1. Management Practice of Bangladesh
Management practice around the globe has a lot diversities because of the presence of
different social, economic, political, and legal and tax systems. After independence the
industrial enterprises of this country were initially brought under the control of the
government. Very soon it was realized that the nationalized sector was not performing as
desired because of unsuccessful management practice. Since then the country has been
going through denationalization process. And then every type of concepts and theories of
different countries has been practicing in our country. But it is very difficult to say which
type of management practice should be applicable for our country. The author has
attempted to analyses the different types of management practice especially in U.S.A.,
Japan and China in the context of Bangladeshi management practices on the basis of the
basic functions of management. As per the findings, management practice in Bangladesh
is not being dominated by any specific country's management practice. The author tries
to select and makes suggestions of what types of management practice should be made
applicable with respect to socio-cultural or environmental circumstances and other legal
and govt. policies.
Planning & Decision Making
Long-term orientation:
Now there are only two types of management in the world, one is Japanese and the
other one is American. Bangladesh follows a mixed concept of these two types of
management. For some work they follow the Japanese and for some work they follow
the American type of management.
Bangladeshi managers follow 5-year plan. They make a 5-year plan to improve their
organizational condition. Government also takes 5-year plan. Sometimes these plans do
not come true when Government changes; the new Government takes new plans.
Private organizations are free from this problem; they take their own plans as they want.
When they need they can take short term plan what can make good to their
organization.
Decision making differs from organization to organization. Organization type is another
big factor for decision making. Some prefer short term and some prefers long term
planning, but all the executives like long term planning for their own benefit. So,
Bangladeshi managers like to take long tram plan
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2. PLANNING & DECISION MAKING
Long -term orientation (5-years plan)
Decision are always made individually
Bangladeshi
Management
In Planning
and Decision
Making
Involvement of few people from top level in
making decision
Decision initiated at only the top level
Fast decision making and slow implementation
There is often communicatin with
subordinates before making decision
Bangladeshi managrs make decisions only for
some small issues or non critical issues
Individual decision-making
In case of making decision we see that Japanese Mgt takes decision collectively, U.S. Mgt
takes decision individually and Chinese Mgt takes decision by their committees. In this
case we see that Bangladeshi Mgt also takes decision individually like the U.S.
management.
It is a very common fact that everyone wants to be big in the world. Everyone wants to
express him or her where s/he works. For these reasons some people don't like to talk to
others before taking a decision. This is a common mentality of the executive people of
our country.
The executives have another point that if a group of people sits together to make a
decision then no decision will be made. There happens only some waste of money and
time. This is why the executives want to take decision individually.
Bangladesh is using a mixed management system of Japanese and American. In private
section the American system is very much popular for its fast working capacity. Govt.
sections like the Japanese system and sometimes the American system. When they don't
want to do any work they form a committee to make a decision and in the most cases the
committee can't take any decision
Decision initiated only at the top
In American system the top-level management takes decision and the lower level follows
that decision. Here every one has his own area of thinking. Top-level thinks how to take
an effective decision and lower level thinks how to follow that decision. Bangladeshi
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3. follows the American way in this case. Here in Bangladesh the top-level always takes
decision and the lower level follows that. This is why decision is initiated only at the toplevel, not from the bottom-top.
Fast decision making and slow implementation
Decision can be made by anyone, but everyone can't implement the decision. In
Bangladesh the managerial parsons take decision, but they can’t implement all the
decision when they want. In Bangladesh this problem mainly occurs in Govt. sectors.
Here one takes decision very fast but at the time of implementation no one comes
forward to make it happen. So, here every decision is made very quickly but the
implementation of that decision is very slow.
Involvement of few people from top level in making decision
An individual always takes decision but if there arises any critical problem in the
organization that can't be solved by only one person, then he (Bangladeshi manager) may
call some reasonable and some of the best subordinates for talking about the problem.
Often this can give a good solution to the problem because two heads are better than
one. But even after such discussion if an individual takes a decision it is not sure that
decision would be always perfectly alright because there may be some chances of
mistakes.
Organizing in Bangladesh
In Bangladesh employees are making informal relationship. The responsibilities are not
divided equally along with equal authority
and they are overburdened with their
Individual Responsibility
and Acountability
responsibilities. For this employees are not
Motivational and
happy with their position. Employees are
predicative decision
waiting for better opportunities to go
Mostly govt.firms use formal
away. The organizations are unable to fulfill
bureaucratic organizasional
the requirements of the employee's need.
structure.But Pvt.
Bangladeshi
organizations use informal
So the company is losing skilled employees.
Management
organizational structure.
Personal connections, family relationships,
and seniority are frequently more
Well-known common
organizational cuture
important for promotion. Most of the
organizations have not well-defined rules
Holistic concern
including family
and regulations to maintain discipline. As
well as organizations have no organogram.
Firms have high
employee turnover
rate becouse of
uncertainty of job
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4. Leadership Approaches in Bangladesh
Leadership research has also been conducted among managers in , developing countries
such as India, Peru, Chile and Argentina. Although there will always be important
differences between various parts of the world, as countries develop and become more
economically advanced, participation leadership styles may become more prevalent.
The leading process of BD is almost similar with that of India at present, new organization
tries to follow U.S. leading style. And the leading approaches are continuously changing.
Leaders of Bangladesh are assigning two tasks at a time to an employee. Dual
subordination and overlapping authority is a conventional phenomenon of our country.
Every employee is working with over burden. Evaluations and promotions are very slow;
big promotions may not come for the first 10 years. Promotion depends on group
lobbying and bossing as well as internal organizational politics. Leaders are not very
motivated to attain the objectives of the organization. They like face-to-face
confrontation. They try to impose all liability for unsuccessful work to their subordinates
and success goes on the individual performance. But in our country the leader generally
adapt an autocratic view in taking decision. In our country the leaders gives supreme
importance to their personal benefit to gratify their own desires rather than the
organization welfare.
BANGLADESHI LEADING
Leader acting as the
decision-maker and
head of the group.
Critical and non-critical
communication top
down
Leaders do care much to
make the subordinates
work to meet the time
schedule or deadline
Mostly benevolent
autocratic style (parentchild relatons)
Promotion is slow and
often depends on Group
Lobbying
Leaders are not very
motivated to attain the
objectives of
organization
Divergents values ;
groupism sometimes
hindering cooperation
Responsibility is
assigned to individual
Face -to-face
confrontation
Liders give not too more
importance to the
organizations goalattainment than
Interpersonal
relationship
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5. Controlling in Bangladesh
Control by superior
Control focuses on individual performance
Fixing blame
Bangladeshi
Management
Limited use of quality control circles
Chance of partiality
Importance is given to the skilled person as
well as political persons.
Duration of work is not fixed
In Bangladesh, primarily group Leaders exercise control. Japanese importance is given to
the unskilled person. U.S., China and Bangladeshi managers' importance is given to the
skilled person. In Bangladesh control focuses primarily on the group but also on the
individual performance. They try to increase the productivity rather than quality.
Bangladeshi managers look for maximization of profit. Most of the time, the work forces
are not adequate. Skill persons are not treated in a fair way. The enterprise's wage
structure does not meet going level of the community. For the unexpected result
managers try to find out the human errors.
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6. Management thought has always been and probably will continue to be highly dynamic.
New theories will emerge and old one will be discarded. Some consolidation among the
many present management theories is to be expected. The future may bring a viable
integration of presently separate schools of management. Dynamic management thought
will continue because a discipline is vital as management - with its involvement in
fundamental issues that affect human wants, values and technology- is certain to attract
schools and practitioners to contribute to a modern and meaningful theory.
In some managerial areas, we predict results from selected actions with an acceptable
degree of certainty, but in the other areas, we are still in what can be termed the
descriptive stage. That is, we can apply certain managerial knowledge, but we are not
positive what specific results will ensure from such action. Once a manager has the
symptoms identified, he or she can prescribe exactly what to do, with assurance that the
desired results will be forthcoming.
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7. Management Practice of America
From the beginning of industrial revelation in England, a “System” was introduced in
manufacturing and other industries in America. The system relied on machine tools, jigs
for guiding the tools and fixture for properly holding the work and gauge blocked for
checking the fit of parts. These methods eventually were known as the “American
Systems” of manufacturing. Application of the American system was to the sewing
machine and reaper industries in the 1880 resulted in substantial increases in
productivity. The American system was applied in the manufacturing industry almost
from the beginning. Later, in the 1880 and 1890, concept developed during the period
was “Scientific Management” or Taylorism developed by Frederick Winslow Taylor and
others. Scientific management initially concentrated on reducing the steps taken in
performing work such as bricklaying or shovelling by using analysis such as time and
motion studies, but the concepts evolved into fields such as industrial
engineering manufacturing engineering and business management that helped to
completely restructure the operations of factories, and later, entire segments of the
economy.
Thus scientific management’s application was contingent on a high level of managerial
control over employee work practices. This necessitated a higher ratio of managerial
workers to labourers than previous management methods. The great difficulty in
accurately differentiating any such intelligent, detail-oriented management from mere
misguided management also caused interpersonal friction between workers and
managers.
After that, basically from 1960, most of the American organizations follow McGregor’s XY
theory for the purpose of management.
At that time, autocratic “Theory X” American managers liked to retain most of their
authority. They made decisions on their own and informed the workers, assuming that
they will carry out the instructions. Autocratic managers were often called
"authoritative" for this reason; they acted as "authorities". This type of manager was
highly tasked oriented, placing a great deal of concern towards getting the job done, with
little concern for the worker's attitudes towards the manager's decision. This showed
that autocratic managers lost ground in the work place, making way for leaders who
shared more authority and decision making with other members of the group.
On the other hand, who were soft in management practice and belied in workers
potentiality, they followed “Theory Y”. In managing the organization who believed in
"participative" (Theory Y) leadership style they shared decisions with the group. Also
mentioned, were subtypes to this type of leader, namely the "Democratic" leader who
allowed the members of the working group to vote on decisions, and the "Consensual"
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8. leader who encouraged group discussions and decisions which reflected the "consensus"
of the group.
But, in late 1960, American business organizations faced global challenges. Almost every
day, competitors followed those. Competitors changed their strategies to compete the
American organizations. Therefore, fixed strategies for achieving goal were not suitable
for the betterment of organizations. That’s why; organizations of America had been
following Contingency Theory and it took into account the fact that managers must be
flexible and took the approach that best fits the situation.
By following, contingency theory of management American companies ensured that the
employer got what they were paying for in an employee and eventually results in more
wealth for everyone involved. Organizations were open systems that needed careful
management to satisfy and balance internal needs and to adapt to environmental
circumstances. There was no one best way of organizing. The appropriate form depended
on the kind of task or environment one was dealing with.
But in the 1970s and 1980s, many United States industries lost market share to
international competitors, particularly Japanese companies. Concerns about the
competitiveness of U. S. companies led some to examine Japanese management
practices for clues to the success enjoyed by many of their industries. This led to many
articles and books purporting to explain the success of Japanese companies. It was in this
atmosphere that “Theory Z” was introduced into the management lexicon.
A Management Comparison between American Organizations and Japanese
Organizations “before Theory Z” followed by American Organizations
United States Management
Planning
 Primarily short-term
orientation
 Individual decision-making
 Involvement of a few people
in making and
 “selling: the decision to
people with
 divergent values
 Decisions are initiated at the
top and flow down
 Fast decision-making; slow
implementation requiring
Japanese Management
Planning
 Long-term orientation
 Collective decisionmaking (ring) with
consensus
 Involvement of many
people in preparing and
making the decision
 Decision flow from
bottom-to-top and back
 Slow decision-making;
fast implementation of
the decision
8

