1. Japanese HRM, Evolution and its Current Trends

Japanese style of Human resource management or the soft approach to human resource management have been studied rigorously by many scholars and researchers. Evolution and the current trends of it had been influenced by the Japanese society, economy and the global economy.

What are the key aspects of Japanese HRM Style

There are two theories on the evolution of Japanese HRM style.

1.      First theory says that Japanese management practices have minor influence from history and culture, and its developed through past 60 years, specially after the world war 2.

2.      The second theory says that the Japanese management practices are heavily influenced by Japanese culture and history (Firkola, P., 2006).

But reality lies in between above two theories. Both the history and the culture have been playing a major role for evolution of the Japanese management style. Three major characteristics of Japanese management are lifetime employment, seniority and enterprise unions.

Lifetime employment: During the past, lifestyle of Japanese farming villages were mostly around rice-fields. Very little mobility makes them born and spent their whole life within the same village. It is believed that the concept of lifetime employment arises due these rural and difficult conditions.

In the lifetime employment concept, an employee stays with a same company for their entire lifetime. This is more or less an ethical bond between the company and the employee rather than a legal agreement. Japanese are looking for a company to work with rather than looking for a job within a company. During their tenure, employees received a general training covering the whole process areas of a company. Regular job rotation (within company) is a common practice and it is done for the benefit of both the company and the employee (Firkola, P., 2006).

Seniority: Seniority is defined as the number of years an employee with a same company and its not related to the employee’s age. In this system promotions and salary revision are minimal during the early stage of employee’s career. It is believed that with the time employees develop skills and gained experience, therefore salary revision and promotion are more abundant with the seniority (Harvard Business Publishing, 2019).

Enterprise Union: Japanese enterprise unions are single company unions. i.e. they do not spread outside the company. These unions members are full time employees of the company and is consists of both blue-and white-collar employers. These union have dual relationship with company. They are,

1.      involvement during the collective bargaining process and

2.      the involvement during discussing the company strategies (Firkola, P., 2006).

Current Trends

Current trends of the Japanese HRM system can be easily identified by studying the changes in these core values, i.e. studying the changes in lifelong employment, studying the changes in Seniority and finally by studying the changes in enterprise unions.

Changes to Lifetime Employment:

With the new trends in global economy, new technology and cultural changes in Japanese companies itself are forced to reduce their labor costs. Different companies had different strategies in reducing the labor costs, such as VRS, reduce the number of new recruits, new recruits hired as temporally employees, etc.

      There are both good and bad with the concept of Lifetime employment, so some Japanese companies and employees still prefer to be with this concept. Most interestingly concept of lifetime employment is less popular with the Japanese young generation.

Changes to Seniority:

Most Japanese companies are in the process of transferring from seniority-based evaluation system to performance-based evolution. With this new trend arose the issue of establishing a fair and uniform performance evaluation system within companies.

Changes to Enterprise Union:

In the recent past the power of enterprise unions have decreased and also their role has become undefined. Further, companies refuse to discuss the salary increments with unions and salary increments become more interrelated with the company’s market performance. Moreover, this leads to the fact that seniority-based pay system is no longer in-effect and unions are no longer discussing the salary increments with the management.

Global market trends, emerging new technology, changes in Japanese culture have put enormous pressure on Japanese HRM system. With this, Japanese HRM system is now marching towards a hybrid system, while preserving good aspects from there old style and absorbing a lot from the Western world.

References

Beechler, S., Najjar, M., Stucker, K. & Bird, A., 1996. Japanese-style versus American-style Human Resource Management Overseas: Examining Whether the Data Support the "Facts", Columbia: s.n.

Drucker, P. F., 1971. What We Can Learn from Japanese Management. [Online]
Available at: https://hbr.org/1971/03/what-we-can-learn-from-japanese-management#
[Accessed 30 03 2019].

Firkola, P., 2006. Japanese Management Practices Past and Present. Volume 35, pp. 115-130.