JAPANESE MANAGEMENT STYLE

1. JAPANESE MANAGEMENT STYLE

2. WHAT ARE THE KEY ELEMENTS? • Centralized management control • Strong head office/subsidiary manager interpersonal relations • Multiple locations • Business strategy: • Single product focus • Minimize costs of production • Maintain consistently high quality output at all factories through standardization of best work practices & procedures • Diversify market segments, geographic markets, & production location

3. STRENGTHS OF STRATEGY & STRUCTURE • Qualified senior management • Low costs of production • Quality control • Diversified & strong market positions in established & growing markets • Good reputation – early leader in small motors • Good fit between organization structure & competitive environment

4. WEAKNESSES OF STRATEGY & STRUCTURE • Limited scope for continued expansion with existing managerial capacity • Relative difficulty in transferring Japanese management style across cultures • continued growth will be difficult; long term problem is new competitors allowed to establish themselves or if existing competitors were allowed to grow in strength

5. JAPANESE MANAGEMENT OVERSEAS • Japanese firms – more Outsider than firms from other countries • Manufacturing subsidiaries: average of 4 • Electronics industry – mean was 5.03; • Overall average in Asia: 3.25

6. COMMON BELIEF • Belief: Japanese management system is so unique that it cannot be easily transferred overseas because these processes of management are culture bound

7. HUMAN RESOURCE PRACTICES IN JAPAN FOR MANAGERS • High wages based on seniority (including substantial bonuses) • Structured managerial career paths • Employment security (for regular employees) • Company-sponsored welfare systems (I.e. subsidized housing, recreational facilities, etc.) • Wide involvement of middle management in decision making

8. HUMAN RESOURCE PRACTICES FOR LOCALLY HIRED MANAGERS OUTSIDE OF JAPAN • Prevailing market rates – no attention paid to seniority & bonuses rarely paid • Employee welfare system usually absent – future of employees depended upon the market performance of the subsidiary

9. POTENTIAL AFFECT • Program intended to enable the firm to maintain its strategy of: • minimizing costs • occupying the maximum competitive space • Allowing continued diversification of production locations • Impact upon the firm: • Expectations from the local managers • Communication problems since Japanese are not very bilingual • Possibility of ties weakening between head office & subsidiary

10. WHAT ALTERNATIVES? • Increase recruitment of Japanese managers • Reduce requirements for expatriate managers • Alleviate pressure on cost control • Diversify upstream, out of small motors

11. ASSIGNMENT • Compare Japanese Management style with western management style

12. ACT PLAN CHECK DO Quality Guru

13. Quality Guru • Kaoru Ishikawa • Father of Quality Circle • Launches Japan’s Quality Movement in 1960s. • Series of Articles in his Magazine “ Gemba to Q A” • Fish Bone Diagram • Quality circle was first piloted at Nippon Telegraph & Cable company in 1962 - …1978- One Million QC’s - 10 million employees. …2000- Two Million QC’s- 20 million employees. • Book “ What is TQC?” • Given Seven basic tools for Quality- 1. Pareto Analysis 2.Fish Bone Diagram • 3 Stratification 4.Tally chart • 5 Histograms 6.Scatter Diagram • 7 Control Charts • Book Guide to Quality Control in 1974 • Binomial Probability & Sampling

14. Dr Genichi Taguchi In the early 1970s Taguchi developed the concept of the "Quality Loss Function" and by the end of that decade was highly acclaimed in his own country.It was not until 1980 that Western companies, particularly in the USA began to implement Taguchi's methods. The most notable of these being Xerox, Ford and ITT.Taguchi had made little impact in Europe until the Institute of Statisticians organised a conference in London in 1987 to discuss his methods

15. Shigeo Shingo His method, poka-yoke or zero mistakes, stops the process whenever a defect occurs, defines the cause and prevents the recurring source of the defect. The method relies on a process of continuously monitoring potential sources of error. The machines used in this process are equipped with feedback instrumentation that identifies errors before they become defects, so remedial action can be taken

16. WHAT IS TQM ? • T TOTAL • Q QUALITY • M MANAGEMENT

17. WHAT IS TQM ? • “T” TOTAL • ALL FUNCTIONS / AREAS / DEPTTS. • ALL ACTIVITIES • ALL EMPLOYEES • ALWAYS • AT ALL PLACES

18. WHAT IS TQM ? • “Q” QUALITY QUALITY DOES NOT MEAN MERELY QUALITY OF PRODUCT, SERVICE & WORK BUT QUALITY OF A COMPANY WHAT IS QUALITY OF A COMPANY ? • CONSTANT AND CONTINUAL APPROPRIATE PROFIT GAIN • EMPLOYEE SATISFACTION (INCLUDING SELF REALISATION) • CUSTOMER SATISFACTION • SHAREHOLDER SATISFACTION • AFFILIATE COMPANY SATISFACTION, AND • SOCIAL SATISFACTION.

