As part of the Chartered Institute of Management course I am studying for my development at Purple Cubed, I’ve been introduced to a plethora of management theories and ideas. It seems that now, more than ever, business leaders are open to ideas about new practices and how they can be applied and adapted to ensure they work for the organisation.
One theory which particularly caught my attention was ‘Japanese Management’; this has come to prominence in recent years and been credited with the phenomenal success of organisations such as Toyota, Hitachi and Nissan.
Traditionally Japanese Management is characterised by creating a harmonious working culture where people can flourish, delivering results not only for shareholders, customers and employees but also wider society; job rotation and lifetime employment (‘Shushinkoyo’).
Some of these principles have evolved in recent times to reflect the global market. For example it is not always feasible to promote lifelong employment, especially if, like Japan, there is a declining population and low birth rate. However, some of the key principles that Japanese Management adheres to promote competitive advantage and delivering strong revenue.
Konosuke Matsushita, the prominent deceased founder of Panasonic, is an excellent example of an inspirational Japanese leader who followed the rules of Japanese Management. Known to many as “the god of management” he cared deeply for his employees and treated them as if they were family; whilst building from scratch an empire worth $42 billion in the late 1980s. One of his famous sayings was
;“We produce people, and we also produce electrical goods.” He treated his employees not only as co-workers but as people whom he served. He encouraged his management teams to be equally as people focused. Matsushita firmly believed that a business as large as his was responsible for helping all of society prosper – not just his shareholders. He encouraged a fair approach, for instance, selling products at a price which allowed a good margin for all and making payments to suppliers on time.
Toyota is another great example – working to maintain a business which l allows its employees and wider society to flourish. Their global vision; ‘Toyota will lead the way to the future of mobility, enriching lives around the world…We will meet our challenging goals by engaging the talent and passion of our people who believe there is always a better way’ is lived and breathed globally by its people. Furthermore Toyota has become the thirteenth largest company in the world, with revenues of $222 billion (US). Arguably few organisations have proven as influential outside of their industry as Toyota. Thousands of companies have studied its production and management methods to increase efficiencies and various books have been written about its success including; ’The Toyota Way: 14 Management Principles from the World's Greatest Manufacturer’.
The idea of rotating team members practiced by many Japanese firms every two to three years with the aim of exposing people to various jobs is also a clever one; if managed properly – you don’t want to create a management team who are ‘jack of all trades and masters of none’. This enables broad business exposure results in logical decision making and clarity. For some, it’s also seen as a great employee engagement tool; helping people to broaden their skills and mind-set and unlocking untapped skills and expertise.
In difficult economic times Japanese firms traditionally avoid letting people go. Instead they use this time to develop and grow customer relationships, develop their people
,and carry out project work. The government proactively invests in learning during down times. Whilst sometimes redundancies are unavoidable, it creates high levels of trust and strong relationships if your workforce know that employee cuts are a last resort and your organisation is happy to ‘get creative’ in order to retain and continue to develop its people.
Japanese Management theories offer some practical and inspiring insights into building a motivated and high performance culture. Therefore it’s worth looking towards other cultures and organisations for inspiration and ideas; adapting them according to your business and the market you operate in.
Do you work for a global business which takes leadership lessons from a variety of cultures? Or perhaps for an SME where you have looked further afield for innovative ideas?