Strategic Management for Competitive Advantage

This report discusses the importance of Corporate Social Responsibility (CSR) & Sustainable Development, Triple Bottom Line (TBL), Sustainability & CSR of Honda, and Financial Performance and Future Impact of the Expectations in the context of Strategic Management for Competitive Advantage. It also includes a case study on VECTOR X's marketing efforts.

STRATEGIC
MANAGEMENT FOR
COMPETITIVE
ADVANTAGE
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Table of Contents
INTRODUCTION...............................................................................................................3
CORPORATE SOCIAL RESPONSIBILITY (CSR) & SUSTAINABLE DEVELOPMENT. .3
TRIPLE BOTTOM LINE (TBL)...........................................................................................4
SUSTAINABILITY & CSR OF HONDA..............................................................................4
FINANCIAL PERFORMANCE AND FUTURE IMPACT OF THE EXPECTATIONS........5
CONCLUSION...................................................................................................................8
REFERENCES................................................................................................................10
APPENDIX.......................................................................................................................11
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INTRODUCTION
For the organizations like Honda it is inevitable to keep its steps back when it
comes to sustainability, CSR and ensuring development of society. Since the global
market is now more inclined to the notion of welfarism (Rhou, and Singal, 2020) With
this respect the all key components would be discuses in this report. The report is
intended to bring sense of clarity pertaining to Honda which is getting operated across
the world. It would be reflecting drastic views on CSR, sustainability and financial
information.
CORPORATE SOCIAL RESPONSIBILITY (CSR) & SUSTAINABLE
DEVELOPMENT
With the progress of time the world has experienced a strong need of installing a
well structured corporate governance. Since the owners and operators or decision
makers are no longer same so there is hyper need to bring kind of system which gives
better control and can also ensure rights, interests of all the associated stakeholders.
Corporate governance is nothing but a system which is helping such organization to
abide with the rules and regimes. By imparting the system a better management can be
ensured along with upholding the interests of all stakeholders. Corporate social
responsibilities and sustainable development are also being driven by corporate
governance (Crane, and Matten, 2021)
Honda motors is the largest manufacturer of tow wheelers in the world. The
organization is getting operated in number of nations with its full potential. For such
strong organization the role pertaining to corporate social responsibilities and
sustainability becomes quite inevitable. CSR can be defined as the set of
responsibilities which are instilled on the organization to contribute towards society. The
companies are using social resources and by using the means of productions they are
getting thrived so they are supposed to pay attention on the welfarism of the society
which is only possible by playing vital role in the realm of CSR.
ISO 26000 is a globally applied set of principles which are supposed to be
inculcated by the organization in order to fulfil the requirement pertaining to CSR. There
are some principles which are to be instilled (Shin, et. al. 2021) These principles are
Accountability, Ethical behaviour, Respecting the interests of all stakeholders,
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respecting codes and rules, Transparency, respecting human rights, keeping the
international behaviour live etc. The all associated organizations are supposed to
practise these all things.
Being a global player and a big attraction for the world the Honda plc. Is having
its own CSR policy. Since the entity is getting operated in number of nations so along
with global principles it is managing to work as per the national CSR regimes. For
instance- In India companies act 2013 is applied so as per the schedule 7 and section
135 some guidelines are suggested the organization is complying with it in order to fulfil
its CSR requirements.
Now entire world has moved to bring awareness among global entrepreneurs
about fulfilment of their Sustainable development related needs. The fact can not be
rejected that SDGs are to be achieved by the year 2030 so such global enterprises can
not keep their self back (Talha, 2021) The organization has already imparted such kind
of mechanism so can fulfil the CSR related requirements and can also extend a strong
message to the world.
TRIPLE BOTTOM LINE (TBL)
The need was felled that there should a kind of mechanisms which help to
measure the environmental and social impact along with financial performance of an
organization. For fulfilment of the aim TBL concept was introduced by John Elkington in
the year 1994. these three bottom lines were environmental quality, economic
development, and the social responsibilities.
This is a conventional method to measure, profit, earth, people and corporate
profits. This helps organization to measure its long way or can be called strategic
success. By the analysis it can be perceived that how and to which extent the
organization is taking advantage of economic development, social environment for its
favour (Vishwanathan, et. al. 2020)
Honda is playing great role for all People, Profits, Planets. It is giving them great
attention in order to make them foster. At the same time, the impacts and success
measurement are also being carried out so can pave the way forward. By imparting the
analysis the organization would be able to change its outcomes in a radical manner. It
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would help it to hike water conservation, reducing risks, hiking energy efficiencies,
surging employee productivity, reducing risks come form government side etc.
SUSTAINABILITY & CSR OF HONDA
Honda is an MNC with its headquarter in Minato City,, Tokyo, Japan. The entity
is known as the biggest tow wheelers manufacturer in the world. It is getting operated in
number of countries located in different continents. It is also engaged in car
manufacturing but the bikes and other two wheelers are key products. There are
number of models of bike such as- Honda X ADV, Honda Scoopy, Honda Dio, Honda
Shine, Honda Livo etc. and in cars the models are as- Honda amaze, Honda Jazz,
Honda WR-V, Honda City etc.
The company always keeps the CSR responsibility in order to provide the best
products and best deal to the world. It is having some rules which are helping it to make
its process more aligning with the environment protection. The organization is taking
some steps on regular interval so can uphold its ability of performing CSR
responsibilities. For instance in the year 2014 it has put great efforts in India for
promoting road safety awareness, driver training etc. it has also driven expeditions for
women empowerment, building hostels etc.
