The Marketing Book 5th Edition

74 The Marketing Book

number of marketing strategy lessons is the case
of Honda and their entry into the American
motor cycle market. The various interpretations
and a set of comparative commentaries are to be
found in a set of articles in the California
Management Review(Mintzberg, 1996a).
In summary, the original consultancy
study conducted for the UK government by the
Boston Consulting Group interpreted the suc-
cess that Honda enjoyed in the USA partic-
ularly at the expense of the UK imports as the
result of substantial economies of scale for their
small bikes based on the Cub model, along with
a market entry strategy to identify and exploit a
new segment and set of customers. Richard
Pascale, on the other hand, interviewed rather
later a number of the key executives who had
worked for American Honda at the time and
they told a story which suggested the whole
operation was very much on a shoestring and
the final success was down to a number of
lucky breaks, including a buyer from Sears
persuading them to let him sell their small
model bikes when they were really trying, and
failing, to break into the big bike market.
The debate recorded in the California Man-
agement Review certainly illustrated how the
same story can be interpreted in very different
ways. It also emphasizes the problem that
learning from the undoubted final success that
Honda achieved can be very problematic: even
perhaps for Honda itself. It would seem that in
many ways one of the underlying dilemmas for
Honda, as indeed for any new market entrant,
was that if they took the existing market
structure as fixed and given then the possibil-
ities for them were remote; on the other hand,
market knowledge could only really hint at
possibilities for new market structures.
In the end, Michael Goold (1996), who
worked for BCG at the time, concluded that:

The (BCG) report does not dwell on how the

Honda strategy was evolved and on the learn-

ing that took place. However, the report was

commissioned for industry in crisis, with a brief

of identifying commercially viable alternatives.

The perspective required was managerial, not

historical. And for most executives concerned

with strategic management the primary interest

will always be what should we do now?

Presumably the (Mintzberg) recommenda-

tion would be ‘try something, see if it works

and learn from your experience’; indeed there is

some suggestion that one should specifically try

probable non-starters. For the manager such

advice would be unhelpful even irritating. ‘Of

course we should learn from experience,’ he

will say, ‘but we have neither the time nor the

money to experiment with endless fruitless

non-starters.’ Where the manager needs help is

in what he should try to make work. This surely

is exactly where strategic management thinking

should endeavour to be useful.

Whilst, Mintzberg (1996b) comments:

How then did BCG’s clients actually learn from

this report? And what lessons did BCG itself take

from this particular bit of history? Did it take a

good look at its own performance – do some

analysis about the impact of its own analysis?

The British motorcycle and parts exports to

the United States collapsed to 10 million dollars

in 1976, the year after the report was published.

So much for the result of this practical manage-

rial perspective. I believe that managers who

have neither the time nor the money to experi-

ment are destined to go to the road of the British

motorcycle industry. How in the world can

anyone identify those endless, fruitless non-

starters in advance? To assume such an ability is

simply arrogance, and would, in fact, have

eliminated many, if not most, of the really

innovative products we have come to know.

In the terms of our previous analysis we could

argue that Goold is focusing attention on the 10

per cent that can be explained analytically,

whilst Mintzberg is arguing not only that the 90

per cent is much more important but, much

more importantly, that a realization of specific

causes of success can be achieved more effect-

ively through processes such as learning. This

is, in practice, a strong assertion about the

efficacy of learning processes in organizations

that others might dispute, perhaps most obvi-

ously James March, who in a number of