Gradual Evolution of the Management System in Japan

We describe here the gradual evolution of the management system in japan. Japan’s industrial progress in the last century is largely indebted to its system of management which relies heavily on patriotism and group endeavor. During the period of post-war recovery, the government also played a big role.

The Meiji leaders took up the issue of industrial development as their number one agenda. Initially, they emphasized Japanese industries. Gradually, they became alert in the borrowing of these concepts and technologies and ultimately put their energies in the development of purely Japanese tradition in management.

Gradual Evolution of the Management System in Japan

There is no denying the fact that the Zaibatsus, the national industrialists of Japan, did their best in Japan. As a matter of fact, the joint endeavor of both the Government and the Zaibatsus played a big role in making Japan what is now at this moment.

The noted industrialists of Japan are almost self-made. Their name and fame owe a great deal to their untiring efforts in industrializing Japan. They emphasized the employment of potential executives from among bright graduates of “A-grade” universities and business schools.

Young graduates also felt encouraged to join the better-paid executive positions in industries instead of government service. Business executives have thus occupied a more prestigious position in society compared to their counterparts in civil service. Consequently, today’s managers are enjoying a high social position.

Appointments in such positions are, therefore, highly competitive. Talent hunting is also popular in Japan through which industrial houses try to lure away talented executives from other enterprises. However, the usual practice is to hire fresh graduates direct from universities and then to train them up for senior positions in the management hierarchy.

Organization Structure and Management of corporations in Japan

Some sort of specialties is there in the organizational structure and management of industrial enterprises of Japan. In fact, they grew up in conformity with the Japanese social system and culture and for that, the management practices in Japan are quite distinct and different from those of other industrially developed countries of the world.

Most of the large industrial and commercial enterprises of Japan are managed and controlled by corporations, whose pattern of ownership and management are nearly similar to those of public limited companies of Bangladesh.

They have got their separate legal entity and the main responsibility of management rests with the board of directors whose members are elected by shareholders. The directors enjoy a wide latitude of autonomy in management under the Commercial Code of Japan. The said code empowers the board to do the following:

  1. Determining policies relating to the production and sale of the corporation.
  2. Purchasing and selling of valuable properties of the corporation.
  3. Performing important contracts on behalf of the corporation.
  4. Setting important organizational and/or personnel matters.
  5. Defending important litigation in favor of the corporation.
  6. doing all other important jobs on behalf of and being empowered by the shareholders

The directors remain accountable to the chairman of the board who performs the duties of the chief executive of the corporation. The final decisions on important matters rest upon the chairman. The image and the prospects of the corporation also depend on the foresightedness and efficiency of the chairman.

The size and composition of the board of directors of Japanese corporations are different from those of the USA or the UK. In each and every board there is the existence of a representative director who performs all the legal formalities on a representative director who performs all the legal formalities on behalf of the board.

He is selected by the board from among its senior members. Moreover, the appointment of an auditor, as one of the top executives, is compulsory. Such an auditor may be a shareholder or even a director of the corporation.

The directors are regarded as the top-most executives of the corporation. The limits to their responsibilities and duties are set by the “Commercial Code” as aforesaid and thus it is difficult for them to avoid their duties and responsibilities. The most senior of them is usually appointed as the chairman.

Among the other top executives are i) the senior executive vice-president, ii) the executive vice-presidents and iii) the managing directors.

The senior executive vice president and the executive vice presidents remain closely associated with the chairman. Just below them is the position of the managing directors who perform duties in their respective divisions/departments under the direct supervision of executive vice presidents.

These top executives are being assisted by advisors, being appointed by the board. They are usually the people from among the retired senior executives and they enjoy honorary staff positions.

Management Structure of Japanese Corporation

Another feature of management in Japan is the existence of an “executive committee” in almost every corporation. Such a committee is manned by senior executives and is entrusted with the responsibility of formulating policies and performing important functions.

Just below the top management is the divisional and branch managers. They are the mid-level executive and do usually perform their duties as per instructions of policies laid down by the top management. Under each division/branch there may be some sub-division or sections.

In each section, there may be some officers and employees numbering between 12 to 20. Most of the office employees are female while the production workers are mostly male.

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