Japanese Management
The japanese management culture and its organization became from the 50’s to the 90’s in a synonym of corporate success, and even though after the 90’s crisis many changes have taken place to the management culture and organization, most of it traditions stills intact and plays a important role in the japanese daily life.
Corporate Organization
Keiretsu
Post-World War II and after the dissolution of the Zaibatsu , which were groups of large Industries run by a single family, Japanese business corporations were organized as Keiretsu.
The Keiretsu is a group of corporations, in which each corporations within it own share of each others member’s stocks of the Keiretsu. This guarantee that that the group sticks together and becomes a cohesive and cooperative entity. Additionally, The Keiretsu has a research group in order to promote joint projects between member and articulate their goals. There are two types of Keiretsu. The horizontal Keiretsu that groups different industries and sectors, which are organized around a general trading company (Sogo Shosha) and a major bank to which all members resort according to their necessities, whereas the vertical Keiretsu groups companies in one industry, where a manufacturing corporation stays in the center surrounded by its key suppliers.
Traditional Management Style and Organization
Despite of the fact that the crises suffered in the 90’s from some of the Japanese companies have lead to the modification of some management and organizational culture in some of the companies, the time span for this changes is too short to really be changing the core values of the japanese people. After saying this, comes then very important to identify and explain some key concepts embedded in the japanese organization and management style.
Groupism
Embedded in the japanese culture is the concept of groupism by which many of the management and organizational characteristics of the japanese will be dependent. The organizational structure in Japanese companies pay respect to this concept as employees are organized in office groups that at the same time have work groups. In this way, many times who gets rewarded or punished is the group instead of the individual. Additionally, its very common that japanese workers do not identify themselves in a formal job position but to its work group. So for the japanese people “Collective needs and goals of all employees are more important than individual needs”[1]. Even the office layout of an office is made in order to arrange tables in which groups work around its group’s supervisor and the general manager can see all groups at work.
In the japanese organization, the Habatsu is a social organization within companies, where individuals are organized in informal small social groups in which membership is a permanent obligation and people are expected to be completely loyal to their Habatsu. This groups have their own hierarchy , set of rules and seek their own goals. The Habatsu is formed based on a specific criteria such as the university in which a person graduated or coming from the same town. As Habatsu has a very strong influence in a company, they can be then an instrument for cohesion and corporate alignment if the top management can take a grip of them or a destructive and dividing force if they are let to operate by themselves, as every Habatsu is completely different from other Habatsu and many of their interests and goals generally are different from those of the company.
Korean Management
Nevertheless, the Japanese cultural way of doing business and organizational behavior has influenced the Korea management style:
- During the colony period a lot of the industrialization of Japan took place in the Korean land. Heredity that Koreans keep it to themselves after the colonization.
- The repatriation of a many Korean experience that have living in Japan during 1945.
- The opportunity to imitate the Japanese post- war economic policy to the benefit of the domestic growth.
- The glovalization of the Japanese`s technology and technical in operation management that were skills famous around the word.
Religion and philosophical beliefs of Koreans are seen in Confucianism, Buddhism and Christianity, but there are minorities of Koreans that believe in Taoist tradition holism who are Influences on the South Asian neighbors.
The Koreans government has a strong commitment to education, its goals is to increase the level of literacy in people and at the same time grow the ambition of its citizens to achieve great accomplishments. To achieve this, South Korea, has construct a solid reputation for its educational institutions, and graduating a high proportion of engineers and scientists of high educational level.
Now the government controls the private business sector and the cuts are selective. Stein also aims at restructuring and economic liberalization the regulation by the government in addition to the internationalization of the economy and the entry of foreign investment.
The second objective of the government is the financial reform that reduces government influence in the banking sector.
South Korea management style.
The main feature of the management style of the Koreans is the close relationship that has private companies with the government, which was copied from the Japanese style. chaebol structure also was copied from the Japanese zaibatzu. Koreans tend to be more individualistic in spite of emphasizing the concept of group harmony and do not include loyalty and consensus which is the Japanese style. The family business in Korea is a very solid figure based on bloodlines.
Another feature of the management style of the Koreans is the management of the affairs of a hierarchical way. Fukuyama, a political scientist contextualizes better the Japanese hierarchical management style of Korean, (2) “virtually all comparative studies of Korean management (have indicated) that Korean businesses tend to be run in a hierarchical, authoritarian, and centralized manner … this was particularly true of … chaebol still run by founding entrepreneurs, who insisted on making all major management decisions personally … the authoritarian nature of decision making in Korea makes it easier for Korean companies to move quickly and decisively; they are not bogged down by the Japanese style need to develop extensive consensus throughout the hierarchy before making a move. This more decisive style, however, can also mean that decisions are not adequately vetted by staff and (may) be made on the basis of insufficient knowledge’
Corporate Organization
Chaebol is a business based model on large conglomerates with presence in different economic sectors, which has developed in South Korea. Companies that have this peculiarity are characterized by its strong growth, technological development, diversification and strong business dimension. “The Korean word means "family business", but is also used to refer to a monopoly”. [3]
The model emerged after the independence of South Korea when their government gave various national strong political and financial companies the support to lead the country's economic boom by investing in different fields as industry, metallurgy, technology and construction among others. The work of these groups contributed to the country's economic growth in the second half of the twentieth century to put South Korea as one of the four Asian tigers. Examples of chaebol are Samsung, Hyundai, LG, Lotte and SK Group.
The conglomerates of South Korea ("chaebol") have becomed in a few years in companies of enormous size and remarkable technological capabilities .The recent evolution of the Korean economy and disadvantages of the particular corporate structure of large companies have forced the "chaebol" to undertake, in recent years, a process of internal restructuring, trade diversification and a rapid multinationalization.
The advantages of Chaebol
* The size of their internal resources
* The value of their brands on the market
* The stability of their supply chains
* The social network based on trust
The weaknesses of the Chaebol
* Lack of directive transparency
* Bureaucracy
* Vulnerability of trademarks
* Lack of control over the distribution network
sources
Explain the phenomenon of convergence in terms of management styles. What are the forces or factors pushing for convergence?
The japanese management culture and its organization became from the 50’s to the 90’s in a synonym of corporate success, and even though after the 90’s crisis many changes have taken place to the management culture and organization, most of it traditions stills intact and plays a important role in the japanese daily life.
Corporate Organization
Keiretsu
Post-World War II and after the dissolution of the Zaibatsu , which were groups of large Industries run by a single family, Japanese business corporations were organized as Keiretsu.
The Keiretsu is a group of corporations, in which each corporations within it own share of each others member’s stocks of the Keiretsu. This guarantee that that the group sticks together and becomes a cohesive and cooperative entity. Additionally, The Keiretsu has a research group in order to promote joint projects between member and articulate their goals. There are two types of Keiretsu. The horizontal Keiretsu that groups different industries and sectors, which are organized around a general trading company (Sogo Shosha) and a major bank to which all members resort according to their necessities, whereas the vertical Keiretsu groups companies in one industry, where a manufacturing corporation stays in the center surrounded by its key suppliers.
Traditional Management Style and Organization
Despite of the fact that the crises suffered in the 90’s from some of the Japanese companies have lead to the modification of some management and organizational culture in some of the companies, the time span for this changes is too short to really be changing the core values of the japanese people. After saying this, comes then very important to identify and explain some key concepts embedded in the japanese organization and management style.
Groupism
Embedded in the japanese culture is the concept of groupism by which many of the management and organizational characteristics of the japanese will be dependent. The organizational structure in Japanese companies pay respect to this concept as employees are organized in office groups that at the same time have work groups. In this way, many times who gets rewarded or punished is the group instead of the individual. Additionally, its very common that japanese workers do not identify themselves in a formal job position but to its work group. So for the japanese people “Collective needs and goals of all employees are more important than individual needs”[1]. Even the office layout of an office is made in order to arrange tables in which groups work around its group’s supervisor and the general manager can see all groups at work.
In the japanese organization, the Habatsu is a social organization within companies, where individuals are organized in informal small social groups in which membership is a permanent obligation and people are expected to be completely loyal to their Habatsu. This groups have their own hierarchy , set of rules and seek their own goals. The Habatsu is formed based on a specific criteria such as the university in which a person graduated or coming from the same town. As Habatsu has a very strong influence in a company, they can be then an instrument for cohesion and corporate alignment if the top management can take a grip of them or a destructive and dividing force if they are let to operate by themselves, as every Habatsu is completely different from other Habatsu and many of their interests and goals generally are different from those of the company.
Korean Management
Nevertheless, the Japanese cultural way of doing business and organizational behavior has influenced the Korea management style:
- During the colony period a lot of the industrialization of Japan took place in the Korean land. Heredity that Koreans keep it to themselves after the colonization.
- The repatriation of a many Korean experience that have living in Japan during 1945.
- The opportunity to imitate the Japanese post- war economic policy to the benefit of the domestic growth.
- The glovalization of the Japanese`s technology and technical in operation management that were skills famous around the word.
Religion and philosophical beliefs of Koreans are seen in Confucianism, Buddhism and Christianity, but there are minorities of Koreans that believe in Taoist tradition holism who are Influences on the South Asian neighbors.
The Koreans government has a strong commitment to education, its goals is to increase the level of literacy in people and at the same time grow the ambition of its citizens to achieve great accomplishments. To achieve this, South Korea, has construct a solid reputation for its educational institutions, and graduating a high proportion of engineers and scientists of high educational level.
Now the government controls the private business sector and the cuts are selective. Stein also aims at restructuring and economic liberalization the regulation by the government in addition to the internationalization of the economy and the entry of foreign investment.
The second objective of the government is the financial reform that reduces government influence in the banking sector.
South Korea management style.
The main feature of the management style of the Koreans is the close relationship that has private companies with the government, which was copied from the Japanese style. chaebol structure also was copied from the Japanese zaibatzu. Koreans tend to be more individualistic in spite of emphasizing the concept of group harmony and do not include loyalty and consensus which is the Japanese style. The family business in Korea is a very solid figure based on bloodlines.
