Lesson 3: Management Theories

The Japanese Model of Management


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During the 1970s and 1980s, many North American companies looked at the Japanese business model.


When this was compared to the practice of Canadian companies, several differences were observed.

Click in the space under Canadian Companies after you have thought about how most Canadian companies would be different.

  1. Employ their workers for life.

  2. Employees work in groups, learn a range of job skills done by the group, and can be called upon to use any of those skills at any time.

  3. Decisions are made by management and workers consulting together.

  4. Organizational structure for workers in Japan follows a clan or family-like group structure.

  5. Responsibility in Japan lies with the group as well as the individuals.

  6. Japanese companies use formal and informal systems of internal control.

  7. Salaries in Japan are seniority-based.

  8. Japanese firms tend to offer facilities and services to their employees. These include recreational and social facilities that bring managers and employees together to have fun, which is intended to promote unity within the company.

  9. Japanese firms motivate employees through quality circles, which are small groups of workers who meet to various ways in which the company could improve. They focus on common commitment to continuous improvement (kaizen) of all production systems, worker flexibility, and reciprocal obligations among employees, departments, and related suppliers.
  1. Employment with a Canadian company can be terminated by either the company or the employee at any time.

  2. In Canadian companies, jobs are assigned by task.

  3. Decisions in Canadian companies may be made that way, but more often, they are made from the top management down.

  4. In Canada, the structure is often more bureaucratic.

  5. In Canada, responsibility usually lies with the individuals.

  6. Canadian companies use formal systems and external control.

  7. In Canada, salaries reflect skill levels.

  8. Facilities and services offered to employees are not as extensive in Canadian firms, and often, are minimal or non-existent.

  9. Quality circles are not used.
This democratic style of management has several advantages. However, delays in decision-making occur often, and a large proportion of a manager's time is spent in conferences and meetings.