E2: describe and explain the objectives of the business
Introduction
I am researching a tyre company called 'Bridgestone'. Bridgestone is a limited liability company and it is begun in Japan in 1931 by Mr. Ishibashi. He dreamed of supplying his nation's new automobile industry with tyres developed and manufactured with Japanese capital and Japanese expertise. His mission, which is to 'serving society with superior quality'. Bridgestone soon became the largest manufacturer of tyres in Japan and expanded its business in other markets in the world. Nowadays Bridgestone is expanding to more than 100 factories in 24 countries in the world. The growth of Japan's automobile industry subsequently propelled them into the top ranks of the global tyre and rubber industry. First of all, Bridgestone started to make tyres and after this success they started production on car components. The Bridgestone Group has diversified more and more, encompassing industrial products like polyurethane foam products, construction materials, parts and materials for electronic equipment, bicycles and sporting goods.
Their ethos is to make life safer, more fulfilling and more fun but of course their major objective is to produce high quality products. The most important thing for Bridgestone is to earn the trust of their customers. So they never neglect marketing, manufacturing, researching and developing, providing service and using new technology.
E1: Classify the business according to its ownership, and explain the benefits
and constraints of this type of ownership
Companies in the private sector organizations are separated into categories. These are;
* Sole trader
It is the most popular type of business which is owned by one person. Sole trader is self employed, because it is easier to set up than any other kind of business. There are lots of sole traders in UK.
They have tendency to rely on banks for overdrafts or obtain credit from suppliers when they start their business, but it is difficult to borrow money because their funds are limited. As the owner they make all the decisions themselves. It can be set up with relatively little capital. As they work in close contact with customers they can encourage customer loyalty.
Unfortunately their hours are long because they do not have any help and they have unlimited liability which means, they are fully liability for the company's debts.
* Partnership
This type of business is also very easy to set up and it consists of between 2 and 20 people. They are providing capital and working together in a business with an objective of making profit. It covers professions like accountants and solicitors.
Partnership means they can raise enough finance, because they can help each other, they share the work load, and support each other when they need to go on holiday and are ill. To become partner it is necessary for the prospective partner to buy their way into the partnership thus providing existing partners with additional capital. Bank prefers to lend more money to them because of the security. Partnership can share ideas and useful skills for their business.
However they may have disagreement when they have to share profits. Also unfortunately they have unlimited liability. In addition, if one partner resigns, dies or is made bankrupt, a partnership will automatically end or dissolved to overcome this Deed of Partnership can be drawn up.
* Co-operative
It is a form of business organisation owned and run by its members. It is divided into two types, which are a retail cooperative and a worker cooperative.
If it is a retail cooperative the profits are shared through the interest payments of shares and dividend Stamps which can be exchanged for gifts or money off products. It is declining due to large organisations that can purchase in bulk and sell more cheaply. Cooperative has limited liability and they can appoint a board of directors and also societies are regenerated under industrial and provident societies.
However unfortunately financial organisation do not like lending money to cooperatives because they are not primarily a profit-making organisation and also it they find it difficult to attract the right calibre of managers to run the organisations successfully.
* Franchise
It is to be taken on ownership of a company which has already created an image by individuals who buy into a Franchise. Owner can get money from franchisee.
Different amount of money are paid depending on location and type of business and franchisee will get company image, support from Head Office in respect of marketing, sales, designing of premises, possible transport, expertise, corporate image, initial support, on going support and advertising for their money.
Franchisor will get money from franchisee for initial outlay and 5 -10% of the profits on a yearly basis. The franchisor will expect the franchisee to keep the rules of their company.
Franchises do not have any problem in launching a new business and also there is less chance to fail the business. Business is already published and established so it is easier to raise finance and they will succeed at high degree. Another thing is that they do not have lots of competition and they can always be supported from franchisor so it is easy to solve problems. In addition, they are economies of scale and they have established product so they do not have any development costs.
Unfortunately they are less independent than a sole trader and they are not allowed to sell business without franchisor's permission. Also they do not have automatic right to renew business. Another thing is they have to make continued royalties for franchisor.
* Limited company
Limited company is divided into two types of limited companies (Private Limited Company and Public Limited Company). Both of them have to have at least two shareholders. If they wish to set up as a limited company the promoters are required by law to provide a number of legal documents to the Registrar of Companies at Companies House, Cardiff. These are:
Memorandum of Association
It show how the company is managed, who are the name of business, owners, business address, objectives of the business, a statement of limited liability of the members, amount of capital to be raised by issuing shares and the agreement of the founder members to form a limited company.
The Articles of Association
It controls the inside working of the company. It includes details like procedures for calling a general meeting of shareholders, the number, rights and obligations of directors and shareholder voting rights.
After these documents have been produced, the Registrar at Companies House will issue Certificate of Incorporation, which means they can start trading.
* Private limited company
Many small to medium sized companies trade as private limited companies. This is often once they have been a sole traders or partnership. It is a way of expanding their operations. Their shares are only allowed to be sold to friends and relations. They cannot be sold on the stock exchange.
The advantages of this are money can be raised through the sale of shares and it never has to be repaid. All shareholders have limited liability which means they can only loose the money they have invested as they company receives its own identity. Another thing is that owners can appoint directors on their record of achievement and business knowledge.
On the other hand shares cannot be advertised or sold on the stock exchange.
* Public limited company
This is another type of limited company. Public limited companies are among the largest and the most successful organisations in the UK. Bridgestone is the public limited company. As a Public limited company, Bridgestone is able to sell shares through the stock exchange and therefore should they need to raise more capital they can encourage the general public to purchase.
Advantages
* Company can set targets clearly and ensure objectives can be met. As accounts have to be published, the management needs to make sure that everyone is working towards the same objective.
* Being a Public Limited Company the control of the company is maintained and the management constitution is better and stronger than any other type of business.
* If Bridgestone want to raise more capital they are able to borrow from the bank or sell more shares.
