End of Lifetime Employment in Japan Harvard Case Solution & Analysis

Lifetime employment is one of the most controversial and distinctive aspects of Japanese management. But in Risutora (restructuring) is caused by the economic downturn in Asia in the late 1990s, two million or more jobs are to be cut off, driving the unemployment rate from 4.8 percent to 8 percent. Why must lifetime employment declined? Practice makes for rigid labor market, lack of money (as with Nissan), which causes a sharp decline in R & D, dysfunctional corporate policy, and the difficulty of trading partners in the international business community. In addition, the so-called staff loyalty is an illusion, and that outsiders view as labor management harmony is not more than the absence of labor mobility. Mobility is further undermined Japanese accent in training people in specific organizational practices, in a variety of jobs, not universal and marketable skills. The Japanese economy needs greater mobility in their labor market. If Japan can not develop more fluid labor market, the recession will last for many years. "Hide
on Nakato Hirakubo Source: Business Horizons 6 pages. Publication Date: November 15, 1999. Prod. #: BH039-PDF-ENG

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