1.

Executive summary
The world's largest automobile manufacturing plant in Ulsan, South Korea, produces over 1.6
million vehicles annually. Established in 1967, Hyundai Motor Co. has grown into the Hyundai
Motor Group, with more than two dozen auto-related subsidiaries and affiliates. Hyundai Motor
which has seven manufacturing bases outside of South Korea including Brazil, China, the Czech
Republic, India, Russia, Turkey and the U.S. — sold 4.06 million vehicles globally in 2011.
Hyundai Motor, which employs over 80,000 worldwide, offers a full line-up of products
including small to large passenger vehicles, SUVs and commercial vehicles. Chung Ju-Yung
founded the Hyundai Engineering and Construction Company in 1947.
Hyundai Motor Company was later established in 1967. Smart enough to realize world-class
expertise could unlock lucrative new markets, Chung hired former Austin Morris boss George
Turnbull in the 1970s to lead development of the very first Hyundai car. In 2005, Hyundai built
the Russelsheim Design and Engineering Centre in Germany, a state-of-the-art studio bringing
together designers and engineers from all over Europe. This makes it possible to design, engineer
and manufacture cars in Europe, specifically for European customers. Hyundai has replaced its
entire line-up of 14 cars with all-new improved models, in just four years.
(wikipedia.org)

Hyundai vehicles run the gamut from budget cars to luxury sedans to commercial trucks. South
Korea's leading carmaker, Hyundai Motor produces compact and luxury cars,
SUVs, minivans, trucks, buses, and other commercial vehicles. Its cars are sold in 180 countries
through some 6,000 dealerships. Hyundai generates about half of its sales in South Korea, but its
vehicles are also popular in emerging markets such as China and India. The company operates a
dozen manufacturing plants in China, the Czech Republic, India, Russia, South Korea, Turkey
and the US. It sold 3.6 million passenger cars in 2010, but only 500,000 in the US, where it does
business as Hyundai Motor America. Hyundai also owns a 34% stake in Kia Motors.

Page | 1
Hyundai Motor America earns 217,275 million (USD) revenue, 12,949 million (USD) net profit
and have 262,463 employees.

(Sambitionbox.com)

Hyundai Motors Company recognizes the importance and impact that automobiles have on
society and mankind. It strives to play a role that extends beyond being a simple car
manufacturer to become customers’ lifetime companion. They believe in “Together for a better
future”. The age of smart cars is approaching fast as automobiles are increasingly making full
use of electronic technology developments. There are already cars out there which can drive
themselves, automatically adjust speed and maneuver into the hard shoulder in emergency
situations. The product has many exclusive features like, Smart traffic jam assist, Interactive
voice recognition, Night view, Highway driving assist, Driver state monitoring, remote parking
assist system, Smart blind spot detection, augmented reality, Motion recognition. Currently
includes mass production technology under consideration. Hyundai offers benefits that are
competitive and focused on the wellbeing of their employees and designed to promote a
healthy life/work balance and more. (hyundaiusa.com)

Page | 2
 2. Mission Statement
To create exceptional value for our customers by blending safety, quality and efficiency. Our
diverse team is committed to provide responsible stewardship to our community and
environment while achieving stability and security for our valued customers and for our future
generation. (hmmausa.com)

Page | 3
 3. Organogram of Hyundai

CEO

Vice Vice Vice Vice Vice Vice

President President President President President President
Finance HR IT legal dept marketing production

Chief HR IT
Manager Legal
Accountant manager Seles Plant
Manager Manager manager

Assistent
Manager Technician Assistent Advertising
Junior Manager Supervisor
Accountant Manager

Page | 4
 4. Hyundai motors USA salary chart
Position in company Name Salary (per year)

Senior Group Manager, Simon Cho $141k - $155k

Digital Customer Experience.

Senior Group Manager, Trea Reedy $141k - $155k

Experiential.

Senior Group Manager, John Cook $141k - $155k

Market Representation.

Senior manager, Certified Jose Froehlich $106k - $113k

Pre-Owned

Chief Marketing Officer and Dean L. Evans $124k - $133k

Vice President

General Manager Product Erwin Raphael $95k - $104k

Quality and Service
Engineering

Senior Manager, Auto Shows Erik Thomas $115k - $138k

& Events

(Linkedin.com)

Page | 5
 5. Situational Analysis
Situational Analysis is a systemic collection of past and present economic, social, political and
technological data aimed at identification of internal and external forces that may influence the
organization’s performance and choice of strategies, and assessment of the organization’s current
and future strengths, weaknesses, opportunities and threads. Being based on both the internal and
external environment, the situational analysis tells what are the organization’s and product’s
position and the options that should be developed further. The purpose of the situation analysis is
to indicate to a company about the organizational and product position, as well as the
overall survival of the business, within the environment. Companies must be able to summarize
opportunities and problems within the environment so they can understand their capabilities
within the market (businessdictionary.com)

Situational analysis works with two factors- External Factor & Internal Factor

Situational analysis

External Internal

Management
Competitors
Political R&D
Financial
HR
Technology
Economic
Logistics Marketing
Customers

