Impact of Globalization on Business Functions: A Case Analysis of Honda and Mercedes

This report discusses the impact of globalization on business functions such as operation, marketing, and accounting, from the case analysis of Honda and Mercedes. It also covers the ethical impact, value creation, and cultural aspect of globalization.

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06 Mar 2019

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Globalization offers the scope of development in terms of economic as well as cultural prospect.
In the present report, we will discuss the impact of business function such as operation,
marketing, and accounting, from the case analysis of Honda and Mercedes. Considering Honda
Motors as example, the globalization have enabled the company to attract new customers and
market segment from diverse cultural background and integrate them with hybrid automotives.
As a result of strong marketing strategy, they have 123% (2016) to 129% (2018) increase in sales
revenue compared to that of year 2014 (onda Sustainability Report, 2018). Correspondingly, this
increases the GDP of their operating nations. In addition to this, the increased operational and
HR functionality also enable the company to offer more job opportunities and employability,
thereby contributing to the betterment of society. Ethical impact include, using sustainable
initiatives for supply chain management and respecting the human rights. Moreover, these
standards of HR, accounting, and operations also facilitate improved quality in mobility
experience, reducing traffic and carbon footprint for achievement of sustainable environment,
and contribute to the economic development of developing countries. The value creation and its
impact on the cultural aspect is also significant, which engages not only engineers but also
community members (customers) as potential stakeholders. In addition to this, it is also learned
from the recent report on environmental performance, the innovation in operation brings CO2
reduction by 10% and reduced waste for landfill by 83%, which gives positive return for the
betterment of society (Honda, 2016).
Mercedes on the other hand, adopted unique strategy, which was strategically framed in
accordance to the requirement of customers (Trefis Team, 2015). For example, in developed
nations, they supplied both cars as well as trucks and buses. On the other hand, in developing
countries especially India and China, they supplied only hybrid luxurious cars. Note that the

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globalization prospect offers information and helps the company to understand the requirement
of people according to their cultural and perspective requirements. The effect of the business
development by Mercedes, put positive impact the on the community engagement, especially in
the area of (i) youth engagement; (ii) environmentalism; and (iii) education. These responses are
reflective as sustainable effort in development of local ecosystem, creating employment
opportunities, and offering free education to local children (Metro Atlanta, 2018). Especially in
the heavy vehicle section, Mercedes brings innovative solution to cut the fuel consumption
(Mercedes-Benz Trucks, 2019). This in turn helps the user to gain more profit and further
promote economic development as well as emit less pollution. On the other hand, the accounting
process at Mercedes ensure that financial auditing and statements are free from fraudulent
information and hence ensure reduced risk to cash management, liquidity as well as market price
fluctuation (Daimer, 2017). Correspondingly, the economic development and positive impact on
the culture by reducing corruption is maintained.
In summary, based on the analysis, it is learned that the globalization impact from the business
activities of both companies have significant impact on the economies. The factors include
opportunity for employability, enhanced growth of national economy. It also ensures safe driving
for their customers, thus contributing to their betterment of society.

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References:
Daimer, 2017, Annual Report. [Online] Retrieved 06 Mar 2019, from
http://www.annualreports.com/HostedData/AnnualReports/PDF/NYSE_DAI_2017.pdf
Honda Sustainability Report, 2018. [Online] Retrieved 06 Mar 2019, from
https://global.honda/content/dam/site/global/about/cq_img/sustainability/report/pdf/2018/Honda-
SR-2018-en-all-02.pdf
Honda, 2016, Honda Reports on its Environmental Performance and Progress in 2016 North
American Report. [Online] Retrieved 06 Mar 2019, from https://3blmedia.com/News/Honda-
Reports-its-Environmental-Performance-and-Progress-2016-North-American-Report
Mercedes-Benz Trucks, 2019. Sustainability report. [Online] Retrieved 06 Mar 2019, from
https://www.mercedes-benz.com/en/mercedes-benz/vehicles/trucks/sustainability/
Metro Atlanta, 2018. Newsroom. [Online] Retrieved 06 Mar 2019, from
https://www.metroatlantachamber.com/about/news-press/newsroom/global-commerce-council-
welcomes-two-titans-mercedes-benz-and-porsche-for-a-discussion-on-atlantas-automotive-
ecosystem
Trefis Team, 2015. How Mercedes-Benz Accelerated Its Growth In 2015. Forbes. [Online]
Retrieved 06 Mar 2019, from https://www.forbes.com/sites/greatspeculations/2015/12/07/how-
mercedes-benz-accelerated-its-growth-in-2015/#450999b02a04