19. WHAT IS TQM ? • “M” MANAGEMENT MEANS MANAGEMENT WHICH ACTUALLY MEANS AN INTEGRATED AND CONTINUAL ACTIVITY TO RAISE QUALITY OF A COMPANY AT COMPANY-WIDE LEVEL.

20. TQM DEFINED TQM IS A COST EFFECTIVE SYSTEM FOR INTEGRATING THE CONTINUOUS QUALITY IMPROVEMENT EFFORTS OF PEOPLE AT ALL LEVELS IN THE ORGANISATION TO DELIVER PRODUCTS AND SERVICES WHICH ENSURE CONSUMER SATISFACTION.

21. What Does Kaizen Mean? • KAI ZEN • To modify, to change Think, make good, make better • = KAIZEN • Make it easier by studying it, and making the improvement through elimination of waste.

22. Just-In-Time (JIT) JIT: an integrated set of activities designed to achieve high-volume production using minimal inventories of raw materials, finished goods & work in process. • Management philosophy…Nothing produce until needed. • Encompasses the successful execution of all production activities required from design to delivery of products. • Common sense based/simple techniques

23. Knowledge Worker • Knowledge worker, a term coined by Peter Drucker in 1959, is one who works primarily with information or one who develops and uses knowledge in the workplace. • Also called as intellectual worker or brain worker • A Knowledge Worker's benefit to a company could be in the form of developing business intelligence, increasing the value of intellectual capital, gaining insight into customer preferences, or a variety of other important gains in knowledge that aid the business

24. Knowledge Worker • A knowledge worker is anyone who works for a living at the tasks of developing or using knowledge. • For example, a knowledge worker might be someone who works at any of the tasks of planning, acquiring, searching, analyzing, organizing, storing, programming, distributing, marketing, or otherwise contributing to the transformation and commerce of information and those (often the same people) who work at using the knowledge so produced.

25. Knowledge network of knowledge workers • Knowledge workers work in an environment described as a knowledge network. • Popper (1963) states there is always an increasing need for knowledge to grow and progress continually, whether tacit or explicit. Knowledge grows like organisms, with data serving as food to be assimilated rather than merely stored. • All knowledge workers, particularly R&D project managers, need to easily access and search internal and external knowledge bases

26. Management of knowledge workers • Knowledge workers are believed to produce more when empowered to make the most of their deepest skills; they can often work on many projects at the same time; they know how to allocate their time; and they can multiply the results of their efforts through soft factors such as emotional intelligence and trust. ♦ Organizations designed around the knowledge worker (instead of just machine capital) are thought to integrate the best of hierarchy, self-organization and networking rather than the worst. Each dictates a different communications and rewards system, and requires activation of knowledge-sharing and action learning.

27. The Knowledge Age • The third wave of human socio-economic development is described by Charles Savage in "Fifth Generation Management." The first wave was the Agricultural Age with wealth defined as ownership of land. In the second wave, the Industrial Age, wealth was based on ownership of Capital, i.e. factories. In the Knowledge Age, wealth is based upon the ownership of knowledge and the ability to use that knowledge to create or improve goods and services. Product improvements include cost, durability, suitability, timeliness of delivery, and security. • In the Knowledge Age, 2% of the working population will work on the land, 10% will work in Industry and the rest will be Knowledge Workers

28. Hierarchy of knowledge Work Knowledge work, ranges from tasks performed by individual knowledge workers to global social networks. This framework spans every class of knowledge work that is being or is likely to be undertaken. There are seven levels or scales of knowledge work. • • Knowledge work, (e.g., writing, analyzing, advising) is performed by subject-matter specialists in all areas of an organization. Although knowledge work began with the origins of writing and counting, it was first identified as a category of work by Drucker (1973). • • Knowledge functions (e.g., capturing, organizing, and providing access to knowledge) are performed by technical staff, to support knowledge processes projects. Knowledge functions date from c. 450 BC, with the Chanakya, but their modern roots can be linked to the emergence of information management in the 1970s • • Knowledge processes (preserving, sharing, integration) are performed by professional groups, as part of a knowledge management program. Knowledge processes have evolved in concert with general-purpose technologies, such as the printing press, mail delivery, the telegraph, telephone networks, and the Internet.