* Being a large company means they will get more media attention, also they can advertise more freely as they have more financial stability.
* They are able to attract better staff and therefore create a more stable working environment. They are big enough to offer staff incentives and therefore recruit the cream of all staff.
* Owner has limited liability, so owner will not lose all their personal possessions.
* Disadvantages
* By going public it means their stock and shares can be bought by anyone and therefore competitors could try and take them over.
* It is difficult to manage effectively due to size.
* Accounts are made Public.
I have inserted into my coursework company details obtained from the Companies House web site. This shows that the company although run in England is a Japanese company, it shows the company number, date of registration and what the business sells. In order to register Bridgestone had to complete the Memorandum and Articles of Association.
Company Details
Name and Registered Office: Bridgestone Corporation
10 - 1 Kyobashi 1
Chuo-ku
Tokyo
Japan
Company No.: FC020122
Country of Origin: Japan
Date of Registration: 11/02/1997
Branch Details
Branch No.: BR003796
Name, Address: Bridgestone Corporation
Storage Transportation of Tyres,
Tyre Testing Etc
Unit A, Hurrucane Way
Axis Park, Langley
Slough
Berkshire SL3 8AG
Date of Open: 25/12/1996
Type of Business: Storage Transportation of Tyres, Tyre Testing Etc
Registered at: Cardiff on 11/02/1997
Country Origin: Japan
Tokyo District Legal Affairs Bureau, Tokyo
Governing Law: Commercial Code of Japan
Legal Form: Public Limited Company
No of Branches: 1 Open
Discounts held at Company/
Branch Office: BR003796
Accounts delivered to: 311295
Objects of the Company: Design Manufacture & Sale Automobile Tyres and other rubber product
Bridgestone is a very big company and it is expanding into 24 countries, so they need many staff to work. It is a difficult business to control. However as Bridgestone is a large company they can advertise and promote the company and products better and wider and also the owners of the company can be satisfied that the business will be successful. The owners can recruit good managers to lead and meet objectives and work the company better. In addition, it can borrow money from bank if necessary, because it is more reliable and more collateral. I think Bridgestone has some disadvantages as well.
E2: Describe and explain the objectives of the business
Objectives
All companies need objectives to survive, companies most important objective is to make a profit, to give good value and service and to provide quality. When they decide their objectives, they always have to think about consumers. It is very important to think about what are consumers' needs and want are as without the customer the company cannot exist. Objectives are, in other words, aims in the company's business which they have to achieve. When they decide their objectives, they will imagine some ideas and vision of their products that they are trying to make. It is easy to decide products because they know what they need to do for their products. Objectives are set to succeed in business, so they can measure performance that they should do like advertising and market research. Objectives are geared at everyone in the company so that they can evaluate their own work.
Different areas have different objectives, for example objectives need to cover market standing, productivity, profitability, worker performance, innovation, financial and physical resources and managers' performance.
Objectives in Bridgestone
These are some objectives of the Bridgestone company:
* To make life safer, more fulfilling and more fun for everywhere. It means that pursuing the highest quality in products, in service, in technology and in all our cooperate activities. By devoting ourselves to attaining that goal, we earn the trust of our customers.
* They strive to define the standard for excellence in every tyre category in every nation around the world. Wherever vehicles carry people and goods, they supply world-class tyres and supporting those tires with world-class service.
* Developing global product to support their global marketing.
* Developing global manufacturing to offer products into markets smoothly. Bridgestone companies manufacture tyres and other products at more than 100 plants in some two dozen nations. Those plants ensure reliable supplies of products for people in more than 150 countries. Rigorous quality control assures customers of dependable quality wherever they buy and use our products.
* Making top-quality tyres. To do it, they make synthetic rubber, carbon black, steel cord, textiles fabric and other vital materials and transform them into tires for nearly everything that moves on wheels.
* To help customers get the most from their tyres and vehicles.
* To create better tyres, they deploy the most advanced scientific resources in their industry.
* Local production, it is to make tyres in large volumes is right in the market place where people will buy and use tyres. By local production, creating products that are optimally suited to circumstances in each nation and region. It means furnishing customers with exactly the kinds of tires that they need and wait.
* To offer safe and lasting service to their owners, they make quality tyres.
* The professionals in their sales and services networks help steer customers to the optimal tire specifications for their needs, especially safety is a continuing emphasis ...
This is a preview of the whole essay
* Local production, it is to make tyres in large volumes is right in the market place where people will buy and use tyres. By local production, creating products that are optimally suited to circumstances in each nation and region. It means furnishing customers with exactly the kinds of tires that they need and wait.
* To offer safe and lasting service to their owners, they make quality tyres.
* The professionals in their sales and services networks help steer customers to the optimal tire specifications for their needs, especially safety is a continuing emphasis in maintenance and other support customers, including consumers and fleet users.
* Minimizing the environmental impact of products and operations. Also they try to develop new kinds of products and technologies to help restore and maintain a sound environmental balance.
* Raising energy efficiency and reducing industrial waste.
E3: Describe the functional areas that exist in the business, and explain how they help the business to meet its objectives.
Organisational structure
Each business has number of activities in order to enable the business to function. So the company must divide these activities and link them together to form an organisation structure. There are some different ways of dividing activities of an organisation that they need to carry out.
* Division by product
In this case the selling products are based on as a structure and it may be based on different brands that companies offers. If the organisation uses a structure based, it is possible to create a series of cost centres related to a particular product. It is easier to establish the profit or loss being created. It also allows a business to create identities for the different product sold. Usually the large scale company uses this type of structure. So each division have own autonomously and therefore they can make their own decisions. The head office or holding company may be small, which is the same as the corporative level and the expert of the head office use their influence.
* Division by function
The organisation of structure is designed by some specific parts of the business. For example advertising, finance and accounting, personnel, production, purchasing, sales. This type of structure may be hierarchical or flat. A managing director supported by variety of senior managers control structure. Every manager should have responsibility for the work in their departments of the organisation.