Page | 6
5.1 External Factor: In business, the circumstances or situations outside the business
that a business can’t control are the External Factors. These factors impact each business and
industry differently, which only increases the importance of managers understanding
these external forces. These factors include social, political, technological, environmental, legal
and economic issues. Social factors, such as fashion, trends and demographics, determine the
demand of certain goods and also affect consumers' decisions. Decisions made by legal bodies in
a country lead to changes in business law and even changes in the society. Economic issues, such
as government spending, taxation, interest rates, exchange rates and other global factors affect
the business's financial and legal standing. Advancement in technology brings changes in
production processes, which affect corporate productivity and efficiency. Political factors, such
as changes in government policies, affect businesses too. (reference.com)

Some external factors are given below-

5.1.1 Competitors: In business, a company in the same industry or a similar industry which
offers a similar product or service is called a competitor. Competitor is one of the most important
external factors. The presence of one or more competitors can reduce the prices of goods and
services as the companies attempt to gain a larger market share. Competition also requires
companies to become more efficient in order to reduce costs. Competitors are one kind of threat
for business. Buyers choose among the competitors whose products they like most. If any
company fails to satisfy its customers, the business is sure to lose profit. The main competitors of
Hyundai are Nissan, Toyota, Honda, Maruti, Ford etc. (businessdictionary.com)

5.1.2 Technology: Advancement in technology has had a dramatic impact on the business
world over the last two centuries. For a motor company like Hyundai, technology is a very big
factor. Proper use of technology makes quality motors and machines. Hyundai is working to use

Page | 7
all latest technologies in their products. Use of latest technology would make the products unique
and the customers would get attracted. It is likely to increase the profit margin of Hyundai. The
management of the company is continuously involved in using world class technology in order to
achieve technological advancement. The use of most modern technologies causes an increase in
customer service effectiveness. (ukessays.com)

5.1.3 Economic Factor: Another important external factor is the economic factor. By
capturing environmental opportunities, Hyundai is operating with a rapid economic growth in the
business. Increase in the production capacity in the nations with lower wage rate is reducing overall cost
of the business. The economic environment consists of external factors in a business' market and
the broader economy that can influence a business. You can divide the economic environment
into the microeconomic environment, which affects business decision making - such as
individual actions of firms and consumers - and the macroeconomic environment, which affects
an entire economy and all of its participants. The economic environment of a business will play a
pivotal role in determining the success or failure of a business. (study.com)

5.1.4 Political Factor: Good relationship between countries and their Governments indicates
a good sign of business for Hyundai as it operates its business in various countries. It would
generate business expansion opportunity for Hyundai. In order to ensure the proper compliance
of the business activities with the applicable legislation, the corporation works on certain
guidelines for the different business operation in different countries. It is essential as every
country has different rules and business regulations. The stability of a political system can affect
the appeal of a particular local market. Governments view business organizations as a critical
vehicle for social reform. The government is liable for protecting the public interest. Government
actions influence the economic environment too. (ukessays.com)

Page | 8
5.1.5 Customers: Customers are the external elements that can be attempted to influence via
marketing and strategic release of corporate information. But ultimately the relationship with the
clients is based on finding ways to influence them to purchase products. Market research is used
to determine the effectiveness to marketing messages, and to decide what changes can be made
to future marketing programs to improve sales. Their need and demand would decide how the
company’s going to conduct its business. Companies need to make their products according to
the customers’ income, ability, choice, preference, needs and others. Hyundai always gives
preference its customers’ choice. (smallbusiness.chron.com)

5.2 Internal Factors: Internal factors are those issues that affect the business's
performance either negatively or positively and originate from within the business. These factors
may increase profitability or cause loss depending on how they are handled. The internal
conditions are many and varied depending on the organization. Management has some
strategic control over how these various internal conditions interact. Internal factors can strongly
affect how well a company meets its objectives, and they might be seen as strengths if they have
a favorable impact on a business, but as weaknesses if they have a deleterious effect on the
business. It’s needed for making good strategic decisions. (reference.com)

5.2.1 Levels of Management: The term level of management refers to a line of

differentiation among various managerial positions. The levels may increase as and when the
size of the business increases. There are mainly three levels of management in most of the
organization. They are

1. Strategic or Top level management

2. Technical or Middle level management
3. Operational or Lower level management

Page | 9
Strategic Level Management: Top level or strategic level of management consists of the board
of directors, general manager and other senior executives. They fix the objectives of the
organization. They fix the objectives of the organization. Preparation of premeditated plans and
policies are done at this level. It is the supreme source of power since it manages the policies and
procedures of an entity. Every organization runs by the managers in that organization, who are
taking opinion in the all step of organizational activities.

Technical Level Management: Middle level or technical level of management consists of head
of financial departments. They are responsible to top management. They are concerned with
organization and direction function of management. Interpretation of the programs and policies
communicate by the top level management, organizing and manning their departments as per the
main plan, plan the departmental operations, guide direct and motivate their workers to attain the
objective, co-operate and co-ordinate with other departments, evaluate the performance of his
subordinates, collect reports and statics from the lower and send in to top level management.