9. 


Organizing


Staffing
compromise, often resulting
in suboptimal decisions
Individual responsibility and
accountability
Clarity and specificity of
decision responsibility
Formal bureaucratic
organizational
structure
Lack of common organization
culture
 People hired out of schools
and from other companies;
frequent company changes
 Rapid advancement highly
desired and demanded
 Loyalty to the profession
 Frequent performance
evaluation for new
employees
 Appraisal of short-term
results
 Promotions based primarily
on individual performance
 Training and development
undertaken with hesitation
(employee may go to
another firm)
 Leader acts as decisionmaker and head of group
 Directive style (strong, firm,
determined)
 Often divergent values;
Leading
individualism sometimes
hinders cooperation
 Face-to-face confrontation
common; emphasis on clarity
 Communication primarily
top-down
 Control by superior
 Control focus on individual
Controlling
performance
 Fix blame
 Limited use of quality control
circles
Organizing
Staffing
Leading
Controlling
 Collective responsibility
and accountability
 Ambiguity of decision
responsibility
 Informal organization
structure
 Well-known common
organization culture and
philosophy; competitive
spirit toward other firms
 Young people hired out of
school; hardly any
mobility of people among
companies
 Slow promotion through
the ranks
 Loyalty to the company
 Very infrequent formal
performance evaluations
for new (young)
employees
 Appraisal of long-term
performance
 Training and
development considered
a long-term investment
 Leader acting as social
facilitator and group
member
 Paternalistic style
 Common values
facilitating cooperation
 Avoidance of
confrontation, sometimes
leading to ambiguities;
emphasis on harmony
 Control by peers
 Control focus on group
performance
 Saving face
 Extensive use of quality
control circles
9

