Overseas Transfer of Japanese Managerial Skills and Human Resource Development: Small Business s Expansion in China
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1 Overseas Transfer of Japanese Managerial Skills and Human Resource Development: Small Business s Expansion in China. Introduction Sun Yan* By considering the adaptability and applicability of Japanese employment system on a basis of previous comparative studies, this research attempts to explore a proper direction for the transfer of Japanese employment system overseas making discussions along with the development of exampled small businesses. In recent, the overseas transfer of Japanese corporations has attracted a lot attention and it is popular and necessary to do researches on seeking proper routes for Japanese employment system by examining its compatibility. Hot debate are done mainly on subjects over recruitment and development of IHRM (International Human Resource Management), the problem of excellent human resources appointment to local executive positions, conflicts of sense of values and cultures between Japanese employers and local employers, as well as the problems of local laws such as industrial relations, labor laws and labor market. Besides hot discussions there are three outstanding achievements in searching for the truth of Japanese employment system made by David Marsden, James Abegglen, and Ronald Dore on behalf of each period. Of course theories of the three stand for different periods, consider different fields or even view from different perspectives, but they also show factors in common, and the meaning of comparative study done by the writer before lies in their key concepts on Japanese employment system: common destiny and ual custom. Therefore, form the viewpoint of human resource management, and by taking conclusions drawn from the comparative research based on the three researchers mentioned above, a case of Japanese companies transfer to China has been chosen as a research example in this paper: the expansion of Yanmar s 2 subors in China. Numerous discussions have been done on large corporations and conclusions are made in difference fields, and whether it is applicable to small and medium enterprises comes to an interesting problem. Thus, a group of six subors of Yanmar is chosen here 3 * Sun Yan, Department of Economics, Shiga University, Japan. smilesun527@yahoo.co.jp A comparative study has been done and published by the writer based on the theories of these three researchers. David Marsden, A Theory of Employment System: Micro-Foundation of Social Diversity, Oxford University Press, USA, 999. J. C. Abegglen, The Japanese Factory: Aspects of its Social Organization, Glencoe: Free Press, 958. R. P. Dore, British Factory-Japanese Factory: The Origins of National Diversity in Industrial Relations, University of California Press, About Yanmar: 3 Six subors chosen by Yanmar in China: ) Enomoto Qingdao Machine Co., Ltd 2) Qingdao Precision Instrument Manufacturing Co., Ltd 3) Dongrong Metal Products (Qingdao) Co., Ltd 4) Qingdao Oida Works Co., Ltd 5) Kawamura Jinlong Machinery Co., Ltd 6) Takano Precision Products Manufacturing Co., Ltd
2 because they are in line with the two above-mentioned characteristics of Japanese employment system, and the transfer into Chinese market is coming into existence. 2. Research object s selection and data collection 2. Selection of the research object In the year 203, a group of six corporations have expanded into Chinese market as subors of Yanmar Corporation 4 (the headquarters of 6 corporations are also subors of Yanmar Corporation in Japan). Due to the internationalization strategy of Yanmar and the purpose of reducing costs, these six companies that make important parts of engines have been chosen from Yanmar s 4000 subors in Japan to establish factories in Qingdao, China, and Yanmar invests 9.9% to each of the six (each of them owns 80.% of total the investment). Though each of them is a subor of Yanmar (China) and provides main products to Yanmar, they can do business with other countries across the world as well as other companies in Chinese market. Factories of the six are established one by one in a large piece of land about 400 meters far from Yanmar s. And in this way, these suppliers can be regarded as a large company to certain content. At the same time, however, all of them can do their own business freely as independent individuals, where the greatest advantage of this particular strategy of expansion lies. These supply companies not only transfer their products and technology but also the Japanese employment system. And this research will take the biggest one of the 6 called Enomoto as an example and do detailed empirical analysis. 2.2 Available data and research methodology All of the data used in this research is primary source material from the person in charge, especially that of internal, and the writer has been to Qingdao twice for field survey. The first time was on November, 203 and the second time was on February, 204. Thus this research will ensure its quantity and uniqueness of data, and what s more, witness the growing with the company. These primary materials and interview made with those who are in charge of the six corporations (China) will be examined, reorganized and analyzed in order to reach definitive conclusions. In addition, instead of listing data directly, this research will focus on the layout of the factory and its production line first, and then recruit staff according to the needs of staff by the assembly line. In accordance with this kind of approach, the fact of carrying out Japanese employment practices through its transfer process will be proved again 3. Empirical Analysis Enomoto (Qingdao) is the largest corporation of the six at the beginning as this research started and in the business relation with Yanmar for long. Thus Enomoto is chosen here as a preventative for detailed data analysis.
