Assignment 1: Japanese management in U.S. companies [618216]

Assignment 1: Japanese management in U.S. companies
American-Japanese Company Sony in San Diego is an e xample of practical Japanese
management in United States. The San Diego plant pr oduce more than 700,000 color TV
sets/year, which represents 1/3 of Sony's global pr oduction. Making a labor productivity
similar to that of a company operating Japan is due and the atmosphere created in the
company. There is no hierarchy, managers and worker s use their surname and have dinner
together, and once a month a senior manager is addr essing the workers presenting sales and
production targets and encourage them to express th eir wishes. The company organizes four
times a year a reception for employees. The attitud e of American workers can be
characterized by the view expressed by Price, 54 ye ars old, who works on the assembly line
"… to work for Sony, is like working for your fam ily”. Moreover, the plant director, Shiro
Yamada, 58 years old, says that there are very few differences between American workers
and their Japanese colleagues. He says that "Americ ans are as aware of the importance of
quality as the Japanese, but need to be motivated f or that”.
Shiro Yamada pays particular attention to the needs of workers. Once a year the
workers whose rate of absenteeism is zero are invit ed to a restaurant in downtown. Attention
is paid to employees working and living conditions. Thus, if there is a complaint about the
size of the refrigerator, for instance, it will be replaced quickly. Vice President Masayoshi
Morin, which is called by everyone Mike, took cours es of Spanish to converse with plant
Hispanic workers. Everywhere phones are installed t o allow communication and record
anonymous suggestions and claims by the workers. Ho ping that workers will show their
loyalty, the company strives to create close ties w ith them. Promotions come from within;
most assembly line supervisors are graduates of sec ondary schools promoted because of their
work and their loyalty towards the enterprise. Alth ough sales during the last 5 years have
significantly decreased, nobody was fired and they were asked to carry out other maintenance
work to remain in the company. When one of the firs t employees of the factory demanded his
resignation less than a year before retirement, Jap anese managers were surprised. Richard
Crossman, human relations specialist for the plant, explains "… they came to see me and
asked me where they were wrong. I had to explain th at in southern California is common
practice to leave the job". The company care for it s employees gave excellent results.
Numerous attempts aimed to implement a trade union were rejected at a ratio of 3/1. Jean
Timmerman, 22 years, say: "The salary you are recei ving at the union was higher and social
benefits were probably better, but eventually we de cided to ignore them". However, Sony
hasn’t forced American workers to work in Japanese style. The use of yellow overalls for
workers on the assembly line was a failure, because they prefer to wear jeans. Also, the
company has tried to implement group exercises with workers in San Diego, as exists in
Japanese plants, but backed off on that decision be cause of their opposition.
The youngest of the plant supervisor, Mark Dempsey, 23, admits that there is a
cultural gap between Japanese and Americans, saying : 'They do not understand that some of
us think only at the weekend, while most of them th ink how to resume work”. There are also
different opinions of American workers about Japane se management system: “the consensual
decision making process cause delay, it demonstrate s an inability to decide”. However, most
Americans appreciate the management system even tho ugh some of them still consider it
foreign. Significant for this purpose is the statem ent of supervisor Robert Williams: "A long
time ago, Americans also take into consideration th e person like the Japanese does, but in
time we lost that sensitivity”.
Topics for discussion:
1. How do you consider the Japanese management syst em?
2. What kind of problems you think will have to sol ve Japanese managers in the U.S.?
3. How do you consider the knowledge transfer in ma nagement should be done?

