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In the post-World War II era a set of Japanese cultural patterns and managerial practices came to be known collectively as the Japanese management style or Japanese management techniques. Many of these techniques were credited with helping vault the Japanese economy to its status as the world's second largest, behind only the United States, and with making Japanese businesses, particularly in the manufacturing sector, more competitive than their international counterparts. In the wake of Japan's prolonged and arduous struggle with recession throughout much of the 1990s, however, many observersboth inside and outside Japanhave called into question the effectiveness of some traditional Japanese management practices. As a result, at the dawn of the 21st century Japanese management techniques are more than ever in a state of flux, as scholars and business leaders alike reconsider which practices work and which don't.

Although Japanese management techniques and economic strategies came to be recognized in Western countries only during the postwar period, their origins are considerably older. Most directly, their origins can be traced to at least the latter part of the 19th century, when a Western influenced modernization program began under the new monarchy created in the 1868 Meiji restoration. In part as a response to the bitter European colonization experiences of its Asian neighbors, the new Japanese government began to open the Japanese economy and society to controlled outside influences in order to stave off any Western conquerors. Some recognizably modern practices arose during the Meiji period. Even then, when the Japanese economy was still shedding the trappings of feudalism after centuries of closure to foreigners and slow technological development, heavy emphasis was placed on developing domestic imitations ofand innovations onWestern goods, rather than relying on imports. The practice was summarized well under a slogan of the era, "Japanese spirit, Western technology." This ambition to preserve the character of the Japanese culture and the autonomy of the economy can be seen in 20th-century practices at both the macro- and microeconomic levels. In the national economy it is evidenced by long-standing restrictions (direct and indirect) on imports into Japan and the concomitant trade surplus Japan has maintained for years. At the company level, the same motive helps explain the prevalence of the Japanese keiretsu, the large and complex families of interdependent companies centered around their own banks (e.g., Sumitomo, Hitachi, Mitsubishi). In theory, at least, these firms can avoid "importing" their raw materials,

components, or even capital from "foreign" (i.e., unaffiliated) companies by sourcing these goods from within their extensive organizations.


Rooted in these and other historical traditions, some of the other key practices commonly associated with Japanese management techniques include:
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in-house training of managers consensual and decentralized decision-making extensive use of quality control methods carefully codified work standards emphasis on creating harmonious relations among workers lifetime employment and seniority-based compensation

It is important to note that these are generalizations according to a conventional formula. There have always been variations, and, as noted above, some aspects of these practices have been increasingly reconsidered in recent years.

The education of managers in Japan traditionally takes place on a relatively informal basis within firms. The percentage of Japanese chief executives who have attended university is high, similar to that in the United States and Western Europe. However, very few Japanese executives have attended graduate schools compared to their U.S. and European counterparts. In fact, only one Japanese university offers a degree analogous to an MBA, a key credential for managers in the United States. Formal education for managers is also not well developed at the undergraduate level. Undergraduate education is not viewed by firms as a means of attaining business skills, and firms base their hiring decisions less on a recruit's knowledge than on general attributes such as character and ambition. Firms do not hire recruits to fill specific occupations. Rather, recruits are expected to be malleable, identifying with the general interests of the firm rather than with their specific role within it. The mentor system is widely used in the early training of management recruits and involves middle-level and senior managers serving as teachers and role models. The emphasis on in-house education is related to the traditional lifetime employment system, in which management recruits are hired each April following university graduation; they typically would stay with the firm until retirement. The lifetime-employment system makes it probable that a firm will benefit from its investment in training, and also enables the firm to develop longrange plans for training recruits. Management training is based on regular rotation through a broad range of a firm's operations. Management recruits also frequently begin their careers as ordinary workers on a production

line. The pattern of regular rotation enables managers to develop a detailed understanding of a number of varied operations, and thus over time to attain a rich general knowledge of the firm. Linked with the lifetime-employment system is the emphasis on seniority in compensation and promotionoften over what Americans would take to be "qualifications" for the job. This results in a higher average age and less variation in age among top executives in Japan. Compared to the United States and Europe, for instance, relatively few company presidents are under age 50. This practice is believed to equip Japanese executives with an intricate knowledge about their particular business. Japanese managers typically take a more long-term interest in their firms than do their American counterparts, partly a result of the lifetime employment and seniority systems. In the United States, managers are typically compensated on the basis of their divisions' performance. This bonus system is not used for Japanese managers, as it is considered detrimental to a long-term perspective and an interest in the firm as a whole.


The long-term view of Japanese managers is also based on sources of finance. While American firms rely heavily on capital from the stock markets, Japanese firms tend to rely more heavily on borrowing from banks and generally have much higher debt-to-equity ratios. Consequently, Japanese managers are under less pressure to maximize short-term earnings to please shareholders. By contrast, in the United States there is intense market pressure for companies to meet quarterly earnings expectationseven exceed themor else face a sell-off of their shares. In general, Japanese firms are more likely to focus on productivity, growth, and market share, whereas U.S. firms are more inclined to concentrate first on profitability.

While directors from outside the company are common in the United States, they are rare in Japan. The decision-making process in Japanese firms is highly decentralized. In publicly held U.S. corporations, power is concentrated in a board of directors, with each director having one vote. In Japan, both middle and senior management serve as directors. Japanese directors typically retain production-line responsibilities. For example, in the early 1970s, 14 of Hitachi's 20 directors were engineers. This represents another facet of the strong production orientation of Japanese management.


The traditional decision-making process in Japanese firms is referred to as the ringi system. The system involves circulating proposals to all managers in the firm who are affected by an impending decision. Proposals are generally initiated by middle managers, though they may also come from top executives. In the latter case, an executive will generally give his idea to his subordinates and let them introduce it. Managers from different departments hold meetings and try to reach an informal consensus on the matter. Only after this consensus is reached will the formal document, or ringi-sho, be circulated for approval by the responsible managers.

The ringi system requires long lead times, and thus is problematic in a crisis. In recent years the focus on speeding up decision making has made this approach unpopular at many firms. Nonetheless, one of its underlying principles remains prevalent. That is, when a decision proves beneficial, the middle-level managers who initially advocated it receive credit; when a decision proves unsuccessful, responsibility is taken by top-level executives. This practice is intended to promote aggressiveness in younger managers.

One distinctive characteristic of labor-management relations in Japan is the enterprise union, which is organized around a single plant. Consequently, any given company may have several enterprise unions representing various portions of its workforce. Enterprise unions generally belong to a larger federation, but the balance of power is at the local level. Japanese unions are distinct not only because of their highly decentralized nature, but also because they represent both white-collar and blue-collar workers, with union membership open to managers up to the section chief level. The fact that many upper-level managers have moved up through union ranks and may have even served as union officials highlights the generally less antagonistic relationship between labor and management in Japan. Combined with a relatively narrow income gap between managers and workers and the willingness of manager recruits to work on production lines as part of their training, the open membership policies of Japanese unions contributes to the fairly harmonious interaction between unions and management. Union membership is generally associated with lifetime employment guarantees. Membership varies widely by firm size, and relatively few workers in firms with fewer than 100 employees receive lifetime employment guarantees. Nonetheless, in large firms the lifetime employment guarantee creates an environment in which workers are less likely to feel threatened by technological change. As a consequence, changes in the production process are likely to be undertaken by management and workers on a cooperative basis. More generally, since semiannual bonuses and annual wage negotiations are based on a firm's competitive strength, workers have a large stake in their firm's long-term success.

The extensive use of quality circles is another distinguishing characteristic of Japanese management. The development of quality circles in Japan in the early 1960s was inspired by the lectures of American statisticians W. Edwards Deming and J.M. Juran, in which they discussed the development of wartime industrial standards in the United States. Noting that American management had typically given line managers and engineers about 85 percent of responsibility for quality control and only 15 percent to workers, Deming and Juran argued that these proportions should be reversed. Production processes should be designed with quality control in mind, they contended, and everyone in the firm, from entry level workers to top management, should be familiar with statistical control techniques and undergo continuing education on quality control. In general, Deming and Juran argued that quality control should focus on prevention, with the ultimate goal being to improve the production process until no defective parts or products are produced. Quality circles were one method of reaching these goals.

In Japan, quality circles consist of groups of about 10 workers who meet weekly, often on their own time. The groups typically include foremen, who usually serve as circle leaders. Quality circles focus on concrete aspects of the operations in which they are directly involved, using tables and graphs to communicate the statistical details of their quality issues. In one common format, problems are categorized by materials, manpower, and machines. Quality circles provide a means for workers to participate in company affairs and for management to benefit from worker suggestions. Indeed, employee suggestions play an important role in Japanese companies. Two associations, the Japanese Association of Suggestion Systems and the Japan Human Relations Association, were developed to encourage this process. Japanese employee suggestions reportedly create billions of dollars' worth of benefits for companies.

Japanese management techniques have been strongly influenced by the tenets of scientific management. Like quality circles, scientific management originated in the United States, only to be more systematically adopted in Japan. The pioneering figure of scientific management is Frederick Jackson Taylor (1856-1915). Taylor is best known for his time and motion studies of workers as part of an effort to optimize and standardize work efforts, but he also argued for a system of bonuses to reward workers based on productivity. These ideas were implemented by Japanese firms as early as 1908, and a translation of his Principles of Scientific Management sold 2 million copies in Japan. In the post-World War II years, carefully codified work standards and the use of semiannual bonuses for workers became common practices in Japan. Consistent with the Japanese emphasis on teamwork, bonuses are generally allotted to a work group rather than an individual worker. Scientific management emphasizes the role of management in the production process. This is reflected in the more hands-on approach in Japanese management training, as well as the relatively high share of managers directly involved in the production process.

As with managers, Japanese industrial engineers are more directly involved with production processes than their counterparts in the United States. In his book The Japanese Industrial System, Charles J. McMillan explained that most Japanese companies make few distinctions between engineers and blue-collar workers, although engineers do tend to earn more. They work closely alongside production workers. In addition, Japan produces up to three times as many engineers a year as the United States. Japan's emphasis on production oriented engineering is consistent with its dominant competitive strategy in the postwar yearsindeed, since the Meiji eraof focusing on improving existing products or processes rather than developing completely new ones.


