Honda Inc. Supply Chain Management

1316 Words Sep 29th, 2014 6 Pages
Honda Motor Company Ltd.
How does Mr. Honda’s history with suppliers relate to Honda’s current supply management strategy?
Honda’s current supply management strategy is consistent with Mr. Honda’s history. There three factors about Honda’s supply management strategy, focus on local market, emphasis on competition and reliable suppliers.
According to the Honda’s export strategy of “Honda and U.S. – Japan Automotive Trade”(1997), it is clearly that Honda focuses on regional markets which contributes to developing more sales, strong research and better development. And their strategy of manufacturing the products where or near to where they are sold is the result of their being local strategy. Additionally, focus on local market benefits
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Since 1986 the MOSS came out, Honda created thousands of job opportunities in US and in turn it gets a lot benefit.
What are the key elements of Honda’s supplier evaluation policy? How does it differ from others (e.g. the Big Three)?
Suppliers are able to be involved in the product development to some degree. Different from others which control everything during purchasing and the suppliers are just responsible for supplying products as what is in the contract, Honda’s suppliers are able to offer advice about enhancing the efficiency which facilitate the cooperation as well as the products. In other words, Honda and its suppliers are mutually-beneficial cooperation rather than Honda just relies on suppliers.
Continuous development and responsiveness of suppliers at the early age of product development process is critically important. “Honda tries to encourage suppliers’ suggestions early before finalizing drawings, particularly in the area of cost reduction and quality improvement.”
Honda always tries to maintain relationship with suppliers. It is hard to communicate effectively in Honda’s four trade zone but Honda always pays attention to it. As Mr. Morita says, “Honda places value on maintaining relationships, so we do not enter into them lightly.” Different from companies which focus on the immediate benefit of low cost rather than long-term benefits of maintaining relationship, Honda values suppliers and tries best to maintain

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