The Japanese industrial presence in the USA: trading one source of friction for another?

Article Abstract:

The capture of a larger market share by increasingly competitive Japanese firms is one of the long-term consequences of Japanese manufacturing investment in the US. Official US policy toward foreign direct involvement (FDI) is 'neutrality with encouragement': Japanese companies are welcome in all sectors except defense-related and information technology industries. The effects of an inconsistent Federal policy are enhanced by the division of power between state and Federal bodies and by aggressive competition between states to attract industry. The total Japanese FDI has grown from $7.7 billion in 1981 to $23.4 billion in 1986. Although the manufacturing investment accounted for $3.02 billion of the total 1986 FDI, projections indicate annual growth rates of 15% until the end of this century. The trade deficit and decline of the dollar will contribute to sustained growth in Japanese manufacturing investment.

United States, Foreign investments

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How the Japanese account for long-term risk: some lessons for Western companies

Article Abstract:

Risk-management, decision-making and capital investment strategies of Japanese and Western managers are contrasted. Japanese firms are internally-driven in that their strategic objectives are closely associated with operational concerns. In contrast, British and American managers labor under external assumptions of profitability imposed by company shareholders. Thus, western firms are most often managed with an eye on quantitative measures or discounted cash flow techniques, especially in evaluating investment projects. Japanese managers, on the other hand, use cash flow extrapolation methods, such as year-by-year projections or one-year return on investment, to guage a project's profitability. Payback and return on investment techniques are more popular with Japanese firms, who use low risk-adjusted discount rates in order to avoid risk assessment drawbacks.

Capital investments

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Multinational management strategies

Article Abstract:

European and Japanese multinational corporations are increasing their foreign direct investment in the US, and they must develop multinational management strategies. European multinationals could make improvements in some areas, including the flow of products, information, and employees across traditional manufacturing boundaries; flexible manufacturing; and product design. Multinational firms should develop an international orientation, and the involvement of top management and the development of personnel policies are essential to a strategic approach.

Europe, International business enterprises, Multinational corporations, Corporations, European

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