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The Decline of the Japanese System of Management
Sethi, S. Prakash, Nobuaki Namiki, and Carl L. Swanson
26/4 (Summer 1984): 35-45 *

This article focuses on the decline of the Japanese System of Management. Ironically, while many American companies have become interested in adopting Japanese management practices, a careful review of business and economic activities in Japan in recent years shows that Japanese Business and Management System (JABMAS) has been undergoing significant change. Although the changes have not as yet attracted mass attention, they are affecting the concepts and practices that are at the core of JABMAS and provide it with its most distinctive, and widely appreciated, characteristics-lifetime employment, a seniority-based wage system, and consensus decision making. Three major factors account for these changes. One is the slowdown in Japan's economic growth and the resulting constraint on corporate expansion, which has exposed corporate inefficiencies in terms of an excessive labor force, a cumbersome decision-making process, and lack of innovativeness in generating new products and ideas. Two, Japan can no longer compete on the basis of production efficiencies alone. In their effort to cope with the new international environment, Japanese companies are modifying their traditional management practices as they relate to their employees in Japan.

California Management Review

Article Information

California Management Review

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