Operational Level Management: Lower level or operational level of management consists of

supervisors, superintendent, foreman, sub-department executives; clerk, etc. Managers of this
group actually carry on the work or perform the activities according to the plans of top and
middle level management. Their authority is limited. The quality and quantity of output depends
upon the efficiency of this level of managers. They pass on the instruction to workers and report
to the middle level management. They are also responsible for maintaining discipline among the
workers. (ukessays.co.uk)

5.2.2 Research and Development: To place Hyundai at the forefront of global motoring
technologies, Hyundai Motor Company has an established network of global research and

Page | 10
development centers. These centers reinforce and advance Hyundai’s styling, study, engineering,
testing and manufacturing potential and capabilities. The design and engineering of Hyundai
vehicles includes many obvious and not so obvious inclusions combining to produce some of the
world’s safest vehicles. Ranging from large components such as chassis design through to
minute details such as a seat belt chime, all aspects combine to maximize total safety for
occupants in Hyundai vehicles. Too numerous to comprehensively mention, some key safety
technologies can be summarized in terms of Active Safety and Passive Safety.

(hyundaipng.com)

5.2.3 Financial Statement: The business strategies of Hyundai are to increase the
opportunities through the environmental factors is effective as it is causing an increase in the
number of sales units continuously. But in the last year the economic factors have affected the
sales of the business as total number of units sold were 1668745 in the year 2008, which is less
in comparison of the year 2007 in which it was 1700297 units (Hyundai Motor Company, 2010).
The decrease in the sales was domestically due to fluctuation in the current rate as well as in
commodity rate. (ukessays.com)

5.2.4 Human Resource Management: Human resources are increasingly becoming an

important way of attaining sustainable competitive advantage. Hyundai has about 120,000
employees including staff and managers. Large number of organization is used strategies to
overcome the competition from the competitors. Hyundai consider their employees as human
capital. Training and development is the next main policy has regulatory impact on human
resource of Hyundai Motor. This covers not only activities which improve job performance and
also growth of personality. It helps in the process of individual towards maturity and
actualization of the potential capacities so that they become not only good employees but also
good human being. (uniassignment.com)

Page | 11
5.2.5 Inbound Logistics: Inbound logistics refers to the transport, storage and delivery of
goods coming into a business. It means deriving inputs for operational process. Here Hyundai
received goods from their suppliers. They will store the goods until they are needed on the
production line, and the goods will move around the organizations. The raw material of Hyundai
motors is purchase from all around the world. Company’s goal is to maximize their availability
of raw material, and maintain good relationship with their suppliers. Hyundai use JIT (Just in
Time) approach for handling of raw material.(boundless.com)

5.2.6 Marketing and Sales: Hyundai Motor Group supports diverse sports events and
teams ranging from soccer, baseball and tennis to cricket, ski jumping and motor sports, as a
means to communicate with people around the world. On the other hand, they want to make
more people to know about their company. In true customer oriented fashion, at this stage the
Hyundai motors prepares the offering to meet the needs of targeted customers. They also
promote their products through Road Shows. This area focuses strongly upon marketing
communications and the promotions mix. (uniassignment.com)

6. SWOT Analysis

Page | 12
SWOT analysis is a process that identifies the strengths, weaknesses, opportunities and threats of
an organization. Specifically, SWOT is a basic, analytical framework that assesses what an
organization can and cannot do, as well as its potential opportunities and threats. A SWOT
analysis takes information from an environmental analysis and separates it into internal strengths
and weaknesses, as well as its external opportunities and threats. SWOT analysis of Hyundai in
discussed below. (investopedia.com, shell-livewire.org)

6.1 Strength

Page | 13
Strengths are those features of a business which allow you to operate more effectively than your
competitors. For example: a strength could be your specialist technical knowledge. You need to
consider your strengths from your own point of view and from that of your customers’ and
client’s. You must be realistic and honest. (shell-livewire.org)

1. Safety-Hyundai is considered to be one of the safest car brands in the world. The company has
made significant improvements to the cars safety features and has been awarded many safety
awards.

In addition to Hyundai’s efforts to improve its cars’ safety features, the company also stepped up
in its design efforts. In 2015, Hyundai’s Sonata, Genesis, Elantra, i20 and Tucson models have
been acknowledged as the best in design, earning Red Dot Design, Good Design and Product
Design Awards. In total, the company has earned more than 20 design awards over the last 6
years. (Source: hyundai.com)

2. Market position -According to Interbrand, Hyundai’s brand is the 7th highest rated
automotive brand in the world, behind Toyota, BMW, Mercedes-Benz, Honda, Volkswagen and
Ford. The company has evaluated the brand at US$11.3 billion just behind Ford’s brand.
(Interbrand 2016)

3. Product innovation -Hyundai has spent KRW￦ 2.712 trillion or USD$1.847 billion on R&D
in 2015. While it’s far from the largest amount spent on R&D in the industry, the money is spent
very effectively by Hyundai. The company has been able to introduce a few models (Ioniq and
Sonata) that are capable of running on electricity only. Sonata’s plug-in hybrid engine has been
awarded as one of the top 10 in 2015 and is actually capable of running on only electricity farther
than Toyota’s Prius.Yet, the major company’s achievement is in hydrogen fuel cells technology.
Hyundai is the first company to mass produce its Tucson vehicles running only on fuel cells. The

Page | 14
company is also planning to introduce a new generation fuel cell car in 2018, which brings the
company ahead of competition in the field. (greencarreports.com)

4. Fuel efficiency -Hyundai cars are well-made. The company provides 5 year guarantee for any
new car sold, which is one of the longest and best covered guarantees in the industry. The
company is able to offer such guarantee because Hyundai produces quality cars.

