INTRODUCTION—
TOWARD MORE ACCURATE CONCEPTS
Ezra F. Vogel
Progress in an academic field may be viewed as a series of successively closer approximations to reality. Since World War II a number of compelling concepts have advanced our understanding of Japanese society, but as scholarship progresses these have been modified and the scope of their applicability more precisely delimited. For example, shortly after World War II the concepts of giri (duty) and ninjo[*] (human feeling) called attention to a fundamental conflict in Japanese attitudes, and oyabun-kobun (parent status-child status) was a key concept for understanding many economic and social relationships outside the family. Later, as the concepts were modified and the scope of their applicability more clearly specified, new concepts were introduced to explain other aspects of Japanese society.
The papers selected for this volume include analyses of political, economic, cultural, and educational organizations. The conference for which these papers were written was designed to present an overview of modern Japanese organization and decision-making but, in passing, the papers and the ensuing discussion had to come to terms with a number of concepts which currently dominate Western work on Japanese organization. In this process, some of these concepts were criticized and modified whereas others were reinforced, extended, or applied to additional phenomena. Since Japan has been changing so rapidly, one might legitimately raise the issue as to whether our effort to refine our understanding of Japan merely reflects a changing Japan rather than a change of our understanding. This essay endeavors to call attention to
what many scholars at our conference considered a refinement in our understanding, but before trying to describe these more accurate statements of enduring characteristics of modern Japanese organization, one must first consider which qualities are related to the particular stages of development since World War II.
Changes in Organization and Organizational Climate
Although the Japanese economy has grown almost continuously since the Meiji Restoration, the growth rate since World War II has been unusually rapid. In the first quarter century after World War II, Japanese companies modernized their physical plant and basically closed the technological gap with advanced Western countries. This process involved the purchase of foreign technology, heavy investment in new facilities, rapid increases in productivity, and the transformation of almost one-half of Japan's population from agricultural to industrial and service occupations. In the course of this very rapid modernization, plants that were able to modernize and compete in international trade were sometimes spectacularly successful, whereas many companies that were unable to modernize or keep pace with the rate of change went bankrupt. During this period there was an extraordinarily high rate of saving and reinvestment and extensive bank loans to finance the growth. Wages, welfare, and public services tended to lag slightly behind economic development, but since the mid-1950s, after the economy had fully recovered from World War II, improvements in wages and living standards have virtually kept pace with economic growth.
In the early postwar period there was a considerable surplus of labor and enormous competition for the openings in the better educational institutions and the more successful companies. By the late 1960s, there was a considerable shortage of labor, especially of young workers, since most organizations preferred to recruit young employees, pay them low salaries, and train them within the company. Business strategies were geared to modernization, rapid expansion of facilities, and rapid growth. The ministries' policies were designed to build up a modern industrial capacity to compete in world markets, while ensuring an adequate supply of raw materials.
Japanese companies are still geared to rapid growth, but by the late 1960s they were moving from labor-intensive industries, where their competitive advantage had been low wages, into high technology fields, where their competitive advantage was a combination of technical superiority, efficient management, and motivated workers at wages still below other highly developed countries. With the closing of the technological gap between Japan and other advanced countries and the rising cost of
borrowing technology, the Japanese government and Japanese firms began to invest heavily in research and development.
After World War II, the government bureaucracy lost some of its coercive powers and the aura of the imperial way, but it maintained its power in guiding the country and gave top priority to economic development. In the early years after World War II the Ministry of International Trade and Industry (MITI), which played the critical role in industrial development, maintained considerable leverage in getting companies to accept "administrative guidance" because of its capacity to make decisions about foreign exchange. Although MITI and the banks lost some leverage as companies accumulated their own capital and foreign exchange, the governmental bureaucracy found new ways to maintain its leverage. MITI, for example, is likely to maintain its leverage for administrative guidance by its capacity to decide whether companies meet acceptable standards of pollution control and consumer protection. In the future, new regulations concerning incentives for relocating industry, strongly supported by MITI, are likely to provide new bases for ensuring that companies remain responsive to MITI guidance. Currency controls and flexible tax incentives have also enabled the Ministry of Finance to maintain considerable leverage over the economic life of the country.
