Survey of Corporate Personnel Affairs & Training Department in 2003 conducted by Benesse
Number of valid responses: 504 (companies)
vol.1
Globalization Phase 4
By Hiroshi Nishimura
The global business environment of Japanese companies is now
moving into a new phase. With the spread of the Internet, the
globalization of “manpower, materials, money, and information”
continues to advance rapidly.
GTEC would like to serially examine two fields of interest. First, what
are the effects of the borderless expansion of information
accompanying the spread of the Internet? Secondly, how are the
abilities required of the leaders and other businesspeople engaging in
global business changing?
The Globalization of Japanese
Companies is Now Moving into
Product Planning and Development
The globalization of Japanese companies has advanced in four phases.
1)Phase1: Exchange of Materials
In the first phase, Japan imported
cheap raw materials and developed
products to sell overseas. Materials
were exchanged and trading companies played an important role.
2)Phase 2:Cost Reduction
In the second phase, Japanese manufacturers transplanted their production
divisions offshore to reduce distribution and labor costs.
3) Phase 3: Introduction of International Standard
In the third phase, the introduction of
international accounting standards as
the world moved toward borderless fi-
nance strengthened the administrative
divisions of Japanese companies.
Up until this third phase, Japanese
manufacturers sought to procure materials directly and produce goods at low
cost. Overall, they were extremely successful in selling high-quality goods at
comparatively low prices around the
world.
At the same time, as is well known, foreign companies promoted the globalization of “service and knowledge.” In
the finance and service industries, for
example, steps were taken to move information technology and call center
operations to India to service the entire
English-speaking world. Dell is still
moving its call center operations to the
optimum locations for its different customer segments.
Another important change during the
third phase was the accumulation of
“production know-how” in countries
with low production costs such as China.
4) Phase 4: To the Age of Global One
Marketing
The fourth and current phase of globalization is taking place in the arenas of
product planning and development.
Japanese companies can be classified
into two types: the conventional types
that plan and develop their goods and
services in operational headquarters at
their head offices, and the less conventional types that seek to transfer their
planning and development functions
for goods and services to optimal locations worldwide. The latter choose ideal regions with “pace-setting” customers as new operational bases and
research the markets in those regions
to support their planning and development activities.
vol.1 Globalization Phase 4 By Hiroshi Nishimura
Companies have two good reasons for
planning and developing their businesses at optimum locations outside of Japan. First, the interests and preferences
of specific segments are homogenizing
globally in parallel with the globalization
of manpower, material, money, and information - especially the globalization
of information. In other words, businesses worldwide increasingly need “global
one marketing,” a form of marketing in
which plural activities are conducted
concurrently at different localities worldwide towards specific targets. Conglomerates also have less to gain from marketing activities focused on the planning
and development of services in Japan, as
the Japanese market is basically shrinking.
5) Hegemony of Global Manufacturers
in Transition
How has this change in the environment
influenced companies doing business
globally? Let’s look at the case of two
leading companies in digital consumer
electronics, Samsung Electronics and
Matsushita Electric Industrial Co., Ltd.
Both companies succeeded in minimizing sales lead times and streamlining
their data-collection capabilities on changes in customer preferences by incorporating a method of vertically integrated
manufacturing that enables simultaneous start-ups worldwide.
In the future we will be taking a close
look to see which type of company enjoys hegemony: will it be the company
with vertically integrated manufacturing
methods or the company that excels in
modularization, as represented by Dell?
Graph1:Priority Areas for Japanese Companies Going Overseas
ratio(%)
number of cases
administration
planning and
development of
goods
production
sales
ratio
27.0%
33.1%
14.3%
25.6%
number
of
cases
147
180
78
139
6) Issues for the Marketer to Notice:
English Content and the Development
of a Base to Support English Proficiency
The abilities to transmit and receive information in real time now make it possible to start-up parallel operations at different parts of the world. The volume of
English content on the Internet now surpasses Japanese content by more than
ten times. Global business marketers can
no longer ignore this huge disparity. Globalization will progress not only in the
areas of global marketing and finance,
but also in management planning and
personnel divisions to support globally
oriented staff. Another near future development will be the establishment of a
base to support English communication
abilities.
Graph 2: English Abilities Required in the Priority Areas
for Japanese Companies Going Overseas
ratio(%)
administration
planning and
development of
goods
production
sales
12.2%
13.3%
5.5%
18.7%
writing
4.7%
9.3%
1.6%
1.3%
listening
3.7%
4.0%
3.5%
3.0%
reading
6.4%
6.4%
3.7%
2.5%
speaking
GTEC [From Japan! International Human Resource Strategies Project]
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