Another feature of the management style of the Koreans is the management of the affairs of a hierarchical way. Fukuyama, a political scientist contextualizes better the Japanese hierarchical management style of Korean, (2) “virtually all comparative studies of Korean management (have indicated) that Korean businesses tend to be run in a hierarchical, authoritarian, and centralized manner … this was particularly true of … chaebol still run by founding entrepreneurs, who insisted on making all major management decisions personally … the authoritarian nature of decision making in Korea makes it easier for Korean companies to move quickly and decisively; they are not bogged down by the Japanese style need to develop extensive consensus throughout the hierarchy before making a move. This more decisive style, however, can also mean that decisions are not adequately vetted by staff and (may) be made on the basis of insufficient knowledge’
Corporate Organization
Chaebol is a business based model on large conglomerates with presence in different economic sectors, which has developed in South Korea. Companies that have this peculiarity are characterized by its strong growth, technological development, diversification and strong business dimension. “The Korean word means "family business", but is also used to refer to a monopoly”. [3]
The model emerged after the independence of South Korea when their government gave various national strong political and financial companies the support to lead the country's economic boom by investing in different fields as industry, metallurgy, technology and construction among others. The work of these groups contributed to the country's economic growth in the second half of the twentieth century to put South Korea as one of the four Asian tigers. Examples of chaebol are Samsung, Hyundai, LG, Lotte and SK Group.
The conglomerates of South Korea ("chaebol") have becomed in a few years in companies of enormous size and remarkable technological capabilities .The recent evolution of the Korean economy and disadvantages of the particular corporate structure of large companies have forced the "chaebol" to undertake, in recent years, a process of internal restructuring, trade diversification and a rapid multinationalization.
The advantages of Chaebol
* The size of their internal resources
* The value of their brands on the market
* The stability of their supply chains
* The social network based on trust
The weaknesses of the Chaebol
* Lack of directive transparency
* Bureaucracy
* Vulnerability of trademarks
* Lack of control over the distribution network
sources
- 1) Management in South Korea: a reviewTony MordenUniversity of Teesside, School of Business and Management, Middlesbrough, UKDavid BowlesDirector of Operations, Northern Development Company, Newcastle-upon-Tyne, U
- 2) Leanne Fiftal Alarid, Hsiao-Ming Wang, (1997) "Japanese management and policing in the context of Japanese culture", Policing: An International Journal of Police Strategies & Management, Vol. 20 Iss: 4, pp.600 - 608
- 3) Lee, Jangho, Thomas W. Roehl, & Soonkyoo Choe. 2000. What Makes Management Style Similar and Distinct Across Borders? Growth, Experience and Culture in Korean and Japanese Firms. Journal of International Business Studies, 31(4): 631-52.
- Image source: http://www.burneylawfirm.com/blog/category/investigations/
- Image Source: http://hanopolis.com/?articleNo=1145&story/Businessweek-Do-the-Chaebol-Choke-Off-Innovation
- Image Source: http://picses.eu/domain/losmejoresskate.blogspot.com/
- · Management in South Korea: a review; Type: Research paper; Author(s): Tony Morden, David Bowles; Source: Management Decision Volume: 36 Issue: 5 1998 (Emerald Database)
- http://www.worldbusinessculture.com/South-Korea-Management-Style.html
- The Management Characteristics of Korean Chaebols vs. non-Chaebols: Differences in Leverage and its Ramifications: Myth or Reality?Texto completo disponible By: Kim Hanjoon; Paul, D. Berger. Advances in Management, Nov2009, Vol. 2 Issue 11, p26-35, 10p, 4 Charts; (AN 47637192) (Ebsco Database)
- Family still has a role to play Geoffrey Owen. Financial Times. London (UK): Aug 5, 2010. pg. 8 (Proquest Database)
- · http://www.apmforum.com/columns/boye46.htm
- http://www.rpi.edu/dept/advising/free_enterprise/business_structures/management_styles.htm
- http://www.learnmanagement2.com/leadership%20styles.htm
- http://smallbusiness.dnb.com/human-resources/workforce-management/11438-1.html
- http://www.managementstyle.net/
- http://www.referenceforbusiness.com/management/Log-Mar/Management-Styles.html
- http://managementstyle.org/E
Explain the phenomenon of convergence in terms of management styles. What are the forces or factors pushing for convergence?
I think both Korean and Japanese management styles tend to converge as we see that many aspects of the Korean management styles are adopted from the Japanese management styles. Also this two cultures share some history specially religion and philosophy that allow them to share at a certain extent values, attitudes and beliefs, which make for Korean organizations and easy task to implement the Japanese model without much resistance . As management styles adoption depends on its success, so as long a the Japanese model remain successful natural convergence will go to it, but as mention not all dimensions of a model are successful so Korea and even Japan will look at another Management styles. They will then tend to look for a new management style that resolve their model drawbacks and improve their actual model.
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