Global Business Environment and Cultural Transformation in the Japanese Market - Example

Global Business Environment Name: Course: Tutor: Institution: Date: Executive Summary The global business environment is increasingly changing. In this case, the global culture changes influence organizational operational and strategic approaches. This report reviews the concept of culture change in the Japanese market. In this regard, the report reveals that the market culture is changing allowing for increased market structure changes. In its analysis, the report establishes that cultural changes in the global market include both the cultural integration and assimilation. These changes in the market competitiveness and efficiency at Matsushita Company can be hedged in cultural changes. A SWOT analysis in the market reveals that the organization faces increased strengths and opportunities, as well as weaknesses and threats because of the culture changes. In order to reinforce the strengths and weaknesses as well as mitigate of the weaknesses and threats, the study recommends the use of culture change specific motivation strategies, marketing and CSR programs for industries serving in the Japanese market. Table of Contents Executive Summary 2 Table of Contents 3 1.0 Introduction and Background 4 2.0 Culture Change Aspects 5 2.1 Cultural Integration 5 2.2 Cultural Assimilation 5 3.0 Analysis 6 3.1 Culture Change 6 3.2 SWOT Analysis 7 3.2.1 Strengths 7 3.2.2 Weaknesses 8 3.2.3 Opportunities 9 3.2.4 Threats 10 4.0 Recommendations 11 4.1 Culture Change Motivation Strategy 11 4.2 Increased Marketing 12 4.3 Corporate Social Responsibility 13 5.0 Conclusion 14 References 16 Appendices 18 Appendix 1: Matsushita Company SWOT Analysis 18 1.0 Introduction and Background Over the years, the global market is facing increased challenges in the global market environment. A market environment is described as the situation at which organizations operate in. In this case, organizational operations and principles are based on efficient operation of the environment. The existing market environment, as well as the possibility of environmental changes, determines organizational strategies, plans and operational activities. Traditionally organizations operated in the local markets. In this case, the markets reflected an increased culture homogeneity and uniformity. As such, the majority of the corporations adopted market specific culture oriented approached to enhance the success. An ideal example of the adoption of culture-oriented approach is the Matsushita Company in Japan. The company adopted business strategies that fitted in the Japanese culture. In the industrialization period, the Japanese culture provided the much-needed human resource services. In this case, a large Japanese population provided its services into the facilities. In this regard, in order to establish relationships, organizations such as Matsushita Company developed lifetime employment packages in the economy. In this case, the company motivated the employees through establish job security and retirement packages for the aged. Consequently, the economy had increased motivation enhancing increased employee productivity. In addition, employee motivation by the organization was based on the Japanese culture respect for the senior citizens, where age difference resulted to social class variances demanding respect between age groups. In this case, Matsushita Company used a seniority approach payment method. In this approach, the system allowed for respect in the workplace for the senior employees in the workplace, subsequently increasing their productivity. This report evaluates the Japanese culture changes, its implications on the Matsushita Company operations and the subsequent alternatives available for the organizational management to enhance its performance and influence. 2.0 Culture Change Aspects Globalization has led to increased culture change instances. In this case, a majority of the cultures are facing tremendous culture changes in their secondary and core values. In this regard, among the major contributors to culture change includes cultural integration and assimilation. 2.1 Cultural Integration Cultural integration is the combining and exchange of diverse cultural values into one. In this regard, cultures share and interchange their values. Most often the cultures she off their secondary values and in turn adopts those of the new cultures. This culture change concept has increasingly resulted from the use of expatriates as a human resource workforce. Expatriates lead to a culture transfer from their local culture onto the foreign markets culture (Chiavacci, 2007, p.35). For instance, the Japanese market was coupled by increased use of expatriates. In this regard, the expatriates led to cultural integration. For example, Matsushita Company CEO worked in the USA. Through this, the CEO adopted the American working condition that relied much on performance-based payment approach rather than seniority based approach. 2.2 Cultural Assimilation In contrast to cultural integration, cultural assimilation incorporates total cultural values change. In this case, cultures fundamentally change, including changes in their core values. As such, the cultures adopt the new culture values in totality. In this case, the old culture seizes to exist and the new culture morals, ethics and values take effect. An example of this was the French cultural assimilation of the West African cultures, where the assimilated persons became French black men. The Japanese market culture change did not attain the assimilation status. 