Assignment 2
Prentice Machine Tools – which way?
Prentice Machine Tools is a mid-size company that p roduces household hand tools
such as hammers, jointers, screwdrivers drills and more. Their products are distributed locally
in a U.S. state. Their main competitors are a few l arge companies with nationwide
distribution, like Rockwell, Sear, Roebuck and Blac k-Decker and some specialized
manufacturers of smaller size. Imports from low cos t countries have an increasing influence
on the American market, representing 10% of total s ales. Prentice estimates their market
share at 5%, while the first 4 major competitors ha ve about 60% of the total. The strongest
competitor is much larger than the others.
The strategy adopted by company was always of setti ng prices 15% below the price of
other competing companies. Company does not spend a lmost anything for promotion and
marketing, based on the fact that the price will ge nerate sales in key retail markets.
Prentice has also had a program to promote their ow n brands, which generated an
increase of 30% of total sales. It was not unusual to discover on some markets the brand
"Prentice Made”. Prentice earned a small profit of 3% of sales. This margin was maintained
approximately the same for the last 4 years. Market share both in industry and in the region
has not fluctuated, although there was increasing p ressure on the price of foreign competitors.
On 15 January this year one of the main competitors (number 3) announced a national
program to reduce retail prices by 10-25%, a promot ional program worth several million
dollars, and redesigning the product range. The obj ective of this company was a substantial
increase in its market share. Company has implement ed a similar strategy in Great Britain
and got an increase of British market share by 10%.
In this situation the alternatives for Prentice top management are:
1. Do nothing, which could put the company in a dif ficult situation, as the other major
competitors could align to the new prices.
2. An immediate cut of prices to have the same adva ntage as in the previous period,
which could cause similar actions from some of the competitors and determine a massive fall
of prices.
3. Implement a marketing mix, which would give the company enough time to decide
what to do next.
4. Attempt to reduce internal costs, which would me an they can handle any price
reductions determined by the market.
Topics for discussion:
1. What is, in your opinion, the most appropriate s trategy for Prentice top
management in order to deal with the situation? Con sider the alternatives presented on the
pros and cons of each.
2. On a long term, which would be the most appropri ate strategy for the firm
Prentice? Explain the answer.

Assignment 3
Robots in production
Like many other inventions, robots were created in the U.S., being perfected and used
with great success in Japan. For instance, in a "Da tsun" car factory located 95 km from
Tokyo, robots and not people are have a leading rol e. They weld car doors, apply the paint
and perform other tasks more efficient, more econom ical and faster than human workers. In
Japanese enterprises, robots can be seen everywhere performing different tasks. It is expected
that in the future they will manipulate parts of nu clear plants, will explore seabed or will
produce other robots.
Manager of the "Japanese Industrial Robot Associati on”, Kanji Yonomoto, argue that,
in 1979 only, in Japan there were more than 50,000 robots in industry, particularly in
automotive, electronics and metallurgy. This figure included automatic machines capable of
performing only single operations and requiring a m ajor adjustment to execute another
operations. For the same year, concerning the numbe r of intelligent robots in Japan, it
amounted to 10.000, controlled by a computer and ab le to distinguish between a car with two
doors and one with four doors, or to appreciate tha t it is not necessary to put a ceiling in a
convertible car.
Today, Japan uses the highest number of robots in t he world, being followed by
U.S.A. and U.K. A spokesman of Nissan, Datsun car m anufacturer, say that "96% of the
tasks of the Zama assembly plant are done by automa ted machines, controlled by computers
and lacking errors.
Nissan began using robots for the first time in 196 9. In 1975 it possessed 52, two
years later the figure reached 209, today the compa ny operates more than 12.000. Another
company’s spokesman states "… of course, we seek to reduce our labor costs but this is not
the only thing that interests us”. According to Jap anese approach, Nissan has been talking
with trade unions for many years before engaging in this way. One of their senior managers
says that 99% of workers monitoring robots are at l east graduates of a secondary school or
technical school and are happy that they can do som ething other than painting or welding.
Kajima, a Japanese trade union leader, said: "Nobod y is willing to spend eight hours a day in
a paint shop where working conditions are dangerous . We need robots. In terms of individual
benefits, robots are more than welcomed”.
To imagine use of robots in Japanese companies is e nough to visualize how a painting
robot, like in a fancy dance, imitates the man who vaporize paint from left to right, go,
withdraw his arm, bows, add one layer in a place di fficult to reach, all this being stored in a
computer program. Then, painting robot is moving aw ay and continues working until the
computer receives a command to stp. Robots do not t ake coffee breaks or holidays, are
equally productive from 6 a.m. 23 p.m.
Japanese government offers tax cuts for small and m edium enterprises to make them
follow the examples of Nissan, Toyota, Matsushita o r other LSE to use robots.
Topics for discussion:
1. Develop a convincing explanation of Japanese man agement in the field of
industrial robots despite the fact that they were i nvented in the U.S. ½ page
2. Identify the main advantages and disadvantages o f using robots. ½ page

Assignment 4
In the following table are presented the answer of managers from different regions
regarding the best measures to increase labor produ ctivity.

