How management is done in the land of the rising sun? Why did problems in USA's economy affect Europe so seriously?

HOW MANAGEMENT IS DONE IN THE LAND OF THE RISING SUN
In past decades the Japanese economy had expanded rapidly and the country’s annual gross national product became one of the largest in the world. A contribution to this growth is said to have been the cold war threat, during which the former leading countries mostly the United States and the Soviet Union were putting a tremendous amount of money to their armament, while Japan under peace Constitution was able to concentrate its efforts on the economy. During this period managers and renowned university professors were trying to find the key to the Japanese success and the “Japanese challenge” became a buzzword for nearly thirty years. Many comparisons between Japanese and American management practices were made, many books related to this topic were written, much research took place and the Japanese management theory soon became an object of wide admiration. This period is already gone. The Japanese economy showed steady growth till the late 80’s, when Japan entered a prolonged period of relative stagnation so-called “bubble economy”, and started experiencing a serious recession. By the beginning of the millennium, the Japanese model once held up as an example to the world is clearly running its course and now is badly in need of complete restructuring. Despite this fact, the Japanese management has become an essential part of the integrated management theory and is still considered to be one of the most significant and noteworthy approaches to this area. To gain a deeper understanding of the Japanese management, we have to describe some of the many cultural differences of this nation, which yield high influence on Japanese society and as a result also on the Japanese business. First and foremost to be mentioned is a strong sense of belonging to a group. The reason for the Japanese group behavior and collective values sharing is definitely the basic unit of society in Japanese minds – “house”, meaning group that bind people together, such as families, companies, schools, unlike the West, where emphasis tends more on individuals. This is the basis for the lifetime employment system in most companies, where the belonging feeling is basically required and employees identify themselves with the organization, which in fact means loyalty and devotion for common corporate goals.

This system requires recruitment right after finishing the school and retirement at the age of fifty-five ; the graduate comes to a low position, his career path is non-specialized (he rotates through almost all jobs in the company) and is promoted and evaluated according to the length service, unlike in Western companies, which employ workers on annual basis and the promotion and evaluation is based on one’s performance. The group principle can be also found in the collective decision making based on consensus of everyone involved, and its result – collective responsibility. Another specific feature of the Japanese society is its high emphasis on the human factor (in fact the only resource Japan has), which stems from both historical concept and underlying social and cultural process, and results in the companies’ holistic concern for their employees. This implies that the Japanese organization forms an inclusive relationship with the worker, provides a social, emotional, and economical support and takes part of the responsibility for the employee; to say it clearly: becomes his second family. In order to achieve this, the maintaining of healthy social and working relationships does not allow for any conflicts and refusals, which would disturb the harmony of the working process, and that is why the Japanese are known for not expressing their opinions, non-committance, and for having double standards, which is in this kind of society considered to be a necessity in order to solve problems without hurting anyone.
A specific characteristic of the Japanese approach is also a leadership by influence, which means a leading process without formal authority involved. The manager has to know how to motivate people, how to win them for his idea and intention, which he achieves by using his charisma and personal qualities instead of his formal designation.
A last but not least Japanese management practice, which I would like to mention is more technical in nature: the Japanese quality control and lean production also known as “just-in-time” or Kanban, the main goal of which is the cost reduction. The quality control is a process, which never allows defective units to flow into and disrupt a subsequent process by making every employee a quality checker, responsible for spotting errors as they happen and correcting them immediately or stopping the production line completely. The “just-in-time” method is used to obtain needed parts in needed quantities when they are required, which eliminates unnecessary large quantities of inventory hanging around for months.
This was a short list of some of the Japanese management practices, which contributed to the magnificent reconstruction and development of the post-war country.

Now a question may appear: which of these could be applied somewhere else in the world? Can we adopt something to our business and organizational environment? The answer is both yes and no. First we have to fully comprehend that the Japanese management stems from a unique historical and cultural tradition, which cannot be simply copied, and trying to imply any of the practices which are strongly based on cultural principles would be inefficient and probably also dangerous. Secondly, we should be aware of the fact, that the Japanese management is an object of a reasonable (justified) criticism since the slowdown in the economy has appeared and some of the practices were proved not to be effective any longer even in the Japanese business environment.
Now, I will try to briefly describe some of the advantages and disadvantages of the above mentioned practices and the possibility of their use in Slovakia. The lifetime employment system is a permanent guarantee of loyalty to the organization and job security for the employee, it also generates a strong organizational culture at the meantime, but on the other hand means a practical impossibility of changing companies. To the Slovak environment this system seems to be inapplicable because of a high unemployment rate and a high level of fluctuation, but we could probably try the use of a short-term employment instead.
The evaluation according to the length service is, in my opinion, a barrier for initiative and qualified young people to build up their carrier, so I definitely would not apply this one in my own company.
The collective decision making brings on one hand a higher expertness achieved by a team, but on the other hand is a bit inefficient and slow, so I would probably recommend the Japanese system only on the strategic and tactical level of decision making process.
The holistic concern for people is only possible in combination with the lifetime employment system in big companies, so in most Slovak organizations, it would have no foundation.
And finally, the quality control is basically used with mass production, and is definitely one of the best contributions to the management theory from the Japanese side. It has already been used in the United States and proved to be very efficient , so it is only a question of time, and this practice will be applied almost everywhere in the world.
In conclusion: “If there is one major lesson to be learned from the Japanese business structure, it is how to manage…” Washington Post 1981.