Hyundai’s cars have been awarded by numerous rewards as ‘the best cars money can buy’ and
‘the best residual value’ cars. This means that Hyundai vehicles do not depreciate as much in
value as other cars and can be resold for the higher prices. (Hyundai.com)

6.2 Weakness

Weaknesses are areas capable of improvement. Are you lacking skills or new products? Do you
have a higher cost base or lower productivity than your competitors? You must face any
unpleasant truths about your business and be realistic.

1. Poor Brand portfolio -Poor brand portfolio, leading to fewer sales. Hyundai is among the
top 5 largest auto manufacturers, but has one of the poorest brand portfolios. The company sells
only Hyundai and Kia brands, while Volkswagen sells 12 different brands, General Motors 9,
Chrysler 8, Toyota 4 different brands. Only Ford sells the same 2 different brands as Hyundai.
Fewer brands lead to fewer customer segments that can be satisfied and as a result, the
company’s earnings suffer. (Hyundai motor China.com)

2. Low presence in U.S-The U.S. market is the leading vehicle market in the world with 21.5
million units sold in 2015 alone. The market has plenty of opportunities for such high profit
vehicles as pickup trucks, electric and fuel cell vehicles. Yet, Hyundai wasn’t even among the
top 5 car manufacturers and sold less than 10% of the market units.

Page | 15
Hyundai also has no presence in the Japanese vehicle market, after the company pulled out of it
in 2009. This is a major weakness as Japanese vehicle market is among the top 10 vehicle
markets in the world. (Hyundai's Financial Information.com)

3. Management-Hyundai’s revenue has been increasing over the last 3 years, yet at the same
time; company’s profit has significantly declined, highlighting poor management of the
company’s operations. The decline of the company’s profit margin has resulted because of the
inefficient company’s management and poor top management’s decisions.

4. Shortage of spare parts -Low availability of spare parts due to unavailability of authorized
dealers and distributors. Spare parts of Hyundai vehicle are comparatively priced higher. It is
hard to find the parts at every place. It’s hard to find spare parts of Hyundai at every shop.

6.3 Opportunities

Opportunities provide an organization with a means to improve its performance and competitive
advantage in a market environment. Some opportunities can be foreseen, such as being able to
expand a franchise into a new city, while some may fall into your lap, such as another country
opening up its market to foreign business. (investopedia.com)

1.Raising U.S. economy -Signs of an improving economy and rising consumer confidence have
been reflected in the strongest increase in new vehicle sales for more than a decade in the U.S.
market. 17.5 million new units were sold in 2015, a 5.7% increase over 2014. Interest rates in the
U.S. have been low for several years and are forecast to remain that way for the foreseeable
future. Hyundai has an opportunity to capture the higher market share and increase sales in such
economic conditions. (Hyundai's Financial Information)

Page | 16
2. Future innovation-The market share of automotive companies is significantly impacted by
the timing and frequency of new model releases. Historically, the new models have tended to
have major upgrades every 4 or 5 years, with only minor modifications in between. However,
due to rising consumer expectations in relation to in-car technology and the competitive nature of
the industry, there is an argument to release the upgraded models more frequently. Hyundai is
well-positioned to be able to do this, with its current focus on R&D. The key will be its ability to
cost effectively implement technology initiatives in order to maximize a competitive advantage.
(strategicmanagementinsight.com)

3.Decline in fuel cost- Currently, fuel prices are the lowest in a decade. This situation has
encouraged consumers to buy big fuel-inefficient vehicles such as SUVs and pickup trucks.
Hyundai, which relies mainly on the line of sedan cars, is at disadvantage in low fuel situation.
The company has its own SUVs, which are smaller than traditional SUVs and has no pickup
truck lines, which currently drive the automotive companies’ growth in the U.S. The trend of low
fuel prices is likely to stay and Hyundai could introduce wider range of SUVs or even consider
introducing a line of pickup trucks. (strategicmanagementinsight.com).

4.Hybrid cars-The fuel prices are increasing therefore; it’s the right time for Hyundai to start
focusing on manufacturing Hybrid cars. Hybrid vehicle uses two or more distinct types of power,
such as internal combustion engine and electric motor. The presence of the electric powertrain is
intended to achieve either better fuel economy than a conventional vehicle or better performance.
As the hybrid cars saves gasoline it will be wise decision to manufacture hybrid cars for Hyundai
motors. (strategicmanagementinsight.com)

Page | 17
6.4 Threats

Threats are anything from your organization's outside environment that can adversely affect its
performance or achievement of its goals. Ironically, stronger organizations can be exposed to a
greater level of threats than weaker organizations, because success breeds envy and competition
to take what your organization has achieved.