3.0 Analysis 3.1 Culture Change Despite the increased culture merits in the market, no culture remains static. Ornatowski (1998, p.74) conducted a study to evaluate the causes of culture change in the economy. The study aimed at establishing an explanation for the widespread culture change in the global markets in the recent past. In its hypothesis, the study developed a hypothesis that the culture change was both internal and externally stimulated. Affirmatively, the study, in its analysis revealed that the culture changes resulted from both the internal and external sources. On one hand, internal culture change sources revealed that the changing societal role in the societies results into increased culture change. Such internal factors include increased literacy and education levels, where such education levels changes the social class order and stratifications. This can be attributed as one among the culture changes in the Japanese culture. In the Japanese culture, social status was based on family backgrounds and age seniority. However, the industrial revolution resulted to increased educational standards in the Japanese markets. The economy supported the education system to allow for the development of these skills. Subsequently, these structures allowed for increased need for remuneration resulting to the adoption of the performance and level based payment system by the Matsushita Company (Varley, 2003, p.351). 3.2 SWOT Analysis Xie and Lin (2008, p.70) in analyzing the Blockbuster Case Study argued that in analyzing an organizations internal systems, it is necessary for evaluators to adopt appropriate evaluation tools. One among them is the SWOT analysis tool. The adoption of this analysis tool enhances an overall view of the market in its operations. This report section conducts an evaluation of the SWOT analysis on Matsushita Company with respect to the discussed culture changes in the Japanese market. 3.2.1 Strengths Organizational strengths reveal the systems internal merits that increase organizations competitively in the market. The Japanese work culture change presented increased merits on the organizational performance. On one hand, the abolishment of the lifetime employment package as the only package reduced organizational spending on human resource management. Traditionally, the organization invested heavily on employees packages. In this regard, employee and workforce spending Is a form of organizational spending that increased the overall organizational production costs. Moreover, these reduced the organizations working capital. In this case, the organization had minimal funds to invest into other functions besides its human resources function. In addition, the seniority payment program was liability to the organizationally increased performance. Under this program, employees were compensated based not on their performance but number of yeas serving the organization. Consequently, this reduced the possibility for increased productivity motivation. However, culture change and the development of alternative packages provided a merit to the organizational challenges. On one hand, reduced spending on employees packages increased the organizations working capital. As such, the organization acquired enough cash flows to allow for increased investment and expansion On the other hand, the introduction of performance based payment program facilitated increased performance. Qualified and capable staff was motivated to increase productivity in order to increase their sales. As such, the corporation developed a motivated and hard working workforce unlike its traditional workforce management approaches (Wright, 2007, p.20). 3.2.2 Weaknesses The organizational weaknesses represent the faults and internal challenges emanating from adopted organizational strategies. On one hand, the organizational weaknesses represent a market inefficiency through which corporations could lose market influence and control in the market to competitors. The Japanese market culture changes have resulted into increased organizational weaknesses at Matsushita Company. One among the changes resulting into increased organizational management weaknesses includes the abolishment of the lifetime organizational employment programs. Moreover, the organization has increased weakness in its goodwill with the market. As evidenced in the case study, the organization due to management structure changes introduced new employment packages. In this case, this violated the discussed Japanese culture of establishing relationships and loyalty. Traditionally, the organization enjoyed increased employee loyalty. Due to the guarantee programs developed, the organizational employees were committed to establishing and attaining the organizational objectives. This was because of meeting their needs. This can be related to the Maslow’s hierarchy of needs. The theory holds that upon meeting employees’ needs as based on their respective levels in the needs hierarchy; organizations are bound to obtain increased employee motivation and commitment. Therefore, Matsushita Company, through its programs allowed for increased motivation. However, the abolishment of this employment program exposed the organization to human resource commitment challenges. In this case, the employees’ job security was reduced resulting into reduced motivation and loyalty. Consequently, this increased the organizational employees’ turnover rate. An increased employee’s turnover rate increases organizational expenses in recruiting employees. In this regard, the process of recruiting, training and developing employees is n expensive venture. Consequently, increased employee turnover results to increased management challenges due to time and resources spent in developing new human resource. Consequently, as Pearse (2011, p.161) argues, the approach, leads to increased operational and human resource skills negating the intended need for the establishment of the diversified strategies. Therefore, the adoption of these diversified create human resource retention weaknesses in the system. Consequently, this risks Matsushita Company reduced market competitiveness. 