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Panasonic and Japan's Changing Culture

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Panasonic and Japan's Changing Culture
Case #2; Panasonic and Japan’s Changing Culture 1. Some of the drivers of the cultural changes in the 1990’s with Panasonic were that Japan’s generation of workers, starting with the generation born in the 1960’s, did not wholly believe in being a “salaryman” and working for a company from when they start until when they retire. After many years, in the 1990’s Japan entered an economic slump that lasted the majority of the 1990’s. Only a few companies at first started to lay off employees and go back on their promises of employment until retirement because the older their workers, although they worked hard, also were less efficient than younger workers were. As the younger generations saw this happening they concluded that loyalty to both the company and workers would not be reciprocated anymore and became less harder working than previous. This undermined the traditional culture in Japan of the central bargains of housing and retirement packages for an employees hard work and loyalty. 2. Japan’s businesses in the future have to operate with more than one plan when they hire workers to effectively. In 1999 Panasonic gave recruits three different choices when they were signed on in employment. They could continue with being given housing, go free to company social events, and buy cheaper services from banks, while also receiving a two year salary bonus when they retired. They could choose to forgo the retirement bonus, while keeping the company housing and be given a higher salary, or they could forgo the retirement bonus and any subsidized services but would be given an even higher salary. In addition to the changes in hiring, companies needed employees to be more risk taking and needed to encourage individuality which is something that was not very prevalent in Japan. Without employees taking risks, companies would suffer and that is what happened to Panasonic as they were forced to close thirty factories, and cut 13,000 jobs while selling “huge

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