Matsushita and Japan’s Changing Culture

Case: Matsushita and Japan’s Changing Culture; pg 161

Question 1

Japan suffered one of the worst economic hit in history when the economic bubble deflated steeply in the 1990s. Stock prices and real estate slumped enormously mostly due to domestic monetary policies. As a result, companies in Japan faced financial trouble, which triggered the cultural change in Japan. Before the Economic crisis, employee and the company have a particularly close relationship. The company is involved in the life of the employee. For example, many companies require their employee’s manager to sign before they can rent an apartment. On the other hand, employees are also very loyal and obliged to their company. With the company’s guaranteed lifetime employment policy, few employees will fancy changing jobs. Moreover, they work hard in response to the generous benefit by the company. However, culture does not stay constant. According to some observers, the generation born after 1964 lacked the same commitment to the traditional Japanese values as their parents. They grew up is a world that was richer, and where Western ideas were beginning to be felt and where possibilities seemed to be greater. The new generation did not want to be with a company for life. This cultural change propagates to traditional value change eventually when employees see that loyalty does not guarantee anything. Since then, younger employees started to think more about individual as opposed to group.

Question 2

Japan’s changing cultural trend would influence the way Japanese businesses operate in the future, as it would have significant implications particularly for the human resource strategies of firms. Older styles of recruitment and selection would be minimized. A new employee pool that will be focused more on individualism and self-benefit without the support structures of paternalistic firms would mean different incentives and pay schemes. Japanese firms would also be more open to international...