Honda Company’s Innovation Management

Innovation approach to management takes on a four part process that ensures full control of performance of either a product or labor force. The process of management can be simply explained as a progression of preparation and control of activities. In the Honda Company the top management is mandated with the responsibility of ensuring that the management process functions and is both effective and efficient. In some cases a project manager is appointed to steer the management process.

Fundamentally, the four part approach to management process starts with 1) capture; 2) search; 3) select and finally 4) implementation. The process is a sequence of a system of procedures or activities that have a specific purpose, for instance in launching a new product in the market, train the workforce or provide community support in execution (Trott 2005). An innovative management process should have a resource system in place to provide support along the way, that acts as an executor of all parts of the process that are all set for execution.

Innovation management underlines a number of significant issues such as: innovation regarded as a process of management; framework development for innovation strategies;exploitation of technological processes or events developments over a period of time; strategic learning of markets integration;gaining more insight through corporate ventures by managing the internal processes of management; innovative organization building; creation of new innovative businesses; and integrative approach to innovation management (Tidd, Bessant & Pavitt 2006, 15). Business corporations choose to appoint project managers to carry out the management process implementation for various reasons. Some of these may include value-added accountability to the company and better stakeholder management.

Against this background, the main aim of this paper will be to look into the four parts that make up the management process and relate them to Honda’s new innovation, the VTEC (Variable Valve Timing and Lift Electronic Control). The VTEC is a new system technologically advanced by Honda. It is a valvetrain system and its main aim is to increase the volumetric efficiency of a four-stroke internal combustion engine (Trott 2005, 28).

The management process put in place is responsible for impacting top level management and project managers with the necessary information and knowledge to comprehend, and the expertise to successfully manage and implement innovation at operational and strategic levels. This process has individual qualities that allow a distinction to be made or make a distinction necessary, makes the integration of market organization, administrative and technical change possible which in turn results to an improved competition between companies (for example, Honda and Nissan) and an efficiency of other establishments. In the case of Honda, the management of innovation is intrinsically interdisciplinary and multifaceted.

Honda’s process of innovation can be described by two methods: “pull and push through development” methods. In the case of pulling; the process is designed to try and discover unsatisfied customer needs and consequently concentrate the company’s development energies to finding solutions. On the other hand the process that entails pushing through innovativeness, the process is grounded on both newly acquired technology and that which was already in place, both accessible to the company. Its function is to identify them and look for cost-effective applications able to make use of the technology. Managers need to fully understand the market and the needs brought about to successfully implement innovativeness.

Capture: formulation of management strategies to reflect objectives and goals

Honda’s development of the VTEC approach (Variable Valve Timing and Lift Electronic Control) is aimed at increasing the volumetric efficiency of a four-stroke internal combustion engine while maintaining the company’s expediency for its use in mass production of motor vehicles. Earlier versions were based on the increasing of fuel efficiency but later designs of the VTEC are now focused on fuel efficiency and power output increase. This first part of the management process encompasses a number of aspects, namely: knowing your clients’ expectations; setting out objectives to be met by your strategies; resource allocation; market orientation; and

Know clients’ expectations

Consumers/clients form the other major vital block of a company’s core, the other being employees. Without them, not much can be achieved in terms of sales and realization of profits. It is therefore, very necessary to ensure that the company constantly has products that appeal to their current consumers and are also able to attract potential clients. Not forgetting making employees always feel comfortable and satisfied enough to exhibit their best potential in their work (Trott 2005, 43; Tidd, Bessant & Pavitt 2006, 17). It is with this in mind that Honda undertook to come up with an innovative new technological advancement of their engines so as to cater for their clientele who want to have a vehicle that is fuel efficient but still capable of producing more power. In turn these results to a guarantee of higher revenue generationas the expected standards of clients are met.

Setting out objectives to be met by your strategies

This can be done through an increase in a company’s research and development department or initiative. Honda has taken up a mandate to enhance and make their innovative channels and systems to function at its best or most effective, while using the available resources to its best advantage. As a result this has put their products a cut above the rest. Honda has been able to increase its research and development byquickly sorting throughall quality conceptsbeing generated and thought up and coming up with an efficiently strategically ideation process backed by correct statistics and facts (Tidd, Bessant & Pavitt, 2006, 73).

Another point to note is the capacity to build up on corporate innovation by creating an avenue whereall top innovators within a company are incorporated. This is effective in that, it helps them subscribe to, browse, collaborate, comment, enrich, build upon, and evaluate each other’s concepts and thoughts. Developing an entirely adjustable valve timing engine is a challenging endeavor for designing and implementation. Honda’s strategies on marketing of its products are focused towards developing these high model capacities, therefore the close attention to accuracy and detail being accorded to the VTEC system.

