People Management Fiasco in Honda Motorcycles and Scooters India LTD

Honda Motorcycles and Scooters India Ltd (HMSI) was a wholly-owned subsidiary of Honda Motor Company Limited (HMCL). The headquarters of HMCL is in Tokyo, Japan. It was one of the world’s leading manufacturers of automobiles and power products, it was also the largest manufacturer of motorcycles in the world. The company with more than 120 manufacturing facilities in 30 countries. For HMSI, their target was to produce world-class motorcycles and scooters. They had been providing high quality products at reasonable prices to ensure customer satisfaction. HMSI advocated two essential beliefs, “respect for individual differences”, and “Three Joys”.

Core Issue

There are some issues that reflected in this case. The initial issue is due to Diwali gift, HMSI’s gifts made employees feel slighted compared to gifts from competing company (Hero-Honda). Then, it is about strict control over employees, employees could be fired for using the rest room at work. In their production system, workers are also required to handle multiple machines at the same time.

Furthermore, staff leave management is also strict, workers were not allowed to take time off work even if their close relatives have serious disease. Employees would get fired if they did not perform well. Including many managers showed signs of favouritism in hiring, this issue has been around since the beginning and is widely debated among employees, and top Japanese managers did not really know about this thing.

Indian managers were not allowing employees to meet with senior management, and this caused resentment among employees. There is also the strict attitude of the Japanese vice president. Therefore, these issues led to the incident of violence that followed. Unions began to form; the workers began to raise money to maintain Union’s activities. The formation of the Union was opposed by the management, this included government intervention. This leads to employees take a go-slow approach. However, the difference position between management and workers had also made matters worse. Summarize these factors, the main issues in there are excessive workload, unequal treatment on hiring, lack of feedback opportunities, biased evaluation system, and disrespect for human rights.

Main Reason

These issues all reflected HR failure in this case. Actually, both Japanese and Indian management have the problems. The main reason is that the parent company did not have a clear understanding of its strategy in the Indian subsidiary, the headquarters failed to understand the demand of workers. Cross-culture problem is obvious in this case, from the Diwali bonus, the attitude to work, the leadership style, and management style are all very different. Cross-culture problem focuses on the difference between individualism and collectivism, and this difference is mainly appeared between Asian countries and Western countries.

However, different management style between Asian country will cause issues. The management style of Japanese companies is ethnocentric, but the most serious problem is lack understanding the significance of Diwali festival. The ethnocentrism and beliefs in one’s own values and ideals should be avoided (Chanlat, Davel & Dupuis, 2013). Their management style is coercive and harsh, it likes a militarized and authorized way of management. For example, Japanese have a strict sense of time, and strictly abide by the rules and regulations. Hence, due to the lack of understanding of the culture and environment within the organization caused a series of problems.

In an organization, different levels of management see things differently. The more senior the manager, the more they represent the will of the company. From the standpoint of the company and senior management, they would like to maximize profits, good work efficiency. Inversely, for employees, the salary is the most important thing they care about, reasonable working hours, certain job security and good work environment. Hence, if they do not see eye to eye with each other, and it will exacerbate the problem. HMSI’s management does not understand the wishes of the workers at the bottom, and managers treat them in a repressive and coercive way.

There is an obvious problem with the way of organization communication. Undoubtedly, manager should communicate with their workers in proper time, but HMSI’s managers did not do in this way. There is a serious problem in their HR policies. Training department as a part of HR department, the position has been vacant for a long time. Similarly, the past newsletter did not show anything about employees, the employees do not have any way to write a letter to editor about this issue. It shows that communication channels between junior staff and management are closed, it is difficult for junior staff to express their opinions to their superiors.

The obvious gap between the company’s organizational philosophy and the actual implement. Honda’s Three Joy mentioned three aspects: the joy of buying, joy of manufacturing, and joy of selling. In order to extend these three missions, HMSI made “joy of creating” as their value. Furthermore, organization wants the whole company could be an entirety, this embodied in the same uniform, shared canteen, but for employees, these ideas reinforce their work intensity. Hence, the philosophy of the company should be separated from the management with the organization.

Recommendation

The senior management should always pay attention to the local culture of the subsidiary, and this is good for the relationships within the organization. Senior management should plan a planned and reasonable way of working, employees will not feel stressed out because the intensity of work affects the working environment. A two-way feedback system should be established so that the company can get the opinions of employees and improve the efficiency of human resources work.

Employees can also use the company’s feedback to find problems in their work. Most importantly, this feedback system can deepen the management and the grassroots employees. In addition, training course for the Indian managers is necessary. The authoritarian leadership is not advisable. HMSI’s HR process should be rearrangement, changes should be made from recruitment to management and training. Unions should also continue to be transparent, trustworthy, independent and fair, fighting for benefits for employees in legal circumstances.

In conclusion, through HR failure in HMIS, it shows many problems in people management. There are five main issues in there: unreasonable workload, unequal treatment on hiring, lack of feedback, biased evaluation system, and disrespect for human rights. Finding the main reasons for these issues by analysing the cross-culture issues, inconsistency of ideas among employees at different levels, also the bad communication, and the conflict between company philosophy and the implementation. These are the reasons for the failure of Honda’s human management.

Lastly, from this case, it clearly showed the false HR strategy would lead to such serious problems, and the importance of understanding the cultural background, the feedback system, and appropriate workload and respect for human rights.