alone fail to develop and improve competencies and capabilities to manage this integrated system via experiential learning, feedback, and criticism [ 67 , 68 , 69 ]. Deep collaboration needs robust methods to design, evaluate, and verify data gathering and data feedback to optimize effectiveness for the total eco-system organization, not sub-optimize for only certain members, sub-parts, or component firms [ 70 ].

Words like kanban, andon, jioda, yo-i-dan, and kijosei have precise meanings and routines, and such terms as reverse engineering, early detection, and ringi seido or consensus decision-making, simplify and codify precise protocols for shared communication. Benchmark techniques are widely used but less to evaluate past performance against competitors, but more to evaluate current performance against higher targets and aspirational stretch goals [ 71 ]. Indeed, deep collaboration at each stage requires a judicious combination of sharing ideas, new targets, real time feedback, and potential revisions.

Where ambiguous signals, informal targets and past measures become explicit, and shared across the system.

Training programs—internships, formal courses, apprenticeships—build organizational capabilities and mitigates risks from operating with incomplete knowledge, inexperience, understanding operating rules and procedures. Deep collaboration illustrates the need for similar training approaches to know, understand, and apply knowledge across the entire system. Toyota gains three network advantages: positional, where individual managers and subsidiaries access tools and protocols for high performance processes and benchmarks that create learning; structural, where communication connections strengthen the effectiveness and acuity of information flows to attend to emerging problems; agility, by strengthening interactions between individuals and teams, and embedding the new benchmarks across the entire network of factories, sales offices, and supplier organizations.

1 Executive Summary

By the early s, Toyota, like many leading Japanese corporations such as Sony, Komatsu, Canon, Matsushita, and Hitachi, were making deep inroads in the American market via exports. The auto sector was singled out, as , American autoworkers were laid off, a new President, Ronald Reagan faced pressure from Congress to take legislative action, and firms like Ford applied to the American International Trade Commission for temporary relief, following similar action by the powerful auto union, the UAW.

The percentage breakdown for each of the five biggest exporters, calculated mainly by US exports in the previous 2 years, was as follows: Toyota Toyota illustrates the complexity to manage very fast growth in foreign markets, while transferring its corporate identity to a network identity of safety, quality, and value [ 43 ], even though the knowledge sharing processes that are now taken for granted at home, including quality standards of suppliers, may not exist in foreign countries [ 75 , 76 , 77 , 78 ].

The massive recall in , where Toyota accepted responsibility to service over 8. The reality, despite paying fines, accepting responsibility, apologizing to the American public, and accepting the huge financial costs of the recall, Toyota refused to play the blame game, or take easy solutions, like importing more parts from Canada or Japan, or shifting American production to Canada or Mexico.

Toyota took the difficult decision, true to its identity, of fixing the core problem, raising the quality standards of its American-own parts supplier, devoting more resources to training, and accepting short-term risks to financial performance, particularly when leading automakers from Europe, Korea, and Japan were investing in the US market.

Toyota quietly responded about building a truck factory in Texas. In a world of disruptive corporate strategy and identity offer a refined tool for alignment of stakeholders to create competitive advantage.

Global Corporate Strategy - Honda Case Study

Corporate culture focuses on the behavioral assumptions to perceive, think, and feel in problem-solving [ 81 ] within the organization, while organizational identity is a projection of that culture to external stakeholders to align both cognitive and behavioral tools for growth and innovation. Individual and sub-unit identities can lead to cleavage and discord, especially where environmental forces make knowledge and information asymmetric, so special attention and sense-making requires an adaptive alignment to improve performance Figure 5.

Increasing, all organizations face four separate but related challenges that impact overall performance but also survival as independent entities. Clearly, technological change imposes new challenges for internal organizational competences and capabilities, as firms scramble for mergers, takeovers, and new alliances to meet the test of size and foreign market penetration, or a retreat approach or even drift. Decision uncertainty influences the nature of internal competencies, learning barriers, and the sustainable position of existing firms.

The fourth challenge relates to the first three but is subtler. That challenge concerns what might be called the Galapagos trap, namely designing an ecosystem that is suitable for one market that is unsuitable for global markets and allows little transfer of knowledge or engineering knowhow to other markets with a separate eco-system, including the supplier system.


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In all four of these development challenges, the competitive race is to avoid the lessons of the computer industry, where new smart phone technologies displaced existing incumbents, lowered entry barriers for new startups, and shifted the main suppliers and their location. Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution 3. Help us write another book on this subject and reach those readers. Login to your personal dashboard for more detailed statistics on your publications. We are IntechOpen, the world's leading publisher of Open Access books.

Built by scientists, for scientists. Our readership spans scientists, professors, researchers, librarians, and students, as well as business professionals. Downloaded: Abstract This chapter links organizational identity as a cohesive attribute to corporate strategy and a competitive advantage, using Toyota as a case study.

Keywords institutional identity lean management learning symmetries docility habits of attention kaizen. Article for Lawrence Emeagwali Ed. London, October 18, Introduction Few organizations combine the institutional benefits of longevity and tradition with the disruptive startup advantages of novelty and suspension of path dependent behavior. Organizational performance at Toyota By any standards—shareholder value, product innovation, employee satisfaction measured by low turnover and lack of strike action, market capitalization—Toyota has been astonishingly successful, both against rival incumbents in the auto sector, but as a organizational pioneer in transportation with just-in-time thinking.