29. Hierarchy of knowledge Work • Knowledge management programs link the generation of knowledge (e.g., from science, synthesis, or learning) with its use (e.g., policy analysis, reporting, program management) as well as facilitating organizational learning and adaptation in a knowledge organization. Knowledge management emerged as a discipline in the 1990s. • • Knowledge organizations transfer outputs (content, products, services, and solutions), in the form of knowledge services, to enable external use. The concept of knowledge organizations emerged in the 1990s. • • Knowledge services support other organizational services, yield sector outcomes, and result in benefits for citizens in the context of knowledge markets. Knowledge services emerged as a subject in the 2000s.. • • Social networks enable knowledge organizations to co-produce knowledge outputs by leveraging their internal capacity with massive social networks. Social networking emerged in the 2000s.

30. Corporate Social Responsibility • Corporate Social Responsibility (CSR) is a concept which encourages organizations to consider the interests of society by taking responsibility for the impact of the organization's activities on customers, employees, shareholders, communities and the environment in all aspects of its operations. • This obligation is seen to extend beyond the statutory obligation to comply with legislation and sees organizations voluntarily taking further steps to improve the quality of life for employees and their families as well as for the local community and society at large.

31. Corporate Social Responsibility There is no universally accepted definition of CSR. Selected definitions by CSR organizations and actors include: World Business Council for Sustainable Development "Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large" Mallen Baker "CSR is about how companies manage the business processes to produce an overall positive impact on society." CSR Asia "CSR is a company’s commitment to operating in an economically, socially and environmentally sustainable manner whilst balancing the interests of diverse stakeholders." International Finance Corporation "Corporate social responsibility is the commitment of businesses to contribute to sustainable economic development by working with employees, their families, the local community and society at large to improve their lives in ways that are good for business and for development” European Commission "A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis."

32. Corporate Social Responsibility • Dr. Reddy's corporate social responsibility - Truly sustainable ... • Corporate social responsibility - Dr. Reddy's believe that any high performance sustainable organization rests on the three pillars of economic, social and Emplioyees.

33. ITC’s e-Choupal’ • ‘e-Choupal’ also unshackles the potential of Indian farmer who has been trapped in a vicious cycle of low risk taking ability > low investment > low productivity > weak market orientation > low value addition > low margin > low risk taking ability. This made him and Indian agribusiness sector globally uncompetitive, despite rich & abundant natural resources.

34. Infosys Foundation, the philanthropic arm of Infosys Technologies Ltd., came into existence on 4th December 1996 with the objective of fulfilling the social responsibility of the company by supporting and encouraging the underprivileged sections of society. In a short span of time, the Foundation has implemented numerous projects in its chosen areas. The Foundation has undertaken various initiatives in providing medical facilities to remote rural areas, organizing novel pension schemes and in aiding orphans and street children. It has undertaken a large rural education program titled "A library for every school" under which 5500 libraries have been set up in government schools spread across many villages. Other activities include the reconstruction of old school buildings, setting up of rural Science Centers and schemes to provide support to dying traditional art and culture forms THE SOCIAL COMMITMENT NTPC believes in growth with a human face, and pursuing people-centred development. NTPC is a socially committed organisation and a socially responsible corporate citizen. It attaches great importance to discharging its overall social responsibilities to the community and the society at large where its projects and stations are located. In this regard Resettlement and Rehabilitation (R&R) program becomes an area of sharp focus, a program that addresses people affected directly or indirectly in the wake of the projects undertaken by NTPC. Corporate Social Responsibility

35. Corporate Social Responsibility The term 'corporate social responsibility' or sustainability is of relatively recent vintage. Not so the philosophy of social responsibility that underlines the Tata way of conducting its businesses, and the manner of its interactions with all the constituents that come under the canopy of corporate social responsibility. The multitude of initiatives the Group has nurtured from its earliest days flows from a wellspring of voluntary, as opposed to obligatory commitment

36. Assignment • Discuss CSR with the examples of minimum 5 different organisations.

37. Thank you