While many of the patterns just described continue unabated at some Japanese companies, a variety of forces have caused them to change, often toward Western practices. Since the 1980s, for example, the predominance of seniority-based raises has been gradually giving way to a Western style regime of merit-based pay. Indeed, as of 1995, three-quarters of Japanese companies surveyed allocated at least some of their reward pay based on skills or achievements as opposed to tenure. And more than a few Japanese companies have attacked seniority more directly, explicitly revising policies to diminish or even eliminate it as a criterion in the compensation structure. This trend may be evidence of a cultural shift from valuing length of service to valuing quality of service. Also mirroring Western trends, labor union membership in Japan has dropped considerably since the 1970s, falling from 35.4 percent of the workforce in 1970 to just 22.4 percent by 1998, according to figures compiled by the Japanese Ministry of Labor. Union participation remains the highest in large companies (those with 1,000 or more workers), where in 1998 membership was still nearly 57 percent. This share was down from 68 percent in 1987, the first year statistics by company size were kept. Other traditional Japanese practices appear more enduring, notably lifetime employment. Although Japan's economic troubles have meant that some employees have lost their jobs, a continuing commitment to the principle of lifetime employment seems to remain at many companies and in the society as a whole. Still, younger workers (e.g., those under age 30) are decidedly less loyal to companies than in decades past, and there is growing evidence of a rise in professional identification over corporate identification among workers (i.e., "I'm a tax accountant" instead of "I'm a Toyota worker"). Nonetheless, even at the depths of the Japanese recession during the late 1990s Asian financial crisis, companies went to great lengths to avoid outright layoffs. One of the most common practices instead was to reassign workers, either within the corporate family or to other companies, such as vendors the company does business with. These transfers (known as shukko) could be temporary, in which case the worker is still officially employed by the company that has loaned him or her out, or permanent, where the company essentially finds a new job for the employee at another company. Employees who were never considered part of the lifetime staff, such as part-time help, usually didn't enjoy such privileges. Although most agree that Japanese management has been moving in new directions, academics who study Japanese management practices are divided on how profound the shifts in the Japanese business paradigm really are. Indeed, the gamut of opinions has ranged from declaring the death of the Japanese management system to asserting its overarching continuity and strength. A number of observers see a continued convergence with Western practices, but many believe that, as in the past, the adoption of Western principles and practices will never be wholesale, but will blend with prevailing norms and beliefs in Japanese business and the broader culture.

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Workers Characteristics and Attitudes Although it is somewhat presumptuous to generalize about the characteristics and attitudes of millions of people, some rather basic and important differences between the Japanese and U.S. workers appear to exist. First, the Japanese concept of self is very different from the American view. In Japan, each person is believed to possess a unique spirit, soul, mind and heart, but the self concept is considered an impediment to growth. The Japanese establish identities that incorporate friends, relatives and coworkers in an open way to share feelings and improve on weaknesses. The workers relationship within the work group is very important psychologically. On the other hand, U.S. workers are for the most part individualist and strive to appear as macho and self sufficient as possible. The Japanese also have a very strong sense of nationalism and believe that they are superior to all other races. Although Americans also have a strong sense of national pride, there are many racial conflicts in the U.S. that reduce our ability to work together. The education systems in the two countries are also very different. While the Japanese have a very rigorous system through high school, it is possible for a student to graduate from high school in the U.S. without being able to read and write adequately. These differences may have serious implications for U.S. firms seeking entry level workers. Perhaps the fact that the Japanese are all from a single race and have an entirely different concept of self explains why, at least to some extent, they appear to be more cooperative and willing to work together in teams. To maintain and strengthen work group relationships, Japanese workers spend a considerable amount of time socializing after work. Japanese children wear uniforms to school and this is continued with company uniforms later in life. This willingness to dress alike and act alike is very different from the typical American who is taught to be competitive and engage in various political power plays to take credit for accomplishments and achieve star status. Japanese workers also appear to have more respect for authority than their U.S. counterparts, as well as an entirely different attitude towards work. The Japanese apparently live to work and are willing to sacrifice their personal lives for the company. They are more tolerant of long hours and uncomfortable working conditions than U.S. workers, frequently work when they are sick and decline vacation time to avoid reducing productivity. One family service day per week seems to be adequate time for family matters. U.S. workers are more inclined to work to live, or for self gratification, have less self discipline and less tolerance for discomfort. In addition, American workers expect to spend more time with their families and obtain a variety

of perquisites that have been won in hard fought management/union confrontations over the past several years. We do not mean to imply that these expectations are unreasonable, only that they are different from those of the typical Japanese worker. The Japanese also keep their cities and factories crime free and spotless, where trash, graffiti and cigarette butts are conspicuously absent. Each worker keeps his or her work station clean. Even taxi drivers wear white gloves and are rather unforgiving if a patron soils the cab. Crime rates in Japan are very low relative to the U.S. where cities and factories are notorious for crime and garbage. Japanese workers are also more loyal to their employers than U.S. workers and in many cases are essentially married to the company for a lifetime. American workers, on the other hand, tend to be loyal to themselves and sometimes their families and frequently use a company only to gain enough experience to move to a better paying position at another firm. EXHIBIT 1 WORKERS CHARACTERISTICS AND ATTITUDES Characteristic Self image Nationalism and image of Race. Typical Japanese Belong to a group. Okay to show feelings and weaknesses. Strong sense of nationalism based on a single superior race. Typical U.S. Individual. Macho. Hide feelings and weaknesses. Strong sense of nationalism, but many racial conflicts. Relatively weak system through high school. Click for Summary of 2001 ASCE Report card on U.S. Infrastructure. Competitive. Engage in political power plays to become stars. Few team players. Minimal. Work to live. Self


Rigorous system through high school.

Social cooperation and willingness to work together. Respect for authority. Attitude toward work.

Team players. No stars allowed. The individual is not important. Uniformed teams are self regulating. Substantial. Live to work. Self sacrifice.

Highly self disciplined. What can I do for the Company? High tolerance for personal discomfort. Decline vacations and sick days. One family service day per week acceptable.

gratification. Little self discipline. What can the company do for me? Low tolerance for personal discomfort. Take all vacation and sick days allowed. Family demands require weekends plus. A clean work-place and environment is someone else's job. Less respect for property of others. Loyal to Self. Individual and family first. Company second. Work for a company to gain experience to obtain a better job elsewhere.

Attitude toward workplace, property and environment.

Everyone's job to keep it clean. Respect property of others.


Loyal to Company. Company first. Individual and family second. Belong, to or married to, a company for a lifetime.

Management Attitudes and Policies Towards Workers Japanese workers are expected to provide suggestions for improving their own operating efficiency, as well as the overall productivity of the organization. The rational for this expectation is that it promotes continuous improvement. Although suggestion systems are also used in the U.S., employee suggestions are viewed more as a threat to management. U.S. employees who constantly recommend changes are likely to be labeled as trouble makers. Japanese managers seem to view the company's employees as their most important resources. To develop these resources to the fullest potential, the typical Japanese company offers lifetime employment, promotions from within, considerable cross training and job rotation and frequently a no layoff policy. In this way the Japanese use human resources as a competitive weapon. Employment in the U.S., however is somewhat analogous to a revolving door. Workers are routinely laid-off during economic down turns and there appears to be little commitment to training. The scientific management approach used in the U.S. is based on a system of specialization where each worker performs a few repetitive tasks. In this approach, workers are de-skilled to such a low level that all are expendable. Neither

management nor the workers trust each other, thus the process feeds on itself. U.S. managers appear to use a type of short run leverage in the area of human resources. Scavenging trained workers from other firms, the scavenger uses other firms' investments in human resources to achieve results. The typical Japanese incentive system also appears to be quite different from U.S. systems. The Japanese place considerable emphasis on employee recognition including simple pats on the back, business cards for all workers, trophies, company pins, plaques, medals, group approval, and charts over work stations to show goals and achievements. Although there are some small cash awards for suggestions and employee profit sharing systems, Japanese workers seem to respond reasonably well to the psychological incentives. American incentive systems are for the most part monetary systems based on salary increases, promotions and bonuses. Japanese companies also have worker participation systems that are very different, at least conceptually, from their U.S. counterparts. Workers are expected to participate in consensus decisions where the group attempts to come to a unanimous decision. The final decision is made by the group leader, and all members of the group are expected to accept it as their own decision. Voting is not allowed however, because voting denotes winners and losers. In the consensus system, there are, supposedly, only winners. U.S. workers do not participate in work related decisions to the same extent as Japanese workers and may frequently provide only pseudo participation in decision making. Most work related decisions are made by autocratic supervisors. When group or committee decisions are made, the democratic voting process prevails with the inevitable winners and losers. Another difference between Japanese and U.S. companies is the accessibility of managers to workers. In Japanese factories, managers tend to wear the same uniforms as line workers and work in offices that are inside the factory and open to workers. U.S. managers, above the supervisory level, are generally inaccessible to workers and are perceived by workers as aloof. American managers work in air conditioned offices separated from the factory by long infrequently used corridors. EXHIBIT 2 MANAGEMENT POLICIES AND ATTITUDES TOWARDS WORKERS Policy or Attitude Workers suggestions. Typical Japanese Way to achieve continuous improvement (kaizen). Typical U.S. Threat to management.


Lifetime. Paternalistic. No layoffs. Promote from within. Use cross training and job rotation to develop human resources as a competitive weapon. Recognition. Pats on back. Trophies, plaques and metals. Group approval and praise. Profit sharing. Charts or boards (andon) over work stations show goals and current rate of achievement. Dress code to promote team spirit. Worker participation expected to reach consensus decisions. Accessible to workers. Wear same uniform. Open office policy in plant.

Revolving door. Workers laid off during economic decline. Little commitment to training. De-skill so all are expendable. Use other firms training programs as leverage by scavenging workers.



Mostly monetary. Individual ego.

Participation in decisions. Managers accessibility.

Pseudo participation. Autocratic decisions. Inaccessible. Aloof. Offices separate from plant.

Management Competitive Focus and Policies The overall focus of Japanese management is on the firm's long run competitive strategy as opposed to U.S. managers who appear to be more concerned with short run financial performance. Perhaps, to some extent, this difference may be explained by the variations in reporting requirements in the two countries. For example, Japanese companies are not required to submit quarterly reports to stockholders. However, there are other more fundamental differences in the way the Japanese manage. In fact, the concept underlying the very foundation of Japanese management is substantially different from the traditional U.S. concept of management. Japanese management policies and techniques are grounded by the concept of continuous improvement (kaizen). On the other hand, traditional American management practices are derived from the concept of optimization which grew out of

the scientific management era of the early 1900's and developments in the operations research discipline in the 1950's. Understanding the differences between these two concepts is extremely important because they have a pervasive influence on the design and implementation of every management policy, technique, performance measurement system and decision. The fundamental difference is that management based on the concept of continuous improvement is dynamic, i.e., constantly seeking perfection by removing constraints, while the concept of optimization is static, i.e., find the optimal solution given a set of constraints. In the area of resource management, the Japanese use the sub-concept of just-enoughresources (JER), commonly referred to as just-in-time (JIT or Kanban) for inventory. The idea is to squeeze out three kinds of waste including "muda" which represents waste caused by idle resources and unnecessary motions (e.g., looking for misplaced tools), "mura" which is waste caused by the irregular or inconsistent use of a resource, and muri", which is waste caused by placing excessive demands on resources. In the JER approach, all resources are minimized, including inventory, workers, equipment, job classifications, and product parts and subassemblies. Traditional U.S. managers use an entirely different concept that some authors have referred to as just-in-case (JIC). In the JIC approach to resource management, large amounts of slack resources are kept on hand to guard against contingencies such as late deliveries, poor quality, production bottlenecks and fluctuations in demand. Of course, these concepts have some very important implications for the resources themselves. JER and JIT require highly skilled and highly dedicated cross trained workers, as well as high quality raw materials and well maintained equipment. In the JIC environment, high skill levels and high quality materials and equipment are not as critical. For example, in the area of inventory and production lot sizes, the idea, according to the applicable sub-concept of optimization, is to find the economic order quantity or batch size (EOQ) that will minimize the conflicting costs involved in the decision, (e.g., ordering and carrying costs or setup and carrying costs). To promote high quality, the Japanese use the sub-concepts of total quality control (TQC), or zero defects, and quality at the source (jidoka). Jidoka places emphasis on correcting problems when and where they occur. Implementing these quality concepts obviously requires dedicated workers. High quality also requires close relationships with vendors to insure that the firm receives defect-free raw materials and close relationships with customers to insure that customers' specifications are met. The Japanese view this as a co-destiny relationship with their vendors and customers. These partnerships provide linkages across the entire value chain that lead to fewer, more reliable vendors and more frequent deliveries from vendors, as well as to customers. U.S. firms have traditionally used multiple vendors and placed more emphasis on price variances and quantity discounts. Thus, quality has not received the

