Changing Japanese Business Practices (Corporate Restructuring in Japan)

Essay by freedomroadUniversity, Master'sA+, September 2008

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AbstractThe culture and management practices of the Japanese economy have long been the focus of curious outsiders keen to understand their mix of Eastern and Western values, and how this may connect to the economic highs and lows of Japan's recent past. Due to hardships endured in Japan during the Heisei Recession, this has somewhat changed the outlooks, attitudes and expectations of the Japanese greatly, especially in terms of their management. These new attitudes are in response to the new economic climate in Japan and the world, which have somewhat altered the landscape of the Japanese enterprise management system.

Outlined at length is how Japan appears to be recovering from its long stagnation of the Heisei Recession with the following statement being critically discussed, "the days when the Japanese economy was built on Japanese-owned companies, run with Japanese management systems, have gone forever." Coherent to this topic are the 'Three Sacred Treasures' of the Japanese management system; lifetime-employment, the seniority system and the enterprise union; which now seem to be at odds the direction of the economy and desires of the new Japanese worker.

As a result, in the 1990s, the aura of the keiretsu ceased to exist in Japan, and it was evident that there were inherent flaws in the system. Also described are the current keiretsu relationships in Japan and how they have drifted away from the keiretsu governance modes towards the American style of arms-length contracting and top-down administration.

In conjunction with this environment, the term 'freeter' is also discussed, a phenomenon that grew out of economic adversity, which helped sway people's opinions towards the benefits of individualism and freedom from the shackles of traditional life-time employment.

As Japan now seems to be opening up to more gaijin or 'outsiders' to manage traditionally Japanese owned companies, a...