OPM500 CASE Mod 4 Business & Marketing Essay Paper

Nissan Company Tsunami Disaster in 2011
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OPM500 CASE MOD 4
Introduction
In March, 2011, Nissan Company suffered a tsunami disaster which almost brought the company to its knees. About 5 staff as well as their 17 family members died in the damaging 9.0 magnitude tsunami and earthquake, with over 50 parts suppliers and dealerships destroyed as production throughout Japan closed totally (Greimel, 2011). This essay will present the earthquake and tsunami impact on Nissan company.
Earthquake and Tsunami Impact on Nissan
Q1. The company took four responses to the disaster that enabled it to survive the disaster. The actions included action empowerment, supply allocation, production management and information sharing.
Firstly, the gathering and sharing of information became decentralized as well as collaborative. Every area was required take two representatives to Japan to collect data and provide solutions to enable the corporation as a whole to carry out collaborative effort with input and details from all areas. Information gathering and sharing costs appeared normal as minimal resources were utilized to take the representatives and maintain them in this task. But, the benefits were noticeable. With domestic regional representatives in the center of company-wide decisions, the areas that were significantly impacted were offered priority first over other areas that were considered less impacted thereby reducing the whole company’s effect of the disaster. The sharing of information and resolutions offered assurance to the company to empower actions, manage production and allocate supplies to the areas that had much needs. Therefore, there was accurate flow of information as well as resolutions that showed actual needs.
Supply allocations had significant benefits. The decline of sales income was avoided from converting to idle inventories when regions not affected allocated their provisions to higher profit vehicles (Copeland & Hall, 2011). This was realized owing to areas that produced low profit vehicles gave up their GPS units to areas that could utilize units required for higher profit vehicles. This enabled the company realize great revenue generation, most likely in Yen millions in place of declining sales by the delay of manufacturing of higher profit vehicles. The related costs were giving up of good sales characteristics of lower profit vehicles to promote great revenue advantages that were acquired from high profit vehicles.
Managing production suffered low incremental expenses together with seen benefits. The company took slow production lines as well as increased in-stock as well as in-transit inventories to forecast challenges. This enabled the company to avoid ordinary amount of parts from supporting idling inventory and needing housing as well as sitting costs. Also, Nissan lowered costly overtime relating to normal production levels. Looking at in-transit inventory time to identify supply options possibly saved money. Air freight as well as other fast transportation costs would have been expensive compared to other sea shipments.
Empowering activities made the company flexible to allow area management make decisions fast without time consuming discussions from centralized authorities. As a result, the company prevented losing millions of sales by fastening vital decision making as well as recovering associated challenged by downward assigning of authority for some time. As emerging information was communicated from distinct areas, corrections were integrated fast. But, the costs of eliminating centralized authority may have impacted quality anticipations. Nevertheless, the related benefits were a fast decision-making process which decreased idling resources thereby lowering costs and preventing a decline in sales.
Q2. The company underestimated the harm done by the disaster which resulted from an earthquake. It could have identified new evacuation routes as well as centers that considered risks. Additionally, the company could have significantly grown the food storages to become enough for the workforce, their families as well as domestic residents in the area. Thought the buildings had been tested and strengthened following seismic simulations, better measures could have been integrated to prevent the falling of items following the earthquake as indicated. These additional measures could have had small incremental costs and greatly significant in saving lives from the risks that were involved. The fire that broke out in Tochigi factory indicated the company had not prepared enough for fire in the identifying and planning phases of risk management. The minimal costs could have been incurred to thwart these fires as the current plans could have been integrated to cover the unidentified areas where the fires broke. The actual costs of the proposed risk prevention strategies were unknown owing to the lack of information to establish the costs and benefits.
Q3. The company had an arrangement that was committed to risk management. The Global disaster Control should have planned as well as established the risks in a strategic way considering the geographical interdependence as well as risk contingencies that were involved. The team possibly used a probability matrix which considered the effect as well as the probability of circumstances like this happening in certain regions ...