* Division by process
Many goods are needed to pass several stages or processes in the manufacture. At each stage, different things are needed and it is carried out in different locations. Normally each process is divided into separate departments frequently. i.e. a Browry growing its own hops, manufacturing its own beer and selling to its own pubs.
* Division by geographical area
Many organisations work in different locations at home and also abroad. They are usually divided into separate divisions with complete autonomy, reporting to a board of directors.
* Division by customer
Many companies sell to consumers and industrial markets. These two customers might ask different treatment so the organisation normally sets different divisions to reply for the individual needs.
I am going to show the organisation of structure of Bridgestone. Bridgestone has a very big organisation structure and in this company's case the type of the organisation structure is the division by function and also the division by geographical area.
The organisation structure of Bridgestone is very complicated and it is divided into lots of sections but it is roughly separated to following divisions.
* Sales Division
They are trying to increase sales and profits within half a year or a year and to achieve it, each department creates an executing plan. Sales targets are set for this period of time and all departments are expected to perform their functions in order to achieve this. I.e. marketing have to do their bit, finance will set aside appropriate funding for sales campaigns etc. The Sales department must have full product knowledge. They are trying to sell products faster than competitors'.
* Development Division
They are researching new elements of product developments and new materials. All new products have to satisfied quality and hopefully improve technology i.e. tyre performance.
* Manufacture Division
They are trying to improve the techniques of manufacturing to reduce costs and increase quality. Hopefully creating more and better sales. They work closely with the sales department, making sure sufficient tyres have been made ready to meet orders taken. There are different types of production sections in the factory and people who are asked to work on a given area must perform their function i.e. general affairs, planning, manufacturing, technology and equipment. They also try not to cause errors as faulty goods are bad for company image. The manufacturing department are responsible for maintaining quality standards and have to meet safety marks set by the trade.
* Finance
There is a finance section based at the Bridgestone head office. Their main work is checking at looking after the finances of the company. Any department needs to go through the finance section e.g. for costing etc. They try to work out the money needed in running the company, they also have to make sure there is enough money to pay salaries and wages.
* Human Resources and General Affairs Division
In this division they try to employ the right people and to train them. The most important thing for the company is to employ good people so and they understand exactly what the company's policy is. To achieve this they create posts and give company training according to the company needs. They are responsible for keeping the motivation of the work force happy and paying salaries on time. They too work closely with finance section.
* Quality Assurance Division
They check to make sure they are fit for sale of high quality. If a defective product was passed to customers, they need to sort it out. If they do not they would be up against the standard ISO9001. They try to set high quality to encourage customers to support their company and buy their products more. This area works with the manufacturing sections.
Bridgestone is a very big company therefore it is difficult to establish meetings for everyone. So the communication as a whole is important at each division. The organisation structure in Bridgestone consists of department, division, project working and project management. These small units gather information and work together to achieve a common goal to make the company successful.
E5: Identify communication channels used by the business
Communication
Communication means to impart knowledge or to express ideas in words or other symbols. It will not work if ideas are poorly expressed, because the vocabulary is too complex, or someone is not concentrating. All organisations need to have good, communication so that:
* Everyone is clear about objectives.
* There is smooth and accurate communication both within the organisation (internal communication) and between the organisation and other individuals, bodies and groups (external communication).
* Everyone in the organisation is kept informed of developments and changes.
* Ideas and views are clearly heard.
* New ideas can bubble up through the organisation.
* People do not feel frustrated because nobody is listening.
* The organisation and its members can respond quickly to new developments, etc.
* People i.e. the workforce know what to do work wise.
(Used AVCE business - Heinemann)
Open and Restricted communication
These cover important ways in which communication can be carried out to targeted or not so targeted people.
Open communication - In this case the messages are targeted to everyone who is in the organisation or outside groups. These messages are not confidential, that is to say they are published on notice boards in the staff room and could inform people about a proposed coffee morning raising money for a charity.
In Bridgestone open communication is used by employees whether they are at the top of the management structure or at the bottom. E-mails are used and address books are set up so that everyone is kept in formed. For the factory part notice boards are used as factory workers do not have access to computers.
Restricted communication - In this type of communication, messages contain something confidential. These are targeted to just a few groups for example a particular department or only directors or executives.
In Bridgestone they use personal letter which is only sent to the said person. Emails also can be confidential. However, personal contact face to face is also confidential if in a restricted area.
Formal and Informal communication
Formal communication - It is a way of communication that takes place officially for example holding official meetings and distributing letters, memos and facsimiles.
Bridgestone holds meetings in the company but it is not for everyone, only the managers from each division take part in those meetings to show how their divisions are going on at the moment and they discuss what they should do to be a successful business. Normally minutes are taken of each meeting as a record on who said what.
Informal communication - This is another way of communication that people use. They do not take place officially and are usually carried out outside the company networks. I.e. over lunch or on a golf course. This type communication is more creative as people have more chance to take initiative with coming up ideas and to express their own opinions.
In Bridgestone general conversations about work is informal communication. They also communicate informally through email and phone.
Internal and External communication
Internal communication - This communication happens in the organisation only. There are several ways to communicate in the organisation and in Bridgestone they communicate as follows.
Style
Method
Email
It is the quick way of sending messages from one to another in the company. It could cover any type of communications i.e. letters, memos provide reports as an attachment. It can be secret or open depending how the message is set up. A computer is needed by the sender and receiver.
Letter
Letters are not used internally but can be used by personnel to confirm contract arrangements. I.e. amount of pay receiving.
Fax
It is good way to send urgent messages to different divisions or executives. It is ok provided it is open and can be seen by others.
Memo
It is the good way to send quick messages one to other divisions and also one to another in the same divisions. It is used as informal and open communication.
Meeting
It is very important to have meetings to run the company. It allows managers to discuss problems and issues in detail. Normally after a meeting information is communicated upwards and downwards the organisational structure.