Although there have been many political disagreements in this postwar period and many conflicts between companies and between the companies and the government, there had been a fundamental national consensus about the importance of economic growth and of Japan achieving a favorable position in international trade. With this high sense of purposiveness various bureaucratic and business leaders had been willing to sacrifice for national goals. Now, in the 1970s, there is increased recognition that other goals, connected with social welfare and the quality of life, are also important. As a result, there is no longer such a clear purposiveness, such a high level of consensus about the desirable goal, nor such willingness to sacrifice for economic goals.
Modifications of Previous Concepts
A number of concepts currently used to describe various features of Japanese organization have taken on exaggerated importance in Western scholarly literature. In part, the exaggeration occurs because observations at a particular time and place have been assumed to be general characteristics over a long period with applicability to a wide range of phenomena. In part it occurs because certain Japanese expressions are assumed to represent unique practices, which, upon closer examination, are not very different from practices in the United States or other Western countries. In part it occurs because Americans have dominated most Western analyses of Japan, and what is really unique may not be Japanese
patterns but American patterns. Among the concepts currently popular in the Western literature on Japanese organization that need to be modified are the following:
1. Japan, Incorporated .—The notion that Japanese government and business work so closely together that Japan resembles one large corporation is a conception used differently by different authors. Sometimes it describes big-business domination of the government decision-making process. Sometimes it describes business docility in the face of government direction. Sometimes it describes collusion between the two. Recently, in some circles competitive with Japanese business, the concept has taken on pernicious overtones, implying that close cooperation between government and business is illicit.
There is no question that, in general, there is a closer working relationship between government and business in Japan than in the United States. Compared to their American counterparts, the major ministries supervising economic activities are more concerned with improving Japanese economic capacities to compete in international markets and less concerned with regulating business and preventing unfair monopolistic practices. The Bank of Japan, for example, stands firmly behind the city banks, which in turn lend money to the largest Japanese corporations, and it is ready to exert itself to prevent these companies from going bankrupt.
But, as Gerald Curtis points out in his article, the notion that Japan behaves like one large corporation vastly exaggerates the contact between governmental and business leaders and the identity of purpose between the Japanese government and specific companies. It understates the tension between certain companies and various branches of the government, especially when government decisions are not in keeping with their companies' interests. It incorrectly implies that the government only makes decisions that are in the interest of big business. In fact, to remain in power, the Liberal Democratic Party (LDP) has to respond to a variety of demands: rice price supports, pollution control, improved social security, and trade and capital liberalization.
Compared with their American counterparts, Japanese businessmen meet more frequently to discuss problems of economic policy for the nation as a whole as well as specific programs and policies which would potentially benefit businesses of a particular kind. They are thus in a much better position to aggregate their interests and represent them to the Japanese government than are comparable American businesses.
Nonetheless, as Curtis points out, it is hard to identify any tight organization of zaikai (literally, financial circles, but generally referring to the business community's central leadership). To the extent that there has been effective coordination in the business community representing business interests as a whole, it has been led by a number of senior citizens in these financial circles. Just as the Meiji genro[*] , the senior political leaders,
began to lose their power and influence as they aged and political authority became diffused, so the zaikai genro[*] , the senior leaders of the financial community, are currently aging, and their authority has already been diffused. This gradual dissipation of the senior economic leaders' power accelerated during the tenure of Premier Sato, when the political leaders chose to confer on economic matters not only with a small number of senior representatives of the so-called zaikai , but with large numbers of business leaders whose interests were not identical with those of the zaikai genro . In short, no small circle of business leaders can now effectively speak for the business community as a whole, and as the public consensus on the priority of economic growth breaks down, the LDP will increasingly find it necessary to compromise big-business interests to stay in power.
2. Ringi Sei.[1] Ringi Sei—the system whereby documents are drafted at lower levels of an organization and then circulated to various units for approval—is sometimes described as the unique Japanese process of decision-making. Ringi sei is sometimes interpreted to mean that the real power of decision rests at lower levels or that decision-making is a slow, clumsy process in which no one has clear authority. The practice of ringi sei is widespread in Japanese companies and government offices, but the concept has been overinterpreted and misinterpreted in the Western literature.
For one thing, as Yoshihisa Ojimi points out, this concept understates the authority and initiative of leaders in an organization. Especially among organizations with an able and forthright leadership, not only do initiatives come from the leaders, but they exert close supervision over the drafting of documents at lower levels. Even where leadership is less vigorous and consultation between levels less frequent, section members drafting a memorandum are aware of the purposes of the organization and the wishes of their superiors, and they draft documents within this context. To be sure, leaders uncertain of their own authority are influenced by the convictions of people at lower levels in the organization; but more commonly, those at the lower levels of the organization are given leeway to draft documents only when they have the confidence of their superiors. They are acting within the bounds of explicit or implicit trust placed in them by their superiors.
