Question

In: Operations Management

: For each of the BMW and Honda companies, assess the external environment of the companies...

: For each of the BMW and Honda companies, assess the external environment of the companies in terms of the level of uncertainty. Explain how you concluded that the environment is simple or complex and stable or unstable. Combine the simple/complex and stable/unstable dimensions to arrive at the level of uncertainty. Write down any assumptions you make because information is missing? mention every detail, make it as long as it can be

Solutions

Expert Solution

Honda: Honda Motor Company is a Japanese public multinational corporation. This is a large automotive manufacturer in world market. It has various products in manufacturing of automobiles, aircrafts, motorcycles and power equipments. The Honda Motor manufacturer is a well-known manufacturer in the world market with high reliable products in worldwide market.

BMW: Bayerische Motoren Werke is a German multinational organization which manufactures automobiles, motorcycles and also produce aircraft engines. The company was founded in 1916 and the company has its headquarter at Munich, Bavaria.

For each of the BMW and Honda companies, the external environment of the companies in terms of the level of uncertainty is a complex environment which has many players in the market. Thus the competition is very high in the market and Honda and BMW are working hard to remain the leader in the market for their products. The External environment is highly affected with various factors and is a very complex market for the organizations.

Consumer interests are changing day by day and it is very difficult for the BMW & Honda to meet the demands as per consumer interests.

Price wars are key issues in the external market and BMW and Honda are facing strong price issues due to many competitors in the external market.

So the uncertainty in the external market for Honda and BMW is mainly due to high competition, changes in consumer interests, price war in the market, higher marketing and branding in the given market.

We can conclude that the environment is simple or complex and stable or unstable based on following points as

  • Competitions in the market.
  • Challenges for the manufacturers in the market.
  • Pricing and consumer paying capacities in the market.
  • Consumer interests in the products and changing demand.
  • Higher marketing and branding by competition and local players.

Thus based on the above points, we suggest that the external environment is complex and unstable.

The above mentioned dimensions are suggesting for the complex and unstable market conditions for the BMW and Honda. These elements results in the uncertainty for the organizations. Thus the external market environment is uncertain based on the complexity and unstability in the market.

Assumptions we make because information is missing are:

  • Honda and BMW are facing high competition in the market due to other competitor players.
  • Pricing is still a big issue for Honda and BMW organization as well, because consumer’s affordability is a question mark in the external market.
  • Consumer interest dynamics is a key concern for BMW and Honda as well.
  • External environment is not easy for organizations like BMW and Honda.

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