I am Yoshida, president of Yamada Shusei Ltd., a professional apparel garment repair group in Nagaoka City, Niigata Prefecture.
The background to the talks of a merger between Nissan and Honda was likely the intensifying competition in the industry as a whole and the need to cut costs. However, Nissan's insistence on equal footing despite its deteriorating financial situation made the integration difficult to achieve.This situation illustrates how differences in the financial situation and strategies of different companies can affect cooperation between firms.
Lessons for Small Business Owners
1) Understand Your Financial Situation
When considering an integration or alliance, it is important to accurately assess your company's financial situation and consider the balance with the other company. An unreasonable proposal may result in a breakup.
2) Overall Optimization Perspective
It is necessary to consider not only the company's own profits, but also the overall benefits of cooperation with the partner company. If you fall into partial optimization, there is a risk that the cooperative relationship will break down.
3) Flexible attitude
It is important to have a flexible attitude as talks of integration and cooperation progress. You must respect the other party's opinions and situation, and strive to find a compromise.
4) Long-term perspective
Considering strategies from a long-term perspective, rather than being preoccupied with short-term profits, will lead to sustainable growth.
In the end, talks between Nissan and Honda to merge their operations are headed for a dead end, and the idea of becoming the world's third-largest automaker is back to square one. However, both companies will continue to search for a way to survive on their own in a changing automotive industry, as no effective alternative will be found anytime soon.