Measures to increase labor productivity

Zone
No. USA Europe Japan
Position Position Position
1 Inflation control 2 1 1
2 Incentives and government capital
investment 1 3 4
3 Incentives and funding of research by
government 5 5 4
4 Emphasize on managerial techniques 2 6 3
5 Workers training 6 7 2
6 Minimize government intervention 4 4 7
7 Reduce power of trade unions 7 2 8
8 Changes in the definition of items
and labor structure 9 8 6
9 Mitigating regulatory provisions on
health, pro-labor and pollution 8 9 9

Topics for discussion:
Analyze the table focusing on the impact of every m easure (explain how every one of them
influence the productivity) and explain the differe nces between the three regions (2-4 pages).

Assignment 5
A message from the East
Matsushita about managerial system:
"We will win and the industrial West will lose; we cannot do anything to help because
the causes of failure is in you.
Your companies are built based on Taylor’s model an d worse than that, it is rooted in
your minds.
Your senior managers are responsible for decision m aking, while your workers are
performing low qualified tasks and you are deeply c onvinced that this is the right approach to
carry out economic activity.
For you, the essence of management is to take your ideas and transfer them in the
hands of workers.
We abandon long time ago Taylor's model; economic a ctivity is nowadays so
complex and difficult, for companies is increasingl y difficult to survive in an unpredictable
environment, competition and dangers are becoming c ommon occurrence, so business
continuity depends on the daily mobilization of eve ry ounce of intelligence.
For us, the essence of management is precisely this art to mobilize and assemble the
intellectual resources of all our employees in the best interest of the company. As we assessed
new challenges better than you, with your reliance on technological and economic
intelligence, so we come to the conclusion that a h andful of technocrats, regardless how
intelligent and brilliant they are, are no longer e nough to address those challenges as real
sources of success.
Only by harnessing the combined intellectual power of all of its employees, a
company may cope with turbulence and environmental constraints.
This is the reason why our large companies provide employees with three to four
times more training than yours, this is the reason why we realize that continuous changes and
improved communication within the company has to be intense, that explains why we
constantly ask suggestions from employees and why w e claim educational system an
increasing number of graduates, intelligent and wel l-trained, generalists, because these people
are the life blood of Japanese economy.
Often your social leaders, full of good intentions, think that it is their duty to protect
employees. Unlike them, we are realistic and we bel ieve that our duty is to make the
employees defend those companies. In doing so, we c ome to be more "social" than you”.
Topics for discussion:
1. Identify the main differences between Japanese a nd US management system in the text
above.
2. Comment those differences.

Assignment 6
Management-trade union relationship at IBM
International Business Machines Corporation (IBM) i s proud not only of its world
known products, but also for the fact that for more than 35 years the company has not fired
any employee for economic reasons. This is due to t he policy of "career change" as they say
at IBM, or to re-train workers whose work is no lon ger justified. In recent years, over 5.000
employees have attended special courses and were re trained in a program designed
specifically for this purpose. An example is the ca se of Mrs. Karyl Nicholas who once
worked as a secretary at an office of IBM in the We stcester Country, then became
representative in New York for selling typewriters and other office equipment. Without
sharing tears of gratitude, she devotes 10 hours a day, or even more, to her work.
Along job safety for its employees, IBM offers adva ntages for loyalty and
productivity. Considering that job safety is the ma in rationale behind establishment of trade
unions, IBM assumes that if employees are not afrai d that they would be laid off, they will be
willing to cooperate with company management to ach ieve the targets set, which will be
reflected in financial results. At the same time, I BM does not hesitate to fire unproductive
employees, which according to company management sh ould not be tolerated.
To retain employees company often perform changes b etween holders of various
positions and sometimes job rotation, especially fo r junior positions. For IBM, job safety is
an important issue of human resources management. C ompany’s HR specialists argue that it
is not a pattern to turn against the company by sta gnation since its values promotes
individualism and creativity of employees. Accordin g to a former specialist at IBM:
"Ensuring job safety without requiring productivity , it may lead to problems. But we claim
results. Simultaneously, it is impossible to mainta in a favorable organizational climate by
increasing or decreasing staff number without havin g in mind people’s needs, also".
Topics for discussion:
1. Ensuring job safety make useless the need for a trade union?
2. If IBM would had adopted an authoritarian style of leadership, which would be the
impact on staff productivity?
3. Relationship between top management and trade un ions at IBM is common for U.S.
managerial system?
4. Discuss the following statement: "In the R&D int ensive industries HR is one of the
most precious resource of the company, so IBM has n o alternative but to handle their
employees very well."

