Joined: 16 Jan 2003
|Posted: Fri Mar 14, 2003 3:28 pm Post subject: Mistakes of Japanese style restructuring
|Mistakes of Japanese style restructuring
Restructuring which is under the way in many Japanese companies contains four mistakes,which give deep bad effects to Japanese economy.
First mistake is the timing of restructuring. At the point when japanese economy recovered step by step from the collapse of bubble economy, tax burden on people increased and managing failure of banks and security firms begun. We can say that after this point Japanese economy rushed into deflation spiral. Additionally companies made an employment adjustment at this point. If wage adjustment had had priority over employment adjustment, anxiety of people would be by far smaller.
Second mistake is that the speed of restructuring is too fast. Most of restructuring at present don’t have supportive background for advanced productivity. Therefore they resulted in that employee who remain the company are taking care of jobs,without overtime pay, of employee who were fired. If any, instead of restructuring,it is better for all employee to share their jobs. In other words,worksharing is very good for business people’s mental health.If labour cost need to be cut,wage adjustment should be taken. By that, technology and know-how which were possessed by employee still remain. And in case that restructuing is too fast, even if the company’s business recovered by firing employee, the employee who are fired cannot find out new posts. Unemployment benefit which is paid in that case are beared by workers and companys,so it doesn’t become a benefit for the country.
Third mistake is the direction of restructuring.Althoug the aim of restructuring is to increase the productivity, the restructuring at present such as employment reduction or scrap of production facility is the reduction of input(investment of capital and labour power). But in the coming intelectual creative society,by quality upgrade output(production) needs to be increased. But in the restructuring at present,employee who made mistakes become scape goats,instead of that employee who attribute to the company are evaluated. Under that circumstance,employee who are trying drastic challenges don’t appear andnew creative achievement are not made. Japan in the future cannot help manufacturing products which are with refined sence and novel idea by high technology which cannot be obtained by other asian countries. But such ideas are not produced by employee who withered under such circumstance.
Fourth problem is that most companies are misunderstanding the merit system. Merit system officially is to pay wages depending on how much the employee could attribute to the company.But in Japan, regardless of one’s desire,all employee have to do jobs in the job field which are dicided by the company.And the company it self is responsible for whether if the job can succeed or not. So regardless of the result of the job, employment and a certain treatment have to be secured on the responsibility of the company. This should have been the Japanese employment style. The restructuring which are underway in many Japanese companies at present is as follow. Employee in middle age have only job ability which is useful only in the company in the result that they have developed their job ability according to the company. And then suddenly they are said “Time of merit system has come. You have to quit your job and get another post by yourself. We add a little to your retirement money.
The restructuring which is underway in Japan made those mistakes. The best restructuring is to intensify the merit system on condition to secure the employment and to secure employee’s creativity by giving employee a freedome to plan ones’ job carrer. When large scale restructuring is made, in short term, the company’s benefit doesn’t increase because of the cost for the restructuring such as wellpaidmoney for early retirement. And in long term, its business doesn’t improve because able employees go out the company and the moral of the employees go down.