Japanese and Korean Management Styles
Everyday Japanese and Korean companies interact more and more with each other, which has help them to grow simultaneously and converge in some aspects, but it is important to clarify that they will never be homogeneous because of their different cultures and systems inside the countries.
On one side, Japanese management style has been concentrated for years in market share as a growth strategy, based on aggressive pricing and economies of scale that lead them to value maximization, thinking always in their future and in Japan’s development as an entire country.
Japanese organizations have an excellent relationship with its suppliers, recognizing them as partners and maintaining an association, which is based on business cooperation and coordination, where they are able to obtain adequate and accurate information and especially to receive the products quickly and continuously.
In these organizations, employees have an active participation, which demonstrates trust, loyalty and motivation towards the corporation. They are committed with it and know how to deal effectively with customers, connecting the product, design and production to have a perfect manufacturing process. This can be explained by the importance of corporate values within Japanese organizations, because workers feel part of the company, willing to carry with it through changes and difficult times.
In the Japanese culture, there are big group of companies called “ZAIBATSU”, which were originated by groups of families during the Meiji Era. These enterprises have their own banks, so they receive financial privileges and special treatments. Besides, the Japanese government give them subsidies and a favorable tax payment. They were the most important part of the economy and industrial activity during the nineteenth century.
On the other side, Korean management style is really similar to the Japanese style, because Korea was a Japanese colony from 1910 to 1945 and in this way their culture was influenced.
In order to succeed in a globalized world, Korean management style followed the Japanese economic development model during the 70’s and 80´s. They implemented government’s intervention with credits, foreign relationships and exports, looking for an augmentation of growth and benefits.
Korean culture also has large conglomerates, controlled by families that are called “CHAEBOL”. They play a very important role in Korean´s industry as well as “Zaibatsu” do in Japan. The difference between those 2 groups is that “Chaebol” are not allowed to have banks, so they can only use government help and financing.
Everyday Japanese and Korean companies interact more and more with each other, which has help them to grow simultaneously and converge in some aspects, but it is important to clarify that they will never be homogeneous because of their different cultures and systems inside the countries.
On one side, Japanese management style has been concentrated for years in market share as a growth strategy, based on aggressive pricing and economies of scale that lead them to value maximization, thinking always in their future and in Japan’s development as an entire country.
Japanese organizations have an excellent relationship with its suppliers, recognizing them as partners and maintaining an association, which is based on business cooperation and coordination, where they are able to obtain adequate and accurate information and especially to receive the products quickly and continuously.
In these organizations, employees have an active participation, which demonstrates trust, loyalty and motivation towards the corporation. They are committed with it and know how to deal effectively with customers, connecting the product, design and production to have a perfect manufacturing process. This can be explained by the importance of corporate values within Japanese organizations, because workers feel part of the company, willing to carry with it through changes and difficult times.
In the Japanese culture, there are big group of companies called “ZAIBATSU”, which were originated by groups of families during the Meiji Era. These enterprises have their own banks, so they receive financial privileges and special treatments. Besides, the Japanese government give them subsidies and a favorable tax payment. They were the most important part of the economy and industrial activity during the nineteenth century.
On the other side, Korean management style is really similar to the Japanese style, because Korea was a Japanese colony from 1910 to 1945 and in this way their culture was influenced.
In order to succeed in a globalized world, Korean management style followed the Japanese economic development model during the 70’s and 80´s. They implemented government’s intervention with credits, foreign relationships and exports, looking for an augmentation of growth and benefits.
Korean culture also has large conglomerates, controlled by families that are called “CHAEBOL”. They play a very important role in Korean´s industry as well as “Zaibatsu” do in Japan. The difference between those 2 groups is that “Chaebol” are not allowed to have banks, so they can only use government help and financing.
According to Jangho Lee, Thomas W. Roehl and Soonkyoo Choe "The convergence assumes that as countries develop, management systems will converge to a model found in developed countries. The other, the comparative cultural approach (divergence), is based on the assumption that a wider set of cultural norms in each society is a powerful force for differentiation" (1).
