Organizational Learning Mechanisms for Corporate Revitalization

The Japanese economy has lost over a decade of growth since the bursting of the bubble economy in the early 1990s: from a high of 38 915 yen, in 2003 the Nikkei stock average fell below 8000 yen for the first time in 20 years. The attempts by businesses and the government to revitalize the economy have met with little success, and many have only resulted in cosmetic modifications being made to business and industry. For example introducing performance-related pay without accompanying changes in business philosophy and the paradigms behind human resource practices and employee-employer relationships has given the illusion of progress rather than bringing about fundamental change. The Japanese business model, characterized by a stable long-term relationship between employee and employer, and between businesses and their suppliers, partners and customers, is no longer viable. Companies must rethink the manner in which they do business and develop a new model that can respond to the dynamic global business environment while maintaining traditional strengths such as organizational commitment, loyalty and emphasis on quality. The key to recovery will be this balance of change and continuity.