Feb 22, 2010
The Japanese Management Theory Jungle (Keys, J.B. and Miller, T.R., 1984)
Keys, J.B. and Miller, T.R. (1984). The Japanese Management Theory Jungle.
“The present review of some of the leading theories attempts to classify and clarify the state of knowledge of Japanese management.”
> The Jungle of Theories
* Manufacturing Management
Japanese success is related to manufacturing management (cleanliness, responsibly employees, JIT, absence of work stoppages) – an eternal quest for perfection. Technological advantages stem from in-house production of equipment and training of highly skilled employees (Hayes, 1981).
Further, Japanese integrate operations and strategy (as opposed to the ‘trade-off’ approach in the U.S.) (Wheelwright, 1981). In can, however, be argued that the above features are the result rather than the cause of superior manufacturing efficiency.
* Quality Circle
“…a relatively small group of employees who meet together to discuss and develop solutions for work problems relating to quality, productivity, or cost.”
Japanese adapted the ideas of humanistic behavioural scientists for use in their own organizations as quality circles. This participatory style management has led to improved productivity (through increased motivation, commitment, job satisfaction, and sharing of decision making). Whether their use is applicable in an American setting is, however, still open to debate.
* Statistical Quality Control
From the 1950′s the Japanese devoted themselves to making ‘made in Japan’ synonymous with high quality. In the beginning ideas were imported from American consultants and quickly and successfully implemented – resulting in widely known techniques such as zero defects and value engineering. While these techniques are understood in America, the difference is that the Japanese take them seriously.
* Long Term, Bottom Line
Drucker notes that the basis of Japanese superiority lies in their long-term focus (as opposed to the American focus on, for example, quarterly earnings). This long-term approach is illustrated in the system of lifetime employment (or at least long employment) which involves extensive training, engenders loyalty and motivation, and reduces resistance to change (this last point is what Drucker terms “the most important secret of the Japanese economy”).
Some observers note, however, that Japanese employees belong to company based unions which makes it hard for them to shift companies and renders the unions almost powerless.
Further, the Japanese government has played a significant role in pursuing economic growth.
* Decision Making
As opposed to the American concept of participative management in Japan a very large number of stakeholders are consulted, meaning that when a decision is reached it is almost unanimously supported. The decision making process (nemawashi) may appear inefficient and long-winded from the outside but proper problem definition and unanimous support results in significant efficiency gains at the implementation stage.
* Attempts at Integrated Models of Japanese Management
Seven S: Strategy, structure, systems, (hard S’s); superordinate goals, staff, skills, and style (soft S’s). American and Japanese firms may not differ much on the hard S’s but the Japanese excell at the soft S’s. This is primarily a matter of culture (ability to deal with ambiguity, uncertainty, imperfection and interdependence) – contrast this with the American ideal of openness and directness.
Organizational: Theory Z (Ouchi, 1981). Japanese and American organizations are contrasted, with differences between the two being a product of differences in culture (collective versus individual focus). While being born of the Japanese culture this organizational style is not culture bound and can be implemented in non-Japanese companies. This viewpoint is debatable – see Gibney (1981) and Sullivan (1983).
Human Resource: Success rests on the maximization of HR development through three strategies: an internal labor market, a strategy of cooperation and teamwork, and a well-defined socialization process (hiring/training) for new employees. Uniquely Japanese in this equation is the internal labour market (based on lifetime employment and slow pay increases based on length of service).
In order to develop their human resource system, Japanese companies develop employees’ knowledge of the company (job rotation, slow promotion, lifetime employment), build teamwork abilities, evaluate employees on both performance and attitude, encourage open communication (no separate offices for top managers, high-frequency of visits to the ‘shop floor’), use participatory decision making processes, and take care of employees outside of the workplace (social and cultural activities etc).
The above view may, however, be based on generalization from too few examples. Emphasis on group harmony, for example, hides the deeply competitive nature of Japanese society; a harmonious and secure seniority system reduces incentives to work; rather than ‘the spirit of its workers’ it may be more appropriate to note the ‘coercive, regimented side of [Japan's] society’.
> Sources of Entanglement in the Jungle
Talk about Japan focuses on ‘intimacy’ while for America the emphasis is on ‘individuality’.
The structure of Japan’s union system enables it to easily partner with management and implement new practices.
Macro factors (MITI, low defense spending, lower wage rates, undervalued yen etc) may have helped Japanese firms succeed as much or more than their ‘Japanese’ management practices.
The Japanese emphasis on a ‘quest for knowledge’ (in a competitive school system) is another factor often cited.
Most problems for Japanese firms involve consumers or the environment (not labor or shareholder pressure).
There is a danger of oversimplifying Japanese management and its effectiveness – it is much more complex that just ‘decision making’.
Furthermore, most research to date has focused on large automotive and electronics firms.
> Common Factors in the Theories and Models – A Mental Factor Analysis
Three underlying factors (consisting of a variety of management practices) are at the root of the Japanese management system (See Figure 1 in the original text).
- Long-Run Planning Horizon
- Commitment to Lifetime Employment
- Collective Responsibility
> Clearing a Path Through the Jungle
Research to date only grasps separate pieces of the picture. An approach based on the Japanese management ‘system’ (political, social, religious, management).
Keys, J.B. and Miller, T.R. (1984). The Japanese Management Theory Jungle. Academy of Management Review, Vol. 19, No. 2, pp. 342-53.