Market orientation

Market orientation is also more or less similar among big global multinational companies. But then again the multiplicity of customer requirements and needs across various consumer markets results to a difficulty in satisfying customer needs. Inthe case of Honda, the company through the VTEC innovation seeks to satisfy the biggest need among customers, which is efficient fuel consumption while increasing more power output.An unsatisfied customer may result when the resources from the company are inadequate.

Resource allocation

This is an equally vital/core aspect of the management process. This is the dispensation of available resources whether money or human resources in an way that makes economic sense to achievement of company objectives. The success of the VTEC system is evidence of a proper and well planned out plan of work to be done, showing the order in which tasks are to be carried out and the amount of time allocated to them and costs to cater for the specific activities(Tidd, Bessant&Pavitt 2006, 37). Consideration of available resources and timeline of the project is mandatory for better resource planning.


Honda’s operation on its basic principles that define its business outlook is what makes it to be a cut above the rest. It bases its business outlook on two principles 1) is what they term as “the three joys: joy of buying; joy of selling; and joy of creation and 2) “respect for the individual (customer)”. This shows their aspiration to create vehicles that fulfill the needs of an individual customer. And since its start in the late forties it has focused itself in developing higher value products at very reasonable prices for its diverse customer base. This has led the company to be a market leader within the motor vehicle industry for a long time. All this is line with their environmental conservation and protection policy.

A business should also strive to establish their standards before undertaking any process. These standards are what the criteria of operating are based on and always act as a reference point for the company when implementing its strategies or coming up with new products for its market niche. It also comes in handy when appraising the workforce (Tidd, Bessant & Pavitt 2006, 107). Setting up and establishing criteria and values of a company is the initial in conflict resolution and management process.

Management should always use quantitative terms to draw up standards with absolute accuracy. This is a process that is a core central part of the management process. Proper management process use set standards to evaluate performance of projects and whether they answer all checkpoints put along the way. Managers should not forget to measure the performance of these strategies and standards (Tidd, Bessant & Pavitt, 2006, 37). The management should not rely on the assumption that standards are being realized, but should measure achievement against standards on a forward-looking manner so that variations are identified before taking place and evaded by putting in place apt measures.

The success of Honda is dependent on the involvement of all stakeholders, customers and supporters of the company hence the need for more experts and partners to be integrated and incorporated in every step of the way of its activities. While accounting and marketing new strategies objective will mainly work in structuring the organization for the future, these objectives therefore require officials to coordinate the plans and also review their performance by preparing reports quarterly which they will forward to the top management responsible for planning so that the whole plan can be assessed (Tidd, Bessant & Pavitt 2006, 76).

Targets are set for each objective at the commencement of each financial year, with each department been assigned adequate resources that will be monitored by the officials responsible. There are agreed upon evaluation techniques which are used in the preparation of the quarterly reports. The reports are used to prepare an annual report which is used in setting the targets for the following year (Trott 2005, 106).


For effective strategic positioning in anticipation of crisis, competition, and launching of new products, Honda has put in place a crisis planning process. Since most crises occur within the predictability of a corporation, for the anticipated crisis, a company should identify the dangers or risks involved in its market and come up with a management contingency plan, which clearly outlines measures to be put in place when crises strike. The main aim for crisis preparation is minimizing the impact of any crisis arising, providing a quick and efficient response system and also aims at putting the organization at the best possible position to counteract and recover from crises.

When planning, the crisis team is advised to be inclusive and not limited to specific disasters, although it can lay more emphasis on the most anticipated crisis (Tidd, Bessant & Pavitt 2006, 62). Honda takes more precaution by creating a crisis management function within its operations. This operates as a division in the organization and its functions includes; predicting any occurrence of a crisis, planning to curb crisis, communicating and advising the management about the vulnerability of the organization. Issues planning will address matters like crisis management methods, communication plan, management team and the evacuation team.

Companies are very diverse and each has its own dynamics of employment relations that work for both its employees, employers and the whole organization. A company like Honda selects its workforce well. Industrial relations, work organization and human resource management are referred to be the main points of focus in labor management and employment relations. In connection to the same, there are also numerous themes identified, which relate to the alignment of preferences in the motor vehicle world. These are such as the personnel not having enough knowledge on industrial relations or they do not like certain features of work management, yet they react positively to other aspects of human resource management policies and practices. They could also be the issue of the personnel lacking sufficient information of general labor management issues.