10. Theory Z was first identified as a unique management approach by William Ouchi. Ouchi
contrasted American types of organizations (Type A) that were rooted in the United
States' tradition of individualism with Japanese organizations (Type J) that drew upon the
Japanese heritage of collectivism. He argued that an emerging management philosophy,
which came to be called Theory Z, would allow organizations to enjoy many of the
advantages of both systems.
Ironically “Japanese Management" and Theory Z itself are based on Dr. W. Edwards
Deming's famous "14 points" (appendix-2). However, Theory Z is a form of management
in which workers are involved in the work process on the factory floor. Schedules,
division of labor, work assignments, and other aspects of the labor process are given over
to workers to do as they see well. Investment policies, wages, fringe benefits and kind of
product are not given over to workers to decide; only how best to do that decided by top
management. American businesses ultimately have been trying to use "Japanese"
approach to improve their competitive position.
Today’s the features of management practice of America are as follows …
PLANNING
The process and function of planning focus on organization purposes and objectives and
possible paths to achieve them. Plans themselves can be broad (long term, strategic) or
narrow (short-term budgets and operating plans). The planning process can be formal or
informal, decentralized or centralized, or continuous or discontinuous. It can be done
individually or by groups. It may or may not involve outsiders (e.g., customers,
consultants, suppliers). Plans can be put in writing or remain mental maps in the minds of
managers (for a comprehensive conceptual overview of the planning process.
History shows the following tendencies in large U.S. companies compared with their
counterparts.
More formalized long-range
planning
More recourse to external
consultants
Planning
More willingness to accept
change
Slow decision making
Fast implementation
10

11. ORGANIZING
Organizing is concerned with the integration and coordination of resources and effort
and the flow of information and authority. It considers what activities to decentralize and
whether company structure should focus around business functions (e.g., marketing,
finance, manufacturing), or around product group, geographic region, processes,
projects, or some hybrid approach (e.g., a matrix). The preferred choice can depend on
circumstances (e.g., organization size, strategy, performance, technology, people, and
goals). For example, a smaller business, or one with a narrow product line, will normally
structure itself around the business functions. But if it grows or diversifies, then changing
to a product or geographic area orientation can enhance coordination and integration of
operations (see Chandler, 1962; Stop ford &Wells, 1972). External factors (e.g., intensity
of competition) can also influence change. High acceptance of change in American
culture makes organizational change more welcome than in most cultures. Two
organizational tendencies in large U.S. corporations (relative to counterparts abroad) are
as follows:
More likely to decentralize
authority (i.e., to delegate
key tasks and decisionmaking authority to
subordinates)
Organizing
More frequent
organizational change
11

12. DIRECTING
The managerial function of directing involves guiding, commanding, nudging, exhorting,
and inspiring subordinates, colleagues, superiors, and others to higher performance. This
requires skills of leadership, communication, and motivation, in turn influenced by
culture. Among some general tendencies of U.S. managers and subordinates (relative to
many counterparts abroad) are the following:
Much directness in interpersonal
communication
Directing
Aversion for authoritarian leaders
Motivation mainly from money, ego
gratification, and personal challenge
(and less from loyalty and personal
relationships)
12

13. CONTROL
Managerial control assesses whether organizational objectives are being met and calls
for corrective action (or maybe a change in objectives) when needed. Control can be
both broad and narrow. Very broadly, enterprise is controlled by its external product,
capital, and labor markets. For example, if sales and profits fall (or are expected to fall),
company share price and debt rating normally fall, making new funding more costly until
performance improves. Boards of directors normally are empowered to control
management (e.g., hire, advise, counsel, evaluate, reward, persuade, or remove
managers) on behalf of owners, and they do so with varying effectiveness. Internal
control systems (e.g., financial controls, budgeting systems, quality control, and
supervision) are also part of the control process.
Some control tendencies in large U.S. companies (relative to peers abroad) include the
following:
Broader and more transitory shareholder base that is
more inclined to flee (sell their holdings) rather than
fight (engage with managers) for change
More attuned to shareholder interests relative to other
stakeholders
More vulnerable to buyout and takeover pressures
Controlling
More focused on quantifiable performance criteria
Shorter-term time orientation
More bottom-up appraisal of managers
However at the end it is said, after 1980 and till now by analysing the different case
studies of management of American organizations it is identified (Heinz Weihrich, (2011),
Management Practices in the United States, Japan, and the People's Republic of China)
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14. that by following the “Z Theory” now the features of American organization’s
management practices are slow decision-making; but fast implementation of the
decision, collective decision-making (ring) with consensus, Long-term employment and
job security, collective responsibility Implicit, formalized measures collective decisionmaking, slow evaluation and promotion, moderately specialized careers, concern for a
total person including their family, informal control with explicit. There has been a
stronger tendency in the United States than abroad to decentralize organizations and to
effect organizational change (acquisitions, mergers, restructurings, managerial mobility).
Leadership, communication, and motivation style conform to the low-context nature of
U.S. culture; in general, people prefer no authoritarian leaders; directness and frankness
are valued in personal communication, including in performance evaluations; pay, public
esteem, and personal challenge are stronger motivators than is loyalty to an employer.
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15. Management Practices of Germany
Overview of German Management and Practices
German management, as it has evolved over the centuries and has established itself since
World War II, has a distinct style and culture. Like so many things German, it goes back to
the medieval guild and merchant tradition, but it also has a sense of the future and of the
long term.
The German style of competition is rigorous but not ruinous. Although companies might
compete for the same general market, as Daimler-Benz and BMW do, they generally seek
market share rather than market domination. Many compete for a specific niche. German
companies despise price competition. Instead, they engage in what German managers
describe as Leistungswettbewerb, competition on the basis of excellence in their products
and services. They compete on a price basis only when it is necessary, as in the sale of bulk
materials like chemicals or steel.
The German manager concentrates intensely on two
objectives: product quality and product service. He
wants his company to be the best, and he wants it to
have the best products. The manager and his entire
team are strongly product oriented, confident that a
good product will sell itself. But the manager also
places a high premium on customer satisfaction, and
Germans are ready to style a product to suit a
customer's wishes. The watchwords for most German
managers and companies are quality, responsiveness,
dedication, and follow-up. Product orientation usually
also means production orientation.
The business set up in Germany is extremely formal. In order to achieve successful cross
cultural management, you must be prepared for a host of regulations, guidelines, and
principles covering every aspect of conducting business in Germany. German
businesspeople have deep-seated rules and regulations. This is a formal culture that
believes time is money. Relationships are clearly defined, which intimates the type of
communication and behaviours expected.
Some employees in Germany do not feel that they are authorized by station, education, or
position to either aspire to leadership or to express themselves freely in management
circles. Nevertheless many do, and especially with the influence of intercultural expansion
and globalization, organizations are tending to rely more heavily on the wisdom of their
people and not just the direction of leadership.
15

