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Transformation of an Internal Model Under Crisis Management

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  • Asako Takada

Abstract

It is generally said that Japanese companies are weak in handling the unexpected events. As a result of the Hanshin-Awaji earthquake of 1995,1 the main plant of Sumitomo Electric Industries (SEI) was severely damaged. Most logistic lines and telecommunication systems were disrupted. In spite of the chaos, SEI successfully managed the information disruptions and created a new information network through the office electronic network system (J-NET). As a result, almost 80 percent of the operating functions of SEI were recovered within just two weeks. During this crisis, the board decided to delegate most of its authority of decision making to the front-line employees. This paper presents the results of analyzing nearly 320 electronic J-NET logs from a six-week period following the earthquake. Analyses show that employees exchanged their internal models of the company's actual situation through the J-NET. Moreover, the cohesiveness of the employees became stronger during the crisis.

Suggested Citation

  • Asako Takada, 2000. "Transformation of an Internal Model Under Crisis Management," Japanese Economy, Taylor & Francis Journals, vol. 28(3), pages 32-68.
  • Handle: RePEc:mes:jpneco:v:28:y:2000:i:3:p:32-68
    DOI: 10.2753/JES1097-203X280332
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