Week 21

  1.      What are the benefits and drawbacks of taking an ‘emergent’ approach to strategy making?

By choosing 'emergent' strategy it leads a business to provide what the market actually wants, rather than what the owner or executive's thinks or believes the market wants. This approach requires that the organization maintain the flexibility, particularly at the owner or executive level, to embrace the new strategy.

Drawback of 'emergent' strategy is this approach works only on ongoing organizational activity. This approach does not offer a genuine alternative to more traditional intended strategy follower. (Dontigney, 2013)

2.      Was Honda’s entry strategy in the US more deliberate or emergent?

Honda's strategy seems like an emergent approach. Although they thought that Americans would love heavy and big motorcycles and were emphasizing on selling 250cc and 305cc bikes, people were more interested in Supercubs type which was small 50cc bike.

3.      Which of the accounts seems more accurate and why? Why do you think the two accounts differ so much?

The second account seems more accurate because it is based on an interview with Honda executives and they have provided all the reasoning for succeeding and failure in US market.

The two accounts differ because the first article is based on the research done by a consultant group i.e. Boston consulting group and the second article is based on the interview with executives of company itself.

4.      Did Honda’s entry strategy demonstrate the characteristics of ‘logical incrementalism’?

Yes, I think Honda's strategy demonstrates characteristics of 'logical incrementalism'.

Environmental Uncertainty:

In Japan, Honda was more popular because of its light weight segments bike but when they entered US market they had to adapt to US market where heavy bikes were preferred. Likewise, they also had to advertise widely to change people's mindset about bike riders; they spent spent $1 million in advertisement with slogan “You Meet the Nicest People on a Honda.” People were inspired and started to buy the bikes.

General Goals:

They had no strategy other than the idea of seeing if they could sell something in the United States. It was a new frontier, a new challenge for them to fit in. They did not calculate the profits and only wanted to succeed in the market.

Experimentation:

Honda's larger bikes were not robust enough for American riders and they started having engine failures. While waiting for the engineers to upgrade the design, the staff in the U.S. continued to hit the streets. They rode around doing errands in Los Angeles on Honda's small lightweight bike, the 50cc Super Cub. The success of the Super Cubs eventually translated into success with larger bikes, and Honda went from no presence at all in the U.S. market in 1959 to 63% of the market.

5.      Do you think Honda would have been more or less successful if they had adopted a more formalised strategic planning approach to the launch?

No, I don't think Honda would have been more successful if they had adopted more formalized strategic planning because while entering into new market one must never over-plan and stick with emerging approach and change according to what market wants. This doesn't mean being goal less, but market can be unpredictable so company must always be ready to tackle changes.

References:

 Johnson, Whittington and Scholes (2011) Exploring Strategy, 9th Edition, Pearson Education, Chapter 12

Dontigney, E., 2013. yourbusiness.azcentral.com. [Online] 

Available at: http://yourbusiness.azcentral.com/advantage-disadvantage-emergent-strategy-15781.html
[Accessed 2013].