Honda has Never had Layoffs and has been Profitable Every Year
Posted on November 25, 2008 Comments (6)
Engineers Rule, 2006
Longtime auto analyst John Casesa, who now runs a consulting company, says, “There’s not a company on earth that better understands the culture of engineering.” The strategy has worked thus far. Honda has never had an unprofitable year. It has never had to lay off employees.
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The lean and compact Fukui, like all of his predecessors, is an engineer who started in R&D and later ran the subsidiary. While other auto chief-executives-to-be were punching keyboards in an accounting office, Fukui ran the company’s motorcycle racing operations. He’s still racing. He hikes the stairs to his tenth-floor desk–tenth floor so he’s in the middle of things at Honda’s 16-story Tokyo headquarters and a desk because executives at Honda don’t have offices. Honda doesn’t disclose executive pay in detail, but the sum of salaries and bonuses that Fukui shares with 36 board members, $13 million, is just about enough for the boss at a big American company.
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The lean and compact Fukui, like all of his predecessors, is an engineer who started in R&D and later ran the subsidiary. While other auto chief-executives-to-be were punching keyboards in an accounting office, Fukui ran the company’s motorcycle racing operations. He’s still racing. He hikes the stairs to his tenth-floor desk–tenth floor so he’s in the middle of things at Honda’s 16-story Tokyo headquarters and a desk because executives at Honda don’t have offices. Honda doesn’t disclose executive pay in detail, but the sum of salaries and bonuses that Fukui shares with 36 board members, $13 million, is just about enough for the boss at a big American company.
I checked and Honda was also profitable in 2007 and 2008 fiscal year (ending in September) and no I see no evidence of any layoffs this year (when I look online).
Related: Honda Engineering – Back to School for Honda Workers, 1993 – The Google Way: Give Engineers Room – Google’s Ten Golden Rules – Toyota as Homebuilder – Curious Cat Science and Engineering Blog – Toyota’s CEO pay under $1 million
Of all the bizarre subsidiaries that big companies can find themselves with, Harmony Agricultural Products, founded and owned by Honda Motor, is one of the strangest. This small company near Marysville, Ohio produces soybeans for tofu. Soybeans? Honda couldn’t brook the sight of the shipping containers that brought parts from Japan to its nearby auto factories returning empty. So Harmony now ships 33,000 pounds of soybeans to Japan. An inveterate tinkerer, Honda also set up a center nearby to develop better soybean varieties and improve agricultural processes.
Posted by John Hunter
Categories: Deming, Lean thinking, Management, Respect
Tags: cars, engineering, executive pay, Japan, layoffs, management
Categories: Deming, Lean thinking, Management, Respect
Tags: cars, engineering, executive pay, Japan, layoffs, management
6 Responses to “Honda has Never had Layoffs and has been Profitable Every Year”
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November 25th, 2008 @ 11:25 pm
Thanks for posting on Honda’s methods. We hear so much about Toyota, who’s quality is equal to Honda, at least in my mind. My Honda has 103,000 miles on it, and was purchased because of the brand’s reliability. I’ve done at least one web search on Honda’s “quality” and not been able to find much of anything. Please share more as you find it!
November 28th, 2008 @ 5:55 pm
I will. You can also use our search (on the right) to search our blog for past posts that mention Honda (4) and the Curious Cat Management search (which uses Google to search about 100 management web sites we have selected) for Honda related information (over 100 results).
April 15th, 2009 @ 2:19 pm
The devices combine sensor-driven motors and weight-bearing chassis to guide strides and support body weight…
October 26th, 2009 @ 7:50 am
While other car companies can barely stay in business Honda and Toyota not only are doing well (even if Toyota will lose money this year) they are investing in the future and pushing strong engineering programs…
December 2nd, 2009 @ 5:48 pm
Don’t forget the 3 joys- the joy of producing, the joy of selling, and the joy of buying. It’s an easy framework to remember. If these 3 activities are indeed joyful, you’re probably on the right track.
December 8th, 2011 @ 3:32 am
The levels to which these people take from the organization they are suppose to be leading is a very sad commentary on our leaders. They act as though the corporation exists to enrich them, and their friends, personally…