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Theory Z is coined from the Japanese management approach, which states that Japanese companies and corporations have served for a long time as models for successful business practices. The Japanese style of business management emphasizes respect for workers, which has led to an increase in the company’s loyalty. This theory has its construction based on the application of the Japanese management to the US companies (Borevich & Shafarevich, 1966). In this theory, Type J, Type A and Type Z can be differentiated. The type Z organizations take American values like individuality and combine them with Japanese values like the institution’s care for families of the employees. Thus, theory Z is part of the models constructed in support of their families. The aim of this theory is to involve the employees full in their work by making them invest wholly in their work. Many of the United States companies discovered the increase in the business losses to their competitors. Their biggest competitors were Japanese companies. Therefore, the concerns about the competitiveness of the US companies to their Japanese rivals raised alarm. The theory Z was coined as it combined the best practices of the Japanese organizations while retaining significant aspects of the management deeply rooted in US traditions such as individualism. The incorporation of the type Z management style has the opportunity to increase the employees’ satisfaction. It will also decrease the rates of absenteeism at work and work turnover while increasing the quality of production as well as the overall organizational performance of the company. If the US companies adopt this theory, it will make them more competitive to their rivals increasing the production output of the companies (Bush, 2003).

An Analysis of Three Japanese Management Practices Transferrable to US Companies

Long Time Employment

Japanese companies make long-term commitment to their workers and in return expect loyalty from the employees. It promotes job stability and security of the organization in terms of the employees. On the other hand, the US organizations treat their employees as replaceable cogs within a profit-making machine. In the United States, the employment could be terminated at any time. In case of decline in business and financial income in the Japanese companies, they reduce the working hours of the employees, but they do not fire them. It is the complete opposite of the US companies whereby during low business season, they lay off employees without considering their family and their losses (Lewis, 2005). It results in job insecurities amongst the employees. It also leads to the loss of valuable talents within the organization. The Japanese theory uses the approach that people working within an organization are valuable resources when the economy of the company has gone down. Since the Japanese treat their employees with respect, the employees become an integral part of the community and promote practices that have to be fair and equitable to all employees within the firm. The criterion of promotion in Japan is a combination of seniority and merit. However, education plays a crucial role as the Japanese invest heavily in the training of their employees. Therefore, they do not want to lose their employees and resources invested in the training of these employees. Practices of job rotation among the Japanese employees have led to a broader choice of careers for the employees as they get exposure to different business fields.

Humanistic Approach of Management

Japanese principles of management have more humanistic approach of management compared to the American companies’ approach management. Therefore, many companies in the US are urged to use this approach in order to achieve success. Even though these principles are based on the Japanese principles of management, they combine the management philosophies of the Japanese companies with US cultures of management. The Japanese theory is a psychological rationale focusing on the co-workers’ relationships and specifically on the entire set of the organization’s values. It exhibits a strong set of vital cultural values similar to the tribal cultures. It happens because tribal values are characterized by similarity in values and believes within a common people. However, although this theory has the characteristics of tribal cultures, it has some elements of bureaucratic hierarchies such as authority relationships and different performance evaluations. Companies treat their workers with care and more concern. It makes the workstation a community of individuals working together towards a common goal of organizational success. Building loyalty amongst the employees is achieved by using a humanistic approach. Comfort in the employees working environment is the gateway for their effective performance. For instance, the impact of managerial practices is lifetime employment. The Japanese companies have ensured that the employees have stable employment until retirement. It is not the case for the part time and seasonal employees as they are fired at the times of economic slowdown.

Cooperative Decision-Making

The form used by the Japanese company for decision-making needs to be transferred to the way US companies are used to making their decisions. The most prominent aspect of the decision-making process in the Japanese company is the use of several levels The most prevalent aspect of the analysis is understanding the problem and developing several solutions to problems at hand. According to the Japanese company, the final authority for making decisions rests with the top managerial team. However, before the proposal of the problem reaches the executives, the issue has been discussed on several levels of the organization in a hierarchical form. The top management still has the choice of accepting or rejecting the decisions made. In most cases, decisions are returned to the subordinates for further evaluation. On the other hand, in the US company key decisions affecting the company are made by few people. However, more people are involved in the operational decision-making. After these few people have made the decision, it is then presented to others. People to whom the decision is “sold” may have different perceptions and ideas concerning the problem and their own vision of the best way to reach a solution. In this case, in the US companies and organization decision-making is fast, but the process of implementing the decision is time-consuming and needs compromise from managers with different views (Ouchi, 1981). In the end, the implemented decision will be imperfect due to the compromises made by the managers with different viewpoints. Eventually, the decision can be traced to specific people. In the case of when a problem ares because of the made decision, it can result in blame and search for scapegoats.