Phone
Most employees use the phone. It is a very quick way to get a message across or check something out.
External communication - This communication happens between the organisation and the outside the world. They communicate with someone outside of the company but also they communicate with customers, shareholders, suppliers, government and the community. There are numbers of way that it and in Bridgestone uses external communicate ways.
Style
Method
Email
Organisation widely uses email to communicate faster. It is time saving of not writing by hand or not taking time to send like letters. Good way to create converse.
Letter
It is used the most widely for external communication. It is used to make arrangements in which to confirm verbal arrangements.
Fax
It sends information electronically over telephone lines. It sends both written and visual information.
Website
This type of communication is increasing. Company has website they use for all forms of external communication purposes and for public relations activities.
Interview
It is to communicate with someone from outside the organisation who is interested in something the organisation has done. Part of a public relations strategy in such circumstances is to build up a positive perception and image of the organisation. The response should be designed to improve public.
Phone
It may be the first point of contact outside the organisation. It is fast to communicate and it allows people who would find it difficult to meet for conversation.
Downward and Upward communication
Downward communication - Executives of the company who belong to the top of the structure in the company decide the systems, rules and work and then they communicate these down the line to employees. It is happen to avoid errors.
If a manager needs to remind employees about something, he usually sends emails to them officially. In each division when managers communicate with employees they use face to face, email, memos, faxes or letters. They hold meetings in each section regularly to impact information in that section i.e. what they need to do and it is important that they do their function properly. The root of communication in Bridgestone is the same as the organisation structure.
Upward communication - Employees at the bottom of the structure might suggest any ideas or opinions to the people at the top class. It is used because people at the lower part of organisation structure have more practical experience. Also sometimes good ideas flow from the bottom to the top.
As well as a manager is sending emails to everyone in the company, they also can send emails employees if they have good suggestions, ideas or opinions. In Bridgestone the communications happens more in each division or department and the final ideas, opinions or decisions are brought up to the executive level in directors' meetings or by report. In Bridgestone each position (section manager, general manager, director, vice president, executive vice president and president etc) reports to upper positions with their own responsibility. The root of communication in Bridgestone is the same as I have shown as organisation structure.
These channels are necessary for the business to function, because through their communication the business to be successful. If they do not communicate with each other customers would not be interested in producing the product due to pour organisation and communication. When they work in the factory, they have to communicate to make product on time by production line otherwise the products made up might be defective. Also they need to know customers expectation so they should have some ways of communication so they can increase sales and profits. In addition they need to communicate to the company in other countries regularly to make sure targets of work.
I think communication system in the Bridgestone is very effective. They know the size of organisation and number of divisions which exist. This helps communication. In Bridgestone the working plan includes aims and subject and these are communicated to all divisions. They have meetings regularly and they have their own separates function to make the organisation work. Ideas are gathered in each division and brought to executives' attention. I think sending email is a very good way of communication because everyone will train themselves to check it. If it is shown on the notice board some of them may not see and miss the message and it will cause some problems. In addition the communication downward and upward in Bridgestone encourages people to work more willingly.
The objectives of Bridgestone communication system is that is solving problems quickly and effectively as much as possible. If communication system does not work well, the problem will be hidden and when they notice about it, it might be too late, therefore the organisation might loose customers.
The administration in Bridgestone is based on the organisation structure as well as communicate to administration.
The communication system of Bridgestone has the positive and the negative points as following.
Positive
Negative
It works smoothly by having meeting with managers and executives.
There is less chance to be brought up their individual ideas to meeting.
The information for everyone will be given from president properly by email.
It could be happened missing communication with some parts of the company.
There is chance to discuss in their divisions they will be encouraged managing their functions.
It is difficult that executives know exactly what downward is always doing.
They can communicate widely both inside and outside the company.
Some problem may happen between the companies in another country.
Their view points are expanding through communication in different countries.
Lots of them cannot communicate with customers directly so that it is difficult to find out exact customers' want.
They can communicate quickly so they can deliver the product to customers in early time.
They may miss messages sent by email without accessing to email facilities.
The communication system in Bridgestone works well but there might be some ways to improve their systems. In recent years the ICT systems have developed so it helps their communication. They can use more email in stead of letters faxes which are sometimes very time consuming to communicate so it is time saving. Using ICT make it easy to communicate to not only internal but also external. Internet may help external communication where is companies stock control helps internal communication.
E4: Describe the management styles and cultures present within the business
In Bridgestone, all of them working in the company are skilled or semi-skilled at each level in the each section. Most People work full time and they make a living by earning money from its job. There are also some people working part time. Bridgestone keep employees as they are a good employer. There is not much change. The company try to help the employees feel welcomed and needed and therefore other high incentive to staff for good ideas. Flexible working hours is given. It is the nice company to work for.
Work is sub-contracted out. They need sub-contractors when they get more order than the company can cope with.
Bridgestone has undergone a de-laying of the organisational structure in the past few years. They changed some board members to correspond with the speed of demand in the market place for surviving in business.
They always try to develop their technology by introducing new tyres to encourage customers to repeat business. Bridgestone are interested in satisfaction and reliability for their tyres so they improve these to survive in the market place (customer driven and technological driven). They change them to catch up with the speed of everyday change and to reflect to demand exactly.
Management Styles
It is a typical type of person whose behaviour carries out a management role over a period of time. Roughly this style is divided into three different areas, which is;
* Autocratic - Management makes decisions. The manager is boss and is the only one who can make a decision. A manager gives just his decision to employees rather than asking them for their opinions.
* Democratic - Management involves workers in decision making. Individuals are given responsibility to make decisions. Managers in this case will feel comfortable allowing employees to make decisions. Their understandings on employees are very good and their decisions are usually feedback on results.
* Consultative - Managers are ones who try to consult employees before they make decisions. They consult employees before implementing decisions. Managers have skills of listening and the ability of creating the right channels to consult others. However it does not regularly feedback on results such as democratic style.