Assignment 6
Why we must consider cultural differences in doing business?
A few years ago, Parris-Rogers International (PRI), a British publisher, has sold its branch in Bahrai n,
which hardly kept afloat. This branch was first est ablished to edit phone books and indexes of compani es for
five Arab countries from or near the Arabian Penins ula, plus U.A.E.
While the US military stationed the area after the Gulf Wars have protocol officers that advised on
what was considered as acceptable behavior (e.g. fe male soldier in the US Army were forbidden to jog, to drive
around or wear skirt outside military bases), PRI h ad no such guidance. Moreover, while the Saudis wer e
concerned about the security of their country, book s published by PRI were far less important for them .
As editor and researcher was hired an Englishwoman, Andrea Black, and as sales representatives
company accepted three young Londoners. The four we nt immediately to Bahrain. None previously visited
Middle East; all they expected to operate as usual, accustomed with Western way of doing business.
The three sales representatives, waged based on com mission, expected that adopting an aggressive
strategy, will have the same number of meetings as in the UK and the same success. They were used to w ork
eight hours a day, to receive full attention of pot ential customers and summarize the entire conversat ion about
specific aspects of the transaction. Situation enco untered was quite different. Time available for sal es was much
lower than they expected, primarily because religio n imposed on them Muslims to pray five times a day and
secondly, because the day was further reduced durin g Ramadan month which celebrates sacred time from
sunrise to sunset. PRI representatives noted also t hat the Arabs were giving little regard to meetings . They rarely
started at the set time. When they finally had the chance to meet with Arab businessmen were often inv ited to a
cafe, where the latter engaged in discussions which for British sales representatives represented only "chatter".
Wherever the meeting have taking place, at a coffee shop or in the office, drinking coffee or tea seem ed
to have more importance for Arabs than business pro blems. Also they frequently engaged in discussions with
friends who came to the cafe or office.
Andrea Black, in turn, encountered considerable res istance trying to fulfill her duties. In addition, her
employee based contract with PRI made her to bear a ll the additional costs. PRI had drawn up budgets f or
editing indexes based on experience on the London m arket. In Bahrain, however, preparation of these bo oks
proved to be much more expensive and longer. For ex ample, in a traditional town in the Middle East the re are
no street names or numbers for buildings so that ea ch position is identified by the prepositions "befo re", "after"
or "before" a significant milestone.
Black was faced with other problems because she was a single woman, also. She was responsible for
operations in twelve countries and she planned hiri ng freelancer for each. Ads for hiring such workers , however,
were responded with obscene phone calls and harassm ent.
In addition, Saudi authorities denied her entry int o Saudi Arabia and the visa for Oman took her six
weeks every time she went there. These sad experien ces were very frustrating for her because both Saud i Arabia
and Oman facilitate entry of unmarried women, if th e purpose of their visit are a local priority or in tend to hire
as a maid or nanny, having therefore contact only w ith other women and children.
In countries allowing her visits, Black was bound t o accommodate only in hotels permitted for foreign
women by government officials, and even there, was not allowed to dine in the restaurant unless it was
accompanied by a man, usually a hotel manager.
PRI company sales representatives could not adapted to the unusual business environment. Instead of
forcing the company to change its bonus pattern, th ey tried to change the behavior of Arab businessmen . For
example, after several months, they refused to acco mpany potential customers at the cafe and began to express
irritation with the "irrelevant" conversation or wi th repeated delays and interruptions. As a conseque nce, Arab
businessmen have reacted negatively. In fact, PRI h ad received so many complaints that it was forced t o replace
their sales representatives. By that time, however, their sales were irreparably damaged.
Topics for discussion
1. Why a company needs to change its business pract ices that have proved successful when operating
in another country?
2. What are the major cultural differences arising from the situation described?