Some leaders are concerned about the potential erosion of their authority and make an effort to prevent the drafting of documents unless they have given explicit approval. The ringi system is often an ato ringi system, in which the leaders make the major decisions and then encourage lower levels to draft documents in line with the decision. Of course, as Yoshino points out, the ringi sei rests on homogeneity and consensus, and when there is widespread consensus at all levels of an organization,
documents can be drafted without explicit approval. But if disagreements arise at the lower levels in the course of drafting a document, they are generally taken to higher levels to be resolved.
It should also be noted that the ringi system is not used for all kinds of issues, but only those which are relatively complex and require a high level of coordination. Some sensitive issues, like personnel issues, are not handled by the ringi system at all. General questions of strategy are more likely to be discussed in meetings, and documents may be drafted only when specific measures are required.
To some extent ringi is a system for preserving the right to consultation of various sections of an organization. Some sections may put their stamp on documents without closely examining them, but the system is not necessarily one without responsibility. Rather a section's approval of a document generally means that either the document is not so important or it does not infringe on the section's sphere. As such, ringi sei is often not qualitatively different from the clearance system in the U.S. government. Thus it is characteristic of a more mature bureaucratic organization rather than of a young, dynamic organization with a strong leader. In short, ringi is not as unique as sometimes argued nor an indication that leaders of Japanese organizations are lacking in authority and initiative.
3. Seniority and Permanent Employment Systems .—In large businesses and government bureaucracies, there is an expectation that a regular employee will remain with the organization until he retires and that his salary and title will continue to improve with length of service. It is also extremely rare for a regular employee to serve under a younger employee in the same general line of work. However, the concepts of "permanent employment" and "seniority system" have sometimes been used indiscriminately by Westerners to explain too much.
For one thing, permanent employment and the seniority system apply only to a minority of workers in Japan. They do not apply to farmers or to those employed in small commercial or industrial establishments. Nor do these concepts apply to the large groups of so-called temporary workers who are paid regular wages but are not given the same kind of assurance about permanent employment or the same rate of promotion as regular employees. For example, most young women in an organization are not permanent and are expected to retire when they marry or become pregnant with their first child. Most housewives who come back to work after children are in school are classified as temporary employees even if they remain within the same organization for many years. Other workers in large organizations such as salesmen, special technicians, or unskilled workers are also not necessarily treated as regular permanent employees under the seniority system.
The attention given to permanent employment and the seniority system also understates the degree of mobility from one firm to another. The number of small firms that go bankrupt has remained very high, and even
in large firms it is no longer rare for an employee to move from one company to another company that is not directly competitive. It is also common for an employee to move from one company to another that is in some way related to the first. Thus, within a major company, a person may move from one "child company" to another, or from a "parent company" to a newly established "child company."
The concepts of permanent employment and seniority have sometimes been explained as traditional holdovers out of line with economic rationality. It has been argued that the firm, unable to discharge an employee until retirement, must retain and pay higher wages to an older employee who is no longer useful. Several qualifications need to be made. First, since retirement in most companies takes place by age fifty or fifty-five, the so-called lifetime employment is really only employment for about thirty years. A person past fifty may obtain work in an affiliate of his original company, but it is not guaranteed if he is not needed, and in any case, his salary may be lower. Second, the system of increasing salary with seniority tends to be concentrated in those areas where skill and usefulness to a company are related to length of experience. Third, a company which provides high wages to senior employees also can pay less for junior employees who can look forward to seniority. Finally, even when there is not a direct relation between increased salary and increased usefulness to the company, the high level of employee commitment with this system may be beneficial to the company as a whole. The combination of early retirement, the frequent use of temporary workers, and the use of subcontracting firms where employment is not guaranteed all reduce the financial risks that a company with seniority and permanent employment policies would experience at a time of recession.
Although salary and title increase with age, the task which a person actually performs in a company is not necessarily related to salary and title, and is determined more by a person's actual skills. As Kazuo Noda points out, a subordinate may in fact be given great responsibility in accordance with his abilities, regardless of his salary and title.
