HONDA RISK STATEMENT AND RISK APPETITE Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

HONDA RISK STATEMENT AND RISK APPETITE Case Study Solution

Introduction

The Engineer Honda Soichiro started the Honda T.R.I near Hamamatsu in 1945 to make little, systematic motors inside. It was launched as the Honda Motor Company in 1947 and began manufacturing bikes in 1948. The Honda C-100, a little-engine bike, was launched in 1954 and later in 1960 it became the world's best bike seller. In 1961 the company also launched a U.S branch, the American Honda Organization, which started manufacturing bikes in the U.S in 1980 and cars in 1983.

As Honda is one of the world's best dominant producers of bikes and cars, most of the organization’s yearly sales come from cars, which the company started making in 1965. Among its thin, petrol structured traveling cars have been the famous Civic Prosematic and Honda Accord. Other regions of the organization’s products include auto parts and thin light engines. Honda is an important Japanese seller to the U.S, which also sells to other countries throughout the world. It also has overseas factories and is involved in partnerships with numerous businesses as well as in practical permits with several overseas firms.

Risk Management framework

The Honda overseas risk administration plans aims to operate the organizations’ feasible, widened and long-term management, which are purely based onHonda. The ideas also focuses at all the possible risks of dealing and working in worldwide average. In moving out its risk administration focus, Honda is developing the proper structure and estimates to follow up on finance fulfilment, with attempt focused on the firm’s wider risk.

As an important attempt, Honda uses risk analysis purpose throughout the firm to analyze, rate and answer to risks based on normal ways. In the event of any disaster, the firm builds an overseas crises tragedy to answer in part, to the expected size of the crises.

Honda’s Risk Appetite

Honda has been facing sever issues in its operationsdue to the cyber security attacks.. These operational risk can create financial and reputational vulnerabilities for the Honda Corporation. The Honda’s risk appetite has been analyzed through different risk factors including financial, reputation regulatory & compliance, technology, strategic, market, operational and human capital. The detailed analysis shows that Honda is at the moderate level of the risk appetite. It is because the company faces a moderate level risk in technological, strategic, regulatory & compliance and human capital issues. On the other hand, the cyberattack has create serious issues in the company’s operations, as the malware has halted the production, customer and the financial services of the company. The operations of the company have been impacted globally, as a result of the attack. The Honda’s spokesperson claimed that the cybersecurity attacked has halted the machines and related production, whereby the attack is considered a ransom, which demands the company to pay in order to have an access to its operational information back, through cryptocurrencies, which would incur higher cost,therefore increasing the company’s financial risks. Honda lacked proper security controls over the company’s sensitive information and credential. Such loss of data may lead towards business damage, less market share, operational inefficiency, loss of customers’ trust or the penalties imposed by the government authorities.