Toyota identity as a social construct The auto sector symbolizes the development of post-war multinationals largely based on firm-specific capabilities and proprietary advantages. Okika [ 56 ] describes the implications of the evolving Japanese model of labor-management relations in the firm: Japanese enterprises made their decisions by gaining an overall consensus through repeated discussions starting from the bottom and working up … making it easier for workers to accept technical innovation flexibly.

Challenges to orthodox industrial production The advance of industrialization involved new methods of energy, raw materials, dominant technologies, and organizational configurations [ 58 ] but relatively little to consideration actual production systems, especially after Henry Ford introduced mass production using interchangeable parts. Split identities at Toyota By the early s, Toyota, like many leading Japanese corporations such as Sony, Komatsu, Canon, Matsushita, and Hitachi, were making deep inroads in the American market via exports.

Discussion and conclusions In a world of disruptive corporate strategy and identity offer a refined tool for alignment of stakeholders to create competitive advantage. In mass assembly industries like autos, shipbuilding, and heavy construction equipment, where steel is a complementary component, scale, technology, and technical systems, including plant location, largely define cost advantages. By the early s, the competitive gap between Japan and the US was increasing, just as Japanese firms were shifting from export strategies to direct foreign investment, i.

One analysis showed the contrast: "… the American steel industry had fallen from the largest and most technologically advanced in the world to the condition of a lagging competitor … companies retrofitted new technology unto often antiquated facilities" [49], p. In one of the great ironies of business history, in the s, when Ford and General Motors provided two-thirds of the Japanese car market, mostly by assembling kits from their home market, the Japanese government, despite their desire to focus on auto production, wanted Ford to establish a joint-venture with Toyota.

Various agreements were planned, including land purchase, but Ford, denied permission to expand local production on its own, retreated from Japan in , followed by GM [73]. In , China invited Toyota to establish a joint venture, but when Toyota decided not to accept, China turned to Volkswagen, not by far the most successful foreign carmaker, producing 4 million units, in a market of 2 million a month. Toyota produces only 1 million per year. Download chapter PDF. More Print chapter. The competition in the industry in which the company operated nevertheless, was increased and the organization had to devise and implement adjacent strategies.

Its initial business model had been based on competitive products through high quality and affordable prices, yet it gradually became necessary for the company to develop other strategic advantages. The course of action taken by the Newell Company revolved around gradual mergers and acquisitions of smaller size companies, which would increase the company's competitive positions at various levels.

The purchase of Calphalon for instance led to the company's gaining of more access to the customer base, through the network already created by the purchased entity, but also a significant increase in the product line. Beyond this threshold, the company would become more efficient and would be able to retain more from its revenues, becoming as such more profitable.

Additionally, at this size and level, the organization would. Show More. Read More. Jamie Turner at Mli, Inc. Popular Essays. In addition, Porter suggest five competitive forces -threats of new entrants, bargaining power of suppliers, bargaining power of customers, rivalry among current competitors, and threat of substitute products and services- which must be analyzed to formulate a strategy on a market-based research focus. The strength of each of the five competitive forces is a function of industry structure or the underlying economic and technical characteristics of an industry De wit, B.

Strategic Analysis

In the contrary, resourced based inside-out research focus on the internal capabilities that influence strategic decisions. A common model to identify the internal capabilities is the SWOT analysis. The SWOT analysis determines the current state of the market and outlines the strengths, weaknesses, opportunities, and threats a company faces within its environment. In context to this, a company must ask itself four general questions: What do we have that gives us a competitive advantage?

Where can we be attacked and what do not we have? Where are the best markets to generate successful results? What do we need to look out for that would have negative impact on results?

Table of content

Kern, R. In general, not all decisions can be made based on only internal or external influences. Some strategic decisions are influenced by both factors. For instance, a resourced-based company has still to follow government regulations, which might be able to affect the company's capabilities to provide a good or service negatively Rasche, A. In the past, literature has provided different views about if a strategy should be based on-either market- based or resourced-based.

By contrast, the inside-out perspective is more concerned with the allocation of the company's capabilities to achieve efficiency. Miles and Snow argued that over time an outside-in company might do things right effectively but has lacks of capabilities in other areas such as developing new products. They argue that to strengthen a company's capabilities and being efficient is a precondition for market effectiveness in the long-term.

Especially in times of a fast changing environment due to the economic recession, the increase number of competitors, and due to the globalization, managers are challenged to find the right approach to formulate the right strategy. In this context, Honda tries to reconcile this dichotomy in order to be efficient as well as effective. Honda's core competence is the ability to produce some of the world's best engines and powertrains Hamel, Since the very beginning of the company, Honda's strategy has been built around its expertise in the development and manufacture of engines.

As you can see from the graphic, this capability has successfully been transferred offering a wide range of products Grant, This is considered as an inside out approach first looking at the internal resources and then offering the product to the market. Nevertheless, Honda also put emphasize on doing the right things. The company designed its products and processes according to the need of the markets. Here, it is important not just to be efficient in producing engine but also to meet the market needs in terms of design, safety, price etc. Furthermore, in developing new low-pollution power sources for vehicles Honda follows an outside in approach looking at the market needs and then building the capabilities to do it.

Following both approaches has led to a competitive advantage for Honda. Moreover, according to Hamel a core competence can be identified under the following three questions:. Is ita significant source of competitive differentiation? Does it transcend a single business?