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Why Japanese companies do so many different things

davidoks.blog

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Re: Why Japanese companies do so many different things

#71

Post by xp84 »

toast0 wrote: post #12

> American firms, for example, tend to prioritize focus above all else: it would be bizarre for an American paper mill to also operate a concert hall and an airport catering business I don't think Kimberly-Clark ever opetated a concert hall, but they did run an airline (Midwest Express) and K-C Aviation was an airplane servicing firm. It's not that American companies don't operate in diverse businesses. Maybe they're…

Yeah, we actually had our own era of “conglomerates” - they were very big from the 1960s through 1980s. Companies like ITT, Cendant, Gulf+Western, GE — formed from tons of acquisitions, sprawling across completely unrelated industries.

At one point in the 1990s, you could buy a toaster from the same company that makes airplane engines, MRI machines, and produces “Saturday Night Live.” And you may have financed that toaster through their financial arm (GE Capital). Eventually the many lines of business were spun off from companies like this.

What came next was a very different type of consolidation - companies like Comcast, Chevron, and the current “AT&T” who went from being regional players to buying as many other companies just like themselves in order to maximize economies of scale - they’re huge but really just do one or two very closely-related things.

Re: Why Japanese companies do so many different things

#72

Post by Aunche »

pstuart wrote: post #65
griffinkelly wrote: post #14

Earlier quoted context omitted.

One other interesting fact about Japanese companies is that their CEOs get paid far far less than Western companies. Checkout this article that talks about it: https://www.theatlantic.com/business/2010/07/5-lessons-of-ja... edit: added article.

As it should be. The pay gap from CEO to bottom tier worker is now obscene (21 times in 1965 and ~285 today). It's the foxes looking after the henhouses.

Not sure why the left cares so much about CEO to work pay ratio these days, especially when Marx himself recognized that ownership was the true source inequality. A CEO is just a really well paid worker. Even CEOs who become billionaires do so from capital appreciation more than compensation.

Re: Why Japanese companies do so many different things

#73

Post by djeastm »

busterarm wrote: post #55
jdw64 wrote: post #7

It’s always fascinating to see how Westerners idealize Japan on platforms like HN. It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality. This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is tha…

[flagged]

I'd be interested in hearing your experiences. Are we talking mob association? Arm-breaking thugs?

Re: Why Japanese companies do so many different things

#74

Post by MrBuddyCasino »

sashank_1509 wrote: post #44

I might be gatekeeping, but I consider a mark of actual healthy capitalism, to be creative destruction, the biggest companies of 1 generation are destroyed by the next generation and the churn keeps going on. Nothing ever lasts except the system. By this criteria, in the entire world, only US and UK seem to do capitalism properly. Whether the current age of tech companies survive till 2050s is to be seen, (we are alr…

And even US and UK are very questionable by now. The last time they had something resembling capitalism was sometime before Roosevelts New Deal.

Re: Why Japanese companies do so many different things

#75

Post by layer8 »

jandrewrogers wrote: post #40
etempleton wrote: post #25

My experience in American organizations is that products and services need to not just make money, but make a lot of money. There is zero appetite for things that make a little bit of money relative to the cash cows of the company. You could say this is in part focus, but it is also based on internal accounting. Small product lines are saddled with total company overhead costs even if they do not apply to said produc…

> zero appetite for things that make a little bit of money For obvious reasons, the expected rate of return needs to clear the hurdle of the risk-free interest rate. This puts a pretty high floor on activity that is "worth doing". This is a mechanism by which the phenomenon of ZIRP diversifies economic activity.

The risk-free interest rate is a pretty low floor for returns though? At least in my experience with expectations of what counts as a profitable project.

Re: Why Japanese companies do so many different things

#76

Post by sevenseacat »

toast0 wrote: post #18
hennell wrote: post #11

I'm not sure I'd say a company that makes ceramic toilets also making a tool for memory chips... which is also ceramic is really 'different things'. They're clearly a ceramic company. Different tolerances, but similar expertise. Now the paper company got into the hotel business seems a far better example. No idea how that happens.

> Now the paper company got into the hotel business seems a far better example. No idea how that happens. That's easy. They have corporate visitors to their corporate offices and the available hotels are insufficient. They decide to just make their own hotel. There are many corporate campuses with an embedded hotel. Some run by the corporation itself, some with significant management contracting with the corporation,…

And don't the Japanese railways make all their money from the real estate around their lines, or some such?

Re: Why Japanese companies do so many different things

#77

Post by wotsdat »

jdw64 wrote: post #7

It’s always fascinating to see how Westerners idealize Japan on platforms like HN. It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality. This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is tha…

[dead]

Re: Why Japanese companies do so many different things

#78

Post by busterarm »

djeastm wrote: post #73
busterarm wrote: post #55

Earlier quoted context omitted.

[flagged]

I'd be interested in hearing your experiences. Are we talking mob association? Arm-breaking thugs?

What is this, the 1970s?

No, far more basic negligence and corruption. Negotiating deliberately bad contracts and collecting bribes. Diverting hours and cushy roles to union reps and their personal friends. Overwhelmingly siding with management against employees (which is what you think they're going to be there NOT to do). The kind of day to day petty shit that over time makes your job intolerable.

Oh and that one time in the retail baker's union (BCTGM) when they defended and successfully reinstated an employee who was terminated for _literally urinating in the cake batter every day for months and feeding it to people_ because it wasn't explicitly stated in the contract that they could use video evidence to terminate people.

If your union is protecting people who commit literal fucking crimes and dangers to public health, no, just fuck you and your union.

Re: Why Japanese companies do so many different things

#80

Post by andrewmutz »

jdw64 wrote: post #7

It’s always fascinating to see how Westerners idealize Japan on platforms like HN. It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality. This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is tha…

Japanese and American companies have different purposes.

In Japan the corporation primarily provides stable income and employment for society, and secondarily returns on capital invested. In America, corporations primarily provide returns on capital invested and secondarily provide stable income and employment.

This shows up in the data too. Japanese corporations are less likely to go out of business but provide worse investment returns. American corporations provide better investment returns, but the citizens have to deal with layoffs.

Most citizens would prefer stability to growth, but I think the tradeoff has a lot of downstream consequences.

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