Examples of external threats include new and existing regulations, new and existing competitors,
new technologies that may make your products or services obsolete, unstable political and legal
systems in foreign markets and economic downturns. Sometimes you can turn a threat into an
opportunity, such as a new technology that may displace one of your key products but also
provides an opportunity for new product development. (investopedia.com)

1. Competition-Hyundai is faced with an ever increased competition from the traditional

automotive companies and the new players. In China, the main company’s market, new home
based Chinese manufacturers are competing by offering lower prices and similar features.
Hyundai’s international rivals, such as Toyota, Ford, General Motors and Volkswagen, all have
aggressively expanded in China, the U.S. and Europe’s markets.

New companies, such as Tesla with its electric cars, or even Google, which tries to build self-
driving cars are also threatening the traditional automotive industry. The competition is further
fueled by the fact that the global automotive production capacity far exceeds the demand. In
2015, there was an estimated global excess production capacity of 31 million units.

2. Exchange rates -More than 50% of Hyundai’s revenue come from international markets,
which means that the company’s profits and revenue highly depend on the exchange rates.
Currency exchange rates are often volatile and depend on many factors, which Hyundai cannot
control. Korean Won exchange rate has been increasing against other currencies in 2016 and

Page | 18
may increase significantly over the next few years. This scenario would result in lower revenue
and profits for Hyundai. (strategicmanagementinsight.com)

3. Inflation-Many governments around the world are committed to reducing the greenhouse gas
emissions and are encouraging fuel efficiency initiatives. There is always a risk that such
environmental initiatives may increase production costs for the car manufacturers and that these
costs won’t be able to be recouped in such a highly competitive and price-sensitive market.
(strategicmanagementinsight.com)

4. Improvement in public transport - Betterment in public transport infrastructure could

decline the company sales. Public transport facility affects the sales of automobile company. As
in every country public transportation is getting better day by day and the cost is also lower the
using car, people of lower salary scale and middle salary scale prefer using public transportation.
So improvement in public transport infrastructure can be a threat for Hyundai motors.
(strategicmanagementinsight.com)

Page | 19
 7. Objectives
Objectives are more specific and easer to measure than goals. Objectives are basic tools that
underline all planning and strategic activities. Some objectives of Hyundai are –

Objective 1:
Increase market share in South Asia by 10% within 2017.

Strategy:
They should on the developing part of the world, since they have already good market share in
the developed part of the world. For this reason, they should launch a new bunch of
comparatively low priced products so that the people of the developing country can afford to buy
these products. This strategy is not new for them, as they have already launched “EXCEL” for
the lower section of the people. Now they have to launch it in the developing pat of the world
like South Asia.

Sixteen years after entering India, the South Korean automotive giant is revamping its strategy in
order to become the leader in the compact car segment in South Asia.

To increase market share, Hyundai needs to switch from exports to the domestic market. Exports
were necessary for Hyundai to generate scale and benchmark the quality of its product but with
the demand from the domestic market increasing, the company has stopped export to several
European markets. With a fresh tag line, “New thinking new possibilities”, the car maker’s new
strategy will also include more localized products that are easy to drive and are comfortable.
Hyundai automotive plans to launch at least three new products or refurbishments every year to
take sales to 4.10 lakh units from 3.8 lakh at present.

To keep sales ticking Hyundai is betting on its new concept of “Fluidic design”. The guiding
principle of its design philosophy is to make its car more refined, sophisticated and sporty by
taking cues from its global brands. The Elite i20, with its modern appeal and premium interiors,

Page | 20
is based on the fluidic concept. At the core of the philosophy is simple, harmonious designing
that is easy on the eye and is aesthetically pleasing.

Objective 2:
Sell over 10 million vehicles in USA within 2017.

Strategy:
From our research we have found that to increase the sale Hyundai can go for some strategies
like incentives and rebate policy that might attract lots of customers. If Hyundai offers some
attractive policies like these, people will naturally be attracted to buy their automobiles. Another
example could be sales on credit. The company might have some bad debt at the end of the year
but initially it will help them to grab the market share and eventually it will boost up the revenue
as well. In order to increase the sell, they might also come up with assurance program allowing
customers to return a car if they lost a job. Besides, quality has always been the Achilles heel of
Hyundai in USA. So, they need to invest in the new models and quality programs. Hyundai can
upgrade quality with a daily focus on improvement through new process at its manufacturing
plants and from better design and engineering.

Hyundai can offer a 10 year 1,00,000-mile warranty as well which will also stimulate the sales to
great extent.

Objective 3:
To beat the major competitors in India by offering quality product which will give 5 percent
return on investment this year.

Page | 21
Strategy:
If Hyundai wants to grab the market in the highly competitive automobile industry, then it will
have to compete with brands like Honda, Toyota, Nissan motors, Mitsubishi, Tata motors. Let's
assume its main competitor is Toyota. Toyota offers cars with attractive outlook but it doesn’t
work on the durability of the product as much as Hyundai does. Because of this, Toyota can offer
car with very low price compare to Hyundai. Hence, price is the main issue here. Therefore, if
Hyundai wants to grab the majority market share in automobile industry, it must work on the
quality and price of automobiles.

However, the overall objective of getting an advantage over the other automobile companies in
Indian market, Hyundai has offered the following value propositions better than its competitors.

 Quality
 Technology and innovation
 Design
 Safety
 Features
 Social Responsibility
 After sale service

Objective 4:
Another objective of Hyundai automobile is to increase innovation to adapt with the varying
customer demand within next 2 years.

