Team: The Trailblazers
Ankith Passi(1501069) Aroop Sanyal (1501074) Harmeet Singh (1501080) Krishna !rari (1501019
Case: Honda Today The Honda today case is a classic example example of Concept Concept testing, testing, with with regards regards to product development. It discusses a tough situation for Honda in the ‘micromini’ car segment which is going through a lot of regulatory changes just after Honda released a new engine design for its car, the Honda Today. The case taes taes us to !ecem"er !ecem"er #$, #%&& and revolves revolves around around 'asami (amimura, (amimura, the )arge *roject )eader +)*) at Honda 'otor Co.’s Today team. !ue to expected tax changes, the -apan utomo"ile 'anufacturers ssociation +-' "egan to lo""y for tax exemptions and recommendations for changes in ‘micromini’ speci/cations. The 'inistry of Transportation was expected to /nali0e its decision "ased on the suggestions made "y the -'. The main concern concern fot 'asami (amimura (amimura was that, that, the team had only only recently, recently, as early as -an #%&& come up with a new engine design for the Today after spending a lot of capital on 1n!. Coming up with a new design would mean incurring a lot of additional costs or sacri/cing the high 2uality standards set "y Honda over the years.
Question: How would you characterize Honda’s approach to product development? Honda, since its inception in #%3& has "een a company nown for its focus on innovation and high 2uality standards. It is for these reasons that Honda has "ecome one of the largest engine manufacturers and the largest motorcycle producer. In terms of automo"ile production, Honda is raned #$. 4rom the very initial stages of Honda’s journey, this award winning corporate has "een a constant patron of creativity 5 excellence. Honda fostered an environment without without constrain constraints ts to help their engineer engineers s unleash unleash their their creativ creativity ity and 6ourish 6ourish during testing times. *eople woring woring in Honda are allowed to thin, to participate, to experience and to improve their performance daily. The ‘Honda 7ay’ promotes their egalit egalitari arian an cultur culture e of open open arran arrangem gemen ents, ts, simila similarr unifor uniforms ms and incre increase ase their their performance daily. daily. Honda’s Honda’s develop development ment teams teams were were independ independent ent and focused focused organi0a organi0ationa tionall units8 units8 that is, a team of engineers was dedicated to the development of a new car model. 7hile other competitors "elieved that a simultaneous design of a new engine and a new car was too risy, they generally came up with either an old design or an old engine. Honda’s technical experts "elieve that every new car must have a new engine. They also "elieve that to actuali0e the real character of a new car the coherent match "etween the "ody, the chassis and the engine must "e unleashed. lthough Honda does not "elieve in traditional maret research, it depends on its enginee engineers rs to underst understand and customer customer prefer preference ences s through through understa understanding nding emergin emerging g trends. They did this through their )arge *roject )eaders +)*)s who played a ‘critical’ role in major development process.
Question: What What shoul should d Kamimu Kamimura ra do? What What specifc specifc option option or approa approach ch would you recommend? What must he do to execute the approach in the time availale?
Team: The Trailblazers
Ankith Passi(1501069) Aroop Sanyal (1501074) Harmeet Singh (1501080) Krishna !rari (1501019 (amimura "eing an experienced person in the industry had already pre9empted what sort of proposal -' was going to put forward to the ':T. It mainly involved increasing the engine si0e and the overall si0e of the vehicle to comply with the new tax laws. The options availa"le to (amimura in this regard are; #. Increasing the cylinder stroke length: Involves changing the height of the cylinder "loc along with few minor engine parts. pproximate investment would "e #.< "illion yen. =. Increasing the cylinder bore: Involves expanding the cylinder "ore. Considered as the easiest 5 the cheapest option. pproximate investment would "e <$$ million. >. Increasing both stroke & bore: pproximate cost would "e the com"ined cost of the two options mentioned a"ove. Involves challenge in designing such new thing. 3. 1edesign the engine entirely; Involves higher ris, time and money amounting greater than < "illion yen. There are several important considerations that (amimura must mae while thining of his decision, not the least of which is cost. Honda just spent < "illion yen revamping the Today for its -anuary #%&& introduction and may not "e prepared to spend another #.< to < "illion yen to redo all of that wor. In spite of having a ==? maret share, spending so much money on designing would greatly impact the "ottom line for Honda, which would de/nitely "e a deterrent for proposing an engine change. There is also the consideration of engineering talent. @ince the AHonda 7ayA prevents engineers from woring on multiple projects, the Today would have to eep its very talented engine design engineers on the project for at least another year if the engine is to "e redesigned. )ast "ut not least is the deadline that the Today must meet. If the Honda Today is not released with the speci/ed BB$ cc engine close to the date the new tax laws and vehicle speci/cations go into eect, Honda could lose some of the ever9increasing micromini maret share and perhaps tarnish its image for future models. Dy choosing an inexpensive and simple method of increasing the engine displacement, (amimura would all "ut guarantee that the new Today would "e ready on time for the change in tax laws. Eiven these factors, we "elieve it would "e more pertinent for (amimura to go ahead with increasing the bore length of the existing engine . This would ensure low overhead costs, while eeping their engineers "usy with the new project. lso this is one of the few alternatives which would ensure that the Today can hit the roads without any delay. Eiven the high amount of competition in the ‘micromini’ segment, having the car released with the competitors is critical, else they might lose out of a comparative maret share.
Question: What do you thin! Honda’s competitor will do? Why? "nswer: ccording to the case, -apan’s micromini vehicle maret had "een passing through a terri/c competition during the years of late &$’s. utomo"ile manufacturers had "een trying hard enough to increase their maret share "y
Team: The Trailblazers
Ankith Passi(1501069) Aroop Sanyal (1501074) Harmeet Singh (1501080) Krishna !rari (1501019 introducing newer and newer car models with "etter speci/cation in every new release. nd we see that, this proposed tax policy change has dictated companies to rethin and reposition themselves again. s a result the -' committee had "een formed to lo""y for an exemption from the tax and recommend new speci/cation that would "e accepta"le to all the manufacturers. fter a month long discussion, -' recommended an increase in displacement in the range of B<$9B%$cc and an overall increase in car lengths of <$9#$$mm. nd of course as a participant of -'’s tas force, competitors of Honda had tried to esta"lish the speci/cation that suits them "est. However, upon receiving the /nal decision of -', Honda’s competitors will certainly go for releasing their car models with fewer modi/cations, as they now very well that companies achieving a timely response to the proposed speci/cation would enjoy a su"stantial advantage in the maret and would "e granted considera"le prestige for the feat. Here, one important fact is to "e noted that, as Honda’s competitor does not "elieve in designing a"solutely a new engine for every new model, it wouldn’t "e a tough jo" for them to "ring the re2uired modi/cations as it is in the case of Honda.