16. The Management Style of a German Manager
Subordinates demonstrate their respect of their supervisors and managers by following
their directions to the letter. In return, managers provide explicit directions and ensure that
their subordinates have the proper materials and understand the appropriate procedures.
All work hard within the official working hours. However, neither managers nor
subordinates expect to work past normal quitting time.
There is often a gulf between managers and their subordinates, although this is less so in
newer companies, high tech, or other high growth industries. Managers are expected to give
precise directions when assigning tasks so that there is no question what is expected.
01. Approach to Change:
Germany’s intercultural competence and readiness for change is low, meaning that social
change is difficult to bring about and the idea of it is not received with enthusiasm. The
underlying belief is that change may threaten the social fabric.
02. Approach to Time and Priorities:
Germany is a controlled-time culture, and adherence to schedules is important and
expected. In Germany missing a deadline is a sign of poor management and inefficiency, and
will shake people’s confidence. People in controlled-time cultures tend to have their time
highly scheduled, and it’s generally a good idea to provide and adhere to performance
milestones. Since Germans respect schedules and deadlines, it is not unusual for managers
to expect people to work late and even give up weekends in order to meet target deadlines.
Effective cross cultural management skill will depend on the individual’s ability to meet
deadlines.
03. Decision Making:
For effective cross cultural management it is important to remember that in general,
subordinates do not expect their managers to seek their concurrence. They are comfortable
complying with decisions. Again, this may depend upon the industry, the professional level
of the employees concerned, and the corporate culture. Germany is undergoing rapid
changes which are impacting business life.
04. Boss or Team Player?
Germans like working in teams and collaborate quite well across hierarchical lines. The
communication within a team is generally quite collegial, albeit somewhat direct and blunt.
Role allocation within the team is generally quite clearly defined and people will take
greater responsibility for their specific task than for the group as a whole.
16

17. Successful cross cultural management will depend on the individual’s ability to harness the
talent of the group assembled, and develop any resulting synergies. The leader will be
deferred to as the final authority in any decisions that are made, but they do not dominate
the discussion or generation of ideas. Praise should be given to the entire group as well as to
individuals.
05. Communication and Negotiation Styles:
Direct communication is valued and your German counterparts will be quite unabashed in
pointing out any deficiencies they may find in your product or business plan. Germans will
also be quite comfortable saying "no" directly when necessary, or let you know when they
cannot meet your expectations. To gain control of a conversation, a German will interject
into what the other party is saying, or speak over the other parties in a louder volume. To
avoid any cross cultural miscommunication make sure your printed material is available in
both English and German.
The Culture of German Management
The German manager concentrates intensely on two objectives: product quality and product
service. He wants his company to be the best, and he wants it to have the best products.
The manager and his entire team are strongly product oriented, confident that a good
product will sell itself. But the manager also places a high premium on customer
satisfaction, and Germans are ready to style a product to suit a customer's wishes. The
watchwords for most German managers and companies are quality, responsiveness,
dedication, and follow-up. Product orientation usually also means production orientation.
The business set up in Germany is extremely formal. In order to achieve successful cross
cultural management, you must be prepared for a host of regulations, guidelines, and
principles covering every aspect of conducting business in Germany. German
businesspeople have deep-seated rules and regulations. This is a formal culture that
believes time is money. Relationships are clearly defined, which intimates the type of
communication and behaviours expected.
Some employees in Germany do not feel that they are authorized by station, education, or
position to either aspire to leadership or to express themselves freely in management
circles. Nevertheless many do, and especially with the influence of intercultural expansion
and globalization, organizations are tending to rely more heavily on the wisdom of their
people and not just the direction of leadership.
However, there is a strong emphasis on efficiency, people tend to use their working time to
be highly productive and there is little or no time spent socializing or chatting. The exception
to this is during break periods, which are usually 15 minutes, with 45 minutes for lunch.
17

18. Management culture in Germany is usually highly hierarchical. Germans like to work on
well-thought-out plans and make factually-based decisions. Orderly and well scheduled
meetings form a large part of what tends to be a consensual, group approach to decisionmaking. Punctuality is expected and lateness is not tolerated, so be careful, especially if
you're from a country where this is endemic!
01. Salaries:
Salaries in Germany are among the highest in the world. Most jobs for graduates start from
€30,000/year. Student jobs or unqualified work is generally paid around €6-15/hour.
Salaries are usually talked about gross, i.e. before deductions for tax and social security. Be
aware that taxes, depending on your salary, can be more than 50% of your gross salary, so
don't get gross and net figures confused!
Salary is stated monthly in your employment contract, which should also detail special
benefits, bonuses and salary reviews. Many employers pay 13 monthly payments a year,
which is normally paid out in December for Christmas or split between summer and
Christmas. In some management positions, you might even get a 14th salary.
It's difficult to get exact salary data for specific jobs or positions, which can be useful for
negotiating salaries. Personal market offers you a salary analysis for a fee that takes into
account sector, education, work experience and the geographical region. This might be
helpful for negotiating your future salary.
02. Labour law:
To enter employment, you need a work permit (Arbeitsgenehmigung or Arbeitser laubnis)
or a residency permit that allows you to work. You also require a tax card (Lohnsteuerkarte)
and a social security number (Sozialv ersicherung summer). Tax cards are issued by the
city/regional authority where you are registered as living. Social security numbers are issued
by pension insurance institutions.
When an employee first enters employment, the employer generally makes their
registration for them and provides a social security number and identity card. Queries
should be directed to your employer, your health insurance company or your state
insurance institution.
03. Labor regulations:
Germany has one of the most highly regulated labor markets in the world, with its Labor law
designed to protect employees. Whether or not an employment contract exists, all
employees have basic rights to:
 holidays
 sick pay
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19.  chose to work part-time
 receive training
 receive maternity/paternity leave and related employment protection
Periods of notice are also laid down under law, but companies can agree longer periods of
notice under individual or collective labour law agreements. Working conditions which do
not reach the legal minimum standard are not permitted and are not legally binding.
04. Collective Labor Agreements:
There is also a collective labor law which stems from the laws protecting collective labor
agreements and the framework for the rights of employees at their place of work
(Betriebsverfassungsrecht). The laws governing collective labor agreements allow both
partners (trade unions and employers' federations or individual employers) to make their
own labor agreements. Labor agreements regulate wages, working hours, holidays and
notice periods. Most employees work under a labor agreement, although in recent years
more companies have received exemptions in order to negotiate their own agreements.
05. Framework for Employee Rights:
The Betriebsverfassungsrecht regulates the relationship between employee and employer in
the workplace. Employees are represented by the works council (Betriebsrat) whose
members are elected by the workforce. Among other things, it is responsible for protecting
employee rights in the workplace. Management must also consult with the Betriebsrat
about issues regarding staff or the company. If you have problems in your workplace, you
should consult your Betriebsrat for advice and help.
In firms with 2,000 or more employees, the 1976 Codetermination or Worker's Participation
Law (Mitbestimmungsgesetz) applies. This law requires that the company's supervisory
board contains a certain number of employee representatives. The principle of
Codetermination means that unions and employees have a say in company policy, as well as
sharing responsibility for the firm.
19

