– Thoughts on Strategy and Management

Interesting Link: The contemporary relevance of Japanese management practices

Japanese Management 20 years on is an executive briefing paper from the Advanced Institute of Management Research.

The abstract for this paper says: This report discusses the contemporary relevance of Japanese management practices to managers, policymakers and academic researchers. In the 1980s, a period marked by strong performance of the Japanese economy and the emergence onto the global stage of a number of leading Japanese corporations, managers and management academics in the UK and other Western countries studied Japanese management with great interest.

There was widespread recognition of the efficiency and competitive advantage afforded by certain management practices and several features of the ‘Japanese model’ were adopted by companies in the UK, continental Europe and North America. However, two decades of weak economic growth have undermined this belief that Japanese management can serve as a role-model for Western firms.

This paper puts the ‘Japanese model’ in its historic context. It highlights the development of the Japanese economy and its employment practices. Whereas most Japanese management practices were a perfect fit for the long and stable period lasting into the 1980s, external conditions changed in the 1990s. For this period, the paper addresses some recent developments in Japanese management. It concludes

It would be wrong, however, to see the Japanese management model as largelyunchanged since the 1980s. The tendency to view Japanese management in a negativelight today ignores important changes that have taken place in the last two decades. Japanese firms and successive governments have responded to the difficult economic circumstances by making important adaptations to many existing management practices that are considered fundamental to the Japanese model.

Following that, the paper focuses on the ‘updated model’. It also looks back at the lessons learned 20 years ago. The new lessons from the Japanese model are not as easy and straightforward as they used to be. However, the insights may be just as useful and underline the importance of a contemporary focus on Japanese practices. The country’s unique history and culture provide the context within which alternatives to the dominant perspective of Western management practices may develop and as such assessments of the country, its firms, and its management practices, are likely to continue to provide important lessons.

All in all, the paper reminds us that management models should always be judged in view of their historical context. What once worked well will not necessarily do so in future. But it nevertheless needs to be abandoned as outdated. Management models can evolve and adapt to new economic conditions.


Our book recommendation on Japanese management practices:

  • Understanding Japanese Management Practices
    by Parissa Haghirian
    This book outlines the particulars of Japanese management and how modern Japanese management employs many practices which are very successful and worth adopting. The main objective of this book is to illustrate the many teachings that Japanese management practice can offer the rest of the world.
  • Taiichi Ohnos Workplace Management: Special 100th Birthday Edition
    by Taiichi Ohnos
    This unique volume delivers a clear, concise overview of the Toyota Production System and kaizen in the very words of the architect of both of these movements, Taiicho Ohno. Filled with insightful new commentary from global quality visionaries, Taiichi Ohno’s Workplace Management is a classic that shows how Toyota managers were taught to think.
  • The Toyota Way: 14 Management Principles from the World’s Greatest Manufacturer
    by Jeffrey Liker
    This book explains the management principles and business philosophy behind Toyota’s worldwide reputation for quality and reliability. Complete with profiles of organizations that have successfully adopted Toyota’s principles, this book shows managers in every industry how to improve business processes.
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