3 3. Process of establishment The process of Enomoto s establishment can be summarized in Table as follows. The company established on March, 203. Then the factory was built on August and machines were placed on October. After hiring workers for both sales and production department, machines came into running for production in the following year. TABLE Process of establishmentof Enomoto in China Year Invent Company established Factory built Machine placed 203. Employment of the sales department Employment of the production division Machines started running Enomoto mainly products hydraulic cylinder for tractors, hydraulic cylinder for construction machines, and hydraulic cylinder for combines in Japan and supplies nearly 99% to Yanmar across the whole country. In China, its main products are tractor hydraulic cylinder and lift cylinder. Though all of the six can do business with other countries across the world or other companies in Chinese market, Enomoto along with others are only trading with Yanmar at present. 3.2 Staffing Japanese administration is well acknowledged for its long-term employment and seniority-based pay system across the world. Therefore, how long will the be is a significant problem in recruiting. Table 2 and Table 3 show the situation of recruitment and staffing in sales and product department and what should be paid enough attention is the employment relationship with the company, which tells the difference between way of Japan and China. () Staffing in sales department There are 4 persons in sales department, two men of management and two women office workers. The general manager is Japanese. He has been directly appointed by the head office in Japan and is in charge of overall management of the company. Of course his adopts the way of Japanese employment. The plant manager is Chinese. But he was employed in Japan and then dispatched to China after adopting and trained at the headquarters of Japan. Though he makes a short with the company, he is guaranteed as a long-term hired employer.
4 TABLE 2 Staffing in sales department Position Persons Duties Hiring process Contract type General Manager (male) overall management of the company directly appointed by the head office in Japan long-term Plant manager Cashier Office worker (male) (female) (female) pre-production: business when production starts: production and sales interpretation and cashier procurement and general office work dispatched to China after adopting and trained at the headquarters of Japan locally hired locally hired 2 years (long-term relationship) 2 years 2 years There are also two ladies in the office, a cashier and a normal office lady. They are both hired in Qingdao with a for 2 years and be paid according to local wage standard. Accounting and cashier cannot be in charge by one person according to the Chinese law, so a one-year is made with the accounting firm at present. (2) Staffing in production department The product department is composed of 6 workers, 4 men for production and running machines, and 2 women for assembly. Local hiring is done due to the layout of factory and production line, and focused on technicians of expertise instead of any education background. What s more, the two female workers are only required to ensure their attendance. (See details in Table 3) Department Production department Assembly department TABLE 3 Recruit plan due to the production line Recruitment Workers Duties Conditions of employment a. trained technician with a. person in working charge of experience production line b. graduates of 6 b. machine technical (male) operator vocational c. person in schools charge of c. trainees production studied at the head office 2 (female) assembly of parts women who can ensure attendance Contract type local hiring: 2-year local hiring: 2-year Trainees present a typical Japanese way of employment. Two or three trainees are accepted by the head office every 3 years; and after the 3-year-training, one of the best will be sent back to Qingdao Factory to work as a leader in production department.
5 Here, what deserves discussion is the different understanding of the same word:. In Japanese, it means the sense of responsibility besides simple employment relationship, while in Mandarin; it is close to a kind of monetary relationship that workers only do what is required in the. 3.3 Process of recruitment Recruitment process seems simple. Its preconditions of recruitment include ) the layout of the factory and 2) the placement of machines. And employment practices come to be the theory principle. Based on the layout of the factory and placement of machines, employment plan is set and wages are determined. Then, employment will be done in the labor market and through internet or newspaper. And finally s are made with labors. The process of recruitment is shown in the following figure (Figure ). Figure Process of recruitment layout of the factory & placement of machines setting employment plan & salaries recruiting in the labor market making with the labours 4. Summary and Conclusions Taking account what has been discussed above into consideration, conclusions evident itself that it is necessary to make effort for the relocation of production and quality control techniques, and human resource development for fixing to the local management technology is important. It is because that instead of the sense that there is low-cost labour in China, factories are facing with a fact of labour lack. In common, when the topic of labour lack comes into sight, is it natural to consider it as a lack of skilled persons, on the contrary, positions whoever can adapt to, are hard to hire right workers. In addition, the local condition shows that workers cannot cope with the 24-hour operation. Not only Enomoto but other 5 corporations take on a way of recruitment according to the machine placement and layout of the factory. However, what is this kind of employment system going to be remains a question. Is it a way of Japanese or Chinese? Otherwise is it a combination of the two? As future tasks, there are two points should be mentioned. Rather than recruit workers due to factory site, it is necessary to build a human resource development system based on the long-term vision of the company. On the other hand, enough attention should be paid to the local middle management: their job satisfaction and degree of commitment to the company, because they are actually in charge of the company instead of the head manager.
6 References A.W.Harzing, Who s in charge? An empirical study of executive staffing practices in foreign subsidiaries, Human Resource Mangement, 200, Vol.40, No.2, pp David Marsden, A Theory of Employment System: Micro-Foundation of Social Diversity, Oxford University Press, USA, 999. J. C. Abegglen, The Japanese Factory: Aspects of its Social Organization, Glencoe: Free Press, 958. JETRO, Japanese companies challenge the Chinese market, JETRO, Personnel strategy and human resources management of Companies expanding in China, R. P. Dore, British Factory-Japanese Factory: The Origins of National Diversity in Industrial Relations, University of California Press, 973. T.D.Keely, International human resource management in Japanese firms: their greatest challenge, Basingstoke: Palgrave Macmillam, T.Watanabe, Adaptability and applicability of Japanese employment and production system: the Japanification of Honda in China and related corporations, Osaka Industry University Management Journal, 2007, Vol.8, No.2, pp
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