Whenever Honda has a new product ready for the market, an implementation process is drafted to see the company’s plan succeed. A clear strategized process enables the company to not only see the production process but also the outcome of the whole undertaking. This includes the success in production of the desired product which must be in tandem with the market or consumers desires pertaining to the product’s consumption.

Before embarking into the production process, the company involves a team of experts who mostly lack significant connection to the product at hand, to come together and brainstorm and come up with suitable campaign themes, designs and strategies for the product. Here, they will determine what to be done, see what improvements need to be made, and then plan how to implement. This enables the advancement of new and fresh ideas that may have not been used before (Trott 2005, 79).

Proper implementation can only take place after involving the workforce. One way to incorporate the workers is by having constant workshops to deal with the requirements from the project manager and top management. Workshops are especially effective in helping staff members develop collective understanding, be involved in the planning, take the necessary actions and have a sense of commitment in the efforts of change. The workshops should be allocated a certain amount of time within a specific time frame. This can be such as once a month, a fortnight or a week depending on the pace at which the change is expected to take place.

They can even be integrated with the team meetings. In this case, since the expansion into another unit is expected to take place very soon as increase in the workforce, it is suitable for the workshops to be scheduled once a week with each session lasting for about an hour or so. Having workshops in an organization and particularly in this situation is beneficial because they are very useful in breaking down organizational barriers between employees and the managers or even between the staff themselves (Tidd, Bessant & Pavitt 2006, 86).

They are also handy in the improvement of communications inside and outside the organization and between departments in the organization as well as in the integration of staff after a merger, acquisition or expansion. In addition, workshops would promote buy-in and involvement and are thus more participative as compared to conventional training programs. Due to this, the relationship between the personnel and the facilitator is greatly improved unlike in training where a trainer is perceived as detached. This in most cases is a sure way of successfully dealing with organizational growth and development (Tidd, Bessant & Pavitt 2006, 91).

A successful quality management system in the organization would bring the management together in a commitment of producing goods that ensure customer satisfaction. This is very important in the market niche the company has carved out for itself and also helps it against its competitors (Trott 2005, 135). The ranking and dependability of the organization is reliant on the perceptions of its consumers. Honda or example is ranked highly in the global market because of its steadfastness in producing reliable, fuel efficient and more on power products. Managerial improvements at Honda ensure that protocols are properly observed and company targets are met on time. This leads to constant company improvement and hence attracts more clients and improves the position of the company in the perspective of its target consumers (Trott 2005, 159).


Innovation management process is a very core aspect for any business venture to embrace as seen from the way Honda has used it to push its new VTEC innovation. This process involves development of products and structural innovations within the company are made possible as a result of efficient implementation. Effective research and development is only made possible where appropriate management processes are utilized.

The process of management enables the top level management within a company to carry out a viable cooperation among all aspects and dynamics that make up the company on a mutual and collective framework. Innovative management empowers the organization to take up and be able to fully respond to both internal and external prospects and use this to their advantage to gain an upper hand over the competition by making full use of the company’s innovative labor force. This has greatly catapulted Honda forward in introducing new products into the market.

Innovative management works hand in hand with research and development. It encompasses the whole workforce within the company to further a company’s growth and development within its specific industry market. Honda’s manufacturing processes and sales and marketing initiatives are also boosted by this. It is possible for the top management to prompt and tap into the innovativeness of the company’s workforce if it effectively utilizes the most applicable tools of management. These series of actions directed toward a specific aim can be observed as integrating the organization, the market and technology by use of a sequence of activities: capture, search, implement and select; that are constantly evolving.

For Honda to successfully capture, select, share and implement the strategic options at hand geared to its innovative management process, it needs to adopt an action plan. This should more notably; incorporate elaborate and well-structured communications plan so that everyone involved is on the same page. The communication plan involves coordinating, directing and communicating and providing the levels of command and channels of communication among the crisis team, the stakeholders and media when handling a crisis. Crisis communication can transform the unexpected into the anticipated and save the company’s credibility and reputation, and so it is equally important as a department.

More importantly is the media management strategy. A media center will be under the guide of a chief spokesperson or the public relations officer of the company or a senior communications relations officer. From this center, the Chief Executive Officer and the Managing Director will be personally available to give media updates on the state of affairs. The chief spokesman is supposed to handle the media while the rest of the staff are advised to keep off not to communicate with the media personally or give any information that could interrupt the process. This greatly adds value to whatever projects or products the company has out in the market.

Reference List

Tidd, J., Bessant, J. & Todd, K., 2006. Managing Innovation, 3rd edn. New Delhi: Wiley India Pvt. Ltd.

Trott, P., 2005. Innovation management and new product development, 3rd edn. NSW: Prentice Hall.

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