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VIEWPOINTS : Japan's Business Prowess More Myth Than Reality : Luck, U.S. Missteps Helped a Competitor Capitalize on Our Inventions

June 14, 1987|WARREN BENNIS | WARREN BENNIS is a professor of business administration at University of Southern California and was a co-author of "Leaders," published by Harper & Row in 1985.

In recent years, we've been beaten at our own game by the Japanese so often and so decisively that we have begun to think, as a plethora of worshipful books have suggested, that they are not only better and smarter than we are, but have some inscrutable and devious powers.

In fact, as the current recession in Japan demonstrates, its industry is just as susceptible as our own to market volatility, economic instability, general and specific bad judgment and international tremors.

On top of that, the actual circumstances of Japan's ascension in the international marketplace belie the elaborate mythology that has attended the ascension.

First, the Japanese were blessed with good luck and good timing, more than any kind of manufacturing or marketing genius. As it happened, American industry had fallen into the hands of organization men and bottom-liners about the time Japan got its industrial house in order.

It was our missteps as much as Japan's right moves that led to our decline and its rise.

Detroit Got Complacent

In Detroit, automotive industry leaders had gotten complacent and careless. The inventors of the early days had been replaced by mechanics, who were content merely to tinker with their existing models rather than create new models and thereby create new markets.

Indeed, Detroit shifted its focus from products to profits, figuring that as long as the bottom line looked good, everything was OK. It wasn't until the bottom line turned red that the auto makers realized that things were anything but OK. By then, of course, the snappy, efficient and cheap little cars from Japan had taken over the nation's highways.

They were in , because not only were they less expensive to operate and better made, they were fun to drive. The invasion of Toyotas, Datsuns and Hondas was completed before Detroit even noticed it.

In the same way, Japan's steel industry triumphed over our own because it was less concerned with the bottom line than with innovation.

The Japanese cranked out better and cheaper steel because they developed new means of production, while America's steel industry tried to get by with outdated methods and machines.

It was the same story in the electronics industry. Sony, Hitachi and Toshiba perfected what Zenith, Motorola and RCA invented. Again, the American fixation with profits resulted in inferior products and lots of problems.

Today, America, the world's industrial behemoth, exports more raw materials and agricultural products than manufactured goods to Japan, while Japan exports almost nothing but manufactured goods to us. It even exports steel to the United States--once the steel mill to the world.

Given this bizarre state of things, we naturally import much more ($85.5 billion in 1986) than we export ($26.9 billion), which creates huge problems not just for American industry but for America itself. This country is the world's biggest foreign debtor, and the debt is being steadily compounded by the trade deficit.

Embellished the Myth

To save face, as much as anything else, the American corporate Establishment began to embellish the myth of Japanese superiority with the myth that the Japanese were taking unfair advantage of us. Ever chauvinistic, Congress responded by pushing along protectionist legislation.

In his State of the Union message in January, President Reagan promised us "proposals to enhance our competitiveness." Everyone assumed that he meant measures to help us tend the national store better, but as it turned out, he meant measures to shut down the Japanese store, as more recent moves have shown.

Allegedly in retaliation for Japan's cheating on a semiconductor trade agreement, Reagan imposed $300 million in sanctions on Japanese electronics exports to America in mid-April, although $51 million of that total was lifted last week.

But as happens frequently now, the American people seem to see things more clearly than their political and business leaders do.

A poll conducted early this year by Yankelovich, Clancy Shulman for Time magazine found that, by a 53% to 25% margin, people believe that Japanese corporations are better managed than American corporations. In addition, it found that 68% think that Japan dominates world markets because "they produce quality products for a good price."

In other words, instead of attempting to win the game by loading the dice, we simply should play the game better.

The academicians and theorists who continue to insist that American industry can prosper by adapting itself to the Japanese mold are as far off the mark as the politicians.

American industry not only shouldn't but couldn't emulate Japanese industry if it wanted to. All the rhapsodizing about close-knit "families" in Japanese factories notwithstanding, Japanese industry is organized along highly autocratic lines.

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