HYUNDAI CARS CASE STUDY 2
Running head: HYUNDAI CARS CASE STUDY 1
Hyundai Cars Case Study
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Institutional Affiliations
Hyundai Cars Case Study
Introduction
The Hyundai case study focuses on the leadership challenges that the Hyundai group of companies faces. The major problem is the hereditary leadership style, coupled with autocracy that is dominated by a few family members. The company also is accused of failure to pay tax by its manager, Mong-Koo, who took over from his father. The purpose of this paper is to analyze the leadership style of manager Mong-Koo and the success of Hyundai cars.
Background
The success of the Hyundai cars in the US has experienced success in the US market, rising to a market share of 14.5%. This undoubtedly sets a major threat to the US automobile industries alongside Japanese cars. The Hyundai companies pose a major competitor to the industry due to several factors.
The first reason is the nature of leadership under the management of Chung Mong-Koo. He believes in globalization and customer-oriented when it comes to its product. The manager is very keen to listen and execute the demands of its customers and that of the government and is unlikely to engage in any public struggles in the external environment.
The company has also issued a warranty of ten years to its products, a target that other competitors may not easily reach (Lee, 2011). Under this warrant, Mong-Koo is determined to execute it. He doesn’t want to be like other companies which don’t honor their promises. The company would thus gain trust and a competitive advantage over the other companies.
Alternatives
At the current state, the company is already having the Japanese and the European automobile industries as their major competitors. This means that the company has already surpassed the American automobile companies and is competing at a global level. The first alterative is for a push towards creating a global market for its products would see the company far if it realizes success. This is because they will be able to collect enough capital from the revenues of the companies and attain a financial position that their competitors cannot be able to. The second alternative is specializing in of country as its headquarters and having the others as branches and agents.
The alternatives may be difficult if the company is to operate under one management. This means that the leadership would be different since they would be operating in different areas. Specializing in one country would also limit the market that could have been found in other countries. Every country may also be having their rules and regulations that may not be favorable.
Proposed Solution
For the company of Hyundai motors to be successful, it has to follow the leadership style that is used by Mong-Koo. This is because the success of any company determines the leadership style that is applied. The leadership style will be determined by the characteristics of the leader and his skills and abilities.
In my opinion, Chun Mong-Koo is an effective corporate leader. The first reason is that he has a firm vision for the company which he is using all his ability and skills to execute it. In his first leadership position as the manager, despite facing opposition and criticism from the followers of his uncle, he still worked to prove himself worthy. In doing so, he managed to improve the performance of the business.
He demonstrates a high level of self-awareness when he uses on with his vision for the company despite the critics from the followers of his uncle. He can use the knowledge and skills he had gained from his father, the former manager of the company to actualize his vision for the company. He attains it when he takes the company to the global market and is competing with Japanese and European automobiles.
He is an effective corporate leader since he is decisive. At some point in his leadership, he had to make tough decisions contrary to the board and the engineer. All the decisions he made worked for the good of the company. One of the decisions was on the issue of a ten-year warranty to their customers. He also issued are a recall to all the users of their products for a free check-up and repair (Liza, 2010). This enhanced the image of the company at the international level and even saw its growth in the US.
He also was creative and knew what he was doing. Majority of his managerial skills are based on the past skills and experience he had working under his father. The knowledge he had enabled him to serve well in the industry, knowing where to venture and where not. Through collaboration with his engineers and other staff, he was able to come up with models that his customers wanted. He also formulates many strategies like the ten-year warranty and the recall period, which gained the company a competitive advantage.
Recommendations
Mong-Koo’s leadership style would be a success in a corporate structure that is not chaebol. This is because; the success of the company came solely from his creativity and workings. In his leadership, he portrayed that success depended on the determination of each, and then it would spread to the other. Despite his struggle with legal matters, the company continues improving towards success in his absentia. This was due to the determination he had shown the people.
The court released him knowing the potential he had towards the company. The chaebol corporate structure requires the pooling of resources together by the very parent company for the subordinates to succeed. Even if Mong-Koo runs Hyundai as a separate entity from the other group companies, it would still have thrived since the success can be attributed to his leadership and the contribution of other subordinate companies.
References
Lee, L. W. (2011). Pushing to Make Hyundai a Global Player: Scenes in the Career of Chairman Chung Mong-Koo. In Gale Business Insights: Global Case Study Collection. Farmington Hills, MI: Gale. Retrieved from http://bi.galegroup.com.ezproxy.library.berkeley.org/global/article/GALE%7CAAA000076509/169fcb10e2c27bb579aa0a2a928b9501?u=berkeleycoll
Liza, B. (2010). 2011 Hyundai Sonata Recall, Stop-Sale Consumerreports.org. Web. Retrieved 28 Feb. 2011 from http://blogs.consumerreports.org/cars/2010/02/2011-hyundai-sonata-recall-stop-sale.html