The system of permanent employment and seniority results not from traditional Japanese practices, but from a combination of labor-market conditions, management decisions, and pressures from labor unions. After World War I, because of the shortage of skilled labor, many Japanese companies undertook to provide specialized training and to set up a system to ensure that the best-trained workers would remain with their company over a long period. The same was true for many companies after World War II. The pressure from labor unions was in the same direction because, in the period immediately after World War II, when good employment was difficult to find, unions fought for a system that provided job security.
4. Growth Without Profit .—A number of Western analysts, observing Japanese corporate behavior in the 1950s and 1960s, concluded that
corporations were interested not in profit but in growth. In fact, very rapid modernization and expansion in the fifties and sixties was necessary for companies to achieve economies of scale and to remain competitive on international markets. As Hugh Patrick points out, the illusion of disinterest in profit ignores a number of considerations. For one thing, the extraordinary interest in growth and modernization is characteristic of a specific period. Second, Japanese companies generally have a longer time perspective than American companies. Some American executives feel pressure to keep a high rate of return during a particular term of office. In contrast, the Japanese company is interested in longer term growth and profit. Third, the cultural value system makes it difficult for Japanese businessmen to acknowledge publicly their interest in profit. Unlike the American business ethic, which sees a harmony between the individual pursuit of profit and the general betterment of society, the more common Japanese ethical code views the individual pursuit of profit as inconsistent with societal benefit. Japanese business executives, while concerned with profit, are less likely to make such declarations in public.
5. School Cliques .—Many observers of Japan have stressed the importance of alumni cliques both within an organization and between organizations. It is true that many senior leaders in the Japanese bureaucracy are graduates of Tokyo University and that some leading business and government leaders knew each other in high school or college. However, the importance of such ties has often been overestimated, and therefore needs qualification.
People within a given organization, and especially within business organizations, are unlikely to form friendships primarily on the basis of school ties. Having attended a good school is an advantage in entering a given company. However, as Thomas Rohlen says, once a person enters a company or a ministry, he forms close associations more on the basis of daily work relationships than on the basis of old school ties.
Even when people within a given company go through school friends to contact people in the government or in other businesses, they are doing so to better represent the interests of their organization. It would be highly unusual to advocate policies inimical to one's unit because of friends in other organizations. In short, old school and personal relationships can help cement ties when consistent with organizational objectives.
Concepts Reinforced and Extended
1. Groupism .—Western and Japanese observers have long noted the identification of a Japanese with his organization, and especially his work organization. A Japanese employee is more likely to identify with the organization where he works than with a professional or occupational specialty. In an earlier period, Western sociologists like Weber, Durkheim, and Parsons described professional and occupational groupings as the
major source of group belongingness for industrial societies. The rapid pace of social change in postindustrial societies, however, has meant that a definition of an occupational specialty appropriate at one time is not necessarily appropriate for a later period. Therefore, one can argue that the Japanese identification with company is perhaps better suited to rapid social change than the occupational identification. With the assurance that an employee is likely to remain in its employ, a company can safely invest in retraining for up-to-date skills, and a declining occupational specialty does not need to protect itself with a feather-bedding strike.
Although many observers have already called attention to the importance of this kind of group identification in Japan, several considerations, sometimes neglected, should be added. For one thing, it is important to recognize the conscious management effort to maintain a sense of belonging within an organization. An example Rohlen points out is the companies' efforts to "capture" the recreational groups as affluence enables more company employees to engage in individual or family recreational activities. The companies themselves set up various kinds of activity and sport groups for their employees, often along the lines of college activity groups. They also consciously use such events as vacation trips, celebrations of employees' birthdays, entering and leaving the company, and year-end parties as ritual occasions to reinforce the solidarity of the group. Furthermore, as Noda has shown, in composing sections in a company or government bureau, an effort is made by the leaders to form a team that can work well together.
Second, the phenomenon of groupism applies not only to family and work units, but to political factions and to a large range of secondary groups that develop a much higher degree of solidarity than comparable groups in the United States. Thus, for example, the solidarity among people who entered the company or ministry in the same year or who work in the same section is much higher than in the United States. New ad hoc groups formed for specific purposes across organizational lines also have mechanisms for achieving solidarity very rapidly. Whether by recreation or drinking, or some other kind of ceremonial activity, they quickly develop a climate facilitating close interaction. A wide range of study groups, tour groups, special task forces, and other ad hoc groups mediate among different organizations.
