Routledge Handbook of Japanese Business and Management The Routledge Handbook of Japanese Business and Management provides a comprehensive overview of management and business processes and practices in Japanese companies. The contributors combine theoretical findings and research results with a practical and contemporary view on how corporations and firms are managed in Japan. The handbook is divided into eight sections, covering: • historical perspectives on Japanese management; • structure and theory of the Japanese firm; • the corporate environment in Japan; • the Japanese work environment; • the Japanese market; • manufacturing and logistics; • interaction and communication; • the future of Japanese management. This book is an essential reference resource for students and scholars working on Japanese com- panies, the Japanese marketplace, Japanese consumers, or management processes in the Japanese firm. The book also provides an interesting and informative read for managers who need to deepen their knowledge on Japanese business processes. Parissa Haghirian is the Professor of International Business at Sophia University, Tokyo, Japan. This Page is Intentionally Left Blank Routledge Handbook of Japanese Business and Management Edited by Parissa Haghirian First published 2016 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 711 Third Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2016 selection and editorial material, Parissa Haghirian; individual chapters, the contributors. The right of Parissa Haghirian to be identified as the author of the editorial material, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data Names: Haghirian, Parissa, 1970– editor. Title: Routledge handbook of Japanese business and management / edited by Parissa Haghirian. Description: Abingdon, Oxon ; New York, NY : Routledge, 2016. | Includes bibliographical references and index. Identifiers: LCCN 2015032336| ISBN 9780415734189 (hardback) | ISBN 9781315832661 (ebook) Subjects: LCSH: Management—Japan. | Industrial management—Japan. | Corporations, Japanese—Management. | Corporate culture—Japan. | Japan—Commerce—History. Classification: LCC HD70.J3 R68 2016 | DDC 658.00952—dc23 LC record available at http://lccn.loc.gov/2015032336 ISBN: 978-0-415-73418-9 (hbk) ISBN: 978-1-315-83266-1 (ebk) Typeset in Bembo by Swales & Willis Ltd, Exeter, Devon, UK Contents List of figures ix List of tables xi Notes on contributors xii Introduction 1 Parissa Haghirian PART I Historical perspectives on Japanese management 7 1 The historical development of Japanese corporate management: 1603–1945 9 Sumiyo Ishii 2 Japanese management in the twentieth century 21 Parissa Haghirian PART II Structure and theory of the Japanese firm 33 3 Keiretsu 35 Franz Waldenberger 4 Japanese family businesses 48 Tim Goydke 5 Corporate governance 59 Franz Waldenberger 6 M&A in Japan 75 Carsten Herbes v Contents PART III The corporate environment in Japan 89 7 The Japanese tax system 91 Makoto Fujii 8 Corporate legislation in Japan 103 Bruce Aronson, Souichirou Kozuka, and Luke Nottage 9 The Japanese stock market 114 Katsuhiko Okada 10 Entrepreneurship in Japan 125 Parissa Haghirian 11 Accounting in Japanese corporations 137 Hiroshi Okano 12 Japanese employment law 150 Leon Wolff PART IV The Japanese work environment 159 13 The recruitment processes in the Japanese firm 161 Philippe Debroux 14 Promotion and compensation 174 Harald Conrad 15 Company welfare benefit systems 185 Harald Conrad 16 Equality in the Japanese firm 196 Philippe Debroux 17 Leaders and leadership in Japanese companies 210 Carsten Herbes and Tim Goydke 18 Diversity in the Japanese firm 224 Stephanie Assmann vi Contents PART V The Japanese market 237 19 Japanese consumer behaviour 239 Emi Moriuchi 20 Japanese consumer rights 251 Mariko Morimoto 21 Consumer/market research 260 Emi Moriuchi 22 Japanese marketing 269 Yumiko Toda 23 Japanese retailing 284 Kazuo Usui PART VI Manufacturing and logistics 297 24 Japanese production management and just-in-time systems 299 Yacob Khojasteh 25 Japanese supply chain management 307 Yacob Khojasteh and M. Reza Abdi 26 ‘Hollowing-out’ – Japanese production overseas 317 Patrick Bessler 27 Kaizen: concepts and strategies 331 Yacob Khojasteh 28 Consumer goods distribution and logistics in Japan 340 Hendrik Meyer-Ohle PART VII Interaction and communication 351 29 Japanese negotiation styles and decision-making processes 353 Parissa Haghirian vii Contents 30 Knowledge management in Japan 364 Parissa Haghirian 31 Strategic management 374 Parissa Haghirian PART VIII The future of Japanese management 385 32 Emerging topics in Japanese management research 387 Michaela Blahová, Parissa Haghirian, and Přemysl Pálka Index 396 viii Figures 4.1 Three-circle model of family firms 49 5.1 Employee versus shareholder interests 61 6.1 Development of M&A deals from 1985 to 2014 77 6.2 Overview of factors influencing M&A in Japan 79 6.3 Percentage of insider and outsider shareholdings 1987–2008 81 6.4 Percentage of foreign shareholders 1987–2008 81 7.1 Conceptual diagram of the taxable income calculation 93 7.2 Example of foreign tax credit 95 9.1 Hostile takeover attempts in Japan and the United States 117 9.2 Equity investment performance from 1900 to 2010 118 9.3 Market capitalization of Japanese stocks after the collapse of the bubble economy 119 9.4 International momentum effect comparison 121 9.5 The dekansho-bushi effect for various portfolios 123 10.1 Total early-stage entrepreneurial activity (TEA) in the GEM economies in 2014, by phase of economic development 127 10.2 Changes in the average age of Japanese entrepreneurs starting their own business over the past twenty-four years 129 10.3 Percentage of SMEs conducting R&D 133 14.1 Weight of the role/job pay component (yakuwarikyū) in base pay in per cent 178 15.1 Development of social-security contributions, voluntary welfare benefits, and occupational-pension contributions in predominantly large firms 188 15.2 Occupational pension-plan participants (relative and absolute numbers) 191 22.1 Advertising expenditures 276 22.2 The export rate of primary products 278 23.1 Changes in the number of retail establishments in Japan 285 24.1 Kanban control system 302 24.2 Push and pull mechanics 304 24.3 CONWIP control system 305 25.1 Direct, extended, and ultimate supply chains 308 26.1 Japanese outward FDI flows 318 26.2 Ratios of overseas production and overseas sales 321 26.3 Employment structure, showing the trend towards a service economy 324 27.1 Japanese perception of job functions 332 ix