3.2.3 Opportunities Organizational strengths and market changes present increased market expansion strengths. In this regard, organizations face increased expansion and growth changes in the market. On one hand, the industry derives its opportunities from the respective organizational strength. As such, Matsushita Company derives its opportunities for growth and expansion in both the Japanese and international market from the organizational strength in the development of increased productivity and employee motivation. As already established, performance based payment allows for increased productivity. In this regard, the organization has an opportunity for increased market competitiveness and expansion. Ambroz and Praprotnik (2008, p.161) conducted a study to evaluate the major influencing factors for organizational growth opportunities in the market. In this regard, the study established that organizations succeed because of increased customer satisfaction. In this case, the study established that the development of a motivated employee’s workforce that enhances quality customer service facilitating increased customer satisfaction. In this case, the Matsushita Company has an increased opportunity for growth and expansion. In this regard, the company has an increased workforce diversity that allows for increased customer satisfaction. Consequently, the organization has an opportunity to enhance increased customer loyalty opportunity that allows for increased branding and justified customer growth. 3.2.4 Threats Organizational threats decrease an organization's ability to seize and benefit from the derived opportunities. In this regard, a review of the treats enables organizations mitigate against them to allow for increased opportunities and subsequent levels. On its part, Matsushita Company face increased market challenges in the development of a weak workforce and loss f loyalty. The adopted approach in the market leads to reduced workforce loyalty. In this regard, the organization faces increased loyalty challenges. Employees’ loyalty decline translates into incased market loyalty reduction that risks increased market share loss. In a bid to establish a relationship between market goodwill and organizational success. The study revealed that the organizational market success is dependent on the market goodwill that enhances loyalty (Kopalle and Assuncao, 2000, p.223). As such, reduced organizational loyalty by both the employees and the society, risks reduced growth rate. Therefore, the reduced market loyalty reduces the organizational success rates due to reduced sales risking a market takeover by the organizational competitors in the market. In this case, the organization, due to the changing Japanese culture faces growth retardation in the Japanese market. Therefore, in order to enhance increased organizational success, it is imperative for the management and respective decision makers to develop mitigation strategies for the organization. 4.0 Recommendations The organizational analysis part, with the SWOT analysis tool reveals that the Japanese market and the organizational environment for Matsushita Company face increased changes. As evidenced, the changes have resulted into both positive and negative implications on the industry and organization respectively. In this regard, it is imperative to develop actions plans to adapt to these changes in the new Japanese culture. On one hand, an action plan to enhance the development of established strengths and opportunities should be developed to ensure sustainability and increased success rates in the market. On the other hand, an action plan to reduce on the organizational weaknesses and the subsequent market threats are imperative to allow for retained market competitiveness, efficiency and increased profitability levels. In this regard, this report develops recommendations to allow for the establishment of the above goals. 4.1 Culture Change Motivation Strategy The Japanese and global markets culture is changing. In this case, it is imperative to adopt strategies that support the system. In this regard, motivation programs should be developed to cover and motivate employees in the changing cultures. In this case, the global cultures are changing from loyalty based business cultures into performance oriented workforce culture. As such, it is imperative for the global market to develop motivation challenges to cope with the changing workforce culture. Erbasi and Arat (2012, p.138) conducted a study on the food industry in Turkey to establish the employee motivation programs success. In this case, the study sought to establish if the non-financial benefits in employee motivation programs contributed towards increased employee satisfaction. In its analysis, the study revealed that it is imperative for organizations to develop systems through which non-financial benefits were extended as they were established to increase satisfaction. Consequently, in order for Matsushita Company to reduce on its employee turnover and the resultant costs, it should develop a system providing motivation packages such as career development opportunities. The Japanese market is currently inclined towards skill and knowledge development in order to sustain and enhance the current technological and development levels in the market. Therefore, adopting the career development motivation package in the market would allow for increased employability attractiveness in the market. As a result, the organization will attract a large pool of qualified human resource seeking to advance their careers. In this regard, as the employees advance their career, their experience, productivity and efficiency levels increase. These changes enhance increased organizational performance and overall productivity. In this case, the proposed action plan will not only enhance mitigate the organizational weakness, but also increase the organizational strength of increased workers productivity. 