Professional Documents
Culture Documents
The philosophy: “Respect for the Individual” has proven to be Honda’s foundation when
it comes to decision making as a firm; whether it be major managerial choices or, seemingly
small, decisions like procuring new production facilities. When making the decision to secure a
new location for a factory or facility, Honda considers cultural and social factors, far more
slowly grew to occupy sites across dozens of other countries, Peru Loreta
U.K. Wiltshire
including the United States, UK, France, Spain, China, Thailand, France Ormes
Italy Abruzzo, Bologna
India, and Australia; among many others. Spain Barcelona
Kenya Nairobi
The framework Honda has developed to systematically Nigeria Ogun
Turkey Kocaeli
decide where to build its facilities is quite extensive and places China Hubel, Guangdong,
Chongqing,
significant value on the satisfaction of customers. Honda Shanghai, Huizhou
Thailand Ayutthaya, Bangkok
Bangladesh Gazipur
continuously strives to support communities wherever it goes while
India Pradesh, Haryana
consistently exceeding expectations. On Honda’s website, there is a Indonesia Jakarta, Jawa Barat
Malaysia Penang, Malacca,
Melaka, Kedah, Johor
statement that reads: “Building our products close to our customers Pakistan Karachi, Lahore
Philippines Laguna, Batangas,
helps us support the communities where we work and live. We’re Binan Laguna
Chinese Pingdong
especially proud to have been the very first international automaker Taipei
Vietnam Vin Phuk, Hung Yen
Australia Victoria
capable of complete product creation in the U.S., and that in 2014,
97% of Honda vehicles sold in America were manufactured here using globally and locally-
sourced parts” (Honda Operations). This statement illustrates Honda’s ambition to aid their
customers in ways most other car manufacturers do not even consider to. Many companies tend
to deter from prioritizing their customer’s satisfaction, due to their preeminent priority of
augmenting profits. Honda, however, has proven the value of keeping their customers happy
Honda has been able to efficiently balance productivity with customer satisfaction by
establishing its foundation with a set of core values. With that foundation, Honda has since
developed various strategies that have been very effective and successful when choosing
locations to build factories. When looking at Honda’s accomplishments and success, it is evident
that they do not only focus on their customers but also work to develop efficient operations by
creating “a flexible manufacturing system that enables the company to quickly and efficiently
move production of products from one plant to another and to build multiple products on the
same line. By staying flexible, Honda’s manufacturing plants can adjust to market demand while
maximizing capacity, which helps to provide a stable production base for associates, dealers, and
Another strategy that Honda has, is starting all new foreign operations at a small scale
and steadily growing them as demand increases and operations start running more smoothly.
Honda strives to build its facilities to be completely autonomous by only relying on local
resources rather than unnecessarily importing them. Similarly, Honda tends to hire their
employees locally, rather than transferring in employees from existing facilities. This strategy is
built on the idea of marketing globally but producing locally, which has proved to be very
advantageous to Honda.
When it comes to the final decision Honda has three over arching factors that it considers
to finalize the locations for facilities. The first factor is whether or not there is a big enough
target market for the products that Honda offers. Honda manufactures a wide variety of products
so there are various markets that Honda target within any given region. The second factor for
consideration is the availability of land or real estate large enough to meet Honda’s needs. When
making this determination, Honda also needs to consider whether the location is somewhere they
can easily access resources and their customers. The final factor is whether or not the site meets
Honda’s extensive list of company requirements. These requirements are technical and wide
ranging, depending on which products they wish to manufacture and at what scale. If these three
requirements are met, then Honda goes on to building its facilities there.
Honda Motor Co. “Investing in America.” Honda Operations and Locations | Honda,
www.honda.com/operations.
Mair, A., Florida, R., & Kenney, M. (1988). The New Geography of Automobile Production:
Peavler, Rosemary. “How Just-in-Time (JIT) Inventory Management Can Benefit Your
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