Group Members

Nida Tanveer Butt Neelam Mujtaba Sadia Rafique Zohair Zubair

JAPANESE MANAGEMENT

History of Japanese Management

Techniques and economic strategies Later part of 19th century Mejii period Trapping the feudalism Slow technological development Domestic imitation and innovation Western goods rather than relying on imports

 The practice was summarized well under a slogan of the era, "Japanese spirit, Western technology." 20th Century practices at both the level of micro and macro economics

Traditional Japanese ManagementPractices

In-house training of managers Consensual and decentralized decision-making Extensive use of quality control methods Carefully codified work standards Emphasis on creating harmonious relations among workers Lifetime employment and seniority-based compensation

Management Education
The education of managers in Japan traditionally takes place on a relatively informal basis within firms Japanese VS U.S Firms do not hire recruits to fill specific occupations The emphasis on in-house education Management training Linked with the lifetime-employment

Capital And Priorities

The long-term view of Japanese managers is also based on sources of finance

CHARACTERISITCS OF JAPANESE MANGEMENT

Hiring: Emphasizing People rather than Job Responsibilities Emphasizing Adoption of Corporate Culture Rather than Adaptation to Job Interviews and Personality Inventories as Supporting Tools

Knowledge Tests
Combined knowledge tests (73.8%) General education/Common sense (51.8%) Foreign language (45.9%) Major-related achievement test (33.7%) Job-related knowledge test (11.1%) Other (4.5%)

Aptitude Tests

Combined aptitude tests (63.5%) Total aptitude test (36.6%) Personality inventory (34%) Cognitive ability test (18.5%) Aptitude test according to job (11%) Others (2.6%)

Interviews
Combined interviews Individual interview Group interview Medical exam Others

Culture of Japanese Management

Culture of Japanese Management

Company as a family High-context communication Internal labor market, Concern to employee needs, Cooperation and teamwork Social belonging Life-time employment and loyalty Importance of administrative heritage and managerial beliefs

Culture of Japanese Management

Extensive training, Seniority system facilitates on-the-job training Senior workers train junior workers without fear of jeopardizing their own position Excellent salaries and working conditions Participative decision-making(continuous consultation ) Adaptive organization, Competitive appraisal system Accept and blend in the values and culture of the organization Long-term relationship with employees

Culture of Japanese Management

Company-wide union or house union General preference for inexperienced fresh graduates from schools or colleges Preference for promotions from within Social belonging Life-time employment and loyalty Social status of employees linked to success of company

Culture of Japanese Management

Emphasis on harmony (suppression of conflict) Paternalism Personal and subjective relationships Settlement of conflict trough negotiations

Uniqueness of Japanese Management Culture

Three recruiting attributes Individual intelligence Educational background Personal attitudes

Hofstede s Cultural Dimensions

Individualism Power distance Masculinity Risk tolerance Long term orientation

Japanese Management Culture in Internationalization

Unionized subsidiaries The greater the dependence Interdependence and coordination with strategic links Balance of competition and cooperation Small- and medium enterprises and consumers Many management retirees work for smaller subsidiaries of the larger company for lower salary

Features of Japanese Management People-oriented Work-oriented

Special Features of Japanese Management

SCIENTIFIC SELECTION PROCESS LIFETIME EMPLOYMENT SENIORITY SYSTEM CONTINUOUS TRAINING EMPHASIS ON GROUP WORK DECISION MAKING COMPLICATED PERFORMANCE EVALUATION FATHER LEADERSHIP GOOD BENEFITS FOR EMPLOYEES SIMPLE AND FLEXIBLE ORGANIZATION

Japanese Management Style and Strategies

Responsiveness, loyal, hard work, Teamwork, leadership styles Management by objective Group decision making Problem solving approaches Worker attitudes and thinking processes Inventory and production management techniques Emphasizing People rather than Job Responsibilities Emphasizing Adoption of Corporate Culture Rather than Adaptation to Job Interviews and Personality Inventories as Supporting Tools

Comparison of Management Styles

Traditional style Capitalism Maximization Profit Growing company Shareholders' satisfaction Office priority System oriented Innovation approach Top-down method Result oriented Sophisticated technology
Japanese style Companyism Increasing value-added Growing with company Customers' satisfaction Shop floor priority Human oriented Kaizen approach Top down+ Bottom up Process oriented Simple technology

CHARACTERISTICS OF THE JAPANESE MANAGEMENT STYLE

Recruitement Knowledge Tests Aptitude Tests Interviews Medical exam Training programs On-the-job training programs Off-the-job training programs Management training programs

Evaluation Style
Eager and willing Cheerful and active Able to understand and judge Harmonious and adaptable Expressive and persuasive Has self-understanding and ambition Good manner and attitude Wealth of general and specific knowledge Curious and investigative Is conscious of his/her value system in relation to his/her job Willing to accept responsibilities Leadership Persistent Loyal to corporation Able to handle stress

Japanese Managerial Strategy

Strategies in the Fast Growth Period Multifunctional Teams Horizontal Integration Imitation Loyalty to Classmates Industry Associations

Japanese Management Theories

theory x ('authoritarian management' style)
workers inherently dislike and avoid work and must be driven to it

theory y ('participative management' style)

work is natural and can be a source of satisfaction when aimed at higher order human psychological needs

theory z - william ouchi

increasing employee loyalty to the company by providing a job for life with a strong focus on the wellbeing of the employee, both on and off the job.

