Week 21 Journal

Week 21

1)         What are the benefits and drawbacks of taking an “emergent” approach to strategy making?

2)       Did Honda’s entry strategy demonstrate the characteristics of “logical incrementalism‟?

Answers

1)      An emergent strategy is a pattern of action that develops over time in an organization in the absence of a specific mission and goals, or despite a mission and goals. Emergent strategy is sometimes called realized strategy. An emergent strategy differs from an intended strategy, intended strategy are develops with a specific visions to achieve the specific goal and targets of organization.

Emergent strategy implies that an organization is learning what works in practice. Mixing the deliberate and the emergent strategies in some way will help the organization to control its course while encouraging the learning process.

Advantages of Emergent strategy

a)      Unexpected benefits: Emergent strategy can be designed to address problems, but it can also be used to capitalize on unexpected marketing benefits. One of the advantages of latching on to an emergent strategy is that it could be something that your company has discovered before the competition does.

b)      Product development: Emergent strategy is critical in the advancement of the technology being offered in the marketplace. When companies refine and develop their products, they look for new features to offer that allow their products to stand out from the competition. The company attempts to employ emergent strategy to capture product developments that could help it become a technological leader in its industry.

Disadvantages

a)      Tangents: Emergent strategy is something that a company should keep an eye on, but the original strategic plan is what should be used as a blueprint for success. If a company continually focuses on emergent strategy to try to capture that one idea that could create success, elements of the strategic plan can go off course and create an entirely new set of problems that the company did not count on. Emergent strategy should be analyzed and carefully assimilated into strategic planning. Trying to force emergent strategy to occur normally results in a new string of problems that may not lead to significant business benefits.

b)      Bad Planning: Emergent strategy does not happen by accident. A corporate strategic plan should allow for the emergence of potential benefits that were never anticipated. When those benefits are discovered, an emergent strategy is in place to analyze them and see if the benefits should be explored further. To use emergent strategy properly, there needs to be a strong strategic plan in place with a focused goal and accountability for results. Emergent strategy can sometimes be misinterpreted as a lack of structure. The disadvantage to emergent strategy is the inability of some companies to plan properly for it and the damage it can do to the organizational structure.

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2)      With studying all the case study we can easily say that Honda’s entry strategy demonstrate the characteristics of logical incrementalism. Logical incrementalism is a management philosophy which states that strategies do not come into existence based on a one time decision but rather, it exists through making small decision that is evaluated periodically. These small decision are not made randomly but logically through experiment and learning.

In the case of Honda, they learn from every failure strategy. Every time it failed it goes for another strategy again and again and finally that experience helps them to grow in the market.

At the very beginning stage of business in U.S, the people there used to believe the motorcycles are for bad guy or rowdies, so in order to remove the misconception Honda introduced “You Meet the Nicest People on a Honda" slogan. Further, they knew that Motorcycle business was seasonal in U.S and after knowing this some Honda’s motorcycles began to sell but after some month’s complaint were coming about the machines. They again ran test and redesign the machine. In such a way Honda continuously scanned the US motorcycle environment and it was successful in adapting with changes.

For 5 years Honda struggled a lot to get in U.S. markets.  As it turns out, even 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.

The conclusions from the successes of Honda and Grace Manufacturing are to have humility about what you don't know about an unfamiliar market, to not over-plan and to stay adaptable to emerging information and circumstances. This doesn't mean being wishy-washy or directionless. Your objectives must be clear, but the shape in which success takes shape within them may be quite unexpected.

References:

     Abrahamson, Eric (1996) ‘Management fashion’,Academy of Management Review 21.1: 254-285.

     Abbeglen, James C. and George Stalk Jr. (1985) Kaisha, The Japanese Corporation. New York: Basic Books.

       Lessons from Honda's Early Adaptive Strategy, 2011, Available from 
<http://blogs.hbr.org/cs/2011/02/lessons_from_hondas_early_adap.html>