Boosting Efficiency at Matsushita

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Finally, the capital invested in plant and equipment would not be wasted due to the output of the company after it has optimized workflow. Consequently, as less than 1% of output, by 2006 defect rates were at an all-time low in every factory so it had no real impact on the company. In addition, the reduction in waste made the company further boost its productivity and helped it strengthen its renewing reputation for producing high-quality merchandise.

Question 4

Managers try to find innovative ways to boost the overall financial, technological, and social performance of the companies they manage. In our case study, Matsushita is an example of a company that brightly created a system that allowed it to considerably reduce its defect rates. There are five main benefits to this strategy and ability to decrease the defect rates .

First, by reducing defect rates, Matsushita’s costs were hugely reduced because there was less need to repair the defective goods manufactured. In other words, the company became more profitable, whether it concerned Matsushita’s Saga factory or its six other plants located in Mexico, Malaysia, China, and Britain.

Second, by reducing the defects and errors from the production process, Matsushita boosted its productivity because it had less waste. Thus, it became more time efficient. Indeed, it became more efficient in terms of production, which led the company to improve its ratios of production output to input.

Third, Matsushita became able to produce high quality products. By developing its own software that allowed it to synchronize production, Matsushita better managed its robotic process automation, which led to the production of high quality merchandise. Thus, by enhancing the quality of its products, the company boosted its reputation and reliability.

In addition, the company improved its level of customer satisfaction. Indeed, less defective merchandise means less returnable products: Matsushita almost has defect free products. For instance, in 2006, it had less than 1% of output defect rates. In 2016, eight years after it became Panasonic and became more diversified in its activities, it even had an impressive low failure rate of 0.01% for its solar panels. This gave the company more competitive advantage in the Electronics industry. It also contributed in strengthening customer loyalty through time. In other words, Matsushita reduced its customer defection rate.

Finally, Matsushita is becoming more eco-friendly by decreasing its defect rates. This aspect is not negligible in today’s globalized and polluted world where sustainable development is a challenge that companies have face on a daily basis. In fact, maximizing profits by hugely damaging the planet is not ethical and negatively impacts a company’s reputation. Thus, by decreasing its defect rates, Matsushita has gone green.

Question 5:

Functional level strategy relies on seeing employees and resources as ends, not as a means to achieving something else. Managers at Matsushita's Saga factory in Japan pursued functional-level strategies as an approach to enhance the overall performance of the company and allows it to access its objectives.

First of all, by pursuing the functional strategy, Matsushita was able to raise its productivity, and therefore increase the efficiency of its production process while also reducing defect rates as well as boosting the reliability of its financial and technological product offering. As a result, the company became more profitable. Matsushita has a significant cost advantage over its competitors because of its superior efficiency. The higher level in efficiency enabled Matsushita to lower its costs, while higher reliability enhanced product quality, and boosted sales volume, which helped the company differentiating its product offering by implementing the differentiation strategy. It is known that in the functional strategy, a worker who is an expert in his functional area can perform tasks with a high level of speed and efficiency, which enhances productivity. Workers who know their jobs well can proceed with confidence and a minimum amount of mistakes. They are also able to greatly manage their time, which is precious in business.

Second, functional-level-strategies are very important for Matsushita because they give a competitive advantage over the other firms in the market. By implementing the functional strategy, Matsushita became able to improve reliability from both employees and machinery, which helped it produce a higher quality merchandise. In other words, when the employees and the machinery work are more reliable, it is clear that they will end up with a high quality products.

Third, the functional-level-strategy is important for Matsushita to achieve a competitive advantage because it offers a high level of specialization. Employees typically start their careers in an entry-level position within the function and develop specialized knowledge as they move up. They become experts within their functional area. As a result, the company benefits from their expertise and experience over time.

To sum it up, functional level strategy was so helpful for Matsushita to see its management decisions as specific to a functional area of the organization, such as marketing, human resources, finance, information management and public relations. The advantages of this approach are that employees and resources can be assigned to the tasks that best suit their skills and interests. By developing individual goals and objectives for specific functions within Matsushita, its owners and managers can assign the right people and resources to the right tasks. Therefore, the advantages of functional-business-strategies rely on seeing employees and resources as ends, not as a means to achieving something else.

Question 6:

A manufacturing company has techniques and strategies that enable it boosting its efficiency. So do service enterprises. Indeed, while preparing the services that are going to be developed in order to satisfy the customer wants and needs, they pass through multiple strategies and steps that enable them to deliver excellent services. The increase in efficiency of the service companies is quite different from the one of the manufacturing companies but it has mainly the same objectives, which are customer satisfaction and responsiveness. For this, some companies tend to develop strong trainings for their employees in order to deliver the service in a convenient manner. Trainings are made through team-buildings and eventually through the creation of a strong relationship between the different