Historical Development of Japanese management : An Overview

Kawabe, Nobuo THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 1998 SANGNAM FORUM Vol.1 No.1

Collectivism based upon an equal treatment of all employees is one of the most distinguished characteristics of Japanese management. The traditional research has tried to find out when this collectivism appeared in the history of Japanese business. It has emphasized certain periods to which the origin of Japanese management goes back. On the contrary, this paper is to show the dynamic development of Japanese management from the Edo Period to the present time, emphasizing how and why Japanese management has changed its nature to became as it is today. Historically, Japanese companies went through several periods in which they faced particular problems, and Japanese management evolved as they tried to solve these problems. In the Edo Period they established apprentice systems to maintain family businesses. In the process of modernization, they found a gap between the existing Japanese system and the imported modern technology, and they had to fill this gap by using the traditional idea of "business family." During the World War Ⅱ, the discrimination between white collar and blue collar workers diminished to attain high productivity. After the World War Ⅱ because of the democratization of Japanese economy and business by the Occupation Army and the high economic growth, Japanese companies established so called "Japanese Style Management" which created a strong competitive edge of Japanese business. However, after the collapse of the bubble economy, Japanese companies began changing their management systems to meet the changing environments.

Institutions, Corporate Environment and Transformation of Japanese Management

Okada, Yoshitaka THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 1998 SANGNAM FORUM Vol.1 No.1

Japanese firms effectively coped with economic difficulties in the 50s and 60s by reemphasizing some traditional human-relation-oriented social norms and implementing diverse mechanisms to promote harmony and cooperation in intra-and inter-firm relations. Consequently, they greatly benefited from synergetic effects, and developed the cooperation-oriented business system. Stability generated from such development, however, could not deal with turbulent corporate environment in the 70s and 80s. Japanese firms needed to generate flexibility and dynamics, but without losing the benefits of synergeic effects. They implemented diverse competitive mechanisms, to the extent that benefits from intensive cooperative activities were not significantly reduced. Such competitive-cum-cooperative (CCC) business system enabled them to benefit from both synergetic and market-like effects. Even facing new corporate environment in the 90s, they are implementing practices. not much deviating from the CCC system. The nenpo system, applied mostly to managers, increases a proportion of performance payment, while it guarantees the minimum amount based on nenko wages or qualification, or with a fixed amount. Its purpose is to preserve the benefits of synergetic effects, while increase of the proportion of performance payment requires more effective monitoring and fairer evaluation, stimulates intrafirm competition, and generates flexibility and openness. The increase rather functions to make psychological and motivational stimulation to highly cooperation-oriented Japanese management, not to replace the management with a new one. Evidence indicates that the Japanese business systems have been evolving by reinterpreting the social norms of interpersonalism, without deviating drastically from its path dependent characteristics.

Developmental State in Crisis : Managing Its Decline and Corporate Restructuring in South Korea

Kim, Eun Mee,Suh, Sukyoung THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 2000 SANGNAM FORUM Vol.- No.-

The developmental state in South Korea, which was once a powerful engine of economic development, has been under great pressure to limit its functions and to reduce its size almost overnight the aftermath of the financial crisis of 1997. The international Monetary Fund and the current South Korea administration have suggested that the developmental state should no longer intervene so heavily in the economy, which was at least partly responsible for the financial crisis. The government restructuring, which has been promoted by the Kim Dae Jung administration, however, has not produced a "small, but efficient" government. It has resulted in some reshuffling of economy-related government offices, but has not brought any significant reduction in terms of the overall function or scope of the developmental state. Furthermore, the developmental state has also been in charge of corporate restructuring. This makes it difficult for the developmental state to reform itself, when it is at the same time supposed to manage the restructuring of other important sectors of society including the corporate and financial institutions. The Kim Dae Jung administration publicly announced that it would not intervene in the corporate restructuring process, as the previous administrations have done. However, the method in which it intervened in the restructuring process of two important industries-i.e., semiconductor and automobile-, can only be defined as "coercive." Thus, the paper concludes that the government reform and corporate restructuring are far from over, and that the developmental state is not in a crisis.

Management of Paradox : A Comparison of Organizational Structure and Human Resource Practices in Korean and Japanese Firms

Yoon, Se Joon THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 1998 SANGNAM FORUM Vol.1 No.1

Defining management of paradox as "managerial and organizational practices that realize the simultaneous accomplishment of equally desirable, multiple strategic objectives that are seemingly or actually incompatible". this paper explores how organizational capabilities of effectively dealing with paradox can be acquired. Specifically, the paper attempts to address two organizational mechanisms: organizational structure and human resource practices. Propositions deduced from the existing literature on paradox and comparative management were tested with the data collected from 103 Korean and 136 Japanese firms. The data indicated that firms have to be multi-talented, It was found that firms that rely on a particular set of structural properties and Human resource practices at the expense of others were not so effective. In contrast. firms that successfully accomplished innovation and efficiency objectives simultaneously were those that were able to mix paradoxical organizational practices.

