Maybe he was being spurred on by Chinese consultant and Softbrain founder Song Wenzhou, but Takashi Kawamura, former President and Chairman of Hitachi makes some startlingly radical statements in a dialogue in the Nikkei Business magazine.
Both agree that in 2015 major Japanese companies must grow for Japan to get back on its feet, particularly so they can pull Japan’s small-medium enterprises along in their wake. But although Kawamura maintains the traditional Japanese line that companies exist to add value to society by paying wages, taxes and dividends (in that order), he asserts that Japanese employees must learn to become “faithful to their profession” rather than faithful to their companies as they have been up until now.
This includes company Presidents, who can no longer be “the person who happens to be in the position of President” and use their status and personal influence to get things done, but instead must be judged on their results, and their professionalism as a manager. “Management has become more transparent, and the responsibility to explain has become greater” says Kawamura.
As blogged previously, Hitachi hit the headlines for abolishing seniority based promotion for its Japanese managers recently, with commentators speculating that this would spread to other companies, and may even mean the end of other sacred cows of Japanese corporate life, such as lifetime employment. Kawamura openly says other Japanese companies will have to adopt the same approach and that this will result in greater labour mobility – not just in the Japanese labour market, but also for swapping people across national borders within the company.
However “moving people is tough” and it will take time, with other aspects of Japanese society also having to change, such as education and social mores, Kawamura acknowledges. Hitachi itself is facing the challenge of ensuring it does not devolve back to a ‘village mentality’.
Song remarks that he tried to get a Japanese friend of his who was a General Manager in a major electronics firm to take up a better remunerated position at a start up but his friend refused, saying his daughter was getting married soon, and he wanted to be introduced at the wedding as “General Manager of XXX company” – the status he would lose if he joined a start up was too much to contemplate.
I hope the choice isn’t as stark as Kawamura and Song make out – an adapt or die dilemma between the mutual loyalty of the company and its employees resulting in stagnation, or ruthless professionalism and mobility, resulting in growth. Not everyone can or should want to work for GE.
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