In Bridgestone they use consultative style as their management style. It is the same at any levels and any section but depends on manager's personality. Manager in each section still have to communicate up and down the organisation channel and the flows of information is constant
Business culture
Every company has different cultures and it is influenced by objectives. Culture refers to the personality of an organisation, the shared beliefs of written and unwritten policies and procedures that determine the ways in which the organisation and its people behave and solve business problems. Business cultures in Bridgestone are;
* Customer driven culture - All staff try to satisfy customers. They pay attention to improving all aspects of the company which relate to customers and product. Bridgestone hears a customer's voice and enables it to reflect the voice in the business culture of a company, and product worthiness.
* Dynamic culture - It covers energetic, enthusiastic employees and management teams who are dynamic to be and come up with new ideas.
* Competitive culture - The tyre industry is very competitive. Therefore it is for Bridgestone to keep ahead by new and better ideas to survive competitors.
* Positive culture - Managers and workers alike are cooperative and supportive of each other's contributions and efforts, and consider many issues as opportunities rather than threats. Bridgestone encourages and to all employees when
* Person culture - Managers and employees are genuinely supportive of each other's personal development and progress. Bridgestone tends to cherish people as in-company environment. A company is the man itself. They are not a robot or machines. People are important.
* Technological culture - Emphasis and focus is on the development of technological excellence. Ideas and suggestions from all levels in the firm are positively encouraged. Technology in Bridgestone is at most importance for surviving of market place.
E6: Explain how the production process and quality assurance/control system used by the business helps it to add value to its product or service
Factors of production
Bridgestone falls into a chemical industry and it is also rubber manufacture. They mainly produce tyres which are made from rubber and to make tyres many chemicals are used.
* Land - This factor includes not only the premises of a business and the actual land on which a factory or a shop stands, but also natural resources like rivers, forests, coal, metal ores and the soil itself. Some businesses need large areas of land, while others use only a small building or part of a building.
The head quarters of Bridgestone is in Tokyo in Japan but there are 45 factories in 23 countries in the world. The regional land costs are actually high but by expanding their company in the world they can introduce their products more and so their products will be supported by more people.
* Labour - This resource is people, without whom no business activity could take place. It covers the shop floor workers to the managing director.
Bridgestone employs people as both full and part time shift and they are skilled or semi-skilled at each level. Because of the numbers of factories, these are many employees in Bridgestone (about 121,221 people). Therefore the personnel costs are very expensive.
* Capital - This is the money used to set up and run a business, and also it is including all equipment and machinery used.
The capital of Bridgestone is 631,770,000 pounds. Their sales are totally about 15,347,500,000 pounds and the profits are 976,000,000 pounds.
Production process - the production of tyres in Bridgestone starts from the tropics such like Southeast Asia and Africa. There are rubber plantations of Bridgestone Group in Indonesia and Liberia. Natural rubber which is the main material is grown there. They produce and provide most of steel cord which is used for manufacturing tyres and also the carbon black which add strength on the tyres. The reason that they grow raw material themselves is to make better high quality tyres. These components are delivered to factories to manufacture tyres. Technology plays an important part to ensure quality assurance. During manufacturing process lots of checks take place at end stage of production. Bridgestone tyres are PTO mass produced. This means tyres are produced in large quantities. Different types of tyres are also produced in batches and the production line is continuous.
Adding value
Adding value means that the difference between the cost of producing a product or service and the selling price or the additional benefit offered to a buyer.
Businesses generally want to add value because they want to increase their profit to be successful. Adding value helps business to remain competitive, meet customers needs, allows the company to survive and grow and obviously please share holders.
Bridgestone add value at following stages.
. Growing raw material.
2. Row material is changed into useful material or components.
3. Material is delivered to factories to produce tyres.
4. Produced tyres are delivered into shops.
5. In shops, tyres are sold by customers
Bridgestone is always required to add value to make a profit. If they make profits shareholders will continue to invest in that company. The group needs funds to enlarge their company and improve quality assurance.
Quality assurance
* TQM - TQM stands for Total Quality Management and it is the developed quality assurance from TQC which means Total Quality Control. Bridgestone uses this TQC because by using this quality assurance they can keep tights, quality checks and a longer period of time. Because Bridgestone try to produce the best quality on their product and it is very important for them to use TQM as well.
* Quality circles - It is an important way of increasing participation in organisational activities. They are concerned with putting ideas into action. In-depth analysis is carried out by teams of staff and proposals for action and presentations to management will be involved. In Bridgestone they collect information relating to tyre production to obtain ideas which can be useful to develop the production process.
* ISO 9000 - ISO 9000 series are the international standards about the "quality system" upon which it was decided in order to unify the standard of a guarantee of quality by dealings between international so that there may be no variation in the standard of each country. In Bridgestone they use this because they try to do their business effectively. Also as they are a wonderful company this is an important aspect of reaches quality assurance.
* Benchmarking - In Bridgestone they produce tyres on an assembly line because they want to make large quantities of tyres very quickly. Benchmarking means finding the best practice possible.
* Training and Developing - It is necessary to have ongoing training and development for all staff, because quality is of the most important and should improve continuously in an organisation. In Bridgestone employees are trained at each level so these people have skills and so every thing is going on under their responsibility.
* Quality assurance - Quality assurance (QA) is the responsibility of the workforce, working in cells or teams rather than an inspector. In Bridgestone they repeat checking not just on the actual production line but also once finished. Tyres are tested prior to delivery to the shops.
In Bridgestone as you can see they carry out very strict quality assurance, therefore wherever in the world the product of Bridgestone Group is guaranteed high quality. They check to make sure they are fit for sale of high quality. If a defective product was passed to customers, they sort it out quickly. If they do not they would be up against the standard ISO9001. They try to sell high quality tyres to encourage customers to support their company and buy their products more. In Bridgestone, each person taking part in the quality control are specially trained.
There are some laws which affect quality standards in business.
