Matsushita and Japans changing

culture

1.

What were the triggers of cultural change in Japan during the

1990s? How is cultural change starting to effect traditional values in
Japan?
The triggers of cultural change included three major causes.
The first was due to burst of economic bubble. Japan had to
experience hard time in the 1990s when the economy entered a
prolonged slump. Troubled companies endured bad time and as a
result they fired elder workers whereby they neglected the
traditional Japanese value of mutual obligations and loyalty. Younger
people noticed theses happenings and lost faith in the mutual
loyalty.
The second was that Western ideas were beginning to be adopted
as globalizations increased. The generation that was born after the
1964s had greater opportunities growing up in a rapid growing
economy therefore they lacked the same commitment to traditional
Japanese values as their parents. Their values were more
westernized. They didnt want the same position in the same
company their whole life, the wanted to switch companies and
positions.
Finally, the traditional culture of Japan is inconsistent with the
current economy should be reformed to help the Japanese economy
to overcome the current difficulties and develop.
A bastion of traditional Japanese values bases on strong group
identification, reciprocal obligations, and loyalty. However, all these
events proved that individualism was born.

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2.

How might Japans changing culture influence the way Japanese businesses operate in the future? What are the
potential implications of such changes for the Japanese economy?
Once culture changed, Japanese businesses consequently cant operate in the way they used to. Companies
had to change their human resource strategies such as the pay schemes or the recruiting system. In the past
managers received bonuses regardless of their performance and were granted retirement bonuses as well as
other specials like company housing. As people switch companies more and more, companies have to adjust
the recruiting system which helps them gain more workforce. Nowadays, workers get pays and bonuses based
on their performance but they hardly get offered any perks which leads to a consideration about the lifetime
employment system and the associated perks.
As globalizations increases it is likely that Japanese companies become more and more westernized. Such
changes can have both beneficial and harmful effects on Japanese economy. Focusing on positive aspect,
individualism brings a high level of entrepreneurial activity with it, which involves the opportunity for new
products and new ways of doing business. Moreover it also finds expression in a high degree of managerial
mobility between companies, which might be bad for firms. When a worker frequently switches workplaces, he
might lack the company-specific knowledge and thus might not be so valuable for a company. The high
fluctuation makes it also very difficult to build a team within an organization to perform collective tasks.

3.

How did traditional Japanese culture benefit Matsushita during the 1950s-1980s? Did traditional values become
more of a liability during the 1990s and early 2000s? How so?
Matsushita was established in 1920 and become a giant consumer electronics company in Japan within the next
decades. Traditional Japanese culture is based on strong group identification, reciprocal obligations, and loyalty
to the company. With this type of culture it was possible for Matsushita to hire employees, who worked hard for
the greater good of the company. On the other hand Matsushita was mutual loyal to their workers and provided
them with a wide range of benefits. After the World War II people havent had as great prospects as they had a
few years later thus they were thankful for every job they could get and committed to it. Once hired they would
spend the rest of their lives working for the same company, which supported to develop unique firm-specific
knowledge. As a result Matsushita was at the forefront of the rise of Japan to the status of major economic
power.
As cultures change, people lacked the traditional values during the 1990s and early 2000s. But Matsushita
didnt want to give in on the traditional values and therefore it didnt change their way of doing business until
1998. Unfortunately this adjustment came too late, and the company had already performed poorly several
years before.

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4.

What is Matsushita trying to achieve with human resource changes it has announced? What are the
impediments to successfully implementing these changes? What are the implications for Matsushita if (a) the
changes are made quickly or (b) it takes years or even decades to fully implement the changes?
With its human resource changes Matsushita was trying to enhance its performance by offering a
traditional option and making the company more attractive to new employees with its offers of a high
start salary but no retirement bonus and no subsidized services.
a. Matsushita is well known for its traditional values so if they wouldnt had changed their human resource
practice gradually they would have had destroyed the image of the company. Moreover the average age of
Matsushitas workforce has become older and of course elder workers who benefited from the old system would
have not given away easily.
b. If it would have taken Matsushita years or even decades to fully implement the changes they would have
probably carried on years of poor performance or even will be eliminated.

5.

What does the Matsushita case teach you about the relationship between societal culture and business
success?
The Matsushita case teaches us that societal culture and business success are interdependent. We have seen
that Matsushita had and has to consider the societal culture in order to gain greater or even any business
success. As a result any company needs always to regard the societal culture for the purpose of acquiring and
maintaining business success and needs to respond in an appropriate time to any changes of culture.

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