20. Management practices of Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the
Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of
Okhotsk in the north to the East China Sea and Taiwan in the south. The characters that
make up Japan's name mean "sun-origin", which is why Japan is sometimes referred to as
the "Land of the Rising Sun". Japan is an archipelago of
6,852 islands. The four largest islands are Honshu,
Hokkaido, Kyushu, and Shikoku, which together
comprise about ninety-seven percent of Japan's land
area. A major economic power, Japan has the world's
third-largest economy by nominal GDP and the world's
fourth-largest economy by purchasing power parity. It is
also the world's fourth-largest exporter and fourthlargest importer.
Japan
Flag
Capital
National language
Ethnic groups
Government
Legislature
Total area
Population (2012 estimate)
Currency
Time zone
Calling code
ISO 3166 code
Tokyo
Japanese
 98.5% Japanese
 0.5% Korean
 0.4% Chinese
 0.6% other
Unitary parliamentary
constitutional monarchy
National Diet
377,944 km (62nd)
145,925 sq mi
126,659,683 (10th)
Yen
JST (UTC+9)
+81
JP
Today, Japan is considered as one of the super-economic powers of the world. As the saying
goes that: Rome was not built in a day, Japan was also not built in a day. The process of
development started 130 years backs. Japan as it stands today, is due to the efforts of
Japanese people who were smart enough to adopt the foreign technology and management
philosophy and develop suitable technological and management systems that can be
effectively and efficiently applied for the development of the country.
20

21. 1.0 Special Features:
The Special features of Japanese management practices can be broadly classified into two
areas. Such as:
 People-oriented, and
 Work-oriented.
Peopleoriented
Workoriented
Figure 1: Special features of Japanese management practices.
The Japanese style of People-oriented management practices mainly focus on personnel
and human resources management aspects like the life-time employment, the seniority
system and the groupies whereas the work oriented management practices manly focus on
production and engineering functions which include, the just-in-time production system, the
subcontracting and the Quality control. These specific features of Japanese style of
management have been developed as a result of the socio-cultural characteristics of
Japanese society, which has largely contributed to the built –up competitiveness of the
Japanese companies leading to make Japan a super-economic power in the world.
1.1 The personnel and human resources management practices:
The personnel and human resources management practices of Japanese companies are
mainly oriented towards people and their development. There are some specific
characteristics, which are not found in the traditional western management system. Some
of these distinct characteristics are the life-time employment, seniority based promotion
and wage system and groups.
a) Lifetime Employment:
The lifetime employment system involves hiring people who have just graduated a high rate
of stability among employees and guaranteeing work until the mandatory retirement age.
The system is oriented towards human relations, human development and training
guaranteed employment, equality, participation and welfare. Thus, in a Japanese company,
employees are "born", and develop in terms of work.
21

22. b) Seniority based promotion and wage system:
The promotion from lower level to immediate higher level is mostly based on seniority.
However, the pace of promotion is very slow though. It does not mean to say that
promotion does not take account of performance evaluation and qualification of the
employee. Higher weight age is given to senior person, or on the number of years he or she
has worked with the company. Wage structure is also based on seniority.
c) Groupies:
The special cultural quality of Japanese society has a great deal of impact on the Japanese
management practices. The typical Japanese ways of thinking –"Uchi" (insider) and "Soto"
(outsider) is actually practiced in Japanese management system. The special character of
"WE" is very strong in Japanese companies.
1.2 Work/operations or production management practices:
The operations or production management practices of Japans companies has some specific
characteristics quite different from traditional or western management system. The
Japanese production management system attempts to pursue efficiency in connection with
work while at the same time, shows due considerations for human factors in the company.
Some of the major distinctions can be found in the just-in-time production system,
subcontracting and quality control.
a) Just-In-Time (The Production) System:
Producing and dispatching the products just-in-time is the main objective of employing JIT.
This contains many other areas of improvement like low cost of production, low inventory
cost, low investment for warehouses, immediate checking of abnormalities, high valueadded per person, better quality and improved productivity.
b) Subcontracting:
Large companies, particularly in manufacturing sector, rely heavily on a regular
subcontracting system. To secure punctual and regular supply of quality parts and semi
finished products from subcontractors at various levels, large companies provide smaller
ones with technical, managerial and financial assistance in various forms. This way, the large
and small companies need not compete and contract for every supply and purchase. Mutual
trust is the basis of their long-term transactions.
c) Quality Control:
The Japanese production management now cannot work without considering the concept of
quality or customers in a broader sense. Now-a-days, the Japanese style of management is
also referred to as Management by Quality. This does not mean controlling the quality but
rather managing the company with the "Quality First" concept. Japanese management
22

23. philosophers together with Dr. Juran and Dr. Demming of USA has substantiated that quality
and productivity are positively related, and not a contradictory phenomena as traditionally
believed. Quality and productivity are also defined in a broader perspective encompassing
customer's interest. The productivity (quality) is:




Production or service capacity of the organization.
Quality specification of the product or service.
Cost of Production products or service.
Delivery time of products or service.
To continuously improve the Production Capacity, Quality of Goods and Services, Cost of
Operation, Delivery timing factors of productivity and quality, an organization gives special
priority to the safety and Morale of the people working in the organization. Beside, all
employees from top-management to workers concentrate on improving these six
fundamentals of quality management to improve productivity and ensure sustainable future
growth of the company.
2.0 Japanese management practices:
The management practices of Japanese companies exhibit a number of distinctive
characteristics. Some of the major areas where we can find distinction are, ownership
structure, corporate structure, company strategy, Total quality management (TQM),
decision-making system and communication, given below:
2.1 Ownership Structure:
The vast majority of typical Japanese companies are not family-owned. Some of these
exceptions are Toyota Motor Corporation, Oobayashi Corporation, Taisho Pharmaceuticals
Co, Santory Ltd, and a few others. The owners are mainly financial institutions and
companies that are affiliated to the same business group. The relationship among the group
member institutions are mutual assistance and stockholding, interlocking directors, human
resource development, joint R & D, independent members, no holding company, regular
meetings.
2.2 Corporate Structure:
The top-management in Japanese companies has an extremely closed structure. Although
two or three directors may be invited to join the company from outside, in most cases,
directors are appointed from within the company's former management level-staff.
Moreover, employees are not considered to be consumable physical resources, but as
important corporate members in the corporate structure. A Japanese company is fully
participatory and not authoritative. The following figure shows the typical roles at different
level in a Japanese company:
23

24. Keiei
Directors
Kanri
Administration
Ippan Shain
Rank & File
Figure 2: Different levels in a Japanese company.
Roles at Different Levels:
i.
Keiei:
ii.
 Determination of corporate policy.
 Full support for managers and workers.
 External relations for favorable operations.
Kanri:
iii.
 General planning and friendly supervision.
 Facilitation pleasant work atmosphere.
 Assistance for non-supervisory employees.
 Development of self and subordinates.
 Positive evaluation of employee performance.
 Cooperation with other departments.
Ippan Shain:





