New Managerial Strategies of Japanese Corporations

Japanese corporations became so competitive in the global market in the 1980s that their example generated the ‘Japanization’ of management throughout the world. However, in the 1990s they have faced serious challenges. Corporations in other Asian countries like Korea, Taiwan and China are catching up. There has been a major appreciation of the yen and corporations in North America and Europe have become fiercely competitive. Moreover, Japanese corporations are facing internal problems, such as the ‘hollowing out’ of Japanese industries. In the 1990s, while overseas investment by Japanese corporations has been increasing, particularly in Asian countries, the production of Japanese manufacturing industry decreased remarkably and has not yet fully recovered. This trend has a critical influence on small and medium sized enterprises which provide large corporations with intermediate products. These conditions have weakened the performance of the Japanese economy in general. In 1996, unemployment rose to its highest level since the end of the Second World War (3.4 per cent).