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What Can Japan Work for the New Global Standard Management? The Deterioration of the Two Leading Management Model in the World

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(1)

NOTE

Production

Management

Vol.15, No.3-March,

2009

What

Can Japan

Work

for the New Global

Standard

Management?

―The

Deterioration

of the Two Leading

Management

Model

in the

World―

Heizaburo

Tsurushima

Taisei Gakuin

University,

Japan

Abstract:

There are two leading management

models in

the world. One is called the hunting people management

model, created by the people who used to live in the forest.

This model is represented

by US, based upon western

culture.

Another

is

called

the

agricultural

people

management

model created by the people who used to live

in the Asian monsoon area represented by Japan. These

two models have recently deteriorated due to the current

complexity of the economy and the society. It is necessary

to create a new management

model combining the strong

points of the two models.

This new management

model is to be called the new

global

standard

management

model and needs to be

announced by current Japanese people.

1. Two world leading

management

model and their

system deterioration

Recent excessive credit creation in US like sub-prime's

issue created a tremendous non performing loan in Europe

and Japan, giving a great fear not only to bankers but also

to business

executives.

This issue realized us that the

world is connected in the economy and the management

field, same as a geographic field

At the same time, a drastic change of the world economy

makes a way of the company management

more difficult

than that of before. This is because the management has to

mange the company, taking it into not only the domestic

situation but also that of US, Europe, and even in growing

BRIC's. into their account.

In order to overcome this difficulty , a role management

model accepted all over the world needs to be established.

Current world leading management

model is called the

hunting people management

model is a model produced

basing upon the western culture causing as Sub Prime

Issues

Another

model is called for the agricultural people

management

model created by the peoples who used to

live in Asian monsoon area where has an agricultural culture back ground. It is known that the former is lead by US and the latter is lead by Japan. The concepts of those two leading models are quite different although hunting people management model is a current mainstream of the world.

Anyway, these two models have contributed to the development of world economy in the past. Nowadays, however, they do not work well in the current complexity of the economy and the society. That is because these models could not solve the recent arising issues and held a lot of the problems as shown below.

2. Hunting people Management Model•cUS and its virtual business

Difference between the hunting people and agricultural people in their behavior is whether they are active or passive. The hunting peoples were very active in a behavior as if American driven out Native American to the West in the past. This behavior is carried over to the current hunting people's management model in US as if they make money very aggressively like sub-prime issues. 2-1 The short-term thinking makes the company management weak

Since the hunting people hunted to get their meal on that day, they did not possess the patience to grow the crops in long term as agriculture people did. This tendency is carried over to the recent US management way which seeks for the profit in short term. For example, they seek for maximum ROE (Return on Equity) in first priority index, when the stockholder makes the investment In order to increase ROE, the stockholder asks the company try to cut down R&D investment and personnel cost, otherwise they can not get the maximum dividend from the company.

This is similar that the hunting people try to get maximum game (dividend) by hiring excellent hunting

(2)

dog (employed president), and to minimize the investment cost of the bow and the arrows (monetary investment).

If the company tries to keep increase the dividend to the stockholder, it will lead to reduce their internal reserves and make their financial constitution weak.

2-2 Moneymaking by the Monetary Economy•c virtual moneymaking.

The hunting people may be killed by the others on attack unless they beat the others. This will mean that the hunting society is not peaceful like as agricultural society.

The recent hedge fund and the derivative, popular for wealthy people were very aggressive by any use of the hunting people's technique. They try to get maximum profit by defeating the competitor by any use of the high financial technique. This model focuses on the monetary economy to make a fortune at stroke by intelligence, although the real economy focuses on the real production and the real servicing when getting money. I wonder if the outcome by the hedge fund and the derivative can produce some goods and service in the society or not.

We should realize that the monetary economy did not increase any real product and real service, nor any wealth of the world. It is an easy money, differentiating from the true wealth earned on the real economy by the sweat.

2-3 The Differential Society creating the winner and the loser

An agricultural society is an equality society in which everybody works in collaboration on the schedule. On the other hand, the hunting society is the differential society in which the winner and the loser will be born by the degree of the hunter's talent. In recent global economy, the productivity increased remarkably due to the smooth movement of the management resources such as manpower, goods, money through the world.

Therefore, it makes a clear distinction between the winner group who has a lot of management resources and the loser group who does not have many management resources. Although it is a good society to recompense for a talented and a harder working people, the problem is that the only a very few people can become the winner and many the people become the loser even if they have a high technology and a good business model.

At the same time, the labor market has a similar phenomenon which has big salary difference between the general workers and the elite business person. In 2005, it is reported that CEO earned 262 times higher salary than that of average workers in US. I am afraid if this fact

might cause a social problem in US in future.

3. Agricultural peoples management model•c Japan and its positioning falling down

In the agricultural society, people works in a group to defend for the attack of the enemy rather to strike the enemy like as the hunting people does. Japan has been an agricultural society from an ancient time and it still keeps agricultural style well in recent management style known as "collaboration".

3-1 The convoy system cause a low productivity

Japanese company has been very successful in the management style after the World War II due to the style of working in group. This management style becomes too exceed, however, it creates the illogical equality system like as "no one left behind" in the convey system. The convey system created a society of less competition in which a low productivity company could survive.