Asian Economic Crisis and Corporate Restructuring in Korea

Jung, Ku-Hyun THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 2000 SANGNAM FORUM Vol.- No.-

Asian economic crisis in 1997 was caused by a combination of in ternal system failures and the instability in the global money market. In a narrow sense, the major problem was policy mistakes by governments, especially in the area of exchange rate policy. More broadly, it can be said that some East Asian economies failed to abjust to globalization or to the newly emerging global system. The IMF imposed certain structural reform measures upon these countries as a condition for providing the rescue fund. This paper examined the so-called IMF conditions imposed upon korea mainly in the area of corporate governance and government-business relations. These reform measures can be described as Anglo-American corporate governance system because of their reliance on capital market and emphasis on transparency. These structural reforms are expected to have a profound and long-lasting effect on Corporate Korea in the years to come. Only a small number, perhaps four of five, of chaebols will remain as a looser confederation of firma sharing the root and company name. The government most likely will continue to play an important role in the economy, maybe even more so than in the pre-crisis period. One can say that a new management paradigm is emerging in the Korea economy.

Korean Industry in the New Millennium : The Challenges Ahead

Steers, Richard M.,Ungson, Gerardo R. THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 2000 SANGNAM FORUM Vol.- No.-

Factors leading up to the 1997 financial crisis and effects of the IMF intervention are reviewed as a basis for discussing future economic and managerial challenges facing Korean firms. It is argued that Korean firms face six principal challenges, including reducing excessive economic concentration, increasing concern for public welfare, increasing corporate specialization, fostering an independent banking system, corporate restructuring, and greater financial transparency. At the same time, it is suggested that the Korean government can do more to resource development, support for small and medium-sized enterprise, increased support for technological innovation, and continued efforts to achieve political stability in the region. It is suggested that caution is in order in any attempt to apply western theories or mandates to the analysis and resolution of complex political and economic problems in other parts of the world, including Korea.

Institutional Constraints on the Management of Business Systems : Implications to Korea

Hollingsworth, J. Rogers THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 1998 SANGNAM FORUM Vol.1 No.1

This paper develops the argument that the management of business firms is embedded in a complex institutional environment which consists of a society's rules, norms, habits, and values which give rise to a society a system of training for both labor and management, its financial institutions, its industrial relations system, and the state. Because a society's business system and its social system of production are societally specific. societies cannot easily mimic one another. Moreover, a society's social system of production is path dependent, meaning that as the global economy is always in a state of flux, it is very difficult for a particular society to adapt to the dynamics of global change. It is the tension between the path dependency of a particular society's institutions and the changing global environment which periodically culminates in economic crises in modern capitalist societies.

The Evolution of the Korean Business System

Kim, Hyuk-Rae THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 1998 SANGNAM FORUM Vol.1 No.1

The East Asian business systems appear to have diverged sharply as the process of economic growth took place. The divergence casts doubt on the linear transformation toward economies of scale, industrial concentration, and managerial hierarchy. This study presumes that institutional environments significantly shape the distinctive form of organizational configurations of the business system. In order to fully grasp the historical roots of the business system, the study traces the genesis stage of the establishment of indigenous enterprises under the colonial state; formation stage of the burgeoning of chaebols during the Rhee regime; growth stage of the expansion of large-scale business groups. This study basically attempts to answer the question of how the Korean business system has been constituted and interconnected over time. Primarily, it analyzes the four inter-related dimensions of structural configurations of the business system. First, in terms of organizational vitality, the business system is quite viable in that the young members dominate the population of organization. However, its older members contribute more to the growth of employment and the industrial output. Second, the analysis of size dispersion shows that organizational development is, by and large, following the pattern of dominance of large-scale production unit in a wide range of industries. Third, regarding managerial hierarchy, the business system is distinctively composed of very concentrated and vertically-integrated large-scale business groups. Finally, regarding market integrity, the business system shows aggressive forms of vertical integration and horizontal predation without establishing the extensive networks of subcontracting relationships.

Ownership Structure and Family Control in Korean Conglomerates : with Cases of the 10 Largest Chaebols

Lim, Ungki THE MANAGEMENT RESEARCH CENTRE YONSEI UNIVERSITY 2000 SANGNAM FORUM Vol.- No.-

This study investigates how the 10 largest Korean business groups have operated their strategic efforts in the construction of the groups' overall ownership distributions for management control by the family. Specifically, it discusses 5 detailed topics. First, it describes the interlocking nature of the ownership structure in each of the 10 largest chaebols. Second, it categorizes the patterns of family control via shareholding strategy and examine the factors that have contributed to the differences in control formats. Third, it investigates the components of group ownership and determine the exact level of the family commitment in the groups' overall investments. Finally it re-examines the degree of concentration of inside share ownership by using a more refined measure suggested by a previous study and is results will be compared with the case of Japanese enterprise groups.