highest priority. Determining the optimum level of quality has been the norm for American firms. This is evident when one considers the traditional standard cost systems so common in U.S. accounting textbooks and manufacturing practice. Although there appears to be a new emphasis on quality in the U.S., the newer American approach is still grounded in optimization theory. In this new approach, which has been referred to as the "Optimal Economic Conformance Model", prevention and appraisal costs are balanced against internal and external failure costs. This is fundamentally different from the dynamic TQC approach advocated by Deming in which a company cannot have too much quality. The continuous improvement concept also affects Japanese decisions in the area of equipment acquisition and utilization. Many Japanese companies tend to design and carefully maintain their own equipment with preventive maintenance centered at the operator level. Equipment parts are replaced before they break to prevent idle time (muda) from occurring during production runs. In house equipment development also promotes innovation and allows the Japanese to maintain technological leadership. U.S. firms, on the other hand, are somewhat more inclined to buy turn-key systems and replace parts only when they break down. In the Japanese JER or JIT system, maintenance is mandatory, not a discretionary decision to be used for shifting costs from current to future periods. It is also important to note that buying production equipment from others is another form of leverage that provides certain short term benefits to the purchaser. However, the disadvantage of this policy is the higher long term risk of losing market share to the technological leaders. Buying technology off the shelf prevents the firm from competing on the basis of product differentiation, or innovation, since competitors will have access to the same technology. The Japanese union also plays an important part in supporting the continuous improvement concept and it's many related sub-concepts. In Japan, unions are company sponsored and are more of an extension of management than a separate entity established to represent workers. The union typically works to promote teamwork by supporting a small number of job classifications, considerable cross training and a no strike policy. U.S. union policies conflict with the JER and JIT concepts by requiring a large number of job classifications that prohibit cross training. The American union has an adversary relationship with management and uses the strike as a weapon to achieve higher wages and benefits for union members. Another way that Japanese and traditional U.S. management practices differ is in the area of production. The Japanese tend to build smaller more focused plants where work is performed in sequential order to remove inconsistencies (mura) according to program work sheets. The idea is to remove wasted or unnecessary motions to improve efficiency. U.S. plants tend to be larger and less focused where American workers generally perform the work in the order of their preference.

EXHIBIT 3 MANAGEMENT COMPETITIVE FOCUS AND POLICIES Policy Area Overall focus. Operating strategy. Typical Japanese Long range focus on competitive strategy. Continuous Improvement (kaizen). Just-in-time (JIT) or just enough resources (JER). Squeeze out waste, (muda, mura and muri). Minimum workers must be highly skilled and flexible. Fewer parts, inspections and job classifications. TQC. Seek perfection. Zero defects. Use as strategic weapon. Long term partnerships. Have co-destiny. Frequent deliveries, few vendors. Design in house to maintain technological leadership. Used, but not abused. Emphasize preventive (operator centered) maintenance. Replace parts before they break. Company. Emphasize cooperation. Promote team approach. No strike policy. Small focused plants. Work performed in sequential order to Typical U.S. Short range focus on the bottom line. Optimize with a given set of constraints. Just-in-case (JIC) keep lots of slack inventory and resources. Highly specialized jobs based on scientific management. Dehumanizing repetitive tasks. EOQ for resource decisions. Inspect for optimum level of defects. No special relationships. Obtain best price from multiple vendors. Buy turn-key systems as a form of leverage. Abused and overused. Maintenance discretionary. Wait until it breaks down to replace, to enhance current performance. National non-company. Adversary. Rules prohibit cross training and flexibility. Strike used as weapon. Less focused plants. Task not programmed.

Inventory and other resources.

Quality control.

Vendors and customers.




remove inconsistency according to program work sheets.

Management Accounting and Control Japanese accounting and control systems are subservient to corporate strategy and are essentially used to influence behavior. In the U.S., on the other hand, accounting and control systems have been used mainly to inform management about the company's performance. In Japan, planning and control is based on a bottom up approach where workers and lower level managers participate in developing goals and receive considerable feedback as the plans are implemented. In the U.S., planning and control is based on a top down approach where the financial budget is rolled down into the organization. The view that the Japanese are highly committed to planning and feedback is supported by their almost fanatical use of a system called Plan-Do-CheckAction (PDCA). In this system, the plan step includes identifying the problem and the underlying cause, plus developing a plan for the problem's solution. The Do step involves a trial run to determine if the plan works. In the Check step, the trial run is evaluated and revisions are made if necessary. The final Action step is to implement the plan. The PDCA approach is a never ending activity for the Japanese who are very meticulous about providing documentation for nearly every decision. The Japanese compare actual costs to market driven target costs. Target costs are established somewhere between standard costs and allowable costs which are determined by subtracting a target profit margin from the target price. The target price is the price that would provide the company with a competitive edge in the market. This approach is dynamic since the target costs are continuously reduced, both during and after the design stage to promote continuous improvement. The traditional American approach is to compare actual costs with flexible budgets based on engineer driven standard costs. However, standard costs are based on the static optimization concept where standards are set based on the current plant and resource constraints. The emphasis is on achieving the internal standard rather than continuously reducing costs to achieve the external goal. The Japanese also use a long run life cycle approach to product cost and place a substantial amount of emphasis on non financial measures of performance such as quality, lead time and flexibility. Some of the more specific measurements include: the average number of jobs mastered per employee, average setup times, number of line stops, down time, process times, amount of inventory and number of customer complaints. U.S. firms have traditionally placed more emphasis on short run

variances from standard costs, with considerable attention directed to labor efficiency measurements. However, the standard cost control concept has been criticized because the traditional variances can motivate managers to act in ways that reduce, rather than enhance the company's competitive position. Thus, the standard cost methodology appears to be inconsistent with the concept of continuous improvement. Japanese investment justification decisions are based on a long term perspective where emphasis is placed on growth, increasing market share, flexibility and customer needs. Decisions are made using the Namawashi approach which includes more involvement by lower level managers. When compared to the Japanese, U.S. companies seem to place more emphasis on the short run financial effects of investment decisions and quick paybacks. Thus, traditional American investment decision techniques have not adequately considered the intangible factors involved that affect the company's long run competitive position. The Japanese also appear to be in a better position to exploit interrelationships among business units to achieve, or maintain, a competitive advantage. A horizontal strategy that coordinates investment decisions across a large group of interrelated divisions, may well produce greater corporate benefits in the long run, than a series of independent investment decisions made at the unit level. EXHIBIT 4 MANAGEMENT ACCOUNTING AND CONTROL Policy Area Typical Japanese Used to influence behavior. Emphasis on non financial measurements of strategic activities with charts on wall. Bottom up. Goal setting and feedback. Worker involvement. Near fanatical commitment to four step Plan, Do Check Action approach. Budget and compare actual to market driven dynamic target costs continuously reduced. Long run plant wide life cycle Typical U.S. Used to inform management. Emphasis on financial measurements. Management by the numbers, i.e., net income, ROI, and EPS. Top down. Roll down financial budgets to lower levels. Budget and compare actual to flexible budgets based on engineer driven standard costs for given plant and resource constraints. Short run production costs.

Overall reporting strategy.

Planning and control.


costs. Life cycle costs. Quality, lead time, flexibility (e.g., average number of jobs mastered per employee, average setup times) number of line stops, down time, process times, amount of inventory, number of customer complaints. Long term perspective. Emphasis on growth, increasing market share, flexibility, customer needs and business unit interrelationships.


Cost variances, labor efficiency, machine utilization. Meet due dates.

Investment justification.

Short run emphasis. Quick pay back.

How U.S. Firms Are Becoming World Class Competitors The comparison of the U.S. and Japanese workers and management attitudes and policies paints a rather bleak picture of America's position and potential in the global economy. However, it should be emphasized that the summary comparisons provided above are based on a great many generalizations that do not apply equally to all workers and companies. Many American companies began to develop a different strategic mind-set in the 1980's and currently use many of the concepts previously attributed exclusively to the Japanese. One of the most notable examples of the changes taking place in the concepts underlying U.S. management practices is provided by the CAM-I cost management systems (CMS) conceptual design document. The CAM-I publication embraces the overall concept of continuous improvement and most of the accompanying sub-concepts including just-in-time, total quality control, life cycle costing and a portfolio approach to investment management. The CMS conceptual design was developed by a large group of individuals employed by CAM-I's sponsoring firms and organizations who continue to work together to develop better cost management and performance systems.

Japanese Management: Business strategy lessons for the West

The American economy and its leading corporations are so high in the ascendant that the cult of Japanese management seems increasingly remote. Today's heroes and hero companies are Bill Gates and Microsoft, Andy Grove and Intel, GE and Jack Welch, etc. Their management methods, especially those of Silicon Valley, are now drooled over in the business schools.

Where once books flooded out explaining the mysteries of Japanese marvels, a spate of titles devoted to the Valley's magicians and magical ways has begun to flow, with titles like Relentless Growth, Innovation Explosion and Giant-Killers. The latter, an excellent book by Geoffrey James, has a revealing sub-title: '34 Cutting Edge Management Strategies from the World's Leading High-tech Companies'. The giveaway lies in the plethora of strategies. There is no one Silicon Valley formula that can be bottled and safely imbibed. Grove manages Intel differently from Gates at Microsoft, and Michael Dell and Eckhard Pfeiffer are well apart at Dell and Compaq. There are common features, but they flow inevitably from the pressures of rampant competition and ferocious technological pace. The free-and-easy, quick-on-the-draw dynamism of the software and hardware leaders must be imitated by staider industries as global competition really bites. But the Valley's explosive philosophies make Japan's consensual management seem positively antediluvian. The cult is, in fact, quite dog-eared. It dates back to at least 1980, when an NBC documentary ('If Japan Can, Why Can't We') exposed the terrible deficiencies of America's manufacturers in comparison to the Japanese. As the latter brushed aside Western competition in industries ranging from copiers to cars, motorbikes to cameras, supertankers to transistors, embattled Westerners sought an explanation. Some blamed their defeats on economic and financial skulduggery. The NBC team, however, gave the main credit to Japanese management in general and the quality revolution (influenced by an American, W.Edwards Deming) in particular. Quality circles and then Total Quality Management were enthusiastically adopted by Western firms and gurus, but had the usual truncated life-cycle of management fashions. The present troubles of Motorola will be regarded by some as the tombstone of TQM, of which former chairman Robert Galvin was America's leading exponent. Once as swift as any top gun in Silicon Valley, Motorola is so late and uncompetitive in the digital phone revolution that its core mobile business is wobbling badly. But Japanese management was never built around quality alone. High quality products flowed from high quality processes which in turn derived from powerful management philosophies.

