Effective business strategy: A Japanese example*

Abstract

After touring Japanese factories, especially those of Komatsu, a world leader in construction machinery, it became clear that Japanese managers applied their productivity strategies in a way that motivated employee performance. These business strategies appeared effective because the Japanese were equally concerned about developing a realistic strategy and understanding the planning and control process itself. This paper attempts to first describe what is effective business strategy. Then Komatsu's successful application of quality circles and total quality control is provided as an example, which may provide some insights into Japanese management practice as well. More importantly, the paper will indicate how an effective strategy like Komatsu's commitment to total quality control can help any business adapt to change.