Strategic Management: Formulation and Implementation

Recent Trends

In recent years, two management trends that seem significant in response to international competition are the adoption of Japanese management practice and the renewed efforts to achieve excellence in product and service quality.

Theory Z management. Given the recent success of Japanese companies, management writers have been carefully analyzing Japanese organizations. The most notable publication in this area is Ouchi’s Theory Z. Ouchi showed that American and Japanese firms are essentially different along seven important dimensions:

  1. length of employment
  2. mode of decision making,
  3. locations of responsibility,
  4. speed of evaluation and promotion,
  5. mechanism of control,
  6. specialization of career path
  7. and nature of concern of the employee.

Ouchi’s theory Z proposes a hybrid form of management that incorporates techniques from both Japanese and North American management practices. In a very short time, his ideas have been well received by practicing managers.

Achieving excellence. In their best seller on America’s best-run companies, In Search of Excellence, Peter and Waterman found eight basic principles that reflected these companies, management value and corporate culture. The eight principles of excellent companies are:

Application of these “principles” in the best-managed companies tends to produce an environment that fosters entrepreneurial pursuit of new opportunities and adaptation to change.