Different management styles can seek for convergence when they develop similar styles to meet and satisfy the global demand; or for differentiation when they have a wider set of norms in each society that make them different in the international market.
References:
• (1) Jangho Lee, Thomas W. Roehl and Soonkyoo Choe. "What makes management style similar and distinct across borders? growth, experience and culture in korean and japanese firms"
Questions:
1. List the main similarities and differences of Japanese and Korean management styles.
First of all, it is important to note that both, Korean and Japanese management styles are directed towards globalization, internationalization, expansion and growth. As they are both Asian countries, with closely related cultures they have to face similar markets (national and international) and consequently they have developed similar managerial structures.
Another important similarity is that both managerial styles have large conglomerates controlled by families, which are the “Zaibatsu” in Japan and the “Chaebol” in Korea, groups that have influenced in a big way both economies, industrial activities, development and growth.
In Japanese and Korean organizations, employees are really committed to their work and take participation in important decisions, they both have great relationships with suppliers and they work hard to achieve not only their organization’s goals, but also to have their customers satisfied and fulfill their needs with the products or services.
Another main similarity is that both economies are strong in technology and the automobile sector and have worked hard to develop these industries and to be recognized in the entire world for their aggressive pricing.
According to Won Seok Choi, the main difference between Korean and Japanese managerial styles is the intervention that the government of each country has in organizations. In Korea, the government has a close relationship with business corporations, including direct credits given to the organizations, import restrictions, subsidies and sponsorship for some specific industries, etc. In Japan, the government protects mainly the agricultural industry and they heavily depend on imported raw materials and fuels. Another difference is their hierarchy orientation. Koreans have more respect for their family and children usually want to work in the same as their father.
Korean and Japanese styles are developing and growing within two different economic environments. This explains their divergence and why they will never be homogeneous despite having many similarities that lead them to converge.
References:
• Jangho Lee, Thomas W. Roehl and Soonkyoo Choe. What makes management style similar and distinct across borders? growth, experience and culture in korean and japanese firms"
• John Lie. Is Korean management just like Japanese management?
• http://econc10.bu.edu/economic_systems/Country_comparisons/korea_japan.htm
2. What is isomorphism? Do you think organizations change management styles to adapt to the environment? Which environment is stronger: national environment or international environment?
“Isomorphism refers to the constraining process that forces one unit in a population to resemble other units that face the same set of environmental conditions” (DiMaggio and Powell 1983: 149).
According to this definition, isomorphism is the similarity that has one organization´s structure with another, facing the same conditions and limitations.
“Isomorphism occurs because increased environmental differentiation has to be matched by similar patterns of differentiation within the organization”. (Lawrence and Lorsch 1967).
I think that organizations change their management styles to adapt to the environment and its conditions, to different cultures and to the national and international market. Sometimes it is required for organizations that want to enter a new market to assimilate or copy some specific characteristics from organizations that have already entered that market (culture, country, etc), and change some things of their management style, so they can be adapted to the new market, new culture, new people, etc. For example, KFC had to change some of their management style characteristics, like their context, people, strategy and execution when they decided to enter the Chinese market. It wasn’t easy to do it, but they succeed because they learned how to apply their business in a different country, with a different culture and therefore a different market.
I would say that when an organization stays inside its country of origin, the national environment would be stronger, because it has to deal only with that country’s market. But when an organization is willing to internationalize and enter other markets, they should at first consider the international environment (in this case the new country) and then the national environment; without losing the principal aspects that have characterized the company and make it grow, but adapting them to the new environment if necessary, always respecting the new culture, new market, beliefs, etc. Otherwise the organization would not succeed in the international market.
References:
• P. J. DiMaggio & W. Powell, "The iron cage revisited" institutional isomorphism and collective rationality in organizational fields", American Sociological Review, 48 (1983), 147-60.
• Lawrence, P., and Lorsch, J., "Differentiation and Integration in Complex Organizations" Administrative Science Quarterly 12, (1967), 1-30.
• http://knowledge.insead.edu/KFCinChina090323.cfm?vid=195
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