What evoked my interest in Japanese companies was our in-class discussion about Toyota’s success against the Big 3 in terms of automobile manufacture and sales. Just why has Japanese industry become so successful over the recent years? I believe it is because of their business strategy, or lack of strategy, as Michael Porter dictates in his article “What is strategy?”. I believe that the following factors have nurtured Japanese success:
- Low cost structure, including wages
- No legacy costs
- Effective government industrial policy
- Modernization after WWII leading to high capital intensity and productivity
- Economies of scale associated with increased exporting
However, as stated by Michael Porter, Japanese companies tend to imitate and emulate one another. Japan’s strength is that it is a leading nations in technology and machinery but this strength can turn into an eventual threat when too many companies come into the market with essentially the same products and services.
Japanese companies need to set themselves apart from each other and Sony and Canon are examples of companies that have achieved such measures. Perhaps it is time for Japanese companies to stop competing and focus more on brand positioning and management.
http://en.wikibooks.org/wiki/Business_Strategy/The_Japanese_Challenge
Michael Porter: