Japanese History and Business Culture

Japan was ruined in World War II, but only within few decades Japanese people made the world recognize Japan as one of the Economic Super Powers. The secrets of this amazing success lies in Japan's history and business culture. Japan's managerial techniques and cultural patterns are now collectively called as Japanese Management Style or Theory Z.

Though the management gurus started studying Japanese business culture within past few decades, the roots of it's success can be traced in the modernization program that began in the late 19th century.

Dr. William Ouchi coined the term Theory Z of management styles in a response to the established theories of X and Y style of management. Theory X states that workers inherently dislike and avoid the work while Theory Y states that the work is natural and can be source of satisfaction. The Theory Z focuses on stable life-long employment, high productivity with high employee morale and satisfaction.

The Theory Z or Japanese Style of Management stands on Dr. Deming's 14 Principles of Management. Deming was advisor for many Japanese business leaders. Japanese Emperor Hirohito awarded 'Second Order of the Sacred Treasure' to Dr. Deming for his constructive work in Japan.

Some of key practices commonly associated with Japanese Business Culture are:

• Stable Long Term Employment: Most of the Japanese companies recruits their employees just after their graduation. These employees then stay with the company until the retirement. Japanese business culture gives less importance to the specialization. Job rotation, broadening of the skills and continuous training are the characteristics of the Long Term employment. Some of the key concepts in the the life long employment culture are
  • Emphasis on scientific management
  • Concern for employees and their families
  • Seniority based compensation system
  
  
• In-house Management Training: As continuous training is an integral part of the business culture, in-house training becomes important. The continuous training is given in the form of job rotation enabling managers to understand a number of varied operation.
• Ringi System: It is the traditional decision making process in Japanese Business culture. This decision making system is the collective decision making process and is highly decentralized. Only after the consensus is reached the decision is taken. If the decision is successful, then the one who has advocated it gets the credit but interesting part is that in the event of unsuccessful decision making top management takes the responsibility for the failure. The drawback of the Ringi system is that it is slow process.
• Emphasis on the Quality Control and Quality Circles: In Japanese Business Culture, Quality control is the center of the production process. Everyone in the company is trained in the quality control process. Typically Quality Circles are established which is the group of about 10 people. The foreman serves as the group leader. The meeting of the group is held every week often on the time suitable to the members. The groups discusses the statistical details of their quality issues. Thus it increases the participation of the employee in the company affairs and management gets valuable suggestions.