Management: Japan learns to live with change: The thrust is to motivate staff now that growth is not assured, writes Roger Trapp

JAPAN has been associated with astounding business success for so long that any hint of faltering is seized on by Western competitors as a sign that the bubble has burst.

This may well be wishful thinking, according to a study of some of the country's top companies by the Cranfield School of Management. Rather than entering a downturn, corporate Japan looks to be preparing for an about-turn, it says.

Andrew Kakabadse, the school's professor of management development, carried out the study with research fellow Lola Okazaki-Ward. He reports a new readiness to tackle fundamental issues that have been bubbling beneath the surface for some time.

In particular, there is a realisation that shifts in society, such as the falling birthrate and growing independence of the young, must be addressed if long- term difficulties are to be avoided.

As a result, one of the key strategic concerns for Japanese boards is coming to terms with managing change rather than growth.

For a long time, the West has confused Japan's widely recognised excellence in manufacturing with effective management, says Professor Kakabadse. But visits to companies' headquarters reveal a different picture - of administrative mayhem with 'crowded offices, too many people, a lot of hanging around trying to look busy', he adds.

Now automatic growth is gone, this shortcoming has to be addressed. Maintaining a competitive edge is now dependent on a company's ability to manage itself out of difficulty, and most Japanese businesses are worried above all by the increasing costs of labour and power.

Some companies - notably the likes of Sony, Toyota and Nissan - predicted these changes and invested abroad, both to avoid controversy in cutting headcounts and energy costs and to be closer to developing markets. But others are only just starting to grapple with the issue.

Tied in with this is the treatment of, and expectations for, younger employees. Until now, young people have worked long hours for little money while waiting to fill dead men's shoes. But the quiet revolution under way in society is transferring to the workplace.

With women who want their own income and lifestyle joining increasingly ambitious males in the job market, senior managers realise that they must find ways of maintaining the morale and motivation of young employees.

'The volume of debate on this issue, covering such topics as fast- track career paths, appointment on merit and the restructuring of pay scales, certainly suggests that the emerging key issue within the corporate boardroom is the human resources function,' says Professor Kakabadse.

However, this has important ramifications for the over-50s. Getting rid of them in the interests of satisfying the desires of the young threatens to undermine secure employment, one of the pillars of corporate Japan. But with companies all over the world having to deal with this thorny issue, the Japanese are unlikely to be able to avoid it for long. One answer, suggests Professor Kakabadse, lies in the country's continuing emphasis on quality service.

Since the ability to satisfy the demand for consistently high standards in this area is threatened by the declining birthrate, some senior managers see an opportunity for 'the mature, socially adept and well-seasoned' employee.

Another lesson for the West?

(Photograph omitted)