Third, however, the group orientation should not be interpreted to mean that there are not tremendous rivalries and considerable room for politics and manipulation within an organization over questions relating to basic issues of policy and personnel. Indeed, it is partly a reflection of the deep involvement of individuals in the organization that these rivalries are so intense. This is in striking contrast to more anomic organizations where these issues can be handled with more detachment or impersonality.
One special case of groupism, which has received relatively little attention heretofore and which basically affects public understanding of
public affairs, is the press club described by Nathaniel Thayer. A reporter, while loyal to his own newspaper company, also develops strong ties with those in the same press club—a club composed of reporters from all newspapers who cover the same ministry or branch of government. This solidarity is sufficiently strong that the prevailing club view leads to virtual unanimity of articles concerning that ministry. Although the phenomenon of an individual bound by the consensus in his group is prominent in all organizations, the press club situation may adversely affect expression of contrary opinions when a consensus is not in accord with the facts or the best interests of the public.
2. Long-Range Goal Orientation .—Japanese groups are very task oriented, and the solidarity of groups in economic and political organizations is related to the goals of their groups. The definition of a task by the group is generally long term, and group members are generally willing to subordinate short-term interests, whether personal or organizational, to long-range goals. At the psychological level, George De Vos shows how individuals are willing to endure long periods of adversity, including hard work at low wages, in order to achieve greater success in the long run. De Vos points to the optimism about what can be accomplished in the long run as intrinsic to the individual's capacity to endure.
As Peter Drucker points out, the long-range goal orientation of an organization is much more important than tradition. Although the change after World War II has been unusually rapid, the general capacity to work for a distant goal was characteristic of Japan before the war as well.
Because the integration of institutions depends less on rules and regulations and more on solid unity on long-range goals, there is considerable flexibility in devising means for implementing these goals. As Robert Ward pointed out in the discussion at the conference, for example, there is so much flexibility within the bureaucracy that officials in one ministry can be assigned tasks in another as needed.
To be sure, long-range plans are sometimes vague and often altered as a result of changes in mood. Yet what appears as excessive fluctuation or uncertainty may simply be a particular stage, which is seen by executives in a longer time perspective. Often executives are willing to undergo a very lengthy period of study, experimentation, ferment, and discussion before taking action. However, when the desirable course of action for the long run becomes clear, an organization has great capacity to mobilize its members toward the achievement of the organization's basic goals.
3. Nemawashi —(literally, "binding the roots of a plant before pulling it out," used to refer to the practice of broad consultation before taking action). What is perhaps more characteristic of Japanese organization than the ringi system is the frequency of consultation. There is almost continuous consultation among peers in an organization and between levels and between units. The consultation varies from mundane detail to broad general issues, and usually it takes place in a climate of great
mutual confidence and support. As a result, a great deal of time may often pass before a decision is arrived at. Usually the executives in an organization are reluctant to move until a consensus is reached, but if the issues are sharply drawn and the executives must make a choice, they try to gain widespread support before making these decisions. When a consensus is finally reached, there is a high degree of support among members of an organization for the decision and greater willingness to implement it.
Some Japanese executives have expressed surprise and amazement at the brilliant analytical discussions of possible options carried on at small group meetings of high-level American company management, and by the rational, analytic way in which American executives choose from several possible options at such a meeting. In contrast, the Japanese firm is inclined to talk an issue out among large numbers of people, thereby creating a much greater organizational involvement and commitment before a decision is made.
In general, the Japanese organization is less bound by legalistic interpretations or precise statements of rights, duties, and offices. There tends to be much more flexibility, depending on the current prevailing mood, and in general there are no legalistic rules or regulations which inhibit action once there is a consensus that a certain action is desirable.
4. Fair Share .—Group competition is intense at all levels in Japan, but within a clearly defined sphere, groups, in effect, constitute an informal league, with clearly defined rules about what is "fair play." When conflicts between the groups have to be resolved at higher levels, there is a strong notion that each group is entitled to its "fair share."
In many fields, there are myriads of rapidly changing companies, but among large companies competing in a given market, there is usually a finite league of competitors. Although they compete fiercely for an increase in market share, large competitors do not expect to drive each other into bankruptcy. There is recognition of the principle of equitable treatment when a government ministry like MITI has to rule on matters which affect the livelihood of companies in a given market. If one company is disadvantaged by a decision at one time, it is taken for granted that the ministry should make an effort to give assistance to that company at a later time.
