The End of Japanese-Style Management?

Abstract

Many Western observers perceive the Japanese management model as outdated and uncompetitive. This article explores the future viability of Japanese-style management. After a review of the key characteristics of the Japanese management model, a framework is developed that links four forces of continuity and four opposite forces of change with four different scenarios for the future development of the Japanese management model. Subsequently, the current competitive state and future trends of the Japanese management model, as viewed by 359 high-ranking Japanese managers of major Japanese companies at headquarters and at subsidiaries in the US and in Germany, are described. The data reveal that Japanese managers consider their own management system to be in crisis and in need of substantial changes. Inspirations for this change process appear to come in particular from the US management model. The key challenge for the Japanese management model seems to be to integrate the new, frequently US-inspired management practices with traditional Japanese management methods, so that it can attain a new state of stable equilibrium in which its various components are mutually reinforcing themselves. Concrete practical implications of the findings for Japanese companies, for Western multinationals and for their subsidiaries operating in Japan are highlighted and future research directions outlined.