Japanese vs. American Management Styles: A Cultural Comparison

Introduction

Managerial styles reflect the culture in which they developed. It is not surprising that the work experiences and values of American and Japanese managers differ in a number of respects. This has become an important issue as the multinational corporation becomes more common. The global community has made it necessary to understand culturally relevant constructs in managerial style. This paper compares and contrasts American and Japanese managers, demonstrating that knowledge of these cultural differences is important to the productivity of firms that operate multinationally and participate in the global economy.

Managerial Style and Productivity

Understanding cultural differences in managerial styles can have a positive impact on firm performance. A direct link exists between managerial personality and company performance metrics (Westerman & Simmons, 2007). Conscientiousness, agreeability, and extraversion are linked to successful business performance (Westerman & Simmons, 2007). In a recent study that examined U.S.-based Japanese manufacturing firms, it was found that the degree of employee openness to different cultural norms correlated with positive performance. Companies where employees were open to different cultural norms experienced a greater ability to adapt to changing conditions within the business environment (Westerman & Simmons, 2007).

Differences exist in multinational firms regarding the decision to hire expatriates or indigenous managers in foreign satellite affiliates. The Japanese tend to make use of expatriates for top management positions (Belderbos & Heijltjes, 2005). This reflects the Japanese concept of lifetime employment and an emphasis on control through socialization that permeates Japanese human resources practices (Belderbos & Heijltjes, 2005).

Japanese managerial systems highlight loyalty among top managers. This system has both advantages and disadvantages. One key advantage is that Japanese managers become well-versed in Japanese managerial concepts such as total quality control systems and Just-in-Time manufacturing processes. They carry these procedures with them as they assume control of a company branch in a foreign country, meaning the firm does not need to train someone unfamiliar with these concepts in an environment foreign to them. However, the system also has drawbacks, such as the "bamboo ceiling" for host-country managers (Belderbos & Heijltjes, 2005). Japanese firms will often fail to allow non-Japanese managers the same opportunities for advancement as their Japanese counterparts (Belderbos & Heijltjes, 2005).

The Hive Mindset: Ownership, Loyalty, and Group Culture

Japanese manufacturers often build relationships that affect purchasing and distribution decisions more than financial considerations (Belderbos & Heijltjes, 2005). The Japanese tend to form loyal business groups and will not make purchases outside of the group, regardless of the financial risks involved. These business groups are a fundamental part of Japanese business culture and differ markedly from American business practices, where financial concerns often override the social aspects of business transactions.

One of the key differences in managerial concepts within Japanese society stems from the idea of business ownership. In American society, business ownership is the right of the individual and a cornerstone of its cultural identity — the embodiment of the American dream. Businesses are private property, and the only sense of communal ownership derives from public entities controlled by a board of directors. Even then, this remains a relatively small group of individuals compared to the Japanese ideal of business ownership.

Japanese businesses are more akin to national treasures. They are subject to much tighter government control than American businesses, and Japanese society as a whole is a stakeholder with a vested interest in their success or failure. The Japanese manager is viewed less as an entrepreneur and more as the caretaker of a national institution. There is therefore considerably more social pressure on the Japanese manager to achieve success. For the Japanese manager, business success means success for Japan (Hitoshi, 2006). The Japanese manager's reputation is at stake, and a business failure may result in public shame. The American manager, by contrast, need only live up to their own standards or those of their investors.

Conclusion

As this paper has demonstrated, there are many significant differences between Japanese and American management styles. The Japanese model emphasizes loyalty and reputation. The American business model is less concerned with tradition, trading it for efficiency and productivity. The Japanese value hard work as a collective endeavor, whereas the American management model is more focused on results. Americans are stereotypically considered less formal and more aggressive than their Japanese counterparts. Even when delivering bad news, the Japanese favor a gentle and polite mode of expression. These cultural differences often produce friction when the two cultures must come together in a spirit of mutual understanding.

Americans prefer a centralized style of management, whereas the Japanese model favors decentralized structures. American businesses are accustomed to fewer governmental restrictions than those operating in Japan, but they also operate in a riskier marketplace. American businesses are more independent than Japanese businesses, which can make them more willing to take bold chances. These are, of course, generalizations, and there are businesses that do not conform to this model. Nevertheless, these observations reflect trends that characterize the cultural contrast between Japanese and American managerial styles.

The Japanese manager considers themselves to bear a responsibility to the people of Japan. Their businesses are treated as national treasures, and Japanese business practices are steeped in traditions that may extend back hundreds of years. This heritage often takes precedence over purely rational managerial decisions. The American business, by contrast, must satisfy the needs of shareholders and carries no comparable cultural stigma attached to success or failure. An American business failure may not be experienced as a personal failure, whereas for the Japanese manager, their reputation depends on their ability to preserve the enterprise. Once again, these are generalizations, and one can find examples that both support and undermine them.

The true test of both American and Japanese managerial styles comes when they become business partners. Both sides have much to learn from the other. Both Japanese and American managerial styles have advantages and disadvantages, and learning to overcome differences while accepting the strengths of each approach is the key to developing a managerial style that reflects the best of both east and west.

Cultural blending of managerial styles will continue to be a growing trend. Japanese and American managers will face many challenges as they form close business alliances and partnerships. The Japanese could benefit from the flexibility and adaptability of the American managerial style. Likewise, Americans could benefit from the ethical standards instilled in Japanese culture from an early age. A stronger sense of social responsibility might reduce the inclination toward unethical behavior. Both business cultures have genuine strengths to contribute.

This research is not concerned with determining which managerial style is superior. When one compares Japanese management to American management, it becomes apparent that they are very different — shaped by distinct governmental, historical, and cultural contexts. The world will continue to become more internationally interconnected. Understanding and resolving cultural differences will therefore become ever more important. As the world moves forward, managers must seize the opportunity to enrich themselves by developing a genuine understanding of different business models and international managerial practices. This kind of cultural enrichment allows managers to reflect on their own style, adopt new innovations, and ultimately become more effective leaders — and more valuable assets to their organizations.

References

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Hitoshi, C. (2006). Who do Japanese companies belong to? The Japan Journal, January 2006.

Watanabe, M. (2004). Can anyone succeed? Startups in Japan. Japan, Inc., October 2004.

Westerman, J., & Simmons, B. (2007). The effects of work environment on the personality–performance relationship: An exploratory study. Journal of Managerial Issues, 19(2), 288.

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