Strategy:
For attaining the objectives of innovation, it should invest more in research and development. In
addition, Hyundai should energize the existing innovative culture and motivate its employees
toward innovation. They need to create something that goes beyond performance, design, service
price to deliver unprecedented levels of satisfaction.

Page | 22
In order to bring innovation in its automobile, Hyundai introduced:

 Electric all-wheel drive system

 Ideal front and rear weight distribution in the chassis
 Active noise control
 Active sound design
 Stability controls, ABS, ESP and Traction control
 Better performance, higher efficiency and lower CO2 emissions
 7-speed Automatic transmission with rear drive
 8-speed Double clutch transmissions
Hyundai automobile company has also been reshaping into global green company and making a
commitment to environment management.

Objective 5:
Continue being the global automobile hub in the upcoming years.

Strategy:
The management of this organization should continue the previously owned goals of becoming
the global automotive production hub. This objective has been taken as long future projection
which needs to be continued until the achievement and support with highly qualified human
resource and a large budget.

From our research we have found that to achieve this objective, the management of Hyundai
automobile should focus on following possibilities:

 Attractive domestic market & proximity to other markets,

 Political and business environment, technological capabilities in a particular vehicle
class,
 low production and effective supply chain

Page | 23
 8. Management issue
In an organization management issue includes organizational structure, if it is centralized or
decentralized or virtual organization. How they divide the departments and how the departments
work and the responsibility of the departments. Also include which leadership theory the
organization follow. Management issues of Hyundai are written below.

8.1 Organizational structurer

Hyundai is the fourth largest vehicle manufacturer in the world. Headquartered in Seoul, South
Korea, Hyundai is South Korea’s largest automaker. Hyundai is a decentralized organization as
there are so many departments and every department has a department head Hyundai’s corporate
governance structure includes a nine-member board of directors. Including four internal directors
and five external directors, an audit committee, an ethics committee and a committee to
recommend external director candidates. (worldwidehyundai.com)

8.2 Department
Hyundai Motor Co. is one of the largest manufacturers of passenger cars and sport utility
vehicles in the world. Headquartered in Seoul, South Korea, Hyundai is South Korea’s largest
automaker. For maintaining this large company with a large section of products Hyundai is
divided into several Department with one Department Head for each. They have divided their
department into two parts, admiration department and production department. The departments
of Hyundai are given below with the department heads and roles in details.

(karierahyundai.com)

Page | 24
 Administration department

Department Head of Roles and Responsibilities

department
Human resources Jiří Havlín,  Recruitment of necessary talents on
HR General Manager time.
 Selection and hiring of competent
employees.
 Maintaining market competitive
salary level.
 Training and education of employees
to adapt themselves to the corporate
culture and to improve their
productivity.
Employee Relations Ctirad Václavínek,  Support of good employee and labor
General manager. relations.
 Comprehensive employee care,
handling issues and complaints.
 Discussions and negotiations with
trade unions.
General Affairs Hyunyong Cha  Company car fleet management.
General Manager  Planning and management of
corporate events and activities.
 Management of company security
and employee controls
 Management of accommodation
facilities and company real estates

Legal department Petr Michník  Proposal, revision and support in

Manager of Legal contract negotiations.

Page | 25
 Dept.  Litigations.
 Preparation of legal analysis.
 Monitoring of legislation, education
of employees.
 Communication with government
authorities and non-governmental
organizations.
Public Relations Petr Vaněk  External communication with media
General Manager and public.
 Preparation of printed materials and
advertisements.
 Sponsorship, media and marketing
partnerships.
 Administration of company website
and social media profiles.
Financial Accounting Baekjung Jeong,  Bookkeeping and on time books
Business closing.
Development  Planning of complete cash-flow.
Manager.  Management of company tax
portfolio
Purchasing Tomáš Poláček  Raw material procurement and sub-
Business materials.
Development  Customs clearance, transportation
Manager and customs regimes.
Information Young Wook Kim  System administration - installation,
Technology Manager operation and maintenance of HW
and SW.
 Specific systems for production,
materials, finance, controlling,
human resources, etc.
 Support of production activities,
maintenance and monitoring

Page | 26
 Production department

Department Head of Roles and Responsibilities

department
Stamping Jail Gu  Production and quality in
Manager accordance with labor standards.
 Stock and material flow
management.
 Analysis of production process and
machinery failures.
 Preparation and repair of stamping
tools.
Welding Oldřich Fabián  Production of the body on running
General Manager machine line.
 Production status analysis and daily
production report.
 Handling production defects and
process improvement.
 Reduction of production costs.
Paint Jan Kubatý  Compliance to production plan
General manger  Improvement of quality and defect
handling in paint shop
 Maintenance of production line
 Preparation of processes,
procedures and vehicle production
equipment
Assembly Miroslav Jasiok  Planning and preparation of vehicle
General Manager production

