Section 1: Provide a general description of the company.
Matsushita is one Japanese companies activating in the consumer electronics industry. Launched in 1920, the Japanese giant has revolutionized the world along time through its products, which have traveled globally, because the company has established a global presence. In its incipient decades, Matsushita applied a traditional managerial style, specific to Japanese business, based on the paternalistic, Confucian philosophy, which praised the employees’ loyalty towards their superiors and towards the company, in exchange of consistent benefits that settled a positive working environment within the company. This business philosophy, based on employee loyalty conferred the proper context for an effective and progressive growth for the company for several decades. However, the company’s business philosophy needed adjustments, considering the rough circumstances that marked the 90s as a result of the crisis that caused many Japanese traditional companies to lay off employees, despite their business philosophy of preserving employees until their retirement period. In this context, Matsushita brought the occidental business philosophy based on work performances, and not on seniority, which was the traditional element that influenced the employees’ remuneration system, and it is currently adjusting its business philosophy to the actual business trends, being constantly focused on its global presence.
Section 2: Define the central issue of the case.
Basically, the examined case study is concentrated on spotting the adaptation of Japanese organizational and business culture in different periods of time that required change. Speaking about a traditional Japanese system, enrooted in an indoctrinated business philosophy with a precise functioning mechanism, the initial organizational and managerial change proposed in Matsushita by agents of change such as Kunio Nakamura, a manager who was exposed to overseas business practices, was received with reluctance (“Matsushita (Panasonic) and Japan’s Changing Culture”). As such, Nakamura proposed the new remuneration system, based on three payment options: (1) lifetime employment, subsidized company housing and services plus free organizational events and generous retirement bonus; (2) a guaranteed retirement bonus, but higher staring salaries, and cheap housing provided by Matsushita; (3) no retirement and subsidized services, but a higher starting salary. Only 3% of the employees chose the third remuneration option, but 41% applied for the second option (“Matsushita (Panasonic) and Japan’s Changing Culture”). This organizational change and the changes that followed required significant time for being implemented. This situation indicates the resistance to change, marked by the fear of new, but also by a power game between the old and the new authority (Boonstra, 2008).
Section 3: Define the company's goals.
The company’s main goal is to stay competitive and this often requires the adjustment to change, imposed by the global business environment, in which Matsushita is a significant player, on the consumer electronic market. Another company goal is to keep its employees satisfied, knowing that this would bring notably growth for the company. Nevertheless, in the recent period, in the context of another economic crisis that marked the Japanese economy in the beginning of the 21st century, this goal was a huge challenge that the company could not safeguard, being forced to apply layoffs, including in the managerial levels (“Matsushita (Panasonic) and Japan’s Changing Culture”). Aligning to competitive goals, the company also aims to accommodate the change slowly within its traditional conceived business philosophy, integrating the change in its organizational culture, while still maintaining its classic business model.
Section 4: Identify the constraints of the problem.
The main constraint that stays in the way of adjusting to the change imposed by the international business environment is the general resistance to change that is a manifestation of insecurity from the employees and management system that accustomed with the seniority remuneration system and enjoys the benefits that Matsushita traditional business model offered them, such as lifetime employment, retirement bonuses or organizational subsidized houses. Although reluctant, Matsushita’s employees have gradually adjusted to the changes imposed by the continuously evolving business environment, although the transition period was slower. Another constraint which with the company confronted along time is marked by the global economic crisis and instability periods, which hindered it from effectively implementing its organizational changing plans.
Section 5: Identify all the relevant alternatives.
One alternative to applying organizational change is that Matsushita could have continued with its traditional, Confucian business model. Likewise, the company could adopt an abrupt, sudden organizational change and impose its implementation throughout its organizational structures. Another solution would have been to dismiss the employees who were reluctant to change and replace them with new employees, with new business philosophy, progress and career driven. Speed-up the changing process by allowing employees increased benefits for motivating them to embrace the change.
Section 6: Select the best alternative and provide a justification for the selection.
The final solution is the best alternative to the changing process that Matsushita because it influences the employees to see the benefits of adjusting to organizational change for themselves, without imposing the change, aligning like this the company’s objectives with the personnel rewarding needs and expectations (Martin, 2009).
Section 7: Develop an implementation plan.
- Decide on the changes that need to be implemented;
- Identify the sought organizational benefits brought by the organizational change;
- Identify how employees could benefit the change;
- Create an internal communication plan to prepare the employees for the change, letting them know what are the benefits that a change would generate for them;
- Create formal and informal project management groups meant to integrate changed organizational processes in the company and test them for a determined period;
- Officially announcing the organizational change and what it implies, providing sufficient details regarding the changed working procedures or business vision and assigning key contact persons and leaders for offering more details about the change to employees who would need more information and preparing the employees to cope with the change (Giddings, 2006);
- Start working with the new policies and procedures, letting room for new changes to be inserted, demonstrating a flexible organization (Skorstad & Ramsdal, 2012).
References
Boonstra, J. (2004) Dynamics of organizational change and learning. Chichester: John Wiley & Sons, Ltd.
Giddings, S., L. (2006) Understanding the behaviors experienced by individuals during an organizational change effort: A Delphi analysis utilizing the five stage grieving model. Michigan: ProQuest.
Martin, J., W. (2010) Measuring and improving performance. New York: Taylor Francis Group, LLC.
Matsushita (Panasonic) and Japan changing culture. Course material.
Skorstad, E., J. & Ramsdal, H. (2009) Flexible organizations and the new working life: a European perspective. Burlington: Ashgate Publishing Company.