On the spot planning and reporting.
Facilitating workplace meetings.
Leadership by good examples.
Continuous improvement- technical and human.
Cooperation for productivity, quality, human relations.
2.3 Company Strategy:
The distinctive characteristics of the strategies that most of the Japanese companies adopt
as management practices:






Investment in equipment and human resources development for long-term profit.
Quality or customer oriented decision.
Bottom-up problem solving rather than top-down command.
Continuously improving products rather than developing innovative new products.
Improving market share for long term profit.
Providing importance to process rather than results.
24

25. 2.4 Total Quality management (TQM):
The Japanese management philosophy, system and practices, all focusing mainly on people
and work is also termed as "Total Quality Management". The common goal of TQM is to
produce and serve the quality the customers need in a most economic manner. To achieve
this goal, common approaches adopted in TQM are:




Policy deployment (PDCA cycle).
Small group activities (QC circle).
Systematic problem solving (QC story).
Statistical methods (7 QC tools).
We can consider Total Quality Management (TQM) as an umbrella under which many
components of Japanese management practices work simultaneously for improvement of
productivity and quality.
2.5 The "Ringi System and Decision Making:
Japanese companies employ a method of group-oriented and participatory decision making
called: “Ringi" system. This system helps in quick implementation of policies because the
basic approval and the opining of persons concerned have already been taken during the
process of "Ringi" decision making system.
2.6 Communication:
Some distinctive characteristics regarding communication methods within most of the
Japanese companies are as follows:
 Regular morning meeting of top, middle level managers and other employees.
 Open working office area where all level of employees work together with managers.
The layout is very conducive for good communication among employees.
 Regular management-labor discussions on productivity and gain sharing.
 "Nemabashi" or leaking information unofficially to those concerned with or taking
part I the decision on some matters and influencing them to think in a certain way
before the decision is made.
 High volume of information flow as a prerequisite for communication.
25

26. 3.0 Summing up:
The Japanese management practices can be understood better by comparing it with the
Western or traditional management practices.
(Western) Traditional management practices
1. Capitalism
* Maximization Profit
* Growing company
2. Shareholders' satisfaction
3. Office priority
4. System oriented
5. Innovation approach
6. Top-down method
7. Theory by specialist
8. Result oriented
9. Sophisticated technology
10. Optimization
Japanese management practices
1. Companyism
* Increasing value-added
* Growing with company
2. Customers' satisfaction
3. Shoofloor priority
4. Human oriented
5. Kaizen approach
6. Top down+ Bottom up
7. Practice by all people
8. Process oriented
9. Simple technology
10. Continuous challenge
So we can say that Japanese offers interesting insights into management practices.
Successful Japanese companies also provide hints into future management trends in Japan
& demonstrate that they can make necessary changes to deal with a changing economic
environment.
26

27. An overview of Chine
China is one of the biggest countries in the world. It has an area of about 9.6 million square
kilometres which comprises about 6.5 per cent of the world total land area. Its population of
more than one billion accounts for 23 per cent of the world's population. China is the
world's oldest continuous civilization. World Travel Organization predicts that by year 2020,
China will become the number one travel destination in the world.
China, officially the People's Republic of China, is a sovereign state located in East Asia. It is
the world's most populous country, with a population of over 1.35 billion.
Capital: Beijing
Population: 1.40 billion
Currency: Renminbi
Government: Communist state, Socialist state, Single-party state
Official language: Standard Mandarin
Management practice of Chine
China's recent and impressive economic gains have captured the attention of the world.
With the world's fastest growing economy and largest population, China is poised to change
the landscape of global business. China has become the fourth largest economy in the world
in a very short time. This economic gain is driven in part by an impressive expansion of
China's manufacturing base and export abilities; both of which are expected to continue to
increase in the coming years and to outperform its large competitor, India (Black 2007; Wu
2007; Lee, Rao, and Shephers 2007). With China's economic growth comes an increased
need to better understand the strategic thinking of the Chinese. The last few years have
seen an increased interest in understanding the business and managerial practices of the
Chinese (Quer, Claver & Rienda 2007). In the hope of either capitalizing on China's growth,
or being able to defend against its economic threat, many in the West and beyond have
taken a much greater interest in China. One area of particular interest is a better
understanding of Chinese culture and management system.
27

28. Some of the more common characteristics of Chinese management and organization are:
centralized control, collectivism, harmony, authoritarian and paternalistic leadership,
flexible strategies, family-staffed businesses, and strong organizational networks and
business connections. These characteristics are practiced both in China and overseas by the
Chinese Diaspora. All of these practices can be traced to important historical figures and
schools of thought beginning with the very early rules and philosophers of China.
1.0 Management Development in China
The dramatic changes in the Chinese economy have greatly affected the role of the
manager in Chinese society. The managers’ role is changing from a concentration mainly on
people-handlers towards the need for awareness of the market, financial management and
thinking strategically to encourage competition and deal with joint ventures (Chen, 1988).
Consequently, such changes have raised questions about Chinese managers’ abilities to
deal with competition, uncertainty, unpredictability and increased autonomy. The
localization of the management group in the foreign-invested ventures, due to the cost
reasons, puts strong demands on the general management development of local managers
and professionals (Bjorkman and Lu, 1997).
Management in modern day China is argued to be characterized as an exact science with a
clear and definable knowledge base, with a set of quantitative and operational methods
with universal applicability linked to specialized functional skills (Borgonjon and
Vanhonacker, 1992; Qiu et al., 1989). This is supported by the evidence of a knowledgebased curriculum for trainee managers where a great deal of emphasis is placed on the
traditional numbers-oriented (hard) subjects and far less time is spent on people-oriented
(soft) subjects (Bjorkman and Lu, 1997; Warner, 1995). Underpinning this approach are
three issues - professional background, tradition and ideology - all combining to dictate this
distinctly Chinese interpretation of the theory and practice of management. Management
development within the traditional educational system is described as: supporting the more
didactic, teacher-centred teaching methods (Boisot, 1987); a concentration on theory rather
than on practice with little contact with the wider industrial community; and a dearth of
well trained and well qualified management trainers (World Bank, 1985).
China’s successful development as a major economic power can only be achieved with the
aid of highly skilled, professionally trained management (World Bank, 1985; Fischer, 1990). In
China the management training function is not only aligned to economic structure and
development but also to political and ideological beliefs. Since management development is
perceived as an important means of enhancing managerial competence and improving
competitive advantage (Benson, 1996; Gregory and Wales, 1996; Osbaldeston and Barham,
1992), international companies involved in joint ventures need to be aware of the crosscultural implications in the design and implementation of management training programmes
for Chinese managers and its integration into the strategic human resource system.
28