Page | 27
  Installation of production
equipment and inspections
 Inspections during series
production
 Training and education of assembly
team members
Transmission Miloš Bronček  Planning and preparation of
General manager transmission series production
 Installation of production
equipment and inspection
 Inspections during series
production
 Assembly of series production
transmissions
Production Control Pavel Šmída  Establishment of production control
Production manager system with ERP or SCM
 Management of weekly and daily
production planning
 Establishment and management of
specification system
 inspection of all logistics processes
 Inspection of production line and
transmission assembly
Quality Control Martin Kličník  Quality control of incoming parts
Manager  Laboratory tests of incoming
materials
 Static inspection of quality of
assembled vehicle
 Testing and evaluation of
transmission operation
Maintenance Jung Jaehoon  Maintenance and Extension of
Manager Equipment Lifetime
 Performance of specialized

Page | 28
 inspections of production
equipment

8.3 Leadership
Hyundai is a very well-known company for its leadership strategy, even most of the companies
of world want to follow the leadership strategy of this company. The Hyundai Motor Group, is a
large business conglomerate, often known as a Chaebol in South Korea. Chaebols in South
Korea are extremely powerful organizations that exert strong influence, dominate the economy
and are usually controlled by founding families. (worldwidehyundai.com). Some suggested that a
leader is born, some suggested a leader is made from situation but we believe that the leaders of
Hyundai are not only by born but also made from situation.

The Trait Theory: The trait leadership theory believes that people are either born or are
made with certain qualities that will make them excel in leadership roles. The search for the
characteristics or traits of effective leaders has been central to the study of leadership. leadership
capabilities are rooted in characteristics possessed by individuals. Research in the field of trait
theory has shown significant positive relationships between effective leadership and personality
traits such as intelligence, extroversion, conscientiousness, self-efficacy, and openness to
experience. These findings also show that individuals emerge as leaders across a variety of
situations and tasks. Trait theories help us identify traits and qualities, for example, integrity,
empathy, assertiveness, good decision-making skills, and likability, that are helpful when leading
others. The trait theory of leadership focused on analyzing mental, physical and social
characteristic in order to gain more understanding of what is the characteristic or the combination

Page | 29
of characteristics that are common among leader. In Hyundai company we can see the leaders are
using trait theory for good decision making and leading the company. (boundless.com)

The Contingency Theory: The Contingency Leadership theory argues that there is no
single way of leading and that every leadership style should be based on certain situations.
According to this approach, called contingency theory, no single psychological profile or set of
enduring traits links directly to effective leadership. Instead, the interaction between those
individual traits and the prevailing conditions is what creates effective leadership. In other
words, contingency theory proposes that effective leadership is dependent on factors independent
of an individual leader. As such, the theory predicts that effective leaders are those whose
personal traits match the needs of the situation in which they find themselves. Contingency
model of leadership focuses on the interaction of leadership style and the situation. Identified
three relevant aspects of the situation: the quality of the leader's relationships with others, how
well structured their tasks were, and the leader's amount of formal authority. These theories that
leader are more likely to express their leadership when they feel that their followers will be
responsive. Hyundai company do not use a single way to lead the company. (boundless.com)

The Behavioral Theory: Behavioral theories focus on how leaders behave. In response to
the early criticisms of the trait approach, theorists began to research leadership as a set of
behaviors. They evaluated what successful leaders did, developed a taxonomy of actions, and
identified broad patterns that indicated different leadership styles. Behavioral theory also
incorporates theory of behavior modification, which takes into account the effect of reward and
punishment on changing behavior. An example of this theory in action is a manager or leader
who motivates desired behavior by scolding employees who arrive late to meetings and showing
appreciation when they are early or on time. Autocratic leaders make decisions without
consulting their teams. This style of leadership is considered appropriate when decisions need to

Page | 30
be made quickly. Democratic leaders allow the team to provide input before making a decision,
although the degree of input can vary from leader to leader. Laissez-faire leaders don't interfere;
they allow people within the team to make many of the decisions. This works well when the
team is highly capable, is motivated, and doesn't need close supervision. The leaders of Hyundai
also follow the behavioral theory when needed, sometimes they have to make a quick decision,
sometimes they make decision after consulting their team members. (boundless.com)

9. Conclusion
Challenge can emanate from external stimuli or internal endeavor. Either way, it is an
opportunity for the organization to improve. Before jumping into execution, it is imperative that
a proper Root Cause Analysis (RCA) be conducted. There are umpteen number of approaches
available for RCA. Use whichever works best for you. The goal is to make sure your execution is
focused on the real problem. With vehicle industry being very competitive, Hyundai faces stiff
competition from well-established vehicle manufacturers in different markets. Hyundai sells
several models in India, the most popular being the Santro Xing, i10, Hyundai EON and the i20.
On 3 September 2013, Hyundai launched its much-awaited car, Grand i10 in petrol and diesel
variants. Other models include the Getz, Accent, Elantra, second generation Verna, Santa Fe and
the Sonata Transform. Currently Hyundai Motor has six overseas plants on U.S., India, China,
Turkey, the Czech Republic and Russia. The company will add seventh plant by 2012, in Brazil.
Hyundai Motor today has a combined global production capacity of about 3.91 million units a
year. The company has been able to draw the attention of many customers from well-established
industry players, and even penetrate the luxury segment of the auto industry.  The global
operations of the company have also been successful even with the adverse effects of the global
financial crisis that drove many automobile manufacturers in the United States and Europe into
bankruptcy and bailout. The best thing about Hyundai Motor America is the family discount they
offer which is a substantial amount. In a very short period of time Hyundai has earned itself a
reputation as one of the cleanest automotive brands in Europe

Page | 31
 10. Recommendation
Hyundai Motor Group ought to capitalize on its internal strengths, which include its strong
financial position, diversified operations, and its leadership role in producing fuel-efficient cars
so as to combat problems concerned with quality of its vehicles that have resulted in frequent
recalls. The company also needs to enhance its quality checks to avoid the quality problems that
have a high potential to adversely affect its brand image. In addition, there is need for the
company to enhance its efforts in the luxury segment to appeal to consumers and convince them
that indeed Hyundai is a high quality brand. Generally, the future of Hyundai in the U.S. market
appears bright.