Kaizen, or continuous improvement, expresses the belief that anything and everything can be improved. If it can be, it must be: otherwise you are creating muda, or waste. Applying the philosophy naturally reduced costs. That might suggest a close similarity to business process reengineering, which spearheaded the 1980s upsurge of Western consultants and gurus. But as BPR gurus theselves have confessed, rolling about in sackcloth and ashes, their techniques produced wonderful savings in payroll and other costs, but did absolutely nothing to create organic growth. The Japanese combined their greater cost-effectiveness with a sustained drive for the largest possible market penetration, founded on high levels of investment, innovation, and downright ingenuity. The conventional Western approach to long-term strategic planning, with its three to five-year cycles, mostly failed to match this Eastern thrust. That convention, though, is among the management pillars being undermined by Silicon Valley. A fascinating study of electronics leaders by Andersen Consulting found that they plan only 18 to 24 months ahead. Top management lays down an overall 'vision' that establishes corporate objectives. Within that framework, individual business units are delegated the task of devising and executing the strategies demanded by the market. Nobody expects the forecasts to be accurate. Everybody expects flat-out, effective correction of the consequent errors. There is a word for this revolutionary strategic approach, but it isn't English. 'Meikiki', which means 'foresight with discernment', is how the Japanese describe a process which, of course, they fully understand and apply. None of five other central concepts that Andersen's found in California are any stranger to Japanese philosophy and practice. Thus, Western firms still bear many bruises from Japanese moves to 'change the basis of competition continually' (as with small copiers). That concept is backed up by the search for 'multiple sources of competitive advantage', which is basic to Japanese management. So is Concept Three, 'organising to achieve new levels of agility'. Toyota, for example, has revamped its development system so effectively that in 1996-97 new and reworked models totalled 18, some getting into production a stunning 14 1/2 months after design approval. That's partly accomplished by Concept Four, taking 'sophisticated collaboration' with suppliers and customers to new heights. The final high-tech concept, 'focusing on core capabilities to execute strategy successfully', is another Japanese foundation. It explains why Hitachi, Matsushita, Sony, Toshiba and NEC still dominate the global electronics landscape - despite the Intel-led resurgence of American semiconductors. The like prowess of Toyota in automobiles drew the admiring comment from a local professor that 'Toyota's real strength resides in its ability to learn...The company's practices are constantly changing, even though its basic principles remain unchanged'. The state-of-the-art in American management theory promotes the 'learning company', basic and undying values, and change management. Here, too, the Japanese model rides again - or rather, keeps on riding.

One of the model's key components is the Toyota Production System, which, says Fortune magazine, depends for its success on 'highly experienced managers working unselfishly with a motivated, well-trained work force'. It took a genius named Taiichi Ohno to realise that production depended on people, not just machines. It's taken Western rivals decades (some aren't there yet) to adopt TPS practices like allowing workers to stop the assembly line when they spot a problem. For all the genuine advances made by Western manufacturers, many have failed to match the best Japanese, not through technical inadequacy, but because their people management is inferior. As shown by the obscene rewards now paid to CEOs, in America above all, Western management is still heavily top-down - though that's changing. For example, self-managed teams are among many 'human resources' initiatives being both promoted and used - but they, too, are Japanese familiars. The pervasive error of the cult of Japanese management was to suppose that it was fundamentally Japanese. After all, Western consultants have been earning fat fees for years from eliminating waste, promoting change management, installing teamwork, preaching about the high returns on innovation, and so on. Western gurus, too, have long been preaching the virtues of what the Japanese practise: collaborative, collegiate, people-based management that extends beyond the borders of the corporation and aims at long-term pay-offs. The Financial Times was recently pleased to discover (destroying a persistent myth) that only 7% of Britain's 100 biggest companies felt hampered in 'taking the correct long-term strategy' by the attitudes of institutional investors. But how many of those companies actually are pursuing long-term strategies, let alone correct ones? The laggards can still learn urgent strategic and management lessons from that toughest of global challengers: the Japanese company outside Japan.

Japanese Education vs. Amerecan Edukashun

- Comparative Account of Literary Education Between Two Cultures -

There can be no doubt that American schools compare poorly with Japanese schools (Lynn 40). The effectiveness of America's education system in providing the necessary education needed to compete in today's world has been in question for some time now. Every aspect of this debate, American schools vs. Japanese schools, has been evlauated upon in the past; except that which presents a solution. The fear of America lagging behind continually forces us to re-examine our educational system, but yet once again, a solution is not implemented. It could be the ignorance of Americans who continually think that "we are the best," or it could be that Americans are happy with the system currently in place. The American literacy rate is not up to par with competing industrialized nations, such as Japan and Germany, and it's up to our schools to teach America's youth. In educational tests conducted on economically developed countries, the outcome of performace on math and reading levels have always been constant. Japanese scoring the highest, America scoring the lowest, and the Europeans scoring somewhere in between (Lynn 40). Advantages exist in both America's current educational system and Japan's. But this essay isn't intended to serve the bias of one side of this issue, yet through the thorough analysis that has taken place up to this day, but to provide a solution in order to better America's literacy education. Maybe that's why in America, schools are expected to enforce racial integration, foster social progress, and keep kids off the streets till they're 18 years old. In Japan, they're expected to teach (Lynn 40).

By the graduating age of the average American high school student, a substantial number of these students have little knowledge of geography or relative historical events (Hirsch 8). Of the 2.4 million Americans who graduate from high school, 25% cannot read or write at the eighth-grade or "functionally literate" level. Most 17 year olds in school cannot summarize a newspaper article, write a job request letter, solve real life math problems, or even follow a bus schedule (Ehrlich 129). About 33% of American high school students drop out every year and after 12 weeks of summer vacation, the average American student forgets 33% of what he had learned the previous year (Trudeau 1).

A typical Japanese student spends 6 hours every night doing homework during a school year that is 60 days longer than America's (Trudeau 1). Following a regular school day 18.6% of elementary school children and 52.2% of middle school children attend Juku cramming schools bringing them home at midnight from an 18 hour work day (Weisman A8). At the age of 18, 98% voluntarily seek higher education in a university. In early adolescence, Japanese students are 2 to 3 years ahead of their American counterparts and by the age of 18, 98% of Japanese students far surpass that of Americans of the same age. It's no surprise then that a 10th grade Japanese student is envious of the leisure time enjoyed by American college sophomores, his academic counterpart (Trudeau 1).
What is wrong with American education today? The staggering statistics we all want to deny should prompt our current high official social decision makers that a major change must be implemented. Yet all we seem to do is stare at the numbers and just marvel at the study and work ethics of Japanese students and don't do anything about it. Educational reform has been a governmental issue for years now, new regulations, new local bureaucracies have all come and gone to no avail. More and more American school children are not graduating as literate as they should be (Ehrlich 129). But what is being literate? What is being educated? Education is the physical learning of new materials that was previously unknown. Literacy is a little more complicated. It breaks down into two subcategorizes: functionally literate and culturally literate. While literacy is includes the basics of being able to read and write, it goes a little deeper. A culturally literate person has the ability to relate different situations and experiences with other people and find correlation's among such subjects as history, the arts, math, and current events. A functionally literate person lacks this social skill and is unable to make such judgments. However, a functionally literate person is able to read books and words, but there is very little that a functionally literate person can do with that knowledge, that is why culture is needed in today's American schools. So should American schools be more cultural? Yes. Is that why the Japanese are so far ahead? No. The Japanese education system isn't effective, the Juku is. 95% of Japanese students in public schools do not understand what the teacher is saying or what is being taught out of textbooks. Most of them don't even pay attention in class, and most teachers don't pay attention to students. A passing score in a prerequisite is 35% and the majority of Japanese students

go on to higher level classes without passing the prerequisite course. Third year English students are studying Third year English because they are third year students, not because they passed the first or second year English classes. Public high school entrance exams are given based on elimination. If there are 304 applicants and 300 slots available, the tests will be administered in order to get rid of 4 applicants. Passing scores have gone as low as 5%. Japanese students may spend overall more time in school, but all that time isn't devoted to studying. In a typical school year, 65 to 70 days worth of afternoons are spent in free time. Three or four school days per year are devoted to cleaning the school. And in the end, virtually 100% of all Japanese students would fail the university entrance exam solely relying upon the public school (Goya 126). So what is wrong with the Japanese education system? This may be why Americans still don't learn from Japanese public schooling methods. In fact, the Japanese public school system is doing a worse job than Americans in educating their youth. As Americans look only at the public schools, we miss out on the true secret of Japanese education: the Juku - variously translated as "cram schools." The role that Juku schools play in Japan are ever more important than the public schools all students attend. They are numerous, expensive and crucial to Japanese students. The reason Juku's survive is because of the poor public schooling. Entrance into a top Japanese university guarantees a job for life, given that you are able to be admitted. Slots are few, applicants are plenty, and university entrance exams are no public school joke. Japanese entrance exams require students to know more than do similar American entrance exams. The English component of a university exam often includes items that would stump a native speaker (Goya 128). The sole purpose of a Juku school is to provide the student with the information and knowledge in order to pass the entrance exam and be accepted into a top university. While reports on the Japanese school system has mainly focused around the issues of the Japanese public school system, Americans need to pay closer attention to where the Japanese students acquire their much admired education.

The focus of this essay is to deal with reforms in American education in order to have American students be more successful in their academic endeavors in order to compete in today's market world. By comparing the education system status of both America and Japan, a better system isn't the result. Comparing the two educational systems just presents two extremes in the way literacy is being achieved and neither one is the right answer. The point of becoming culturally literate

is for us to advance ourselves and our position in the world in order to achieve individual success. A key difference between American and Japanese schools is that Japanese schools are strictly centralized. Government officials distribute the same syllabi to every public school in Japan ensuring that everyone gets the same education (Lynn 40-41). If that were implemented here in America, what kind of diversity would we be having. There would be lack of culture in this country due to the fact that everyone has the learned the same curriculm. This lack of individuality is very dangerous to a society and culture. Japan turns out some the smartest and brightest individuals in the world, but with the lack of individuality and social culture, they don't develop a mind of their own, they simply regurgitate information (Young 130). In other words, in a society pressed to learn as much as they can in a short period time without the regards for the social well being, the society becomes robots. Not enough of both educational learning plus culture is being taught in our American schools today. This is limiting America in becoming culturally literate, or even literate at all. Emphasis must be given in the public schools and on teachers. Jay Leno put it best when he said that baseball players and teachers should switch salaries. That way, baseball players get what they deserve and teachers get what they deserve. Teaching should be one of the highest paying occupations in America enhancing societal importance and worth. Only 8% of the 1.6 million college freshman want to become teachers, and of them more than half will change their mind (Ehrlich 132). We all want to become smarter and more culturally literate, but without the fundamental basics, where we have no foundation. It's evident that the American school system is fundamentally unstable. Students are not motivated to work as teachers have no motivation to teach. Juku's are not the answer either. Implementing the Japanese educational system in America will not work. It's clear that confining a student to a desk for pretty much the entire day in not a healthy way to teach children, especially in ages 2 to 3, ages some Japanese students start to attend Juku schools. What America is doing right and the Japanese are doing wrong is that the first years of your life are to be spent in personal growth and development. Teaching students textbook knowledge from the very fundamental stages of their life will lead them to see life through the confines of books, numbers and statistics. Ikuo Amano, professor of Sociology at the University of Tokyo, Japan's number one university, says that Juku's are harmful to children and the Japanese educational system. "It's not healthy for kids to have so little free time. It is not healthy to become completely caught up in competition at such a young age." So much is expected of Japanese students that some can't "simply take it." Confucian ideals are still strong and prevalent in Japan which tells students to respect their teachers. But with this respect comes an abuse of powers, and the punishment of students by result of teachers are not uncommon (Young 132). Sure Juku's produce numbers, but that's about it. One thing that no test can ever measure is the cultural character of individual people. The reason is you cannot confine culture down to numbers, something the Japanese live by. Is there a way to keep America's individual ideal yet produce the results enjoyed by the Japanese? That's the question that really should come up in this debate. Too often do we play on the Japanese playing field and look solely on the numbers. We think that Japanese schools are superior to American schools because they produce higher numbers, but the fact remains that forcing information into a person doesn't develop a person, it develops a machine. Juku students