In the banking industry of Japan, for example, a deregulation called "The Big Bang" by the Ministry of Finance caused the some big banks to merge with the foreign banks due to less productivity. The agricultural management model weakness is that the company could not survive due to the weak competitive power in the mega competition age known as the "global standard."

Under these situations, the relative economical position of Japan has leveled down remarkably. The order of the nominal GDP/person of Japan came down from 2nd in 1993 to 18th in 2006.

3-2 End of a catch-up age and recent weakness of the economical power

Peoples of the agricultural society have been working under the predetermined procedures every season, every year. Under this society, the precedent was esteemed and the people worked under getting the consensus of the group people. It was a very effective management model when the catch-up age had continued in Japan at high economical growth time

Japan had been grown up to be 2nd largest economy country, mostly by best practicing the western political and economical system in 20 century.

When Japan became a top runner in economy, however, they lost any target of the good imitating model and then, their economical power became weak. At this moment, therefore, an agricultural people's management model might be difficult to lead the world economy due to less

(3)

creativity and leadership.

3-3 The Insular Management

Model not commonly

accepted

by the world

The Japanese

way of the management

such as a

lifetime employment and a seniority system worked very

well when the relation of the labor and the management

was close. Especially in the manufacturing

industry, an

agricultural management

model had worked effectively

because the employee worked very hard in the group.

This is because that the Japanese way of management

was created by the homogeneous

country's

culture in

which

unitary

race

has

lived

last

1,500

years.

Consequently, this culture enhanced the high quality of

the product as if the product of Made in Japan called a

number one product in the world.

Since the Hunting

people management

model is a

current mainstream

of the world, they might be difficult

to understand the Japanese way of management

due to

its vagueness and non logical thinking in management. It

might cause the misunderstanding

to the other people of

the world and might be called as very special model

which is difficult to become the global standard to lead

the world.

As mentioned above, since both Japanese agricultural

and American hunting models have a lot of the problems,

it is necessary

to create a new management

model

neither by American

hunting model nor by Japanese

agricultural model,

combining the strong points of two

models.

Hunting Model

Agricultural Model

4. What

can

Japan

works

for the

new global

standard

management?

Recently. global standard management

created based

upon hunting

people

management

model

has been

transferred to Japan and its influence becomes larger and

larger day by day.

Since this global standard

management model seems to be a gemstone which has

rough surface and sharp in corner, it is not easy to be

adapted straightly into Japan which has delicate culture.

One of the reasons is:this global standard model would

create the difference between a light and a darkness, a

winner and a loser which does not make peoples really

happy due to not considering everybody equal.

In the ancient time, the Japanese envoi to Tang and the

immigrant from the Asian Continent brought the

continental culture such as Buddhism and Confucianism

from Korea and China to Japan. These culture and the

thinking from oversea seemed to be the gemstone,

having rough surface although they were marvelous

originally. Therefore, the ancient Japanese people who

had delicate and elegant

mind considered that the

continental culture would not work well in Japan if

imported them as they were. Then, the ancient Japanese

people polished this rough but marvelous gemstone

(Continental Culture) well and rounded their corners by

putting a secret taste of the Japanese spirit onto an

oversea knowledge. Consequently, they were changed to

an elegant and delicate Heian Period culture such as the

Genji by Murasaki-shikibu ,Japanese Buddhism by

Kukai,and Saichou. They were the marvelous heritage

exceeded far beyond of the world level in that era.

This means that the rough gemstone had been changed

to the beautiful jewels by the support of Japanese

ancestor's continuous study and efforts. In Meiji era,

Japan did not accept the Capitalism straightly from the

West.

They added Japanese spirit onto Western

Knowledge by the anticipator's efforts such as

Mr.Yukichi Fukuzawa and Mr.Eiichi Shibusawa etc.

This would help for Japan to produce the strong

company system called Zaibatsu such as Mitsui,

Mitsubishi ,and Sumitomo in a short term. Furthermore,

when democracy was introduced to Japan from after the

World War II, it was polished and rounded the corner

by putting secret taste of Japan

Consequently, Japanese way of management was

formed up by the help of the business leader such as

Mr.Taizo Ishizaka Mr.Toshio Doko etc. Judging from

above a series of the historical trend, changing from the

rough gemstone to an elegant Jewel would be a

traditional Japanese Business Model.

5. Conclusion

(4)

The global standard management formed based upon the

hunting people model seems to be a gemstone which has

rough surface and sharp in corner,

Therefore, the current Japanese people's duty is to

change the gemstone (global standard management) to

an elegant Jewel called the new global management

model as an ancient Japanese people did traditionally last

1500 years. In another word, by combining the strong

points of the hunting people management model and the

agricultural people management model, we Japanese

people has to form up the new global standard

management model and also needs to announce it to the

world.

References

[1] Turushima, T.: Coming New Management Model,

Cosumo Education Press, Tokyo(2008),(In Japanese)

[2] Tsurushima, T.: New Global Standard Management

Cosumo Education Press,Tokyo(2008),(In Japanese)

(3) Tsurushima, T:

Strongest Elite Education in US,

Kodansha Press, Tokyo(2004),(In Japanese)

Biography

Heizaburo

Tsurushima

is a

Professor, Business

Administration and a Director of University Library in the

Taisei Gakuin University at Sakai City, Osaka. He

graduated Commercial Science Dept. of Keio University.

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