Theory z
A combination of American and Japanese management philosophies 'Theory Z: How American management can Meet the Japanese Challenge (1981). To promote stable employment, high productivity, and high employee morale and satisfaction Promoting partnerships and group work. It leads to improvement and development

Features of Theory Z
LONG-TERM EMPLOYMENT CONSENSUAL DECISION MAKING INDIVIDUAL RESPONSIBILITY SLOW EVALUATION AND PROMOTION INFORMAL CONTROL WITH FORMALIZED MEASURES MODERATELY SPECIALIZED CAREER PATH HOLISTIC CONCERN

Characteristics and attitude of workers

 Concept of self. o Impediment to growth. Strong sense of nationalisms. Socialization. Willingness to be alike. More respect for authority. Loyalty.

Characteristic Typical U.S. Self image Nationalism and image of Race.

Typical Japanese Belong to a group. Okay to show feelings and weaknesses. Strong sense of nationalism based on a single superior race. Rigorous system through high school.

Typical U.S. Individual. Macho. Hide feelings and weaknesses. Strong sense of nationalism, but many racial conflicts. Relatively weak system through high school. Click for

Education.

Team players. No stars allowed. The individual is Social cooperation and willingness to Competitive. Engage in political power plays not important. Uniformed teams are self work together. to become stars. Few team players. regulating. Respect for authority. Substantial. Live to work. Self sacrifice. Highly self disciplined. What can I do for the Company? High tolerance for personal discomfort. Decline vacations and sick days. One family service day per week acceptable. Minimal. Work to live. Self gratification. Little self discipline. What can the company do for me? Low tolerance for personal discomfort. Take all vacation and sick days allowed. Family demands require weekends plus.

Attitude toward work.

A clean work-place and environment is Attitude toward work-place, property Everyone's job to keep it clean. Respect property someone else's job. Less respect for property and environment. of others. of others. Loyal to Company. Company first. Individual and Loyal to Self. Individual and family first. family second. Belong, to or married to, a Company second. Work for a company to gain company for a lifetime. experience to obtain a better job elsewhere.

Loyalty.

Management attitude and policies toward workers

 Expected to provide suggestions. Company s most important resource. Typical incentive system. Worker participation system Easy accessibility to workers.

Policy or Attitude

Typical Japanese Way to achieve continuous improvement (kaizen). Lifetime. Paternalistic. No layoffs. Promote from within.

Typical U.S

Workers suggestions.

Threat to management. Revolving door. Workers laid off during economic decline. Little commitment to training. De-skill so all are expendable. Use other firms training programs as leverage by scavenging workers.

Employment.

Training.

Use cross training and job rotation to develop human resources as a competitive weapon.

Incentives.

Recognition. Pats on back. Trophies, plaques and metals. Group approval and praise. Profit sharing. Charts or boards (andon) over Mostly monetary. Individual ego. work stations show goals and current rate of achievement. Dress code to promote team spirit.

Participation in decisions.

Worker participation expected to reach consensus decisions. Accessible to workers. Wear same uniform. Open office policy in plant.

Pseudo participation. Autocratic decisions.

Managers accessibility.

Inaccessible. Aloof. Offices separate from plant.

Competitive focus of management and management policies

 Companies long run competitive strategy. Policies and techniques grounded by concept of KAIZEN . Japanese concept of just-enough-resources usually referred as just-in-time or KANBAN . Concept of total quality control or zero defect and quality at source (Jidoka). Japanese unions. Area of production.

Policy Area Typical Japanese Typical U.S. Overall focus. Operating strategy.

Typical Japanese Long range focus on competitive strategy. Continuous Improvement (kaizen). Just-in-time (JIT) or just enough resources (JER). Squeeze out waste, (muda, mura and muri). Minimum workers must be highly skilled and flexible. Fewer parts, inspections and job classifications. TQC. Seek perfection. Zero defects. Use as strategic weapon. Long term partnerships. Have co-destiny. Frequent deliveries, few vendors.

Typical U.S. Short range focus on the bottom line. Optimize with a given set of constraints. Just-in-case (JIC) keep lots of slack inventory and resources. Highly specialized jobs based on scientific management. Dehumanizing repetitive tasks. EOQ for resource decisions. Inspect for optimum level of defects. No special relationships. Obtain best price from multiple vendors.

