Relationship between Business Organisation and Culture

by Ronald Dore

1. Is the high level of competitiveness of the Japanese economy to be ascribed to the characteristics of Japanese business organisations which are peculiar to Japan? If so, what are they and why are they effective? There are, of course, special characteristics of Japanese business organisations that constitute the secret of Japan's success. But before we go further into that, let's ask the question, "How is it then that these characteristics of business organisation in Japan got to be so different from those in the West?"

 

2. Basically there are three explanations of that. One is that these institutions are peculiar to Japan, because the Japanese are peculiar. Because Japanese culture has certain characteristics which it has always exhibited and which it will always go on exhibiting until the end of time, and that the business organisations of Japan are adapted to that particular Japanese culture.

The second explanation is a matter of "civilization" rather than "culture”. There is a set of institutions which are found in other countries but which were adopted in Japan in a different form because Japan was a late developer.

 

3. The third explanation of how Japan got to be the way it is, is the "feudalism" explanation. In feudal societies, whether in Europe in the thirteenth and fourteenth centuries, or in Japan up to the middle of the nineteenth century, you have a strong stress on hierarchy and on corporate identity. The initial manufacturing organisations tend to be highly paternalistic – the guild patterns of a feudal organisation. But gradually modernity, in the form of industrialisation, acts as a solvent to all these feudalistic ties and people become more and more individualistic as society becomes more modern. Therefore, the Japanese pattern of intense loyalty to the firm and lifetime commitment is something which grew out of feudalism, but as society becomes more modern and more affluent it will disappear.

 

4. Let us first consider the institutions- the two pillars, which are the main characteristics of Japanese business organisations – the lifetime employment system, and the seniority/merit promotion system. If you are a late developer you have to make a great technological leap. Therefore you've got to make a great investment in training and, if you've got to make a great investment in training, you want to keep the people you've trained for the whole of their career. The state therefore favours the large corporations which can be quite sure of not going bust; therefore they can make the kind of lifetime commitment to their employees.

 

5. As for the seniority/merit promotion system, it has a lot to do with a capacity to marry co-operation and competition. There is a lot of interpersonal competition in Japanese firms but the function of the seniority constraints on promotion is precisely to limit the amount of interpersonal competition. By and large, a 42-year-old man in a Japanese firm is only competing for promotion with the other people about the same age, who have roughly the same kind of career track as his up to the moment. Most of those other people with whom he's directly competing for the next promotion are not in the same department as him. They are people in other departments within the firm and, consequently, he can devote himself to the success of his own particular department, without worrying about whether the credit is going to be taken by him or by his junior or by his senior, because he's not competing with his junior or his senior. He's only competing with his age contemporaries.

 

6. There is a very clear relationship between the two pillars and the characteristic of efficiency. The capacity of people to work hard and to make personal sacrifices attest to the undeniable fact that the people who work for the large Japanese corporations have to sacrifice much more of their own private lives than is the case in any other society, except perhaps Korea, and probably increasingly in the future, in China. But this dominance of the work life over the private life is, an enormously important strength in Japanese business. If those two pillars of the Japanese system are crumbling, then the efficiency of Japanese firms will indeed diminish.

 

About the author: Ronald Dore was born in 1925. He graduated from the University of London. His major fields of specialization are sociology and Japanese studies.

 

from A Symposium on Culture and Society “Japan and Europe: Changing Contexts and Perspectives”

 

 

WRITING

Exercise 2. Using the information from the article write a short answer to one of the following questions:

 

a) In what way does the Japanese culture determine the business organisation in Japan?

 

b) Why are the characteristics of business organisations in Japan different from those in the West?

 

c) What are the two pillars of a Japanese business organisation?

GRAMMAR

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