Organizational Culture and National Culture of Automakers Comparison Essay

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Overview



Many countries developed their own automobile industries, and did so in order to create jobs, for national security reasons, and simply because shipping cars overseas was impractical for much of the 20th century. This paper will look at three major automobile manufacturers, one each from Europe, Japan and America, to examine the differences and similarities between them. Each company evolved differently, and did so on the basis of both national culture and in terms of the markets in which they operated. The companies studied are Ford, Hyundai and Renault-Nissan-Mitsubishi. The latter makes a nice case study because it is a French-Japanese firm, one of the biggest and most powerful transnational automakers, but a model that if successful might be replicated increasingly in the future.

Depictions



American automakers are depicted both as monolithic giants, and as dinosaurs at the same time. It is only grudgingly that international press talks about a company like Ford as innovative – it seldom happens – but more as a company turning out standard product for a standard price. US automakers fell behind the innovation game in the 1980s and even ones that have successfully expanded internationally have struggled to shed their reputation as anything other than good producers. For Ford, this is something of reality, as the company rose to prominence more on the basis of its manufacturing strength than its design ("you can have any color you like, as long as it's black").



Toyota also built its reputation on production prowess, in its case its famous adoption of the lean methodology, building on some of what Ford did. Toyota is synonymous with lean (Onetto, 2014). Toyota wins market share again not on design but largely on the fact that it builds good cars at low prices. This is the way the company is often portrayed in business press. A good example of the reverence that the business world has for Toyota is in the shock used to describe the company's supply chain issues following the earthquake in 2011 – nobody really thought Toyota could have such struggles (Webb, 2016).

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Renault-Nissan is starting to gain a reputation as a leader – not just in terms of market share (Schmitt, 2017) but as a master collaborator, having learned through the integration of its two largest companies how to work well with other companies, and use that as a component of strategic advantage (Shirouzu, 2017). So there are definitely some differences in the ways that these different automakers are portrayed in the media, and these differences seem to reflect the ways that these companies are internally, at least to some extent.

Models of Culture



Ford's is definitely a power culture, with centralized control. The company is still run by the Ford family, and that alone makes for a power culture, but all of its key decision-making is localized in Detroit. There are some international subsidiaries, but Ford has really centralized its decision-making, its design and still a lot of its production as well. The result is a company that is quite conservative in its approaches, and that despite international expansion remains dependent on trucks in the US market for a lot of its success.



Toyota is a control culture as well. This is part of the Japanese approach, where hierarchy is very important. Automobiles are an interesting industry that way – most of the companies are very old, and have really not adapted very much to modern management styles. So while Toyota has more role-influenced decision-making, it is at the end a control culture with strong emphasis on hierarchy and centralized decision making. The influence of role-based decision-making can mainly be found in engineering, but that is the same as at Ford as well, because subject matter experts are allowed to influence decision-making within their area of expertise.



Renault-Nissan is an interesting case, as this is basically an alliance between two….....

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References

Onetto, M. (2014) When Toyota met e-commerce: Lean at Amazon. McKinsey Quarterly. Retrieved October 28, 2017 from https://www.mckinsey.com/business-functions/operations/our-insights/when-toyota-met-e-commerce-lean-at-amazon

Schmitt, B. (2017). World's largest automakers, July 2017: Renault-Nissan still ahead. Forbes. Retrieved October 28, 2017 from https://www.forbes.com/sites/bertelschmitt/2017/08/30/worlds-largest-automakers-july-2017-renault-nissan-still-ahead/#3c02391a3f31

Shirouzu, N. (2017) Renault-Nissan to build electric cars with China's Dongfeng. Reuters. Retrieved October 28, 2017 from https://www.reuters.com/article/us-renault-nissan-dongfeng-idUSKCN1B90D1

Tutor2U.net (2017) Models of organisational culture. Tutor2U.net. Retrieved October 28, 2017 from https://www.tutor2u.net/business/reference/models-of-organisational-culture-handy

Webb, J. (2016) Toyota's quake-proof supply chain that never was. Forbes. Retrieved October 28, 2017 from https://www.forbes.com/forbes/welcome/?toURL=https://www.forbes.com/sites/jwebb/2016/04/26/toyotas-quake-proof-supply-chain-that-never-was
 

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