John Campbell, in his study of the Japanese budget, illustrates the importance of the concept of "fair share" in allocations. In contrast to the U.S. Budget Bureau, which tries to reach rational overall decisions that affect the overall budget, the Japanese budget is generally based largely on the needs of the ministries. Ministry of Finance officials who oversee the budgeting process view themselves as expert mediators rather than as creators of national priorities. Thus there tends to be less drastic change in the portion of the national budget allocated to different fields than in the United States. Although ministries exert themselves to find worthy projects
to increase their share of the national budget, in fact, the allocation to a ministry does not change greatly from year to year, and each ministry must then make the tough decision of how to allocate the share it receives to its various programs.
Similarly, the concept of fair share applies to expenses for different regions of the country, and the Local Autonomy Ministry attempts to redistribute funds to the various prefectures on the basis of need. There is also an effort to expend funds in the backward areas, thus reducing imbalances from one part of the country to another.
Within the LDP, the concept of fair share is also very strong among the factions. It is a major factor, for example, not only for allocating party funds, but for determining cabinet appointments. In short, when a league of competitors has been defined, there are certain informal rules that regulate the behavior of the various competitors.
5. Bureaucratic Elitism .—As Edwin Reischauer pointed out at the conference, unlike the United States but more like the European pattern, members of government ministries in Japan enjoy enormously high status. Admission to the ministries is intensely competitive and based largely on objective examinations. Ministries are thereby able to recruit extraordinarily talented young men committed to lifetime careers. Upper-level officials in a ministry, therefore, have tremendous dedication to their ministry. Despite criticism of the bureaucracy after World War II, as the bureaucracy lost some of the aurà of serving the emperor, and the source for recruitment greatly expanded with the extension of higher education, bureaucrats nonetheless maintain widespread respect from the public.
Because the bureaucracy has talented people, who do careful staff work on a variety of problems, politicians and even business companies must rely on their judgments. When the steel companies expanded against the advice of MITI officials and it later turned out that the expansion was clearly unwise, some MITI officials were pleased that the companies had learned their lesson, that the rare experience of not following administrative guidance on an important issue had proved unwise.
Although Keidanren (Federation of Economic Organizations), the LDP, and some other business and political organizations have small research staffs, they do not compare in size and scope to the research staffs of the ministries, and they must rely upon the ministries for detailed work on any question. It is not surprising, therefore, that a very high proportion of the bills considered in the Diet orginate not with individual Diet members, but come from the ministries through the cabinet.
As Reischauer pointed out at the conference, because the bureaucrats are so unambiguously in elite positions, they have the confidence to express themselves much more forthrightly. The various ministries are, to a large extent, self-contained under the direction of the senior vice-minister. Outside political leaders, even including those who are appointed ministers, never have the degree of political leverage inside the ministries
that American cabinet officers are expected to have over their departments. The American cabinet officer may bring to his department a number of his own aides and initiate a number of new policies in the hope of gaining the major role in directing the affairs of the department. His counterpart, the Japanese minister, does not expect to have the same degree of control over a ministry and must work through the vice-minister. Just as a high-level bureaucrat who has come up from the ranks of a ministry invariably directs the ministry as administrative vice-minister, so in the Foreign Ministry, no outside political appointees are made ambassador. Therefore, senior officers in the foreign service have more confidence about the probability of moving into senior ambassador positions than their American counterparts.
The high quality and integrity of the bureaucrat, the respect of the Japanese public, and the relatively self-contained nature of a ministry enables bureaucrats to be relatively free from political pressure and to work for what they consider the good of the country. As a result, the Japanese government has enjoyed high-quality leadership with considerable continuity and long-term perspective regardless of the rapid changes in political leaders.
6. Cores of Business Leadership .—Although leaders are bounded by the consensus within their organization, the leaders of most business firms, as in ministries, have worked together for many years and can make bold decisions considered in the long-range interest of the company. This core of executives in a given firm has been able to chart well-considered long-range policies for the firm. Japanese executives have shown an extraordinary willingness to send representatives all over the world to get ideas for major and minor improvements. With a high degree of organizational solidarity, they can guide issues through long periods of nemawashi , arrive at decisions in their interest, and mobilize personnel to achieve these goals. Buoyed by rapid growth rates and optimism about Japan's future, backed by the banks and in turn by the government, the leaders of the largest firms in Japan have been willing to stake out initiatives as bold and ambitious as any in the world.