29. Management has five major functions which are apply almost all countries organizations.
There are five managerial functions which applied in the Chinese management:
1. Planning
• Long-term and short-term orientation (5-year plan and annual plan)
• Decision-making by committees. At the top often individual
• Top-down-participation at lower levels.
• Top-down-initiated at the top
• Slow decision-making / slow implementation. (Now changing)
2. Organizing
• Collective and individual responsibility
• Attempts to introduce the “factory responsibility system”
• Formal bureaucratic organization structure
• Identification with the company but no competitive spirit
3. Staffing
• Most hired from school, fewer from other companies
• Slow promotion, but regular salary increase
• Lack of loyalty to both company and profession
• 5-year plan, otherwise short-term targets
• Promotions are supposed to be based on performance, potential ability, and
education. But
family ties and good relations with top managers are important
• Training programs available. State exam administered for managers
4. Leading
•
Leader as the head of the group (committees)
•
Directive. Parent-child relations (in TA terms)
•
Common values. Emphasis on harmony
•
Avoidance of confrontation
29

30. 5. Controlling
• Control by group leader (superior)
• Primary control by groups-but also by individuals
• Try to save face
• Limited use of quality control
Now broadly describe all these five major functions which are successfully implemented in
the china managerial practice system of any organization.
In China, the situation is quite different. Most of the businesses are state-owned, and it is
only more recently that some private companies have come into existence. In these
businesses, both long- and short-term plans are prepared. The five year plan is prepared at
the top (the State Planning Commission) while more detailed plans are made at lower levels.
The orientation is to meet objectives and achieve the assigned plan, rather than to be
successful in the market. There is also the difficulty of integrating organizational and
personal goals because the achievement of organizational objectives has little bearing on
individual benefits.
Organizing involves setting up a structure to coordinate human efforts so that people can
contribute effectively and efficiently to the aims of the business. This requires determining
roles, responsibilities, and accountability.
In China, major decisions are made by people at the top, but many people are involved in
operational decisions. Lower-level managers have very little authority to make decisions.
Decision-making through the central planning bureau is under the direct control of the
state. This, unfortunately, results in a lack of flexibility in the implementation of the
decisions. Although there is a realization of the need to change, managers in the upper
echelons of the hierarchy resist reforms because it would mean giving up some of their
privileges they have as officials.
Chinese managerial practices are very much influenced by the fact that the businesses are
owned by the state and guided by government officials. This results in a bureaucratic
organization structure that does not respond well to changes in the environment. This may
not have been crucial in the past (although it is ineffective) because managers did not have
to respond to competition. While factory managers, as people, are expected to achieve the
yearly plan, on lower levels the notion of a vague collective responsibility prevails. Within
the formal bureaucratic structure the relationships among people are rather informal.
Recently, attempts have been made through the "factory responsibility system" to delegate
more authority to lower levels. In fact, factories are allowed to make profits, though these
profits are specially taxed. Like in Japan, there are strong organizational cultures in Chinese
businesses. Research indicates that the degree of identification with the business may vary
30

31. greatly. Even with a low degree of commitment to the company, this does not result in
frequent organizational changes because it is very difficult to change jobs among stateowned organizations. And there is a lack of competitive spirit among Chinese employees.
Staffing requires identifying human resource needs and filling the organization structureand keeping it filled-with competent people. It is in the management of human resources, in
addition to the decision-making process, where the Japanese and Chinese approach to
managing differs greatly from that of the United States.
The staffing practices in China have aspects similar to those in Japan. Like in Japan,
employees are hired from school. They are expected to stay with the business for a long
time. More recently, however, personnel are also hired from other organizations; but
people are usually assigned to their positions by higher authorities. As in Japan, employees
are promoted slowly through the ranks with regular salary increases.
Leading involves the process of influencing people so that they contribute to organizational
aims; it is concerned with leadership, motivation, and communication.
The managerial function of leading in China has characteristics of Japanese and U.S.
practices. The leader is the head of the group (in committees, for example), but the
leadership style is generally quite directive. One interviewee described the relationship
between the leaders and followers as "parent-child" in transactional analysis terms. In other
words, it is expected that the leaders' commands are to be obeyed. Leaders, in turn, are
responsible to higher authorities for performance and goals, but not for meeting customer
needs and demands (but this is slowly changing).
In the view of Western managers, controlling involves setting standards, measuring
performance, and correcting undesirable deviations.
In China, control is exercised primarily by group leaders. The control focus is on the group,
but also on the person. Factory managers, for example, are expected to meet their yearly
quotas. Thus, Chinese control practices are a mixture of U.S. and Japanese managerial
practices. In identifying deviations from standards, there is a tendency to let the persons
responsible for poor performance save face (like the Japanese practice). There is some use
of quality circles, but it is not a common practice.
31

32. 2.0 Modern Management Practices in China
Globalization has shrunk the whole world into a single small market in the recent years.
Technology, products, process and people have become easily accessible throughout the
globe. Unlike the olden days each country has started towards contributing the global
market thereby improving its own economy. As the saying goes the world highest populated
country China has also started shifting its management model from the conventional
planned economy to decentralized market economy in the recent years.
2.1 Planned economy
Planned economy as the name suggests is a centralized model in the sense depends upon a
central managing body, here none other than the central government. For centuries the
Chinese Management System has been a centralized system where majority of the
organizations are State Owned Enterprises (SEO).State Owned Enterprises as the name
suggests belong to or are controlled by the government bodies.
2.2 Market economy
Market Economy, on the other hand can be considered as the polar opposite of Planned
Economy. In contrast to centralized system, market economy believes in privatization of
enterprises for the betterment of the industries as well as individuals of the nation. Market
economy is focused towards principles like individual freedom, equal contribution, and
division of labour and so on. World players like United States and United Kingdom follow
market economy.
2.3 From centralized to decentralized structure
But for the initiative of Deng Xiaoping, the former Chairman of the Chinese People’s Political
Consultative Conference, China would have never dreamt of something called market
economy [Selmer J, 1998]. Yes it is the socialist thinking of Deng that stood as an eye opener
to China. A revolution in Chinese Management practices began to take place only after
1978.For his good work Deng is considered even today as the architect of socialist thinking.
China from then on has shifted gradually from a centralized management structure to a selfmanaged decentralized structure over the years. Further in 1992 the Chinese government
introduced the concept of ‘modern enterprises’ in which it gave the managerial autonomy
to organizations thereby decreasing the interference of state government in business
affairs. Recent studies have identified remarkable changes in the management practices of
Chinese Organizations.
32