Page | 32
 11. Bibliography
1. Boundless.com (2016) Theories of effective leadership [online] Available at:
https://www.boundless.com/management/textbooks/boundless-management-textbook/leadership-
9/defining-leadership-68/four-theories-of-leadership-344-7580/ [Accessed: 5 December 2016]

2. Business dictionary (2016) situation-analysis [online] Available at:

http://www.businessdictionary.com/definition/situation-analysis.html [Accessed: 5 December
2016]

3. Edelstein, S. (2016). Next-generation Hyundai hydrogen fuel cells. [online] Available at:
http://www.greencarreports.com/news/1105321_next-generation-hyundai-hydrogen-fuel-cells-
due-in-2018 [Accessed: 5 December 2016]

4. Ford SWOT analysis (2016). [online] Available at:

https://www.strategicmanagementinsight.com/swot-analyses/ford-swot-analysis.html [Accessed:
5 December 2016]

6. Hyundai's Financial Information. (2015) Available at:

http://worldwide.hyundai.com/WW/Corporate/InvestorRelations/FinancialInformation/Financial
Highlights/Annual/index.html [Accessed: 5 December 2016]

Page | 33
7. Hyundai (2016) organization structure [online] Available at: http://www.kariera-
hyundai.cz/en/organization-structure/ [Accessed: 5 December 2016]

8. HyundaiUSA (2016) Hyundai history [online] Available at: http://www.hmmausa.com/our-

company/hyundai-history/ [Accessed: 5 December 2016]

9. Interbrand (2016). Best Global Brands 2015. Available at: http://interbrand.com/best-

brands/best-global-brands/2015/ranking/.html [Accessed: 5 December 2016]

10. Jin, H. (2016). Exclusive: Hyundai to make low-cost SUVs to battle Chinese rivals. [online]
Available at: http://www.reuters.com/article/us-hyundai-motor-china-exclusive-
idUSKCN0Y22RP [Accessed: 5 December 2016]

11. Linkedin.com (2016) Hyundai Motor Company [online] Available at:

https://www.linkedin.com/company/hyundai-motor-company [Accessed: 5 December 2016]

12. M.hyundaiusa.com. (2016). 10 Million Vehicles Sold in the US | Hyundai News. [online]
Available at: https://m.hyundaiusa.com/about-hyundai/news/10-million-vehicles-sold/index.html
[Accessed: 5 December 2016]

13. Narasimhan, T. (2016). ‘Hyundai Market Share in India[online]’ Available at:

https://www.google.com.bd/amp/wap.business-standard.com/article-amp/companies/after-years-
of-steady-growth-hyundai-shifts-gears-in-india-114111701654_1.html [Accessed: 5 December
2016]

14. UKessay.com (2015) Case Study of Hyundai Motor Company [online] Available at:
https://www.ukessays.com/essays/business/case-study-of-hyundai-motor-company-business-
essay.php [Accessed: 5 December 2016]

15. UniAssignment.com (2016) Introduction of Hyundai Motor Company [online] Available at:
http://www.uniassignment.com/essay-samples/marketing/introduction-of-hyundai-motor-
company-marketing-essay.php [Accessed: 5 December 2016]

Page | 34
16. Wikipedia.com (2016) Hyundai [online] Available at: https://en.wikipedia.org/wiki/Hyundai
[Accessed: 5 December 2016]

17. Wikipedia.com (2016) Hyundai Motor Company [online] Available at:

https://en.wikipedia.org/wiki/Hyundai_Motor_Company [Accessed: 5 December 2016]

18. Worldwide.hyundai.com. (2016). Technology | Hyundai Worldwide. [online] Available at:

http://worldwide.hyundai.com/WW/Innovation/Technology/index.html [Accessed: 5 December
2016]

12. Appendix
Income statement

Income Statement 2015 2014 2013

Revenue $78,210.905 $81,205.399 $82,112.832
Revenue Growth 3.4% 2.2% 3.03%
Gross Profit $15,527.953 $17,404.513 $18,290.98
Operating Income $5,407.399 $6,868.977 $7,820.725
Net Income $5,457.916 $6,684.125 $8,033.595
Diluted EPS $20.29 $24.6 $29.57

Board of Directors

Classification Title Name

Internal Director Chairman Mong Koo Chung
Vice Chairman Eui Sun Chung
President Won Hee Lee

Page | 35
 President Gap Han Yoon

Outside Director Director Sung Il Nam

Director Se Bin Oh
Director You Jae Yi
Director Dong Kyu Lee
Director Byung Kook Lee

Page | 36