Eastern & Western Management Styles

Germany, the U.S. and Japan

Carola Carstens, Nina Kummer, Britta Upsing

What is Management?

Staffing Leadership and Career Development Compensation System Motivation and Evaluation

Communication

Introduction

What is management ?

Takeo Fujisawa, Founder of Honda Motor Company: Japanese and American management are 95 per cent the same, yet differ in all important respects.

Introduction

Recruitment in Japan

directly from school with a focus on general characteristics instead of technical skills as one is employed for a lifelong period

Career development

A successful career

After 10 years: promotion to kacho

After

20 years or more: promotion to bucho Not before the age of 50: possible promotion to directorship

Career development

Career perception
Japan

Germany

Life-long employment Seniority promotion

Ultimate goal: broad experience

Short-time employment possible Promotion on merit Increased mobility Specialists

Career development

Factors that determine salary

Prevailing pay Bargaining power of unions Individual needs Job requirements Seniority and education Ability to pay

Compensation System

The pay-package in Japan

Monthly base-pay Semi-annual bonus Allowances and benefits

Compensation System

Sources of Motivation
Similarities

Differences

Responsibility Challenge Interesting work Recognition Money is secondary

Seniority wage Promotion system Importance of the group

Motivation and Evaluation

The process of evaluation

In: Japanese Management, p. 154

Motivation and Evaluation

HRM: Japan - USA

Importance of the company for Japanese and American employees:
In: Japanese Management, p. 155

73% of the Japanese

Conclusion

79% of the Americans

HRM Japan - USA

JAPAN top priority given to human assets in management regular employees fixed assets well-being is crucial USA primary importance will be accorded to numbers and laws rather than to people employees = semi-variable assets can be hired and fired as needed

Conclusion

HRM in Japan
people-centered management

Japanese companies exist primarily for the well-being of Japan and its people people before profit ?

Conclusion

HRM in Japan
Uchi no kaisha*: Ein Unternehmen ist nichts Fremdes, Abstraktes oder Unangenehmes, sondern ein eminent ntzlicher, allseits Wrme spendender Organismus.
* kaisha = Firma, lit. soziales Beisammensein

Conclusion

Office Layout

Open-plan offices No cubicles or dividers Private space is avoided in touch

Keep

Office Layout
I share a spacious office area with other administrative staff members. When we work together in one big room, we can talk casually to one another. There are a lot of suggestions and ideas exchanged in these conversations. (the president of Honda American Motors)

Office Layout

Groups

Working groups with family-like ties Identification with the group The group rather than a single individual is rewarded or blamed in case of failure is maintained

Harmony

Formal and Informal Company Structure

Working groups

Group members are aware of their status Individual needs are deemphasized in order to maintain harmony Dependency relationships

Formal and Informal Company Structure

Rice cultivation

until 100 years ago, 5/6 of the population was employed in rice cultivation Only 10% of the land can be cultivated Crowdedness
Cooperation

is necessary

Formal and Informal Company Structure

Habatsu (Cliques)

Informal groups

Membership is based on unchangeable criteria

Graduating from the same university Having a common hometown

Formal and Informal Company Structure

Communication

office-layout supports the free flow of information everybody is kept up-to-date communication even vertically is easy face-to-face communication is often continued in a restaurant etc.

high-context situation
Communication

Communication
JAPAN oral written preferred form of communication last resort, seen as formal, cold, lacking the reciprocal give-and-take USA non-binding inefficient preferred form of communication: contracts, memos...

nonverbal

very important, subtle, not very developed fine art of communicating (low-context desires and feelings culture) without words, honne tatemae
Communication

Decision Making

popular view: JAPAN group process catchwords: JAPAN USA USA individual process

bottom up

top down

but reality is a little more subtle...

Communication

Decision Making - Japan

Cultural background: Wa: harmony - the essence of Japanese life Kyodotai: harmonic, organic cooperation of a community with friendly mutual support and understanding decisions are ideally made in this atmosphere of friendly cooperation unanimity solidarity
Communication

Decision Making - Japan

RINGI system of decision making

nemawashi: preparing the ground frequent sound-outs on views and positions (uchiawase) ringi-seido: circling process

Communication

Decision Making Japan

ringi-seido 1
ok? ok!
decision form (ringisho)

sound discussion with the affected sections/ people

proposal

fills out
Communication

Decision Making Japan

ringi-seido 2

proposal is forwarded to all relevant sections/ people

section x section y ...

each will make comments on a sheet attached to the back of the proposal
Communication

Decision Making Japan

ringi-seido 3

the decision will be made by top management based on the comments from all people involved in the process official announcement of the approval
Communication

Decision Making Japan

Too time-consuming ?

In: Japanese Management, p. 161

Communication

Decision Making Japan

Pros: elimination of dissension through participation of a large number of people participation of employees even at lower levels cumulated expertise gradual improvement/correction no individual responsibility -> daring and progressive decisions gather opinions of other sections (no nicht mein Bier) smooth/ more efficient implementation
Communication

Two sides of an organization

FORMAL
official side organization charts designated work units

INFORMAL
working side cliques informal leaders

job specifications
titles ranks lines of authority

channels of informal communication

Formal and Informal Company Structure

Kacho

Informal leader Head of department position between management and workforce mediator

Formal and Informal Company Structure

Informal Structure in Japan

Informal leaders groups channels of communication

supplement a steep hierarchy.

Formal and Informal Company Structure

Organic versus Mechanistic View

Organic: The organization as a living organism
Constantly in progress

Mechanistic: The organization as a static scheme

Strive for equilibrated states
Informal and Formal Company Structure

Management

management in Japan has to coordinate, integrate and motivate in America management rather means supervising others

Informal and Formal Company Structure

Hierarchy

Strict hierarchical order Secured spheres of control

Managers are other-oriented In the West most managers are self-oriented

Hierarchy

Power
Power is based on a persons function In Western organizations power is based on a person
Less

competition in Japan than in Western cultures

Hierarchy

Leadership

an effective leader in Japan is above all:

- a catalyst - a coach - a source of inspiration for his team

Hierarchy

Management and working styles 1

JAPAN
generalists promotion by seniority conflict is solved privately people-oriented long-term planning informal communication decision by consensus interdependency
Summary

WEST
specialists promotion by performance conflict is solved in public task-oriented short-term planning formal communication decision by majority interdependency is viewed sceptically

Management and working styles 2

JAPAN
reciprocal commitment between managers and workers open-plan offices formalized and ritualized interactions intuitive, nonverbal communication is important face-to-face communication more important
Summary

WEST
less bonds working space is structured according to individual needs informal interactions more common analytical, logical argumentation style written communication more important

Total Quality Control

Method developed in the USA Quality assurance at every stage of production

In Japan: Quality Circles Target Cost

Organization and Planning

Quality Circles
Quality Circles are small groups of people who do similar or related work who meet regularly to identify, analyse,and solve product-quality and production problems and to improve general operations.
(Robert E. Cole, Director of the Center for Japanese Studies at the University of Michigan, S. 238)

Organization and Planning

Quality Circles

Core element of the Japanese application of Total Quality Control Small groups of employees: 10-12 members to facilitate communication improving process = Kaizen KAI = Change and ZEN = to the best

Continously

Organization and Planning

Benefits of Quality Circles

Improved communication Greater job satisfaction Improved morale Improved quality Cost savings

Organization and Planning

Target Cost
Japan

Germany

Costs estimated by cost engineers What are customers willing to pay?

Costs estimated by accountants Design first, then calculate the costs

Organization and Planning