are never asked about their own opinions on topics discussed in class (Young 131). Everything is done by the book. By giving the chance for students to think on their own develops the mind in imagination, personal decision making and individual achievement. Incorporating this skill with the use of the basic educational knowledge, a person not only achieves the numbers, but also becomes the culturally literate person that is most effective in society. Schools should be organized to focus on practical cultural uses of the educational knowledge that is being taught. The essence of cultural literacy is to foster one's knowledge of subjects in order to be able to effectively be a part of today's complex modern day society. The educational system must be modified to strengthen a student's ability to analyze, reason and extend ideas of which they are presented with. This builds their capacity to learn, to take in knowledge, to be educated. Not only that, but it enables them to make parallels, incorporate, and make references to other subjects concerning the current focus. This is the very idea of being culturally literate. That way, each individual person is specialized to be able to focus upon details of other subjects without having to know everything there is to know, yet have the fundamental knowledge in order to engage in constructive conversation (Hirsch 15). We need to train America's youth in realizing that learning is not a burden. Learning should not cause stress, this only forces information into the head number by number. Students should be given the time in order to fully understand concepts of what is being taught and what is being presented. Curriculum courses should be designed individually around the student; focusing most of the curriculum around the students strengths and less on weaknesses. This allows the student to grow and perfect what he's good at plus be given some practice in other subjects in order to grasp the fundamental knowledge needed to become culturally literate. Focusing on particular subjects to hone and perfect allows for the student to already know what he or she wants to pursue and given the necessary practice in other fields comes together to form an active culturally literate person in society.

48.9% of America's 17-year-olds could not answer questions of this type. One part of Japanese education that seems to be working in America is the Kumon math learning system. Students rush through practice math quizzes in order to solve the problems in a short period of time. Isn't this forcing numbers? No, the key to this system is that if a student makes a mistake, he or she is to re-work the problem until he or she gets it perfect (Murr 60). By having the students rush through the exam cuts back on the time needed to teach new material and in the end, they learn the material. When students achieve, this builds self confidence levels and

encourages them to learn more. If they make mistakes they know they can go back until it becomes perfect. Too much emphasis in today's American educational system is focused on expecting the student to know too much in a short period of time without time to practice. Enough practice isn't given in order for students to grasp basic knowledge. This leads to failure and the inability to make it right and thus students who fail to make the grade see learning as a burden and wish not to take any part in it. Basic fundamental knowledge must be learned and mastered, and the skills needed to become culturally literate develop as time progresses. This allows for the individual to be parallel in his or her society with the knowledge being learned in his or her environment. Cultural literacy lies above the everyday level of knowledge that everyone possesses, but below the levels of expert knowledge. It includes information and abilities that we have expected our youth to receive in schools, but which they no longer do (Hirsch 19). America has this tendency to continually compare, and it's that exact tendency that has led to numerous contributions on this essay on subjects of either how American schools are so bad and Japan's are so good, or that Japan has good schooling but causes humanitarian problems. None of the contributions to this ongoing comparison has ever proposed a solution. With so much analysis of both parties being presented a solution should be inevitable. Once again, we have to look deeper than the numbers of things. The straight facts tells us just that: the straight facts. It doesn't give us ideas, proposals, or innovative methods in solving a very serious social and cultural problem in America. In the process of formulating solutions given the facts, one is exercising his ability of using factual data and analytically coming up with ideas practice one's decision making. This taps into the mind as using educated knowledge and applying them to practical applications while analyzing differences with other situations; all this comes together and defines what we know as cultural literacy. This small step of just sitting and thinking already begins to build and practice ideas that are fundamental to cultural literacy yet are more advanced than the basics of functional literacy. It's this exact thinking that needs to be incorporated in classroom curriculums in order to achieve the educational goals that we aspire for. There is an endless amount to the potential that America's youth can come up with. As the next leaders of the world, it is crucial that they are culturally literate in order to make decisions that best suit the current focus at hand and to be able to express his or her idea to others in order to incorporate other ideas. The building of minds this way each with individual facets, yet focused on one particular subject can reap immense amounts of success in any time era. Changes will have to be made, though, and the change would be very gradual. But it's the shear act of acting upon a decision to better our society that also defines what we know as cultural literacy. Schools were designed to ready our youths for the upcoming competitive world ahead. Communication in critical and knowledge in inevitable. The fusing of the two leads to cultural literacy which America must try it's hardest to accomplish. Japanese students do produce numbers greater than those of America but their main concern is only to "get ahead." They are expected to achieve high scores and if not, they are punished, physically or mentally. The biggest punishment a Japanese student can realize is the non acceptance into a university. To prevent this, it only drives them more and more to learn as many things as they can. Americans must learn to incorporate the attitude to succeed that the Japanese are famous for but Americanize it so

that it benefits every aspect of the student. That the student learns to become functionally literate, yet not forced that he merely becomes a tape recorder. Functional literacy is fundamental for Americans, it's not enough to compete. We must become culturally literate not to compete, but to succeed.

Japanese vs. American Animation

by Jeff Gillespie, Jul 9th 1998 Memories of television programming from my youth consists mostly of great educational shows like Sesame Street and The Friendly Giant, but also consists of classic 1980s cartoons like Transformers and G.I. Joe. Mention these two cartoons to any other guy in their late teens or early twenties and their face will light up, reminiscing on the great fun they had growing up with these action/adventure shows. However, ask any adult in their forties or fifties about these shows and they'll answer with "All that violence on TV... what a shame." or "Sorry, I didn't watch any of those kiddie shows." These are typical responses in America, where animation has evolved into an industry aimed, more or less, at children. In Japan, an entirely different result has occurred in the evolution of the Japanese animation industry, where the main audience consists of anyone aged from one to one hundred. My purpose in this paper will be to compare the two and attempt to reason why they have evolved they way they did.

Most of us will remember the Disney era beginning with Steamboat Willie short, introducing the character of Mickey Mouse. Animation developed throughout the early part of the century purely in the form of short 6-8 minute clips, from both Warner Brothers and Disney studios, with the odd full-length feature like Snow White. Most of these shorts were designed to be comic, to entertain the audience through comedy and slapstick antics where characters could be severed in half and then literally pull themselves together and be perfectly fine for the next animated short. These cartoons developed into short escapes for the audience from the harsh world of the depression, and then from World War II. However, censorship was strong in these periods, and many films had scenes cut, even going so far as to cut a kiss between Porky and Petunia Pig in a 1939 short (where kissing between live actors was acceptable in that era). Critics even went so far as to criticize the excessive humanism depicted in the 1950 movie Cinderella. Reviewers from Time and The Saturday Review magazines were disappointed with the film as it "represented an unusually large number of human characters", feeling that "it provided a kind of realism that should be foreign to animation". From here on, American animation, or more commonly referred to as "cartoons", became an escape from realism. Being a conservative "civilized" American society, the cartoons main audience became children, as it would be considered "childish" for an adult to watch animated features & shorts. The main goal of the industry became not only to sell theatre seats and commercial spots, but sell merchandise as well. While this may seem as a relatively new concept in the economic boom of the 1990s, the 5,000,000th Mickey Mouse watch was manufactured 50 years ago, in 1948. In that year alone, it was expected that "goods bearing the faces of Disney characters will bring in a retail gross of $100 million".... in 1948. Nowadays, it is quite rare to be able to watch an entire episode of X-Men or Spiderman without seeing an advertisement for an action figure of some sort. This has become the main goal of cartoons in America, and I admit to giving in. I personally had almost 30 Transformers by the age of 12, being a victim of the immense commercial enterprise that is the cartoon industry. In fact, it is almost impossible to sell action figures these days without having an animated television show, or feature, to help sell it. In effect, cartoons have become 23 minute-long commercials for their action figures. Airtime is also important, as, with the exception of the children's and cartoon networks, most cartoons can

be found either on Saturday mornings, or in the after-school time-slots, where children are most likely to be watching television. Also prevalent in animation is the influence of religion, as Western civilization is primarily a Judeo-Christian culture, where we are mostly monotheistic, and find comfort in establishing a "good" and a "bad". This theme is present in almost all American animation series, where there is a "good" hero/team, and there is an "evil" villain/criminal. The line dividing the two is strong and never fades. The monotheistic theme is present in that there is one "right" answer to a problem, one Truth. Lately, however, some American studios have been producing adult-themed cartoons, with the best example of these being The Simpsons. While seemingly starting out as a formula family sitcom that is animated, The Simpsons retains its popularity in being as unpredictable as animation is, such as using a large parasol to block out the sun, or having idols appear on a clown's comeback special. And there is always one thing we can take comfort in, and that's the consistent age of the characters. Bart has been 10 years old, Lisa has been 8, and little Maggie has been sucking on her pacifier for almost a decade. More adult-themed cartoons are emerging in the American media industry, notably King of the Hill, Duckman, and South Park (which, technically isn't animation, but is still created using computer-simulated cardboard cut-outs). All of these series poke fun at American life either as a kid in a small town, or as a family of ducks, in an attempt to entertain the audience to sell commercial space. And there is one thing prevalent in almost all American animation it is episodic. Episode after episode, the main characters return unchanged and unaffected by the previous episode's events. It is always possible to miss an episode here and there, or watch the episodes out of order, and never be lost. In short, American animation is mainly aimed at children, promoting Judeo-Christian views that there is a "good" side and a "bad" side, with one "right" answer in the end. It is episodic so that children will never have to worry about missing the odd episode, and won't have to follow a complex storyline or character development usually present in series'. It is designed to be an escape from the harsh world of reality, from which we all want to protect our children. On the other hand, Japanese animation is somewhat different. Often referred to as anime (pronounced ah-knee-may), it is a form of mass media that has an audience of all ages. I look at it as being simply another vehicle to send the same messages and provide the same entertainment that live-action movies do, other than considering it one genre of the industry. Most anime is based on manga, the Japanese version of comics. Authors create their stories in a set of still pictures that, if the strip is popular enough, are then brought to life. Comic strips in Japan, however, originate from the post-WWII era when American strips were imported to Japan. The format was widely popular, and soon Japanese authors began to create their own strips. While there were the weekly strips poking fun at typical family life, other strips also became popular that followed people on journeys. Such stories, however, were mostly serial, where the reader had to read every strip in order to keep track of the goings-on in the story. This