Honda is one among those organizations who are striving a lot to make their
course of actions more helpful to retain sustainability along with higher profitability.
Honda is having its own Environmental Goals which are driving its efforts to pave the
way forward. For instance- it has made 2030-2040 goals. Where it is supposed to come
up with strong vehicles which would got operated by electricity.
2050 goals have their areas or pillars to work upon. For instance- Carbon
Neutrality, Resource circulation and Clean energy. These pillars are to be achieved by
the organization to hike the values of CSR. There is a vast pursuit to come up with
100% sustainable materials so can eradicate the hazardous things which are somehow
demoralizing environmental notions and also making environment unhealthy (Chong,
2019) The plan of 97% CO2 emission reduction is a great aim, where it is working with
full of its efforts. The waste was down up to 18.5% in the year 2021 as compares to the
preceding year. In FY 2021 it has reduced its total water use by 10.9% so these all
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efforts are justifying that there is great inclination form the side of company to make
itself fast and drastic with CSR and Sustainability (Kovermann and Velte, 2019)
FINANCIAL PERFORMANCE AND FUTURE IMPACT OF THE
EXPECTATIONS
The table below is showing profits and loss of Honda. The organization is getting
operated across the world with its headquarter in its nation of origin. The last four years
are showing favourable outcomes for the entity (Jurakulovna and Bahodirovich, 2021)
Yet as it can be seen that the sales revenue is heavily fluctuating and not reverting
same growth as it expects. In the wake of Covid-19 it has made great efforts and now
the organization is able to have better profitability. It shows that CSR factor is helping it
in some or the other ways.
The chart is showing that after a fall down now a better recovery is there form
last couple of quarters. It is all due to better role it has played in term of operations
along with responsibility with respect to CSR.
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As per the analysis of the chart above it can be concluded that the performance
is getting better from last three years. In 2020, it has experienced a down fall due to
pandemics but then it has made great efforts. In the year it has spent around 58 million
USD. It drove the organization to better way with hyper growth (Bhagat, and Bolton,
2019)
The operations got direct advantage of these course of events which is being
reflected in form of its financial performance. For instance- In 2020 the operational
margin rate was 5% which jumped to 6% in the year 2021. there may be range of
elements behind this paradigm shift but the fact can not be rejected that the biggest
factor was the corporate governance where it has poked its efforts more.
CONCLUSION
This piece of document has discussed a range of topics which are quite relevant
for an organization to get operated in such a complex business environment. Firstly the
notions and convictions of Corporate governance has been clarified with respect to
Honda which is one of the largest tow wheeler manufacturer in the world. Then by using
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some key theories such as TBL, sort of clarity has been brought. At the same time, the
financial data of last couple of years was presented in order to drive better outcomes
and at the end of the report by using pictorial presentation those financial data and other
information made material to the fullest extent.
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REFERENCES
Bhagat, S. and Bolton, B., 2019. Corporate governance and firm performance: The
sequel. Journal of Corporate Finance .58. pp.142-168.
Chong, S. C., 2019. An Analysis of the External and Internal Factors Affecting Honda
Motor Company’s Performance.
Crane, A. and Matten, D., 2021. COVID‐19 and the future of CSR research. Journal of
Management Studies. 58(1). p.280.
Jurakulovna, J. G. and Bahodirovich, R. U., 2021. Improving the Theoretical Framework
of Internal Audit in the Corporate Governance System. Middle European
Scientific Bulletin. 19. pp.345-348.
Kovermann, J. and Velte, P., 2019. The impact of corporate governance on corporate
tax avoidance—A literature review. Journal of International Accounting, Auditing
and Taxation. 36. p.100270.
Rhou, Y. and Singal, M., 2020. A review of the business case for CSR in the hospitality
industry. International Journal of Hospitality Management. 84. p.102330.
Shin, H., et. al. 2021. The impact of hotel CSR for strategic philanthropy on booking
behavior and hotel performance during the COVID-19 pandemic. Tourism
Management. 85. p.104322.
Talha, M., 2021. FINANCIAL STATEMENT ANALYSIS OF ATLAS HONDA MOTORS,
INDUS MOTORS AND PAK SUZUKI MOTORS (EVIDENCE FROM
PAKISTAN). Ilkogretim Online. 20(4).
Vishwanathan, P., et. al. 2020. Strategic CSR: A concept building meta‐analysis.
Journal of Management studies. 57(2), pp.314-350.
Online-
<https://global.honda/investors/financial_data/pl_bs_cf.html>
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APPENDIX
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Learning-
Marketing-
Marketing refers to the set of activities which are performed in order to bring all
relevant information to the potential customers in order to ensure their purchase.
VECTOR X is engaged in car manufacturing business. The organization is striving to
augment its market diaspora. It is only possible with the help of better promotional
efforts. It has made great efforts to augment the sales. For the purpose range of tools
have been used such as conventional and modern tools. These tools were as-
Advertising, Copywriting, Product design, process etc.
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In the first round the organization has spent 18 million USD, on its promotion
which led hyper profits to the company. By getting motivated from the outcomes of the
first round, the same strategy was replicated in the following round, the aim was to bring
hyper sales to the company which was only possible with drastic efforts in the realm of
promotion. The same amount was invested and 18 million USD, was expenditure of
second round.
In the third and fourth round the organization made its efforts lower. Since due to over
expenditures on promotions it was facing issue of over cost. In order to get that cost
factor down there was need to make a strong decision supporting this notion. With this
respect, the aim of reducing promotional cost was imparted. In the third round the cost
was 15.8 and it has been kept similar in the last round where even the entity has
introduced its new product in the market.
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