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Nissan: Innovative Solutions Case Study

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Updated: Jul 9th, 2021

Introduction

Soon after its foundation in 1933, Nissan, a Japanese automobile manufacturer, rose to fame and success. Due to its early connections to the United States – a country with a record-breaking number of car owners even at the very inception of the automobile industry – Nissan rapidly expanded its customer base. In 2013, Nissan became the world’s sixth largest car manufacturer and in 2014, it was recognized as the largest car manufacturer in North America.

Over the years, the Japanese company has proven to be a force to be reckoned with and it is safe to say that what indeed fueled Nissan’s success was its constant search for innovation. On par with looking for innovative solutions, this car manufacturer boasts effective management which allows it to tackle emerging issues promptly. This paper will discuss how well-known manufacturing and management strategies relate to Nissan and future recommendations for enhancing its sustainability.

Theories and Techniques

For characterizing Nissan’s approach to management and production, it is essential to explain three popular strategies: lean manufacturing, just in time (JIT), and Toyota Production System (TPS). All three strategies aim at cost-saving and maximum elimination of waste. Lean manufacturing includes a set of principles that, when implemented adequately, allow producers to reduce waste while upholding high quality and increasing labor productivity.

Just in time is one of the methods of bringing lean manufacturing to life: it is encouraged that companies maintain production flow by ordering materials in the process as opposed to purchasing in advance. Toyota adopted both lean manufacturing and the just in time method. Moreover, over the years, Toyota has elaborated its classification of waste that it is trying to combat: waste of time, waste of overproduction, waste of movement, and other types. Nissan too supports zero waste initiatives; however, it is argued that so far, its measures have not been as sustainable as those of Toyota (Schmidt & Simchi-Levi, 2013).

Nissan seems to be concentrating on managing the environmental impact, for instance, emissions. It is possible to point out similar advantages and disadvantages for each of the three concepts. The advantages relate to long-term sustainability and a better reputation, whereas among the disadvantages are the necessity to restructure manufacturing and management processes, which may be expensive and time-consuming.

Sustainability

Triple Bottom Line

Triple Bottom Line is an approach that allows a company to expand its focus beyond financial profitability and consider social and environmental factors. Thus, by implementing Triple Bottom Line, a company upholds moral integrity and seeks environmentally sustainable solutions. In the early 2010s, Nissan adopted TBL for operational management. Increasing revenue is any company’s primary goal, and Nissan is not an exception.

In recent years, Nissan has been tapping into emerging markets such as China and India where car ownership is on a slow but steady rise, seeking to attract new buyers. As for social responsibility, Nissan should consider diversity its strength: top management should never impose its cultural expectation upon regional management, for each country is unique. Lastly, the Japanese company should support more environmental initiatives and follow Toyota’s example regarding waste management.

ISO 14000

ISO 14000 is a set of standards that relate to environmental impact management. A company that adopts ISO 14000 standards expresses its commitment to minimizing environmentally harmful operations, complying with relevant regulations, and seeking continuous improvement. It took Nissan five years to obtain ISO 14000 certification for all its plants in Japan and outside the home country. In 2006, Nissan set long-term goals for Nissan Green Program 2010 to bolster its environmental management. In 2011, the company proved its compliance with ISO 14000 standards (Nissan Global, 2016).

Among the measures that the manufacturer took are making utilization of natural energy more efficiently, launching “Zero Emission” car models, and established environmental management in all domains-buildings (Nissan-Global, 2016).

Corporate Responsibility

Corporate Social Responsibility (CSR) is a business model that holds a company socially accountable – to itself, stakeholders, and society. Nissan is thoroughly apt for integrating CSR into its development strategy: CSR applies best to large companies for at some point of growing their revenue they become capable of giving back to people. Nissan’s corporate vision can be described with their original motto “Enriching people’s lives.” In their mission statement, the company states that it is eager to bring innovation to customers’ experience and contribute to technological advances (Automotive World, 2017).

Nissan seeks to align profitability with social accountability, which accords with the CSR principles. The car manufacturer capitalizes diversity among their managers and employees and strives to build relationships on trust with its stakeholders. As for other measures that the company could take to comply with the CSR model, one of the most relevant goals could be alternative fuel research.

Conclusion

Nissan is one of the largest and most influential car manufacturers in the world. The Japanese company recognizes its vast impact and leverage and holds itself socially and environmentally accountable. The manufacturing strategies at Nissan plants align with lean, just in time, and Toyota Production principles to a certain extent. Nissan is a prime example of a company that successfully adopted the triple bottom line approach and is considering environmental and social factors. One of the significant milestones in the history of Nissan was ISO 14000 certification. The company’s vision is aligned with the Corporate Social Responsibility business model and future recommendations would include realizing employees’ and stakeholders’ full potential and searching for alternative fuel.

References

Automotive World. (2017). . Web.

Nissan-Global. (2016). . Web.

Schmidt, W., & Simchi-Levi, D. (2013). Nissan Motor Company Ltd.: Building operational resiliency. MIT Sloan Management, 13(149), 1-12.

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IvyPanda. 2021. "Nissan: Innovative Solutions." July 9, 2021. https://ivypanda.com/essays/nissan-innovative-solutions/.

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IvyPanda. (2021) 'Nissan: Innovative Solutions'. 9 July.

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