Inventory and other resources.

Quality control. Vendors and customers.

Equipment.

Buy turn-key systems as a form of Design in house to maintain technological leverage. Abused and overused. leadership. Used, but not abused. Emphasize Maintenance discretionary. Wait until it preventive (operator centered) maintenance. breaks down to replace, to enhance Replace parts before they break. current performance. Company. Emphasize cooperation. Promote team approach. No strike policy. Small focused plants. Work performed in sequential order to remove inconsistency according to program work sheets. National non-company. Adversary. Rules prohibit cross training and flexibility. Strike used as weapon. Less focused plants. Task not programmed.

Union.

Production.

Management accounting and control

 Subservient to corporate strategy and are essentially used to influence behavior. Planning and control. Plan-Do-Check-Action (PDCA). Long run life cycle approach to product cost. Japanese investment justification decisions. Namawashi approach.

Policy Area

typical Japanese

typical U.S.

Overall reporting strategy.

Used to inform management. Emphasis on Used to influence behavior. Emphasis on non financial measurements. Management by financial measurements of strategic the numbers, i.e., net income, ROI, and activities with charts on wall. EPS.

Planning and control.

Bottom up. Goal setting and feedback. Worker involvement. Near fanatical commitment to four step Plan, Do Check Action approach. Budget and compare actual to market driven dynamic target costs continuously reduced. Long run plant wide life cycle costs. Life cycle costs. Quality, lead time, flexibility (e.g., average number of jobs mastered per employee, average setup times) number of line stops, down time, process times, amount of inventory, number of customer complaints.

Top down. Roll down financial budgets to lower levels. Budget and compare actual to flexible budgets based on engineer driven standard costs for given plant and resource constraints.

Cost.

Short run production costs.

Measurements.

Cost variances, labor efficiency, machine utilization. Meet due dates.

Investment justification.

Long term perspective. Emphasis on growth, increasing market share, flexibility, customer Short run emphasis. Quick pay back. needs and business unit interrelationships.

Japanese Management Lessons

10 Lessons from Japanese Management

Lesson #1 is no "one" Japan Lesson #2 is a world-class customer commitment. Lesson #3 is the "price down/cost down Lesson #4 is the proactive role of cost management

 Lesson #5 is management reporting Lesson #6 is the business planning/budgeting function Lesson #7 is the use of relevant measures of performance Lesson #8 is the role of accounting

 Lesson #9 is the human resource management function Finally, lesson #10 is the effectiveness and efficiency

Kaizen ( )

Kaizen is founded upon five primary elements:

Quality Circles: Groups which meet to discuss quality levels concerning all aspects of a company's running. Improved Morale: kaizen sets it as a foundational task to keep constant contact with employee morale.

 Teamwork: A strong company is a company that pulls together every step of the way. Personal Discipline: A team cannot succeed without each member of the team being strong in themselves Suggestions for Improvement: By requesting feedback from each member of the team.

The Japanese 5s Practice

Phases of 5S
Sorting (Seiri): Eliminate all unnecessary tools, parts, and instructions. Go through all tools, materials, and so forth in the plant and work area Straightening (Seiton): Items should be arranged in a manner that promotes efficient work flow, with equipment used most often being the most easily accessible.

 Systematic cleaning (Seiso): Keep the workplace tidy and organized. A key point is that maintaining cleanliness should be part of the daily work Standardizing (Seiketsu): Work practices should be consistent and standardized. Everyone should know exactly what his or her responsibilities are

 Sustaining (Shitsuke): Maintain and review standards. Maintain focus on this new way and do not allow a gradual decline back to the old ways. Safety Security Satisfaction

Case Study

The case of the empty soapbox

The company received a complaint that a consumer had bought a soapbox that was empty. Immediately the authorities isolated the problem to the assembly line, which transported all the packaged boxes of soap to the delivery department. For some reason, one soapbox went through the assembly line empty. Management asked its engineers to solve the problem. Post-haste, the engineers worked hard to devise an X-ray machine with highresolution monitors manned by two people to watch all the soapboxes that passed through the line to make sure they were not empty. No doubt, they worked hard and they worked fast but they spent whoopee amount to do so. But when a rank-and-file employee in a small company was posed with the same problem, did not get into complications of X-rays, etc but instead came out with another solution.

Solution
He bought a strong industrial electric fan and pointed it at the assembly line. He switched the fan on, and as each Soapbox passed the fan; it simply blew the empty boxes out of the line.

Moral of the story

Devise the simplest possible solution that solves the problem :-) So, learn to focus on solutions not on problems. "If you look at what you do not have in life, you don't have anything" "If you look at what you have in life, you have everything"