* The Sale of Goods Act - Its aim is to ensure that sellers provide goods that are of merchantable quality. It means that products must not be damaged or broken. Under this law, if products do not meet customers' requirements, they can be returned to the seller.
Bridgestone wants to produce their product when customer wants at the best quality so they try to deliver tyres in each factory in the world therefore they can have more stock in the shop and if they produce tyres in each factories they need less transport to use therefore there are less chance to get damage on tyres or other products.
* The Trades Descriptions Act - This tries to ensure that the description given of the products forms part of the contract the buyer makes with the seller. This Act makes it a crime for a trader to describe goods falsely. The main objective of this is that descriptions of goods and services must be really accurate.
Bridgestone provide good detailed information guide book of tyres for customers and also in the shop or on the phone when customers asked about products they try to correspond for them to understand and satisfy. These staffs are trained very well to meet customers satisfaction.
* Weight and Measures Act - It is to make sure that consumers receive the actual quantity of a product they believe they are buying. Therefore they normally ask us to get agreement if the quantity of a product is slightly over or less than consumers' requirement. This law is no necessary for Bridgestone.
Bridgestone think that it is important using quality control and ISO9000 especially.
Quality control is the way of holding the balance of quality to satisfied customers satisfaction. There are many advantages but it is time consuming and also they need to use many special vocabularies so it takes time to understand. ISO 9000 is a quality management to make businesses standardise and continuously improve. Bridgestone have quality management systems so that the company is able to run smoothly and so that every person knows what is expected of them. This helps to meet objectives in targets set.
C1: Make judgments about how successfully the business is meeting its objectives
* To make life safer, more fulfilling and more fun for everywhere. It means that pursuing the highest quality in products, in service, in technology and in all our cooperate activities. By devoting ourselves to attaining that goal, we earn the trust of our customers.
They are always researching to improve their tyre quality and while producing tyres they never neglect testing and checking products using quality assurance management. Bridgestone provide good maintenance service and also staff for sales and services network not only sell tyres but also listen to customers demand to introduce the best fit tyres.
* They strive to define the standard for excellence in every tyre category in every nation around the world. Wherever vehicles carry people and goods, they supply world-class tyres and supporting those tires with world-class service.
Bridgestone expand their factory into the world and they produce tyres at each factory to reduce transport so that tyres get less damage. Also as they produce tyres in each factory they can deliver tyres quickly for customers and they can keep enough stock so customer can have product whenever they want.
* Developing global product to support their global marketing.
Bridgestone carry out research and development globally. The technology centre in Tokyo is where they develop the latest technology for tyres and other products. Also they try to produce product which meet needs for customers in each country. They produce tyres in accordance to country laws and specification meeting market needs
* Developing global manufacturing to offer products into markets smoothly.
Bridgestone companies manufacture tyres and other products at more than 100 plants in some two dozen nations. Those plants ensure reliable supplies of products for people in more than 150 countries. Rigorous quality control assures customers of dependable quality wherever they buy and use our products. Therefore shops in the world can have many stocks and it is not necessary lots of transports to get there so for customers also it is easier to get products.
* Making top-quality tyres.
They make synthetic rubber, carbon black, steel cord, textiles fabric and other vital materials and transform them into tires for nearly everything that moves on wheels. Also they create new ideas in cooperating new technological advancement Bridgestone carry out SWOT analysis and PEST analysis to ensure quality tyres are produced. I think it is important to follow market demands and also to carry out checks on social and economic factors as these affect could supply and demand.
* To create better tyres, they deploy the most advanced scientific resources in their industry.
They improve the tyre design technology and simulation system by using new ICT system. Bridgestone combining these new technological systems, they can create a reliable tyre. They have established the biggest tyre testing system in Tokyo technology centre. This is my opinion puts them ahead or their competitors.
* Local production, it is to make tyres in large volumes is right in the market place where people will buy and use tyres. By local production, creating products that are optimally suited to circumstances in each nation and region. It means furnishing customers with exactly the kinds of tires that they need and wait.
At each location customers needs and wants might be different and also location itself is different so that acceptable tyres are different as well. Therefore they expand their factories to the world to produce tyres there so Bridgestone can understand the location in each country and they can provide tyres with better quality with good service.
* To offer safe and lasting service to their owners, they make quality tyres.
Bridgestone produce tyres through good quality assurance. Also they help customers to choose the best tyres for each of them in shops and they provide tyre check regularly.
* To help customers get the most from their tyres and vehicles.
Bridgestone try to provide a full range of service and maintenance with producing better high quality tyres.
* The professionals in their sales and services networks help steer customers to the optimal tire specifications for their needs, especially safety is a continuing emphasis in maintenance and other support customers, including consumers and fleet users.
They let customers to understand the importance or checking points about tyres and they provide maintenance in shops. This I think makes a customer have confidence in the product. Bridgestone offers in 24 hour help line as well. This I thinks shows they are responsible in relationship to safety standards.
* Minimizing the environmental impact of products and operations. Also they try to develop new kinds of products and technologies to help restore and maintain a sound environmental balance.
They are especially trying to improve tyre's mileage. They develop energy conservation tyre called Ecopia and they also reduce the volume of rubber to use to make tyre lighter to make good mileage tyre.
* Raising energy efficiency and reducing industrial waste.
They try to recycle old waste tyres and if these are useless to reproduce tyres they try to use part of them as different product material so they can be more environmentally friendly.
