compare and contrast business systems within Japan and China

The following essay will compare and contrast business systems within Japan and China. To begin with a short theoretical description of a business system will be given as well as stating key elements in Japan and Chinas business systems. Relevant theories and use of comparative country and corporate examples will be used for support throughout the essay. One will use 3 areas for contrasting and comparing the different business systems, firstly the nature of the economic agents such as firm ownership, shareholder control and corporate governance will be analysed, secondly the way in which firms connect and develop relationships with each other within the same markets or industry’s and thirdly the coordination within the firm, how the activities are coordinated and controlled these areas clearly distinguish between business system.

To begin with one must understand the theoretical understanding of a business system, which according to Whitley, (2000) business systems are distinctive configuration of firms and markets, which have become established in particular institutional context as the dominant ways of structuring economic activities. Whitley describes the main theme of a business system as an approach that differences in societal institutions that encourage particular kinds of economic organization and discourage others.

The Japanese economy is one of the strongest in the world home to some of the most famous names in business such as Mitsubishi, Toyota, Nissan, Honda and many more. Throughout Japan there is no standard type of firm but the variance is much smaller to that of western countries. The major firm type in Japan is the Keiretsu, which literally means “a series of affiliations” which in fact resembles that of a super mega firm, excluding outsiders, allowing for no new completion and essentially creating a monopoly (Japanese123, 2010) A Keiretsu comes in two different forms vertical and horizontal, but this will focus more on the vertical as it

Bibliography: Ambler, Tim, 1994, 'Marketing’s third paradigm: Guanxi ', Business Strategy Review 5(4), 69- 81. Anderson Gerald H, GHA, 1991 Bird, AB, 2001. Encyclopedia of Japanese Business and Management. 1st ed. Lonson: Routledge. Page 92-93 Berglof et al , EB, 1992 Cadbury, AC, 1992. The Cadbury Report, titled Financial Aspects of Corporate Governance . 1st ed. UK: The Cadbury Report. Freidman , DF, 1988. The Misunderstood Miracle: Industrial Development and Political Change in Japan . 1st ed. U.S: Cornell University Press Japanese-Style Partnerships: Giving Companies a Competitive Edge - The Magazine - MIT Sloan Management Review KEIRETSU. 2010. KEIRETSU. [ONLINE] Available at: http://www.japanese123.com/keiretsu.htm. [Accessed 01 December 2010]. Perner, Lars, (2010), The Japanese Keiretsu Structure [ONLINE]. Available at: http://www.consumerpsychologist.com/international_marketing.html [Accessed 18 November 10]. Redding, RSG, 1990. The Sprit of the Chinese capitalism . 1st ed. Berlin: De Gruyter. The State-Owned Enterprises of China. 2010. The State-Owned Enterprises of China. [ONLINE] Available at: http://www.sjsu.edu/faculty/watkins/chinasoes.htm. [Accessed 01 December 2010]. Tsang , EWK, 2002. a. Internationalizing the Family Firm: A Case Study of a Japanese Management - strategy, organization, levels, system, style, examples, Weidenbaum, M. 1996. The Chinese Family Business Enterprise, California Management Review, 1996, 38 (4): 141-156 Whitley, RW, 1992. Business Systems in East Asia firms, market and societies. 1st ed.26 London: Sage publications Zhao et al, MZ, 2007. The Corporate Governance Model of Japan: Shareholders are not Rulers, [Online]. 1, 3-4. Available at: http://finance.wharton.upenn.edu/~allenf/download/Vita/Japan-Corporate-Governance.pdf [Accessed 23 November 2010]. Appendix Figure 1 (Perner, 2010) Figure 2 (Steers, 2010)