33. 2.4 Independent directors-a revolutionary approach
An Independent director is a person who is capable of exercising his control in an
organization’s decision making process and while taking those decisions work exclusively for
the benefit of an organization and does not give place to conflict of interest. The concept of
Independent directors first was introduced in China by the China Securities Regulatory
Commission in 1997, which later turned out by a success by exhibiting improved
performance of the organizations.
2.5 Need for independent directors in China
The corporate management practice introduced the management by Independent directors
in China keeping in mind the following reasons.
•
Protecting minority stockholders
•
Solve problems brought by shareholders
•
Protection of company by being looted by its managers
•
Equal sharing of profit
•
Promote Foreign Investments
•
Effective Overall management
2.6 The leadership style
Chinese leadership style is more focused towards personal feelings and emotions than that
of factors like motivation and recognition. Humanity comes first and then comes business.
The major role of a leader is to look after the wellbeing of a team and its members. For
example: dispute or misunderstanding among two employees may lead to a situation that
one might feel like quitting the job. In Chinese management practice the leader should
come forward to resolve the conflict and establish peace among his team members.
2.7 Retention management today
The Chinese have and still proving to be the best retention managers since they focus
towards collectivism and long term commitment rather than individualism and short term
employment. Their employee turnover is less whereas retention period is high [Tang J,
2003]. Seniority is given more importance than the fresh candidates. The Chinese are by
nature self-motivated and hardworking individuals. Therefore the organizations do not take
extra pain in motivating the employees. On the other hand they reward and recognize the
employees based on their commitment towards the organization.
33

34. Management, many Chinese managers are at the threshold of a managerial revolution in
which more government-owned organizations gain greater autonomy. Selectively,
competition is encouraged and incentives for private initiatives are promoted. There is an
increasing market orientation, and decision power for meeting customer needs is
decentralized (there have been even some highly publicized bankruptcies). To adapt to
these and other changes, Chinese managers look at both Japanese and United States
managerial practices and compare them with their past experiences. Some may be
transferable, but others are not. The environment, especially socio-cultural factors, does
influence practice, but its impact may have been overstated.
34

35. References
Armen A. Alchien and Harold Demsetz, (2005), Production, Information Costs, and Econoimc
Organization
The American Economic Review-2011
Nicholas Blooma, Christos Genakosb, Raffaella Sadunc and John Van Reenend,
(December 19th 2011), Management practices across firms and countries
Heinz Weihrich, (2011), Management Practices in the United States, Japan, and the People's
Republic of China
www.dineshchapagain.com.np/.../Japanese%20Style%20Management.pdf
-
cob.jmu.edu/icpm/
35

36. Appendix-1
In U.S. organizations, decisions are made primarily by people and usually only a few people
are involved. Consequently, after the decision has been made, it has to be sold to others,
often to people with different values and different perceptions of what the problem really is
and how it should be solved. In this way, the decision making is rather fast, but its
implementation is very time-consuming and requires compromises with those managers
holding different viewpoints. The decision that is eventually implemented may be less than
ideal because of the compromises necessary to appease those with divergent opinions. It is
true that decision responsibility can be traced to people, but at the same time, this may
result in a practice of finding "scapegoats" for wrong decisions. In all, the decision power
and the responsibility is vested in certain people in U.S. companies, while in Japan people
share both decision power as well as responsibility.
Organizations in the United States emphasize individual responsibility, with efforts to clarify
and make explicit who is responsible for what. Job descriptions are perhaps the best
evidence of this. Many organizations, especially those operating in a stable environment,
have been rather successful in using the formal bureaucratic organization structure. As far
as the climate is concerned, not many managers make special efforts to create a commonly
shared organization culture. This may indeed be difficult because professionals-managers as
well as technical people-often have a closer identification with their profession than with a
particular company. In addition, the work force often consists of people with different
values derived from diverse heritages. Many U.S. companies have a high employee turnover
rate, which is partly due to the great mobility of the people in this country. With a relatively
short duration of employment with any one company, the loyalty toward the company is at
times rather low. Organizational change is often accomplished by changing goals instead of
processes. But organizations using change agents with a behavioral science orientation may
focus on interpersonal processes to reduce conflicts and improve performance. In the
United States it is quite common to use outside organization development consultants.
The management of human resources in the United States is quite different from the same
practice in Japan. Like the Japanese, U.S. companies recruit employees from schools, but
they also hire from other companies. High turnover rates among recent MBAs are quite
notorious. Rapid advancement is expected and, if it is not forthcoming, an employee may
change companies. Professionals such as engineers or accountants often identify more with
their profession than with their company, and job-hopping is not unusual.
A common practice in U.S. companies is to appraise the performance of new employees
comparatively soon after they are hired. If performance does not meet the company's
expectations, employment may be terminated. But even for those who have been with a
company for many years, performance is evaluated at least once a year and in many cases
their performance gets reviewed periodically during the year. In general, the focus of
performance appraisal is on short-term results and individual contributions to the company
aims. Moreover, differentials in pay increases are often based on individual performance.
These differences in pay may be substantial, especially at upper levels of management.
36

37. Promotions in U.S. companies are based primarily on individual performance. Although
progressive companies provide continuous development, training is often undertaken with
hesitation because of the cost and the concern that the trained person may switch to
another company. Thus, employees are often trained in specialized functions resulting in a
rather narrow career path within the company. Finally, in many U.S. companies, employees
feel that they may be laid off during economic hard times which, naturally, contribute to job
insecurity. The managerial function of leading is carried out quite differently in U.S.
companies. Leaders are seen as decision-makers heading the group; they are expected to be
directive, strong, and determined. Their job is to integrate diverse values, but the emphasis
on individualism in the society in general and in organizations in particular may hinder
cooperation. Managers are expected to take decisive actions, and clarify the direction of the
group or the business, even if this requires face-to-face confrontation with those who may
disagree. Although managers work hard, they value their private lives and separate them
from their work. Within the organization, the communication pattern is to a great extent
from the top down the hierarchy, with considerable emphasis given to written
communication.
Control in the United States often means measuring performance against precise standards.
Management by objectives, widely practiced in this country, requires the setting of
verifiable objectives against which individual performance is measured. This way the
superior can trace deviations to specific people and this frequently results in fixing the
blame. In an attempt to maximize individual results, group performance may suffer. We all
can think of examples in which the self-interest of people was placed before group or
organizational interest. The use of quality control programs is not new. Hughes Aircraft, for
example, had such programs for a long time under the names of "zero defects" and "value
engineering." Many of these programs were developed in this country and later used by the
Japanese in the improvement of their product quality and productivity.
Appendix-2
Dr. W. Edwards Deming's famous "14 points"
1. Create a constant purpose toward
improvement.
2. Adopt the new philosophy.
3. Cease dependence on inspection to
achieve quality.
4. Cease dependence on a single supplier
for any one item.
5. Improve constantly and forever.
6. Institute training on the job.
7. Institute leadership.
8. Drive out fear.
9. Break down barriers between
departments.
10. Eliminate unclear slogans, exhortation
and targets.
11. Eliminate management by quotas and
objectives.
12. Remove barriers to pride of
workmanship.
13. Instigate a rigorous program of
education and self-improvement.
14. Make "transformation" everyone's
job.
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