An Analysis of Three Japanese Management Practices Not Transferrable to US Companies

Individual Responsibility

The American system of management requires the emphasis on the individual responsibility for performance within the organization. The performance of the company is, in the fact, the overall performance of the company’s employees. Type Z organizations retain the emphasis on the contribution of each individual, which is characteristic of the majority of  American firms. It is done through the recognition of individual achievements in the context of a bigger group.  Most organizations in the US emphasize individual responsibility with the aim of clarifying different responsibilities of different individuals. Most organizations have been successful in using formal organizational structures. However, the majority of the companies’ managers do not create a commonly shared organizational culture. It happens because most managers and technical staff have a close identification with their profession rather than attachment to a particular company. In addition, the work force encompasses different groups of people with divergent values derived from different heritages. Most US companies have a high employee turnover rate due to the mobility of the people in the country. The changes within the organization are accomplished through changes in the goals rather than processes. Organization using change agents to accomplish its goals through orientation towards the behavioral science may focus on interpersonal processes with the aim of reducing conflicts and improving performances. In the US, it is common to use outside consultants to develop the business.

Slow Evaluation and Promotion

Management and human resources in the US and the Japanese companies are common in that they recruit young employees from schools and also hire from other companies. High turnover rates of qualified employees in both countries is overwhelming. A common practice concerning American employees is that the employees are appraised soon after they are employed. Other professionals such as engineers and accountants identify more with their professions rather than with a company by which they are currently employed. American companies are characterized by the short-term evaluation of performances and rapid promotion of top achievers of the company. On the other hand, the Japanese company has emphasis on the slow evaluation and promotion of their workers. In general, decisions and related responsibilities are vested in individual people while in the Japanese company all people in the company share power and have a say in significant decisions of the company (Tamanaha, 2004). It affects decisions concerning evaluation and promotion of the employees. The US companies need to continue with their immediate appraisal of the employees as it this helps in retaining technical employees and making them a part of the company. Since these groups are slippery, it is going to increase chances that these employees will work for some time in these companies. If this strategy is transferred to the US management system, it can lead to the increased output in work as all workers in the company will take a collective responsibility for the actions.

Target Oriented Practices

Most Japanese management practices are not easily transferable to other countries because Japanese management cultures are embedded deeply within the Japanese culture and are difficult to transfer abroad. The use of Theory Z has been dysfunctional in a number of foreign countries. Most of the Japanese theory of management is not functional in of the majority of companies in the US because of the companies asserting that these managerial principles are not sensitive to the domestic cultures of the US. In order to get benefits, the company has to implement this theory (Wang & Pizam, 2011). In addition, due to the environmental factors foreign counterparts do not easily adopt most management systems. Differences in nationality and in culture and variations in the work ethics are some of the issues hindering the incorporation and adoption of the Japanese management principles. The implementation of the Japanese culture fails not due to the geographical difference but due to the mental distance. Furthermore, Japanese principles work best with the Japanese since they have natural structures of decentralized ways of decision making with a low degree of decentralization.

Conclusion

In conclusion, for the success of the companies in the US they need to adopt the management practices from the Japanese companies that are favorable and suitable for the US companies. Some of the managerial factors are not easily adopted due to the differences and variations between cultures and environments. Different types of businesses vary also in their need of this strategy. For this reason, it is essential to consider businesses that are possible for companies. For example, the Japanese theory is a psychological rationale focusing on the co-workers’ relationships in the view of all values of the organization. It exhibits a strong set of vital cultural values similar to tribal cultures. It happens because tribal values are characterized by the similarity in the values and believes among the representatives of a common people. The Japanese style of business management emphasizes respect for workers, which has in turn led to an increase of the company’s loyalty. Therefore, companies are urged to adopt appropriate cultural practices in the US with some business principles of the Japanese companies.

Theory Z is coined from the Japanese management approach, which states that the Japanese companies and corporations have served for a long time as models for successful business practices. This theory has its construction based on the application of Japanese management to the US companies. The aim of this theory is to involve the employees full in their work making them invest wholly in their work. Many of the United States companies discovered the increase in business losses to their competitors. The Japanese companies make long-term commitment to their workers and in return expect loyalty from the employees. This promotes the job stability and security of the organization in terms of employees. In addition, the Japanese principles of management have more humanistic approach of management compared to the American companies approach management.

The most notes worthy aspect of the decision-making in the Japanese company is the use of several levels for decision making. The most prevalent aspect of analysis is the understanding of the problem in the development of several solutions to problems at hand. For the success of the companies in the US, they need to adopt the management practices from the Japanese companies that are favorable for companies in the US. This is because some of the managerial factors are not easily adopted due to the differences and variolisations in cultures and the environments. Different types of businesses vary also in their need for this reason it is essential to consider the businesses that are possible for companies. The Japanese theory is psychological rationale focusing on the co-workers relationships specifically the entire values of the organization. It exhibits a strong set of vital cultural values similar to the tribal cultures. Therefore, the companies are urged to merger the appropriate cultural practices in the US with the other business principles in the Japanese companies for more returns in business.

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