Bridgestone is actually a very successful company and they are one of the top tyre brand leader. They expand their factories in the world to sell products to more people and they start making not only tyres but other products e.g. sports products start making other products they start to gain more profits from them. Also they are selling their brand name in more variety of shops. Because of their dynamic spirit they demonstrate a successful company whilst they pride themselves in providing tyres of superior quality. Looking at the, the internet, the sales of tyres for Bridgestone is very high compared to their competitors Goodyear and Missourian. Their sales increased $9,296 to $19,877, which is about $10,000 increase in recent 15 years. 80% of these sales are done by tyres and rest of 20% are other products and also 69% of these sales have done foreign countries and 31% are sold in Japan. I think the company is very environment friendly. They need to use some chemicals in factories they try to produce energy saving tyres and good mileage tyres. Also they try to recycle old tyres to produce tyres or other products as much as possible to save materials and some energy. Their tyres are used for producing cars but also it is now getting popular and is to be used for motor cars for car racing. Bridgestone is a tyre company so they use lots of chemicals and therefore it is difficult to be environmentally friendly but they are trying to be environmentally friendly by recycling tyres, developing less noise product and reducing energy etc. They produce tyres with high quality and therefore at high price but their tyres are used longer period than other competitors tyres. They have set objective and that is to succeed as a whole business. The set up of department areas helps meet objectives. In Bridgestone, the work force is well trained and staff does not often turnover.
C2: Explain how the organizational structure and management style of the business affects is performance and operation and helps it to meet its objectives
The organisational structure in Bridgestone is a tall structure. The organisation structure enables the company to set targets at different levels. This enables management to make sound business decisions. There are three different types of objectives that affect the way in which Bridgestone is organized and run. These are;
* Strategic Objectives - These are set by Bridgestone's top management. When Bridgestone design any new tyres or products they need to look at long term implement. Before they decide this type of objectives they collect ideas in the meeting. Once they decide upon objectives they inform managers at each division. Bridgestone are trying to develop tyres more environmentally friendly e.g. good mileage, reducing weight, energy conservations etc. These have a tendency to be long term as they may take many years to implement.
* Tactical Objectives - In Bridgestone managers at each division and have this responsibility. They have to consider about resources to achieve their marketing strategy. Because Bridgestone is expanding to the world, they need to contact to those factories about especially finance and purchasing division regularly to check the achievement. These are taken medium term to manage.
* Operational Objectives - These are carried out in each department in short term. These are their running objectives i.e. things to do in order for the factory to run. Managers in each department have responsibilities. It is important that managers check to manage objectives in Bridgestone because there are many divisions in the company so it is difficult upwards always take care these objectives in each division. They need to check stock levels, planning schedules and credit control etc. They are required to check these with looking at oversea factories as well.
Relationships are also important especially when dealing with a tall structure. Communication is very important for the business to be successful. These are;
* Line relationship - As Bridgestone has a tall structure, decisions are past down the communication chain.
* Staff relationship - Bridgestone organisation has a hierarchal structure and therefore staff relationship does not really apply. The only thing I would say is all staff needs to be motivated and therefore I know Bridgestone place great emphasis on encouragement and staff openness. This then leads everyone working well together.
* Functional relationship - In Bridgestone there are some specialist in some divisions e.g. finance, Chemical product production, quality assurance and tyre production technology division etc. Managers in those divisions inform others of work which needs certain skills.
The management style and business cultures help the business to meet objectives and maintain company performance. Management styles need to be effective and must be adapted according to the situation. In order to become a good leader, management representatives must create a trusting and workable environment for which employees can perform their tasks easily to the company's credibility. These are business cultures which also affects the management style used.
* Club culture - In Bridgestone Directors or managers are placed in the centre of the department so that they are kept informed at all stages and are in a position to feed information back through the chain of command. Also employees work, based on company's rules, systems and committees. To make a decision, the director or manager looks at the data in the past and will make decisions about future objectives and customers needs.
* Role culture - Bridgestone uses role culture because they are hierarchical organisation structure and they are divided into so many different types of divisions and departments to work in. They have to respect people in the levels but they are able to have their opinion.
* Task culture - It is important in Bridgestone to succeed their business. In some departments they work together as a team to achieve their objectives in their department. Basically employees are told by managers what they should do however before making decisions, ideas are listened to and could influence the decision process. It means everyone is expected to have their ideas and opinions to work for company and also sometimes they are expected to take responsibility in their work. Especially in development and technology division are needed to have new ideas and opinion for new experience of development and technology of tyres. Therefore they are trying to develop tyres to meet customers' satisfaction all the time and this causes their achievement on their objectives.
These business cultures do work in their business effectively and efficiently. Managers have overall responsibility and must work and through encouragement and motivation help staff to perform duties beyond personal best. This is a good culture. The organisation is tall and hierarchical in structure, so various levels of people are in the centre of the structure, so they can communicate easily with each other.
C3: Analyse the impact of ICT on internal and external communications of the business
ICT stands for Information and communication technology and ICT is the most popular way to communicate within a business.
ICT affects internal and external methods of communication. As ICT systems improve, Bridgestone can bring new and better ways to communicate through new technologies.
Internal communications
* Using ICT internally, Bridgestone's communication has expanded. Before they often use letters and fax for internal communication but now they use e-mail or video conferencing. This is far quicker method and is almost instant provided everyone in the company has access to computers or video conferencing suites. It is cheap too.
* In the factories they use lots of new technologies and these are improving all the time. Computers help in developing and improving the quality of their products. These technologies means improved warehouse storage and access and computer generated orders are responded to quickly. Development of quality assurance also means improved tyres for customers.
* By using ICT employees can take their work home They do not have to stay in the company. This gives flexible hours working and means should child care problem exist, employees do not have to worry . This means employees can be more relaxed and they do not feel stressed so they can concentrate on their work helping the business to be successful.
* ICT helps keep accurate financial information plus data on supply and demand. This is good for the sales department to pass information on to senior managers.
External communications
* Bridgestone has a homepage in Japanese and English on the internet so more people access information.
* Bridgestone are expanding all over the world so if they can use the internet and e-mail to communicate across the world with factories and shops, and of course to customers. Accurate stock records can be kept with automatic ordering process.
* They advertise their better high quality tyres through TV advertisements and they provide the company name around race grounds. They create two types of logos with brand message made by using ICT graphically. These are the same all over the world and they try to give impact image to customers.