format became successful in a commercial sense, as people had to keep buying the next newspaper or magazine to keep up with the stories. While there is always much imagination involved in creating such stories, many anime storylines find their roots in the common Japanese religion of Shinto. Shinto can best be described as a disorganized religion, where there is no single God, but many stories of extraordinary people and things that are worshipped as deities. Where Judeo-Christian values strongly discourage (putting it lightly) homosexual relations and out-of-wedlock pregnancies, the only common moral code in Shinto is cleanliness. Japanese society is far more liberal in terms of censorship and social attitudes than American society. From this, not only are there many stories animated that have to do with Shinto legends, but many stories that explore "taboo" (well, they would be taboo in American terms) social relations between people as a result of the society being rooted in Shinto. Another theme coming from this religious difference is that death itself is often shown in anime. Not just in odd characters added for the effect, like Star Trek and their "phaser bait", but the Japanese audience is never shocked to find their favorite main character killed off. This is because death is honorable in Shinto, especially if there is a noble cause in one's death. An example of this would be the kamikaze pilots of World War II, whose sacrifice was deemed honorable in that they were attempting to take out more of the enemy in such a maneuver. The Western feeling in society, however, was that death was to be avoided at all costs, and has therefore become a "taboo" subject in our media. One main driving force behind the popularity of Japanese animation is how widespread the material is. There are series based on wandering samurai, space adventures, slapstick comedy, and even soap operas. Although not entirely realistic in depicting life in Japan, many series do portray human characters and their lives, but more as a fantasy outlet for the audience. Another thing that I find interesting is that the series premise is never plain, and will almost always have some sort of odd detail to go along with a seemingly normal story. One such example, a comedyromance series called Kimagure Orange Road focuses on a love triangle that develops between a teenage boy and his two female friends. The odd thing about this story is that the teenage boy and his family have the power of ESP. This story element, however, is not the main focus of the story, but used as a vehicle to fill stories, provide some material for character development, and even give some comic relief in times of tension. Another odd plot twist is present in the martialarts adventure series Ranma where the main character becomes cursed in the first episode as he becomes a she when doused in cold water. As mentioned above, many anime series are just that, series. The storyline is continuous, with plot twists and character development, and in my opinion, makes them more interesting to watch. The viewer cannot simply sit back and expect the characters to all be the same as the previous episode, and may miss something if they failed to catch an episode or two. There are select few series that are episodic, and are quite entertaining, but the more popular shows are those that grip the audience from beginning to end. Also rooted in Shinto, many series never clearly draw the line between "good" and "evil". Characters often switch from one side to the other, some characters can be both, and some characters can be neither. A character's motives may be "good", but their methods are "evil", and

vice versa. It is also possible to have two sides present in a battle, with neither being "good" or "bad". This guessing is another point of interest in Japanese animation. Character design is very different in anime is very different from American cartoons. Many characters are human in form, as opposed to animals or robots often present in cartoons. Japanese animation, however, commonly employs simplistic facial design to distinguish characters immediately. More emotional characters tend to have larger eyes, small noses, and small mouths. The "bad guy" of the story is often drawn with smaller eyes, and a larger mouth (often used for maniacal laughter, in which case a bigger mouth has greater effect). Hair color is often wild in anime as well. Colors range from black to pink to blond to blue. This technique is used more to distinguish between characters than for personality traits, although very often characters with blonde hair are more "evil" in motives than the rest of the characters. "But I thought it was all sex and violence?" This is the opinion shared by most Americans on the subject of Japanese animation. But it's the same as saying that American television consists only of soap operas and trashy talk shows if you limit your viewing to daytime television. This opinion results from the fact that most of the companies who translate and distribute anime to Americans initially only imported series they thought would sell with the adult crowd, series that involved sex and/or violence. I must admit, I used to have this opinion as well. At least, until I became exposed to an enormous "underground" community known as Fansubbing. Over the last few years, a small number of incredibly generous Americans have imported video tapes and laser discs of anime series not (yet) licensed for distribution in America. They mainly import series that appeal to a general audience with a flowing storyline and character development. The main reason why these titles are not (yet) licensed for distribution in America is that some of these series run over fifty episodes in length, and American distributors fear losing money on long series feeling that fan support will eventually fade. The fansubber's generosity comes from spending hours, days, sometimes weeks translating and subtitling the material and providing it to fans at the cost of the tape plus shipping. Yes, this is technically illegal, but a strong ethical code is present where no one will associate himself or herself with a series that has been acquired by an American company for distribution. In fact, many Japanese producers see this underground community not as a bunch of bootleggers, but more as a bunch of new and unexpected consumers for related merchandise such as toys, stationary, and music CDs (Selling the show is more important that merchandise as every series is later released on laser disc and video cassette). The Japanese community also sees it as a way of promoting cultural exchange in the Western world, hoping they can remain in contact with Americans of Japanese heritage as well as reach out to the rest of us. Interestingly enough, the latest company to jump onto the anime distribution bandwagon is Disney itself. They recently acquired the license to distribute all feature-length titles produced by the legendary (in Japan) Studio Ghibli, all directed by the legendary (in Japan) Hayao Miyazaki. The first title to be released, through Buena Vista Home Video early September, is Kiki's Delivery Service, a coming-of-age story about a witch who travels to a large city to discover her purpose in life. It is a light-hearted story, fitting in with Disney's ideology well. However, their second release, scheduled for early 1999, is Princess Mononoke. Although I have not seen this title, I have heard much about it. It is, as I'm told, a tale centered around the environment involving some violence, much action, and carries a strong message. As this movie would not fit well with the "Disney" name, it will be released through

Miramax Films, a Disney subsidiary. But the fact remains, the large American corporation known as Disney is buying in to Japanese culture. As are many other Americans, as seen in the exponential growth of the anime distribution industry in the last few years. Companies are gaining faith in longer series, producing more than one series at a time, and importing more recent titles. There is still one major obstacle left, however, and that IS TV penetration. At present, only Sailor Moon and Dragon Ball are pretty much the only Japanese series on American television. This is most probably due to the fact that their targeted audience is the same as the rest of the Saturday morning cartoons, and Tokyo could simply be the name of a fantasy land for children. However, racier American cartoons like The Simpsons have opened up American minds to the imaginative power and potential of animation. Perhaps one day anime will be generally accepted as a form of entertainment in America, and will no longer be limited to college students and comic conventions.

U.S. vs. Japan: Which Economy is Stronger?

Mises Daily: Wednesday, May 21, 2003 by Sean Corrigan How much comfort can the U.S. take in the sufferings of Japan? In a side-by-side comparison of the productivity of the two economies, the U.S. comes off looking worse than one might expect, while Japan, long in the mire of recession, not as badly as one might assume. True, this little examination may seem misplaced now that Resona Bank, Japan's fifth biggest, has been extended a Y2 trillion lifeline, after a more stringent accounting treatment of its deferred tax losses meant its capital to asset ratio fell to just 2%, and that its official capital adequacy threatened to breach the already wafer-thin domestic bank minimum ratio of 4%. However, let us take a second look at the Japanese GDP figures and compare them to the U.S., in order to see whether or not the Japanese Prime Minister's pronouncement that "the real economy is not too bad" was taken straight from the Marie-Antoinette school of social commentary. Well, actually, let's acknowledge that the fruits of previous Japanese prudencetheir vast stock of assets held abroadbring in a good deal of income too, and consider GNP instead. Then, let's perform our usual trick and throw away government spending (since that's exactly what the government does with its citizens' confiscated money, more often than not) and concentrate on the private sector. In short, let's look at the health of the true center of wealth creation. We'll call this pGNP. Next, let's see how this wealth can potentially be spread around, by looking at pGNP per capitaor pGNPpc. Finallyand accepting there are major epistemological problems with the way all these things are measuredwe'll look at some of these aggregates in both real and nominal terms, so we don't confuse a lower paycheck with a smaller basket of purchasable goods. Though the headlines were partly correct in that nominal pGNP was barely changed on the year and, indeed, fell 1.2% annualized on the quarter, real pGNP climbed 2.9% from March 2002, and 0.6% even in the first three SARS and war-ridden, stronger-yen months of this year. True, since the Asian Crisis broke out six years ago, those Japanese prices associated with these two aggregates have declined a cumulative 8.3%or by 1.5% a yearto reach 1985 levels. Despite this, the recovery in real private income has simultaneously taken this last measure to within a whisker of its all-time highs and fully 6% above its end-1999 low. This all but erases the effects of both the Asian Contagion and the U.S.-Techno Bust. That Japan has not met its potential since the early 90s is obvious from the statistics, we have to admit. But with the wholesale monetary manipulation of domestic credit levels, interest rates and exchange parities, combined with a creeping necrosis of socialization of the productive economy, which has seen public spending hit 33% of private domestic outlays, this is hardly to be wondered at.

Nominal pGNP more than doubled in the 11 years to the Bubble's peak, rising by 6.7% a year, but it has essentially stagnated ever since. In real terms though, the contrast is a touch less intimidating, dropping from a 5.5% pa compound rate of climb (equivalent to 5% per head) to 0.8% (0.6% per head). Over this last period, the comparable U.S. figures show markedly stronger trend growth of 3.4%, which translates into 2.8% per capita. However, if we take a smaller sample and concentrate only on the past three years of turmoil, it becomes evident that post-bubble Americans have actually slipped behind their Japanese colleagues in the bust.

Since early 2000, Japanese real pGNP has risen 3.5% overall, and by 2.9% per head, for a modest, but perceptible, annual rate of gain of 0.9%. For its part, U.S. real pGNP grew by an almost identical 3.6% between 1999 and 2002, but, with its population rising between four and five times faster than in its low immigration Asian counterpart, income per head in the U.S. barely increased at all over the period. Moreover, look at the investment ratios, standing each country side-by-side, to begin with. In Japan, (hopefully productive) nonresidential investment was 4.2 times greater than the (largely consumptive) residential kind, 1.6 sigmas over a 23-year mean multiple of 3.4 and the second highest proportion ever. In housing bubble, corporate funk America, by contrast, the ratio was a paltry 2.2the lowest since 1978 and 1.5 sigmas below a lower mean of 2.8 times.

Put another way, Japanese nonresidential investment as a fraction of GDP was 14.8% in March, an 18-month high, if still 0.9 sigmas off the 1980-to date mean of 16.4% In the U.S., in comparison, the ratio was a lesser 10.3%a 9 year low and 1.3 sigmas below an already lower mean of 11.6%. Indeed, the ratio of these two investment aggregates, in common currency, hit a seventeen-year low last March, with the Japanese spending only 47 cents to every dollar laid out in this manner in the U.S. However, 12 months on and this ratio has jumped to 56 cents on the 1 dollar (an improvement of 18% in a year), to reach its best since the end of 2000. To back this up, we can also see that Japanese corporate profits (measured in dollars)which, for a decade, have observed a stable distribution centred on a mean of 39.4% of U.S. profits, were sitting comfortably 0.6 sigmas above that norm at 43.8%, as of last December. Finally, there is one key measure on which even the inveterately interventionist Japanese ruling elite is beginning to behave more wisely than their voodoonomics counterparts across the Pacific. In the past twelve months, government spending in Japan fell by its largest amount in at least 22 years, taking expenditures back to 1995 levels. Contrast this with a full-bore fiscal overshoot in the U.S.where the State now sucks up resources to the tune of a quarter more than it did four years back.

