Japan

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The Japanese economic system can be described as being ‘tri-partisan’ in that the government, industry and the workforce work closely with each other to fulfill one another's aims of prosperity.

The focus of Japanese industrial policy according to James (1989) has shifted from post-war labour intensive industries, through the 1950’s into heavy industry based, then in the 1960’s and 1970’s into heavy electrical engineering with the 1980’s and 1990’s being based on knowledge intensive industries, such as computers, integrated circuit manufacture, aero-space, etc. As Japan was excelling in industries, it’s experience curve moved towards more profitable industries.

Throughout the 1960’s to 1990’s, the economic philosophy of Japan has remained untouched, i.e. nurture home companies, restrict imports and more importantly via keeping a low value on the Yen allow for worldwide growth in exports. The later part of the 1990’s did see a decline in the Japanese economy, but unlike it’s western counterparts, the Japanese remain loyal to their fundamental personnel practices.

Western manufacturers can be described as operating on the premise of ‘economies of scale’ on the premise that the higher the volume you produce of a product, the lower the costs of production will be, this will be reflected in a lower market price allowing for business growth.

The Japanese manufacturers in adopting the idea of flexibility in both production processes and by employees being flexible to work a wider range of tasks with much less demarcation were generating ‘economies of scale’ through flexible specialisation. Piore & Sabel (1984) suggest by operating in such environments manufacturers achieve the freedom to change products and production processes (See FMS Section of web-site) quickly in response to changing market needs.

The Japanese were moving from little profit making industries once their experience curves began to grow into more profitable sectors, in a little over 50 years they had achieved a similar rate of progression, as the UK had taken several centuries to achieve.

Although the Japanese management ideals may appear vastly different from Western counterparts, they are in essence an extension of Fordism and Taylorism, in that the overriding premise remains of achieving ‘economies of scale’, but with greater emphasis on flexibility. We shall now be discussing a range of Japanese and Western personnel practices.

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