The Management Practices of Japanese Subsidiaries Overseas

This article discusses the manpower management problems of Japanese subsidiaries in the U.S., Europe, and less-developed countries. Two different styles of management are identified among Japanese overseas subsidiaries: the modified local system and the modified Japanese system. Rather than replicating the Japanese style of management outside Japan, Japanese subsidiaries overseas are characterized by centralization of decision making, low levels of trust for local managers, ceilings on promotion for locally employed managers, and problems with unions and equal employment regulations. The success of Japanese companies overseas is primarily due to attention to work detail, discipline at the shop floor, and superior operations management and technology. This evidence raises serious questions about the adaptability of Japanese management techniques to other countries and societies.