With the differential in the change in these two burdensome obligations hitting a two-decadeplus record of 11.1% in the last four quarters, the relative size of this harmful intrusion into the free market has seen U.S. spending jump from 150% to 200% of Japan's since the bust began, continuing a reversal from a point in 1995 where these were almost equal. So let's not have any pious criticism of Koizumi and Co. on that score: whatever their undoubted failings elsewhere, they're doing a whole lot better than DubyaDubya III and his team in this particular regard and if continuedyou never knowsome day soon, once their credit system is patched up, it might set the stage for a period of relative economic vigor. So, government wastefulness, housing mania and debt-fuelled personal spending aside, has Japan's 8.3% price decline, or the United States' 8.6% price increase done more or less harm, in real terms, to the crucial private sector economy? The above analysis, we would suggest, implies the answer is not as straightforward as the sound bite doomsters would have you believe. Indeed, it has to be a source of sardonic amusement that the news of Resona's bail-out and a massive BOJ liquidity injection has seen the yen hit a 27-month high against the dollar, pushing it up against all sorts of long-term chart points and prompting a bout of intervention as it did. But then, as Treasury Secretary John Snow put it, when dismissing the Greenback's 23% fall from its 2002 peak against the world's other major currencies as "fairly modest" (sic):

What you want to be strong is that you want people to have confidence in your currency, you want them to see a currency as a good medium of exchange. You want the currency to be a good store of value. You want it to be something people are willing to hold. You want it to be hard to counterfeit. So on at least four of those five counts, we can rule out the Once Almighty Dollar!

Japan vs. US: Who is better in the field of technology

by David Gritz

Although both world powers and leaders in technology, Japan has a better and more refined technological industry than America because of a higher standard of work, a feeling of ethnocentrism, and the fusion solution. First, Japan has a higher working standard for the average person than the United States does. Japanese culture imposes a much greater pressure on its people to do well in society. From first grade through college, students are required to bring home only the best grades, and poor grades bring shame to one's family. American culture has no pressures and requirements like Japan's, often resulting in children who do not work to their full potential due to a lack of motivation at home and from the rest of society. A Japanese legend that explains how the Shinto gods created the islands of Japan led to a belief that the Japanese people were a chosen race. The inspiration from this legend was carried throughout Japanese tradition for thousands of years and has caused them to maintain their position as a world power. Americans also have a feeling of ethnocentrism, however, the American people are part of a heterogeneous society in contrast to Japan's homogeneous nation. This results in Americans working in a less clearly defined national identity due to many different cultures and races having different values of education and work. The Japanese also have a significantly lower unemployment rate than the US, due to the fact that the Japanese people are more willing to obtain a promising career in order to bring a good image to their country. Most people in Japan demonstrate loyalty to their company as with their family, while Americans may switch between jobs many times in their life. Also, the United States must support a large military which takes away from the economy and the working force while Japan does not, enabling more people to work in the technology field. Japanese culture and ethnocentrism are some of the factors that contribute to Japanese technology being superior to American technology. In addition, the fusion solution is something that Japan has practiced since ancient days, and it continues to work well. The Japanese take existing technology [much of the time created by Americans] and use it to produce new and better products that are adapted for their use. The improved Japanese products are usually preferred over the original American and European products. The Japanese are higher ranking overall than the United States in technical industries such as electronics, automotive, and materials development. Consumer electronics is one area where Japan has applied the fusion solution. The Japanese currently excel in creating new products that are smaller and more advanced than similar electronics designed in the United States. One particular industry where Japan is especially ahead of America is the automotive industry. American cars used to dominate the industry when compared to Japanese vehicles. Currently, Japanese automotive companies have improved upon the American designs to create better and more reliable cars for the public. The Japanese were also the first to develop hybrid technology due to the rising of gasoline prices. As Japanese vehicles age, they tend to have fewer problems than their American and European competitors (Consumer Reports). Japan is also currently the world's industrial leader in the development of new materials that are revolutionary in strength and heat resistance. High demands from culture and society, a belief of

ethnocentrism, and the improving of existing technology are reasons behind why Japanese technology is superior to American technology.


Japanese Work Ethics vs American Ethics For an American to consider the Japanese from any viewpoint for any reason, it is important for us to remember that they are products of a unique civilization, that their standards and values are the results of several thousand years of powerful religious and metaphysical conditioning that were entirely different from those that molded the character, personality and habits of Westerners ( De Mente, p.19). To understand the Japanese, it is necessary to have an understanding of their religious and philosophical backgrounds. My research suggests that basic ethical values in Japanese business systems are influenced by three philosophical and religious traditions: the Shinto Ethic, The Confucian Ethic, and the Buddhist Ethic. Boye De Mente adds a fourth which he labels the Parent-Child Ethic. Shinto was the primitive religion of Japan before Confucius and Buddha . The chief deity of Shinto is Amaterasu, the Sun Goddess from whom the Imperial Family of Japan traces its origin. Lesser clans, in turn, claim descent from the lesser Shinto deities. Shinto has only one command, the necessity of being loyal to one's ancestors. This precept binds all Japanese in a bond of unity to a degree unknown in rest of the world. Shintoism stresses that harmony is necessary to keep man and things right with the cosmos. Each individual is obligated to do whatever is expected of him whatever the cost so as to bring honor to his family. Those in superior positions are obligated to take care of those who serve. Selflessness, kindness, helpfulness, loyalty, will bring trust, honor, confidence, and respect from others.(Cowles, p. 623) Confucius insisted on respect for superior persons and things. The five basic relationships are between ruler and subordinate, father and son, elder and younger brother, husband and wife, and friend and friend. The younger or inferior was to obey to the older or superior but at the same time the superior has obligations to the inferior.(Cowles, p.1507). The parent-child relationship rises to be an outcome of this teaching. Confucian principles stress piety, fidelity, obedience, kindness, loyalty to one's superior, self-control, discipline (strong work ethic), and superior/subordinate vertical structures of society. Most Japanese are Buddhists. The Fourfold Noble Truths of Buddhism assert that all is sorrow, that sorrow springs from desire or craving, that desire may be eliminated, and that sorrow can be overcome by following the middle path. This Eightfold noble path is marked by right belief, right aspiration, right speech, right conduct, right livelihood, right effort, right frame of mind, and right rapture. It's goal is the attainment of self knowledge which allows man to live a contented life (Cowles, p. 1507). Western culture is based on Christian philosophy which preaches the equality of men and emphasizes man's freedom as a rational being. Man has a free will and can choose to act in accordance with this principle. Consciousness, choice, and freedom are the key principles. The fundamental work philosophy in the US is capitalism. Webster's dictionary defines capitalism as an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market. Shaw suggests that capitalism is based on the premise that people are basically acquisitive, individualistic and materialistic in practice and capitalism

strongly reinforces those human tendencies (Shaw, p. 32). These basic philosophical differences have resulted in very different corporate ethics for western and Japanese cultures. Because of their ties to their past, the Japanese place more emphasis on the long term success of their country and the long term growth of their company and connected partners who are seen as family. Akio Morita, Chairman of Sony has commented that western society looks ten minutes ahead while the Japanese look ten years ahead (Morita, p.84). The Japanese employee is regarded as a representative of the company and he/she is expected to bring honor to the company. Company needs come before personal needs. As a result the individual must operate within the confines and social circles of the organization and its goals and values. Japanese companies operate by common agreement rather than on individual opinion. To ensure loyalty and proper instruction, employees are hired right out of school and trained in the company way before they can be spoiled by outside influences. Management style is based upon personal loyalties and seniority within a group. This makes it difficult for managers to shift from one job to another within a company and even more difficult to move to another company. In Western society the company is only a means to an end, namely the way to support one's individual or family lifestyle. In the U.S. an individual is not bound to the company and has the flexibility to move in order to further one's personal goals. Movement is often looked upon as an asset to the individual's resume and not as disloyalty to the firm. This emphasis on individuality is seen in the fullness of head hunters who raid companies for key personnel, individual retirement funds which help the worker achieve independence from the company, and references to employees as individual contributors. It is to be noted that John Sculley, the President of Apple Computer, has suggested that a 5 year work term is sufficient to spend in any one company (Dillon, p.28). Japanese society tends to be vertically structured. Historically the vertical rank scale began with the lowest laborer and moved upwards to the emperor, with rank is frequently a birthright. Today this ranking is visible in education and corporate life. The university one attends, as well as the level of education achieved is very important and can influence one's status and subsequently later career success. Companies are ranked and one's status in society is related to one's employer. The Japanese would rank a worker at IBM as having higher status over a worker at a smaller company even though the worker at the smaller company might have more responsibilities. In the same way an Ivy League school would rank higher than a State University. The number one school in Japan in terms of rank is Todai (Dillon, p.28). The student starts at a very early age to work for admittance into the University and it is said that incredible stress frequently leading to suicide is the result. Prestigious companies pick their employees based on the rank order of the universities from which the students have graduated. Once hired by a company, it is expected that the individual will continue to maintain a relationship with their alma mater and their sporting groups and will ease the way for other students to join the company. Success is measured on getting into the right group as opposed to the right job and discrimination does arise. Because the business circle is so important in the Japanese business world, leaving a company to join another, as we do in the U.S. is rare. If an individual leaves a company they will find it difficult to re-establish a new circle and thus will have difficulty advancing as they have violated the principle of loyalty. The organization and even the office structure of a Japanese company reveals a Confucian influence . It tends to be rigid and does not

encourage individual specialization as do American companies. The basic operating unit is a section having a chief, some supervisors, and general staff. Several sections make up a department headed by a department chief. The desks are configured facing each other in rectangular symmetry with the manager's desk looking down the middle. The department head sits farthest from the door and usually has a good view of the department. A task is assigned to the team and members are expected to work on the task as a team. Since the workers face each other they usually are aware of everything that occurs. Sections and departments are ranked. The section tables are aligned in rank order. The more sections to a department, the more important the department. This is significantly different from U.S. practice where individual space is highlighted by blocked - off cubicles or offices. In the U.S. as an individual progresses in rank, his/her office usually becomes larger, more barricaded, and more isolated from general staff, frequently to the point of being located on an entirely different floor. Dress codes differ as well. In Japan all levels wear a uniform for consistency and equality. In the U.S. it is typical that the higher the individual the more expensive the dress becomes, ie: white collar vs. blue collar. The repression of one's feelings, automatic submission to superior authority, and punishment for resistance are quite visible in the corporate structure and system of business practice. For example, the Japanese tend to answer a question in terms of what they think will please the inquirer rather than to answer with a disagreeable truth. He/she values the serenity of the relationship and will not jeopardize it. Akio Morita (Chairman of the Sony Corporation) notes that Japan's Confucian background makes it very difficult for its people to say no within the context of normal human relationships. In a traditional hierarchy, subordinates dare not say no to higher-ups without violating normal courtesy. The higher-up takes a no from a subordinate as insubordination. In a staff relationship, no is something to be avoided in order to maintain smooth human relationships ( Morita, p.121). Taken into the business setting this policy limits what the individual can say or how he/she can act without breaking the peace. Confrontation rarely occurs. Instead workers and superiors hope for a sort of telepathic understanding. Japanese people are not prone to considering complex moral questions as being matters of right and wrong; they are more concerned with knowing what is acceptable and unacceptable to a group. (Dillon, p.27-30). The corporate culture is a place where the worker represses his/her individual style in the interest of the group harmony. As a result, friction and stress build up in the individual. To relieve this pressure there are company sponsored year - end parties and considerable after hours drinking and socializing. While intoxicated, the individual feels free to speak openly to his co-workers and superiors without fear of recourse. As a result alcoholism is a serious problem in Japan. Boye De Mente sees a parent-child relationship as a distinctive ethic in the Japanese business system where the employer is looked upon as a parent and the employees as the children. Since feudal times the Japanese were raised to work cooperatively and respect authority in return for their livelihood and protection. There was a penalty for not agreeing. The word Amae is translated into indulgent love or love by an indulgent mother (De Mente, p. 98). The style of management and the company as a whole is as a mother to a child. Company benefits include housing or the subsidizing of housing, transportation allowances, family allowances, child allowances, health services, free recreational facilities, educational opportunities, retirement funds, and bonuses. The pay scale in the work force is patterned after

