Emerging Management and Organizational Practices

Japanese companies have lost their competitiveness since the asset-inflated bubble economy burst in the early 1990s. They were dragged down by the three excesses of overcapacity, overemployment, and overinvestment after they had made an excessive investment in various business areas at the time of the bubble economy. They had to dispose of these negative legacies of the bubble economy age, but this was a daunting task and they could not move forward. In addition to macroeconomic woes, Japanese companies faced threats from fierce competitors around the world and lost their competitiveness. From the perspective of business strategies, these competitive threats had a more significant effect on Japanese companies’ lost competiveness than the collapse of the Japanese bubble economy (Numagami, Kawabe, and Kato, 2010). Overseas competitors acquired a large portion of the global markets that Japanese companies had once dominated largely because they had learned their business and management practices from their Japanese counterparts; for example, it is well known that Dell Inc., a US PC manufacturer, learned the direct-sales model from Toyota.