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.

“I’m not praising US management concepts unreservedly. There were a bunch of useless concepts used by consultants just for business. However, if we deny the concepts coming from the U.S and say “We Japanese people also have Japanese management style”, what can we see? The answer is nothing. No intellectual creation has been made.”

Mr. Saegusa

Kaizen

Source: www.kanbanchi.com

Originally, Japanese companies were weak in strategic thought. What Japan’s strength was “Kaizen” (improvement) which young employees (not executives) pushed through on site.

There must have been another strategy that business leaders should’ve tackled spontaneously. However, the Japanese managers weren’t required to show their strategic leadership skills inasmuch as the bottom-up Kaizen did work out very well.

The bottom-up management style which was the pride of Japanese people as the characteristic of Japanese management actually caused the delay of nurturing business leaders. In addition, Japanese managers were dependent on Kaizen and misconceived that Kaizen would continue to work out as a corporate strategy. This was the underlying cause of inviting the 90’s hardship to Japan.

Japan’s TQC (Total Quality Control) gradually came to prioritize a formality rather than substance. Then, employees started not to be able to find elements for Kaizen and became tired from it.

This was the time when the rapid progress of Japanese companies stopped.

“Moreover, Japan’s past managers, management consultants, and scholars including me did not have enough creativity. Therefore, against our wills, we allowed American people to carry out the work of developing QC and the Toyota production system (Kanban system) more strategically, and formulated it to a new managerial concept. “

Mr. Saegusa

There is one more example of what Japanese people thought it is common knowledge but it is not.

A lack of a managerial aspect

In Japan, the split of a company by function has been implemented. For example, a lot of companies have separated their sales departments from the companies and founded other companies focusing on just sales as distributors all over Japan and/or separated the function of production and made it independent companies.

In the U.S, company’s division means having a whole business cycle which is development, production, and sales. Therefore, a manager of the division is required to take responsibility for the whole business because a division system is the method of avoiding the weakening of managerial leadership caused by the growth expansion of a company.

However, in Japan, there are a whole bunch of “divisions” just having the function of sales, or just having the function of production not selling goods “they produced” to outside customers by themselves.

Most importantly, many business managers don’t have doubts about this situation.

This is because they don’t have a managerial aspect of the importance of giving a person a chance of having the whole business process (development, production, and sales) and pushing through a project strategically. They prioritize the aspect of the efficiency where people aim to obtain the scale merit by function.

Certainly, the split of a company by function is good for expanding competition where we can get the scale merit by separate optimization.

Kobe Steel Scandal in 2017

However, if we leave it as it is for a long time, it will be unavoidable to cut off the whole business cycle. Then, between departments, in-house political influence will be rampant, organizational speediness will decrease, and eventually creativity and strategic orientation will get disturbed.

Unfortunately, people contracting this organizational climate are usually not able to notice these problems.

For example, Yukijirushi Milk Products Co., Ltd (Japan) caused an incident of food poisoning and dropped to deficit.

Then, they abolished the system of unit by function and the split of a company by function, based on reviewing their organizational fault which was the delay of the communication of the information within the company.

This was an example of the company which wasn’t able to rectify the phenomenon that the chain of development, production, and sales was lost until having a bitter experience.

In addition, the reason why Japanese companies can’t nurture business leaders is that the companies let their excellent employees work in departments prioritizing efficiency by function up to late in their career and don’t let them experience taking responsibility for the whole business cycle (development → production → sales)

A complete defeat of intellectual creativity

Japanese companies have succeeded in launching low-priced and high quality industrial products with collective efforts, but unfortunately suffered a complete defeat of creating managerial know-how intellectually and nurturing managerial human resources dynamically against the U.S.

However, it’s not the result of efforts that managers tried something strategically and failed it, but it is the consequence that the managers hadn’t done anything at all and let nature take its courses, which was the failure.

Now, this case has showed up a lot. As a result of this, Japanese companies re-imported managerial concepts which was originally born in Japan but developed by American people such as supply chain and 6 sigma, and is intent on incorporating US rules including cash flow and shareholder orientation.

However, it is wondered if this can help rehabilitate Japanese companies.

*Japan’s complete defeat of intellectual creativity 1~4/ Source: Vjikaihuku no keiei (The management of V recovery, Tadashi Saegusa, Japan) → Buy