1970’s in the U.S/ Photo: LELAND BOBBE

American economists and business people continuously wrote sort of instruction manual of Japan and not only spread its system to all over the U.S, but also showed great ability in organizing it to the concept of the American version.

At first, a strategy of American companies to compete against Japan was sort of chaos and they couldn’t figure out where the exit was. However, some breakthroughs were born from the latter of half of the 1980’s.

Reengineering and Toyota Production System

Theory Z/ Source: getcontrol.co

From the latter of the half of the 20th century, the U.S developed a variety of managerial techniques and tried them out in the real businesses.

e.g.

(60’s) cash flow, long-term business plan

(70’s) the theory of strategic management

(80’s) the theory Z, excellent company, the spirit of industrialist, venture capital, value chain, the time strategy

(90’s) Reengineering, customer satisfaction, supply chain, transformation, change management, core competence, best practice, IT, benchmarking, BTO, 6 sigma

Especially after 1980’s, the techniques were based on reengineering, or its basic form of the Toyota production system and quality management.

Originally these techniques were developed by Japanese people, but American people learned a lot of things from the techniques launched to the world from Japan as a management method.

Finally, they transformed them to a management concept to compete against Japanese companies.

A Child of the History of the Japanese Management

Photo: gettyimages

As such, US people succeeded in analyzing and resolving almost all of factors of the strength of the Japanese management, and in seeing through the Japanese management by the beginning of 90’s.

In other words, the signals of Japanese management were perfectly decoded.

Dell Computer Ink., founded in 1984 and its sales grew up to $30 billion in 15 years, introduced the managerial concepts which originally Japan had developed including “production-to-order from one piece” and “inventory control”.

When I asked Michel Dell, the founder of Dell Computer, about it, he said. “Exactly! Coming across the Toyota production system was a big turning point.” Dell Computer is so-called a combination of US’s venture spirit and Japan’s method of Kaizen. Therefore, I call Dell Computer a child of the history of the Japanese management. How come we Japanese ourselves couldn’t create this $30 billion company? 

Mr. Saegusa

*Now Dell Computer’s sales is over 50 B.

When we think about this question, we can see the bottom line of the 90’s hardships that Japanese companies fell into.

In short, Dell Computer showed that past Japanese business leaders were bound by stereotypes, neglected managerial innovation, and missed such a big business chance.

The Startup Culture in the U.S

In addition, there is one more element which promoted the US speediness. This was the prosperity of the venture culture in the U.S.

Startup is kind of hit and miss, and not very efficient so that it is doubtful that it can also help revitalize Japan’s economy because the venture culture requires strong management power including leadership which is a weakness of Japan.

On the other hand, startups in the U.S cherish speediness. The U.S succeeded in accelerating industrial revitalization by giving chances a large number of startups and obtained the result which swept the world leading industry.

During Japan’s growth economy, what supported Japanese companies was the fact that employees worked enthusiastically even if it was inefficient.

However, the speediness of Japanese companies declined as time goes by due to the inflexibility of organizations, aging of employees, and loss of clear targets.

In contrast, American people (companies) who learned the Japanese knowhow through the 30 year hardship surpassed Japanese people (companies) with speediness.

This sort of gap between Japan and the U.S in terms of speediness affected the competitions of companies and it resulted in the decline and fall of Japanese companies in the 1990’s.

It was intellectual victory for American people.

What did Japanese business leaders create?

While American people had strived to create new management concepts for 40 years, what kind of innovation in managerial method did Japanese companies create?

To be continued …