ICT helps the business to achieve objectives. The most important objective in Bridgestone is making better high quality reliable tyres to get customers satisfaction. Therefore they need to improve their tyres as much as they can. To do so they need high technology. ICT system is idea for safety testing. Also for customers satisfaction they need to produce tyres as quickly as possible so they need ICT systems in place to provide an automated production line. This reduces man power costs, help to keep product price lower. ICT helps them to improve Bridgestone's ideas because they can simulate the computer so they could know what tyre looks like after manufacturing. Another thing is that they can make tyre more environmentally friendly. They can compare their safety data in past few years easily on the computer and graphically they can get some more good ideas from it. They can work out what they need to add more value to make their product environmentally friendly.
A1: Suggest alternative approaches which might enable the business to better meet its objectives
A2: Evaluate the effects that the alternative approaches might have on the structure and functions of the business, and on how it achieves its objectives
Bridgestone has quite a lot of objectives. They are constantly trying to improve their tyres and guarantee the best customer service possible. Bridgestone has improved immensely and this is due to new technologies and a world of safety conscience laws. Bridgestone are now the one of the biggest and the most reliable tyre company in the world. However in Japan the economy is not good so Bridgestone need to expand their business world wide and concentrate in maintaining profits. In recent years the companies have to become environmentally friendly and this is a problem globally. Great importance is now placed on the environment by customers. Although I feel Bridgestone have been successful. Here, I still think they need to develop the area further. Perhaps working with car manufacturers would help. Global warming might be underestimated and I think all companies even, tyre company should put a side profits and educate and help the environment to prosper. Depletion of the ozone layer, Acid rain etc has got to be number one priority by doing this the company image will be enhanced.
This suggestion will support the objectives which are minimizing the environmental impact of products and operations and raising energy efficiency and reducing industrial waste. In Bridgestone organisation, environmental section belongs to the technology division. This department is then split into an individual section for environment quality and safety management. However if they want to focus on environmentally friendly tyres, the split sections will have to work together as a team. This would be a good way forward for the organisation. Changing the organisation structure as I suggest will help to achieve objectives better and quicker.
Bridgestone makes tyres to meet the need of each country i.e. each country has different laws. However the main company is in Japan so the latest product always comes out in Japan first and those models are produced in other countries a bit later. If Bridgestone introduces the latest products at the same as Japan in other countries, more people will be delighted and again product sales will increase.
I think Bridgestone should make stronger the overseas sales division. I mean they need to communicate with overseas factories and they need to speak other languages and therefore the company need to introduce more language training for employees not only for people in higher levels of the company but lower down the structure.
This would support their objectives which is to develop global product and to support the global market. If each employee has enough language skills in overseas countries they can communicate far better with consumers and they can be more informative on how reliable they are. In Bridgestone the organisation structure has individual overseas operations department but in several countries these divisions are not so strong I think it will be better to separate them and make a division for each country so they can ensure countries cultures and maintain laws. With language training this will improved skills and country knowledge would be far better.
As I am Japanese and I speak English I think they need to develop the area further as it will reach far more customers and show that customer service has top priority. Perhaps Bridgestone needs to look at children's products to the under 18 i.e. those who can not drive. They could create educational projects and introduce these to schools that will get Bridgestone recognized world wide.
I do not think that this would cause too much chaos in the structure as the education section could be created separately. Demonstration production, quality assurance and create environmentally friendly strategies for children to study. Each country could have one person representing this division. I do not think it would take too much profit. I think it could make profits.
Education sections do not need to belong to any divisions and it can be individual divisions. Self standing each division can visit schools in their country offering a service which is varied i.e. environmental opportunities, competition, and knowledge in different fields. This will help objectives.
By increasing numbers of divisions and departments, Bridgestone will have more jobs to do and it means they require more people to work for them. Therefore numbers of employees increase and so they can make a stronger work force and make the market better. This will lead to success. If they need more employees, they need to make more profit otherwise employees can not get the same amount of salary and if they can make more profit they can supply better goods and service to consumers. Nowadays because of the technology development, more people are cut down but if they stop cutting down employees and move them to other divisions which have more changes to meet customers in the market. It would be helpful for them to increase economy and achieve their objectives.
Bridgestone is one of the best tyre companies in the world and their rival companies are Goodyear and Michelin. Goodyear aim also at high quality at production of products satisfying user needs. They too have a good brand image and have a good promotion of the market. Perhaps Bridgestone could merge with it and create a giant tyre business with a strong monopoly. This will reduce competitiveness and also means they can build upon the environmental factor. More money will be used in redesigning and development. Goodyear also could try new things such as producing moon tires for Apollo 14. They could also then look at using their product for a moon surface and they could look at their product on creating Artificial Hearts. This means they start to use their technology in more variety of places. As Bridgestone tried to produce product in different area and this will support and maintain development and obtaining consumers. The more goods made, the more profits are being made. It is important for Bridgestone to be reliable and at the of tyre technology.
Michelin has been the best tyre company for 3 years. Their aim is quite similar to Bridgestone and it means they are aiming to be more environmentally friendly. However they have large area of land for raw materials such as rubber in developing country e.g. Brazil and Nigeria. As Michelin is the best tyre company, it would not be a good idea of Bridgestone merging with them, as Bridgestone and Goodyear are smaller businesses and they could work together.
Index
Introduction page 1
E1 page 2 - 6
company details (page 7 - 8)
E2 page 9 - 10
E3 page 11 - 20
E4 page 21 - 23
E5 page 24 - 30
E6 page 31 - 35
C1 page 36 - 39
C2 page 40 - 42
C3 page 43 - 44
A1 & A2 page 45 - 47
Bibliography
Heinemann AVCE Advanced Business
Vocational A level business
Booklets of Bridgestone
Web site
http://www.companieshouse.gov.uk/
http://www.bridgestone.co.jp/
http://www.goodyear.co.jp/
http://www.michelin.co.jp/
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Ami Asaka
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