Hyundai Motors Completive Advantage
Hyundai Motors Completive advantage
Introduction
In this sternly aggressive business world, the goal of most firms is to establish distinctive or unique capabilities to gain a competitive advantage in the marketplace through utilising the most of their core competencies. Competencies refer to the fundamental knowledge owned by the firm (knowledge, know-how, experience, innovation and unique information), and to be distinctive they are not confined to functional domains but cut across the firm and its organisational boundaries (Lowson, 2002). Having a competitive advantage is having a difference, the choice of certain activities to deliver a unique value-mix to a selected market, thus the ability to perform particular activities and manage the linkages between activities is the key source of competitive advantage. The strategic task, then, is to create a distinctive way ahead, using whatever core competencies and resources at its disposal, against the background and influence of the environment. Through these distinctive capabilities the organisation seeks sustainable competitive advantage. Competition in many domestic and international markets appears to be entering a new phase, in which product quality and performance are becoming more important to customers than price. In such markets, the effective management of the new product development process is the essence of competitive advantage. The goal of this paper is to determine how company can sustain their competitive advantage. In this report, Hyundai Motor will be analysed.
Overview of the Company
Hyundai Motor Company is regarded as the largest auto-manufacturing industry in South Korea and known as the fifth largest industry in the world. The company has the capacity to produce or manufacture 1.6 million units in a year. The company has been able to give emphasis on each level of the industry which enables them to gain the trajectory and momentum required to attain competitive position of being a world-class automotive brand and to attain competitive advantage (Worldwide Hyundai, 2008). The company has been able to operate in different parts of the world including US, Europe and other parts of Asia.
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Explain what the firm could do (or not do) that would lead to the erosion and eventual loss of competitive advantage? Explain what the firm must do in order to sustain each competency’s contribution to competitive advantage.
The management of the company are accountable for having a sustainable competitive advantage in a business. If the management would not be able to do their tasks efficiently, the company might lose their competitive advantage. Competitive advantage is the status of the company in the market environment against their rival companies. Like any other industry, Hyundai has also their competitive advantage against their rival auto-manufacturing industries in the world. In addition, the company may also erode or lose their competitive advantage and position if the management will not be able to adapt to the changing market and customer need, specifically in car industries.
For instance auto manufacturing industries nowadays must be able to provide car products which are affordable and cost-effective in terms of diesel engine aspects. In this regard, Hyundai must be able to produce cars that adhere to these needs. In order to sustain their competitive advantage, Hyundai has manufactured Hyundai’s i30 (Hyundai i30 SX CRDi, 2008). Compared to its diesel rivals, the diesel i30 emerge to have gazumped them all on either price or size before it has turned a wheel. Products like these enables Hyundai to sustain their competitive advantage in the growing crisis of diesel and energy. Aside from that, there are many ways in which Hyundai will be able to sustain their competitive advantage. First of, the company should be able to continue to maintain the superiority of their cars that they offer to the market.
Furthermore in order to sustain their competitive advantage by presenting two new production models and a program than enhances the general environmental compatibility of their products. For example, the Sonata brand has been the standard bearer of the company all over the world in the D segment, and the other is the 2008 matrix. The company ensures that they also consider corporate social responsibility to ensure their competitive advantage by providing products which are environmental friendly as their way of dealing with the greenhouse gases global issues. The are able to create an eco-concept package demonstrating how the emerging technologies can make a relative reduction in CO2 emissions without punitive penalties in terms of price, driving enjoyment and performance. This context is a near production approach for reducing CO2 emission and fuel consumption (Hyundai Motor, 2008) .
As a global leader, the company must also strive harder to fulfil their obligations to provide the needs of the society. The company can also consider their pricing strategy by providing affordable yet quality cars and vehicles to the market. Industrial models which are to be consistent with part of a strategy of 'flexibility and innovation' must therefore give the firm the resources to counter the risks of erosion and losing of their competitive advantage. In order to cope with the various influences and effects of market environment changes, and to sustain their competitive advantage, the management of Hyundai, must be able to improve and expand its organisation so as to conduct environmental activities on a global scale which include the expansion of Hyundai through the manufacturing presence of the brand in China, India, U.S., and Europe; and plans for new plants in Czech Republic and Russia as well as establishing transplants which is an overseas production plant; refers to vehicles produced in US or somewhere else at a Hyundai-owned plant.
Aside from this, the management of Hyundai must also be able to focus on tier research and development department and to initiate innovative strategies, accordingly, the higher echelon of management in organisations is now driven towards innovative strategies designed to provide a competitive advantage and edge in the marketplace. As business gravitates towards a global scale, entrepreneurs find themselves faced with the challenge of producing new and better products at reduced cost and market price. Daft (2003) pointed out that in managing a global environment, managers of Hyundai must be characterised by the ability to bring about change through innovation and creativity.
As discussed, the knowledge of the underlying sources of competitive advantage highlights the abilities and core competencies of Hyundai as a world leader in auto manufacturing industries. In this regard, the company must be able to determine strategies and ways to ensure that their competitive position and advantage are being sustained in all levels of the organization.
Reference
Daft, R. (2003). Management. 6th Ed. Cincinnati, Ohio: Thomson South-Western.
Lowson, R. 2002, Strategic Operations Management: The New Competitive Advantage. New York: Routledge.
Hyundai i30 SX CRDi (January 2008). Online available at http://editorial.carsales.com.au/car-review/2881314.aspx. Retrieve April 8, 2008.
Hyundai Motor (2008). Online available at http://worldwide.hyundai-motor.com/common. Retrieve April 8, 2008.
Hyundai Motor (2008). Online available at http://singapore.hyundai-motor.com/components/menu/MainPage/HMCNew_detail.aspx?no=10943&Menu_no=1001. Retrieve April 8, 2008.
Ulrich, D. (1998). Human Resource Champions: The Next Agenda for Adding Value and Delivering Results. Boston, Mass: Harvard Business School Press, p.88.
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