Nissan United Kingdom Ltd - Case Study Example

An Analysis of Nissan United Kingdom, Limited An overview Nissan United Kingdom was born around 1970 after the Nissan Motor Corporation approached Octav Botnar, then the leader of Datsun U.K. The same year Bortnar travelled to Japan to sign a distributorship agreement between Nissan M.C that saw Nissan U.K become the sole distributor of Nissan models in the Great Britain. Through a new marketing approach, it was able to register high sales and surpass its Japan rivals, Toyota and Honda. Key issues Key issues identified in the case study of Nissan United Kingdom Limited are: The firm’s relationship with its parent company, Nissan Motor Corporation The leadership style adopted by both Nissan U.K and Nissan M.C The establishment of an assembly plant in the U.K Acquisition of Datsun U.K by the Nissan Motor Corporation The tussle and court battles Datsun U.K’s relationship with Nissan Motor Corporation At the onset of the distributorship agreement the two companies enjoyed a significantly good relationship. Nissan M.C took more time to observe and influence the operations of Datsun U.K , encouraging it to reinvest its profit. It even amended the automatic renewal clause of the distribution agreement and increased it from three years to five years. The relationship between the three main leaders, Octav Botnar of Datsun U.K., chairman Katsuji Kawamata and president Takashi Ishihara of Nissan M.C was healthy. The leadership style adopted by both Nissan U.K and Nissan M.C The abrasive leadership style of Botnar was the mean reason behind the success of Datsun U.K. Similarly the leadership provided by Takashi Ishihara, the president of Nissan M.C was supportive. Botnar could refer any operational difficulties he faced directly to Ishihara. This provided a conducive environment for the growth of both companies. While Botnar’s leadership was aggressive, Ishihara’s management decision-making was purely on seniority. This meant that those with more seniority got to work on more important roles. The establishment of an assembly plant in the U.K This is another key issue evident in the study here. An establishment of a new manufacturing facility in the U.K was motivated by the strong market in the U.K. The negotiations began in early in mid 1980s between Octav Botnar, Nissan M.C officials and the U.K minister of state. By end of 1986 operations began in Sunderland. The new stanza model was the first to be made here and by 1993 the annual turnover was 300,000 cars. This was factory was fully owned by Nissan M.C and managed by Nissan managers. They introduced lean production, proper use of employees, teamwork and social organization of control (“a term collectively as the ‘the Nissan Way’) Acquisition of Datsun U.K by the Nissan Motor Corporation Nissan M.C was to acquire control of Datsun U.K after the U.K plant became operational. It wished to acquire the distribution of vehicles and parts but Botnar suggested the subsidiary companies were important for the operations. A letter of intent of sale between Botnar and Nissan M.C officials was signed in 1985. The shares were to be sold in two parts, the first batch of 26% by July 31st 1986 and the second batch before July 31st 1988. Opportunity and strategy Nissan M.C and Nissan United Kingdom were able to beat their competitors by the marketing and selling methods. When it comes to marketing strategy, the market in car making is just the same as other industries. According to Kim (2008), marketing successfully in an automobile market requires one to: 1. Get any new products to the market before your competitor 2. Grab the market segments and gaps that competitors missed 3. It’s better not to attack established services and products. Avoid them until you have a competitive advantage 4. Avoid price wars 5. Make the distribution chain short by eliminating unnecessary middlemen Nissan has fulfilled most of these features of marketing in the past. Nissan has especially been able to avoid price wars due to the Japanese nature of doing business. Target market and Competitive advantage Nissan U.K’s market was primarily the Great Britain. After the establishment of the manufacturing plant, it could export to the neighboring countries in Europe. There are many new products, but not many new competitors in the market place at the moment. The established car makers have been around for some time. This makes it difficult for new organizations to enter the market. Despite that, an occasional new electric car hits the market place now and again, through a new company but do not seem to last very long, however. Nissan’s strategy of improvement should help them survive the threat of substitute products Management of Nissan United Kingdom under Octav Botnar Octav Botnar who oversaw the operations of the Nissan United Kingdom can be said to have led a very strong management role that enable Nissan UK to be the biggest importer at the time of his leadership. The sales surpassed those of Toyota under his leadership. He was sent to Datsun from the West Germany to restructure the Datsun in the U.K which as ailing and bankrupt at the time. He managed to turn it around and even increase the company sales by about 300% with substantial profits. Botnar eliminated the management bureaucracy to a single-tiered with direct contact between individual automobile dealers with the Datsun U.K office. He also downsized his staff to 20 with the best sales and record turnover per employee. Recommendations Nissan Motor UK has been an established UK car maker for over 20 years. It was ranked as the most productive car plant in Europe for seven years consecutively. Their Sunderland plant makes the Micra, Micra C+C, Qashqai, and Note ranges of cars – their production accounts for 80% of Nissan automobiles sold in the European market. This makes it the largest car exporter from the UK.By continually focusing on moving ahead, Nissan aspires to anticipate future requirements and provide even higher levels of customer satisfaction. Nissan has come a long way to where it is and the progress can be said to be commendable. This has been possible through quality leadership styles and taking advantages of opportunities and strategies. References Kim, Yang-Chan (2008). Japanese Inward Investment in UK Car Manufacturing (Explorations in Asia Pacific Business Economics). Chicago, IL: University of Chicago Press. Read More