the lifestyle of the individual. For example, men who have a family will have a higher salary than men who is retiring. The pay is scaled low to high and back to low again. The retired executive is cared for through transfers to another less visible division so that the work status is maintained and the employee is kept active. This family's patterned system of life employment, while it applies to a minority of workers is still an active system in Japan. Under this system all permanent employees of larger companies and government bureaus are generally hired for life. These organizations generally hire once each year directly from the schools. Candidates are invited to take a comprehensive exam and after a careful analysis is made, are then employed for life. Once employees are selected they are expected to commit themselves totally to the company. The company in turn promises to care for their employees to their death. Managers cannot hire, fire, or hold back promotions. The company does the hiring and the managers and supervisors motivate via style, trust, goodwill, and cooperation. Promotions are dependent on longevity first, ability and accomplishment second. Employees are placed according to their abilities with the brighter picking up the heavier load and the less able a lighter load. There are no stars. Everyone is part of the team. Management trainees are switched every two to three years in a circulating effect or rotation. Instead of promotion and pay raise incentives, the most capable and productive gain status and will eventually be singled out for higher spots. Promotion is based on ability to get along with the team and to promote harmony within the group. Groups work on direction and goals and are not as task oriented as in the U.S. Human relations take precedence. The role of the manager is to create harmony rather than to direct. A good manager, for example, will accept blame for employee mistakes hoping to create a more harmonious group by protecting his subordinates from loss of face. This technique binds subordinates to cover for and support their manager should he have a weak area. American corporations focus on the bottom line rather than on corporate longevity or harmony among fellow workers. While life time employment creates a secure working environment and a dependent employee, creativity tends to be suppressed in the Japanese culture. Some researchers indicate that as a result of this parent-child relationship, innovative and creative leaders are lost to the Japanese corporate world. In recent years, researchers have begun to explore the level of satisfaction of the average Japanese worker. There is a condition called ki ga susumanai, which means: my spirit is not satisfied ( De Mente, p.125). It is used to describe a general feeling of dissatisfaction that the Japanese feel towards their work. The long hours and work weeks that have been a part of the Japanese work ethic are beginning to be questioned in the press. Some liberal groups in Japan have started a media campaign questioning the work ethic. Posters have been hung in the Tokyo subway depicting children crying and a comment that these children have lost their fathers to work. Most workers use the subway to get to their place of work. The group feels these are indications that the Japan work ethic is not as successful and fulfilling as once thought and that the Japanese are seeking more than the company reward of security and identity. Akio Morita describes the American work ethic as a corporate right to pursue maximum profits with the worker seen as a tool or resource without rights. He contrasts this view with the Japanese view where the worker is seen as a human being with inalienable rights that include more than wages. It is the role of the Japanese company to provide meaning to the worker's life, to care for him to death. In Japan, Morita says that top

executives work to improve the position of their company with the bulk of their salaries paid into taxes for national goals. American executives, in contrast, hop from company to company, grabbing as much money as they can, often well beyond their ability to spend it. Furthermore American accountants are paid to find ways to help the executive avoid paying taxes. As a result, unions have developed in the U.S. to assist the worker to confront management in order to get what they see as their fair hare (Morita, p.188). The difference between Japanese and American ethical concerns is particularly apparent during economic downturns. If an industry collapses in Japan, the company does everything within its means to secure employment elsewhere for its laid off employees. In the U.S. when the market shifts, employees are laid off generally with little notice and with little regard for their ability to secure new employment. Morita notes that Japanese and American corporate philosophies differ as well. In Japan a corporation is a success if the company accrues profit free from debt. In the U.S., leverage and short term gains are termed success. In Japan no one is fired. If the company decides that they have made a poor selection, they will retrain a deficient worker and place him in a situation where he will receive support and assistance. In the U.S. the deficient worker is fired. Rarely is any thought given to retraining the individual or placing him/her in a more supportive setting. When Sony was hit with a downfall from the oil recession, the CEO was advised to have a lay off. The chairman refused to lay off his workers even at the expense of a loss to the company. To keep people on the job, he installed educational programs and busywork to keep up moral and improve the labor skills. Morita notes that this was an American branch of the Sony Corporation and he was not sure what the reaction would be. He was happy to note that even in America the workers' loyalties to the company were strengthened and a strong sense of company appreciation and camaraderie was developed. Morita notes that employees bought tee shirts which had inscriptions on them against labor unions. Akio's point is that no matter where in the world you live or are employed the basic Japanese (Shinto, Confucian, Buddhist, Parent/Child) work ethics are valued. It should be noted that Japan does have unions within their companies. Younger employees are quite active in these unions. For the most part the unions and the management have been on compatible terms. In recent times this attitude appears to be changing towards the adversarial role of US unions. Employees' organizations want legislation and are calling for shorter working hours, overtime ceilings, an increase in the overtime wage rate, and increased vacation entitlement. (Yamada, p. 699-718) In an effort to retain the free enterprise aspect of capitalism, there have been many movements in the US towards antitrust actions to break up monopolies such as Standard Oil and AT&T. In an effort to retain the freedom of free enterprise numerous laws have been passed and government involvement has been fostered in the US to protect these rights. The Japanese approach towards company development and protection is quite different as evidenced in Keiretsu(). As large parent companies grow they form connections with lower and second tier smaller companies through cross ownership, financial ties, long-term business relationships and social and historical links. Each company entwines their business with one of the Japanese business partners. In this way the sources and uses of funds are dispersed and kept within Japan. As a company expands it will borrow funds or be funded by a series of Japanese connected banks or large firms. They in turn will secure a percentage of the sales profits as the firm grows. If a firm has a downturn connected firms will

help out or help absorb some of the pain and personnel associated with the loss. This connected network has been quite successful and profitable for Japan as evident in large companies such as Mitsubishi, Sumitomo, Toyota and Hitachi. Working in association with one of the large firms has a certain aspect of security associated with it. When companies like Apple work with these large firms, the business practice and ethics becomes quite evident in the manufacturing of their products. For example, when Apple contracts out a job to a firm for a completed product or finished good. The Japanese firm who wins the bid in turn contracts out the component parts of the product and it's assembly to smaller connected firms who each taking a percentage margin. The work performed to manufacture this product is conducted by firms who are connected to the primary company who won the bid. If production increases these smaller firms benefit from the gains and increased production. If the volume decreases the mother firm does pull back but usually assumes the obligation to provide for alternative sources of production work for their second tier subcontractors or cottage partners. We have found that the relationships are extremely tight to the point of blocking alternative sources for component parts. We have had a recent example of this with one of the major Keiretsu firms. Apple dictated a specification for a component part to be used in the manufacturing of a new product. The component part was not manufactured by one of the second tier suppliers or family members of the supplier but by competitor firms in Europe. As a result they commissioned one of their subcontractors to copy the part and refused to purchase the component from a firm outside of Japan.. We have found that Japanese manufacturers will source only from connected Japanese firms and will resist European or American supply sources unless it is a last resort or under pressure from Apple. It is noted that Japanese shops will manufacture needed parts for the benefit of the Keiretsu firm and Japan, and if needed and they will be funded by the Keiretsu to do so. This sort of business practice has been termed as antitrust in the US. This is considered pure and fair in the Japanese culture and the Japan government system fosters this type of business practice. The Confucian ethics of loyalty and fidelity are so strong that companies often will not do business with other companies unless they have personal ties within that company. This has made it difficult for Western companies to break into the marketplace as these ties, for the most part, have never been established. Since the Japanese focus on the good of the nation as a whole and not on individual capitalism it is easy to see why this behavior would be appropriate in their terms. It is necessary to keep in mind that the basic ethics which the Japanese practice, it would be quite appropriate that the company would network in this way. What poses a difficult challenge is when the two different philosophies are entwined within the same region where the basic ethics differ so much. In the States, capitalism demands the use of the lowest cost manufacturer or the bank with the best interest rate no matter who they are or where they are located. There is more incentive in a capitalistic society to save on costs then to network with US firms. In Japan it is a breach of ethics for a Japanese firm to conduct business outside the boundaries of the Keiretsu or where funds are not funneled back into Japan. Is it right for a country like Japan to practice their work ethic in a country like the U.S. whose basic value and moral systems are quite different? It appears that compromises must be made. Recent news articles indicate that the Keiretsu walls are starting to crack and U.S. capitalistic values are beginning to creep into the Japanese workplace. These changes appear to have started in the late eighties when the yen lost

value (Kuniyasu, p.22). As a result large Keiretsu's had to lay off or force out of business their second tier suppliers or lose the mother company. This change in change company behavior led to a change in worker's sentiments. The basic values once cherished appear to be visibly deteriorating. As a result students attitudes are changing and the corporate culture is becoming more and more competitive, seeking talented managers from Western companies. Even Japanese workers are beginning to seek the better job across the street (Kuniyasu, p.45). Companies such as Matsu*censored*a have taken aggressive capitalistic competitive actions within Japan to get ahead. These two cultures often find it difficult to understand and accept each others differing corporate goals and management styles and misunderstandings are frequent. Sources Cited 1. Shaw, William H. Business Ethics. Belmont: Wadsworth Publishing Company, 1988. 2. Dillon, Linda. Can Japanese Methods Be Applied in the Western Workplace? Quality Progress October 1990: pp 27-30. 3. Religion. Cowles Comprehensive Encyclopedia. 1980 ed. 4. Kuniyasu, Saki. The Feudal World of Japanese Manufacturing. Harvard Business Review Nov-Dec 1990: pp. 38-49. 5. De Mente, Boye. Japanese Manners & Ethics in Business. Phoenix: Phoenix Books/Publishers, 1981. 6. Morita, Akio. The Japan that Can Say No --The New U.S.- Japan Relations Card. Osaka: Kobunsha Publishing, 1990. 7. Yamada, Narumi. Working Time in Japan: Recent Trends and Issues. International Labour Review Nov./Dec. 1985: pp. 699718. 8. Capitalism. Webster's New Collegiate Dictionary: 1977. Word Count: 4083