By the time globalization gained momentum, Japanese companies were the leading multinationals in industries, such as electronics, computers, automobiles, and others. This was as a result of competitive strategic operations they had implemented that enabled them to cut the cost of production and maximize their revenues. This enviable growth made multinationals in mainland China imitate their operations and strategies in several ways, including The Japanese Multinationals achieved growth through output expansion at home, based on labor wage and hours per work unit. This is one strategy China has imitated where many of its electronics industries exercise payroll per work unit. This has enabled them to produce a large amount of electronics goods that satisfy global market demand.
Japanese multinationals have implemented a “low wage cost and high western prices” strategy. Chinese transnationals have also embraced this strategy. Companies pay according to work output and take advantage of the high population in China and cheap foreign workers, aiming at lowering the labor wages. The finished products are sold at a higher cost, hence maximizing the company’s income.
Japanese multinationals applied the “products quality improvement and cost cutting” strategy for improving operational effectiveness, another area which the Chinese have imitated. This involves a logistic system that cuts the inventory cost and also a total quality system that reduces products defect. In China, this strategy is exercised more in the automobile industry and involves the installation of systems for detecting defects in the production process.
Many of the Japanese multinationals establish their operating segments in less developed countries where labor is cheap. For instance, the Japanese Toyota Corporation locality in East Asia enabled it to use cheap human and capital resources which have led to a reduction of costs, hence higher profits. Likewise, China multinationals have adopted this strategy and have moved branches of their major industry, such as automobile, to Asian and African countries where resources and labor are cheaper.
The majority of Japanese multinationals both in the motor and electronic industries apply a “marginal product differentiation strategy” in their production process, a strategy that most Chinese multinationals have adopted. This strategy is aimed at final product differentiation from other products in the market. The Chinese electronic industry, particularly the mobile industry has embraced this strategy, in which it produces its product in different forms. This has enabled it to absorb more market demand and meet the people’s different tastes, hence expanding its market globally.
Japanese multinationals use their local supplies in all their operating segments, in ventures within and outside the country. This strategy has been mostly observed in the management of companies and technical operations within the companies, a move that has been attributed to the efficiency technical capability, and productivity of Japanese industries. However, China has marched up with this operation and has provided its companies outside the nation with total management programs. For instance, Wu Yi, a Chinese road construction company, its operations in other countries is managed by Chinese professionals in all departments allowing the locals in these countries to provide manual labor only. This is aimed at maintaining high-efficiency production levels.
Japan’s Asahi Company integrated its technology and market information, a strategy that was aimed to keep off competitors. The majority of Chinese multinationals have imitated these Japanese operations by focusing on the perfection of hardware and software technologies in integration with the vision of the corporate governance in the reinforcement of the development of its total technology.