Is this still true? After reading this work, the decision is up to you…




Why did problems in USA's economy affect Europe so seriously?
When the depression hit USA, the only major country of that time, where the war hadn't been fought, the effects were felt quickly around the rest of the world. USA had acted as the bank of the world, giving loans to all the countries in Europe that needed money to build up their industries and economies after the war. If USA didn't lend the countries of Europe the money they needed there would be no one for them to do trade with. As the depression got worse in USA, the country started recalling their foreign loans and stopped giving out new ones. This lead to many planes in Europe having to be put on ice, as factory owners and others had reckoned on the economical support of the USA in the finance of their product. As the planes had to be put on ice, there was little new-commings in the industry, and little money was made by trade with other countries. To protect their own economy the countries of western Europe put up high toll barriers to protect themselves. This lead to even less trade and less money made. When the USA called back their loans, there was little money left in the hands of the countries that had to pay for the WW1, and the damage done then. The repaying of loans lead to money having to be spent on that, instead of invested in factories and trade. There was too little money to be made, so people had to be fired. The mass unemployment lead to even less of a trade, and therefor less money came into the country. When the stock marked crashed, so did the stock markets in Europe as a result, due to the close relationship between the stock exchanges. People rushed to the banks in Europe as well (even though not in the same extent as in the USA) to get their lifesaving's out in time. As hyper-inflation occurred, many people lost their whole foundation, and got dragged even deeper into the mud. One can also say that USA's economical problems affected Europe due to the mere influence it had on Europe. All American was good, and even fashion, music and dance came from the USA, thus the leaders in industry did not believe that the financial power-men of America could do mistakes, and followed blindly in their footsteps, even if they saw that the USA was headed for a dive. They believed that this was only a periodic low-point that would have to come all over the world no matter what, due to the prosperity of the years before. As a conclusion to this, one can say that European economy was affected by the American economy due to the USA having so large sums of money invested in Europe, that by recalling it, the whole industrial foundation of Europe collapsed, and the effects were multiplied.

How Advertising Agencies Operate ?


The first advertising agencies had no copywriters. They had no art directors, and no account executives either. In fact, a career in advertising during the late 1800’s required virtually no experience with advertisements and no particular insight into the product being sold. The first advertising agencies were simply brokers of media space, buying pages in newspapers and periodicals and selling them to advertisers. Agencies were rarely staffed by more than a couple of people and their motivation was not to help companies attract customers or sell more goods, but to maximize profit on their own transactions. Over the years, the business environment facing agency clients has gotten incredibly complex. Simple products have become multifaceted brands. Manufacturing companies have given way to marketing-driven corporations. And communications have become increasingly vital to their existence. Simultaneously, the outlets for communications have also grown more complex. Consumers have access to hundreds of channels on broadcast TV, cable, and satellite. There are thousands of newspapers and magazines for people to read and millions of web sites to access. Advertising is everywhere and companies more than ever need help identifying the right opportunities. As a result, advertising agencies have grown incredibly. Today, the largest agencies employ thousands of professionals across the globe and manage billions of dollars in business every year. And advertising agencies offer more diverse services than ever, serving as strategic partners with their clients and helping them increase the value of their business.



Word list

Contribution- príspevok
Tremendous- obrovský, ohromný
Armament- výzbroj
Prolonged period- dlhotrvajúce obdobie
Yield- vyniesť,dať
Devotion- oddanosť, nadšenie
Achieve- dosiahnuť
Necessity- nevyhnutnosť, potrebnosť
Disrupt- prerušiť, narušiť
Formal designation- formálne označenie, pomenovanie
Inefficient- neefektívny
Holistic- holistický (fil.)
Fluctuation- klísanie
Loans- pôžičky
Recalling- pripomínať
Incredibly- neuveriteľne
Copywriters- reklamní textári
Leaders- lídri, vodcovia
Mass- vačšina, koncentrovať (v.)
Damage- zničiť
Conclusion- záver
Manage- viesť, riadiť
Slowdown- spomalenie
Maintaining- údržba, pridržiavací
Responsibility- zodpovednosť
Extent- rozmer, rozsah
Restructuring- reštrukturalizácia, reorganizácia
Retirement- odchod do penzie
Influence- pôsobenie, účinok
recommend- odporučiť, odporučenie.