Control Mechanisms at the Honda Essay

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In this order of ideas, they request the assistance of specialized auditors, from both within and outside the institution. "To ensure objective control of the Company's management, outside directors and outside corporate auditors are appointed to the Board of Directors and the Board of Corporate Auditors, which are responsible for the supervision and auditing of the company. Honda has also introduced an operating officer system, aimed at strengthening both the execution of business operations at the regional and local levels and the supervision by the Board of Directors" (Honda Motor Corp. 2008 Annual Report).

A more comprehensive take on the four control mechanisms implemented by Honda can be achieved by looking at the following lines. They are a comparative analysis of the strategic approaches to control, revealing both positive and negative impacts of each mechanism, as well as the impacts they are likely to generate upon the four functions of management (planning, organizing, leading and controlling).

1. Quality control at five organizational levels

Positive: its complexity results in increased chances of simultaneous success at various levels

Negative: its complexity also results in a challenging implementation; foremost, its success depends directly on the managerial skills of the Honda leaders

Impact on managerial functions: increases their complexity and difficulty in implementing control in the meaning that all planning, organizing, leading and controlling functions must be simultaneously addressed at all five organizational levels; the chances of success are also increased

2. Employee relations

Positive: encourages fruitful working relations, which further increase the chances of identifying and resolving problems

Negative: its implementation may prove challenging and could even generate a reduction in the operational efficiency; it requires changes in the corporate culture

Impact on managerial functions: the complexity and difficulty of implementing the four functions of management further increase with the need of placing an increased attention on the new feature of employee relations.

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3. Strategic partnerships

Positive: similar to the financial theory of portfolio diversification, a combined effort will increase the chances of success while reducing the negative impact of weak elements

Negative: increases the dependency on the strategic partner and ceasing the partnership might generate instability and other undesired effects

Impact on managerial functions: the development of strategic partnerships may increase the complexity of the managerial functions as they would have to be developed through the lens of the new control mechanisms

4. External auditors

Positive: they bring in objectiveness and unbiased opinions

Negative: the company's secret information is made available to tertiary parties - this could increase stakeholder dissatisfaction

Impact on managerial functions: the information on managerial functions may be made available to tertiary parties, but this would have no direct impact; mere suggestions could however be made as how to increase the efficiency of each function.

3. Conclusions

Whichever the economic stage of a society, the past recent years have revealed an intensifying competition at all industry levels. In order to strengthen their positions, economic agents develop and implement a wide series of strategic approaches. A most important such endeavour is the formation of control mechanisms. Honda Motors Corp. implements four types of control mechanisms: quality control, employee relations, strategic partnerships, and contracting external auditors. Each mechanism reveals both positive as well as negative implications and their complexity materializes in an efficiency directly dependent on the managerial skills of the Honda leaders.

In terms of the impact these mechanisms of control generate over the four functions of management, a generalization can easily be made: they increase the chances of success for each function, but they also stand increased chances of making their implementation more challenging as the leaders would have to consider planning, organizing, leading and controlling through the lens of the four mechanisms......

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