Global Operations Managed by Japanese and in Japanese


   Strategy of international business of Japanese manufacturing companies has drastically changed for the last half century. Export long occupied central position in the international business strategy. In 1985 the Plaza Accord was reached and sharp appreciation of Japanese yen started. And strategic shift from export to foreign production began in 1986. Recently many companies have overseas R&D sites. However, when we turn our attention to management of international business, we observe only subtle change. Foreign subsidiaries are managed by Japanese expatriates. The Japanese language plays important role in the communication on important matters. Global operations are managed by Japanese persons and in the Japanese language. The non-manufacturing multinationals share the same characteristics as the manufacturing multinationals.
   The Japanese style international management is well suited to respond to Japanese customers and to transfer technology from Japanese parent companies to their overseas subsidiaries. However, it has problems. It is costly and depresses initiatives of local capable staff.
   Then, should Japanese multinationals change their international management in the future ?
   The Japanese style international management is based on Japanese management at parent companies in Japan. It is also based on cultural factors such as the Japanese language, Japanese persons' attitude toward foreigners and interpersonal relationship. Thus, to change the management of international business is more difficult than to change the strategy of international business.

Research Institute for Economics and Business Administration
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: (81) 78 803 7036
Fax: (81) 78 803 7059