Patterns of Control within Japanese Manufacturing Plants in China: Doubts about Japanization in Asia

There remains a paucity of research on Japanese investment in Asia, especially on Japanese management practices in China. The paper draws predominantly on interviews with Chinese managers in 31 Japanese wholly owned and joint‐venture manufacturing plants. In order to account for any differences in the perception of operations between Japanese and Chinese managers, interviews were conducted with Japanese managers in three case‐study plants. The purpose was to examine the structure and pattern of managerial control in different locations and industries, and with different patterns of share ownership, size and age of investments. The paper argues that the patterns of control in Japanese manufacturing investment in China are not unique, and as a consequence call into question much of the current conventional wisdom concerning the internationalization of Japanese management practices. Instead of Japanese seeking to maintain strong control over overseas plants and attain high degrees of ‘Japanization’ (a term used to indicate the dynamics of the transfer process), a complex and varied array of patterns of control are identified. On the one hand, production appears highly Japanized, but personnel management is not. On the other hand, Japanese multinationals make investment decisions that necessitate ceding a high degree of control to local managers. Moreover, it is shown that such ‘localization’ of control is willingly ceded, if not actively sought, by Japanese multinationals