4.2 Increased Marketing The organizational SWOT analysis in the Japanese market reveals a lack of marketing strategies by the Matsushita Company. As already evidenced, the organization relies on the market goodwill and loyalty to propagate sales in the market. This market is economical as it reduces on the overall production costs. A passive selling approach requires no organizational, direct involvement. As such, the organization channels no direct funds in the market. Consequently, this reduces the organizational production costs allowing for relatively affordable products in the market. However, this approach has proved inefficient in the changing Japanese market cultures. On one hand, the culture has reduced on the traditional loyalty on brands due to increased variety and industry diversity. Consequently, customer base is no longer loyal to the market in that it allows for increased market diversification. Therefore, the organization can no longer rely on the loyalty package to increase its sales. Thus, the development of alternatives is imperative. In this regard, this report recommends the introduction of increased marketing approaches. On its part, the organization should develop marketing strategies and framework through which to promote its products in the market. This can be achieved using supply chain management frameworks as well as increased market partnerships. Elliott and Boshoff (2005, p.46) conducted a study in the tourism industry to review the rationale and merits of marketing. In its analysis, the study sought to establish f marketing through supply chain management increased organizational performance. In this regard, the study established that the market should develop supply chain management strategies. It established that supply chain management allowed for increased market influence at reduced market costs. In this regard, this report recommends the adoption of a marketing approach for the Matsushita Company. The strategy will enable the organization mitigates against reduced sales risk as a result of reduced market loyalty and goodwill as a result of increased competition and subsequent market variety availability. 4.3 Corporate Social Responsibility Besides, the profit and marketing oriented approaches, organizations can adopt the CSR programs as alternatives for establishing and retaining market influence, satisfaction and loyalty. CSR programs serve as avenues for developing links between the organizational interests o those of the environment that such organizations operate in. In this case, such approaches allow for increased synergy between organizations and their environment that the boost increased loyalty enhancing increased organizational sales and earnings. Jamali (2010, p.182) discussed the concept of CSR programs in facilitating market loyalty. The study established that organizations adopting CSR programs registered increased profit margins over pees failing to adopt the system. As such, the study revealed that the market is an ideal opportunity that enhances increased loyalty. Therefore, this report recommends the adoption of CSR programs to regain the dwindling Matsushita Company loyalty in the Japanese market. Through this approach, the organization will mitigate against the established threat of reduced sales because of reduced market influence. Resultantly, the organization will register increased market sales. 5.0 Conclusion In summary, the report establishes that the Global market environment is dynamically changing. In this regard, the report majors on the changing Japanese culture. In its analysis, the report reveals that the culture has evolved from the traditional loyal and committed workforce to the current competitive and career oriented labor market. As such, the report establishes that the market faces increased opportunities and challenges because of the culture changes. In order to evaluate the implications of these changes, the report uses the Matsushita Company as the case study. A SWOT analysis on the organization reveals that the change presents strength to the corporation due to reduced spending in human resource management. On the other hand, the report establishes the weaknesses on reduced employee loyalty risks the organization's success. Moreover, the review establishes that the change establishes a platform for increased market expansion because of increased productivity because of the performance based payment program. Finally, the SWOT analysis establishes that the organization faces increased threats in reduces market loyalty and sales decline. In order to remedy these challenges, the report recommends the adoption of the motivation programs, marketing strategies and social corporate programs in the organizational operations. Conclusively, this report argues that the adoption of the recommended alternatives in the changing Japanese culture will enhance increased organizational performance and competency for Matsushita Company. References Ambroz, M. & Praprotnik, M. 2008, "Organizational Effectiveness and Customer Satisfaction", Organizacija, vol. 41, no. 5, pp. 161. Chiavacci, D. 2007, "The Social Basis of Developmental Capitalism in Japan: From Post-war Mobilization to Current Stress Symptoms and Future Disintegration", Asian Business & Management, vol. 6, no. 1, pp. 35. Elliott, R. & Boshoff, C. 2005, "The influence of organizational factors in small tourism businesses on the success of Internet marketing", Management Dynamics, vol. 14, no. 3, pp. 44-58. 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Varley, P. 2003, Japanese culture, University of Hawaii Press, Honolulu. Wright, R. 2007, "Developing effective tools to manage the risk of damage caused by economically motivated crime fraud", Journal of Financial Crime, vol. 14, no. 1, pp. 17-27. Xie, Y. & Lin, I. 2008, "Strategic Analysis: Blockbuster Case Study", The Business Review, Cambridge, vol. 9, no. 2, pp. 68-75. Appendices Appendix 1: Matsushita Company SWOT Analysis Read More