Transfer of Knowledge Related to the Management of Department Stores : Research Based on the “ Buyers Manual ” and “ MD Notes ” in Japan

Academic and business literature in Japan on merchandising, a core capability in the management of department stores, describe the “Buyers Manual” edited by the National Retail Merchants Association. This manual was introduced into department stores in Japan, as the nation was recovering after World War II. Among Japanese department stores, Isetan tried to transplant the knowledge presented in this manual by re-editing it into an in-house document entitled “Merchandising (MD) Notes.” Subsequently, both of these sets of knowledge materials were transferred to multiple department stores when top Isetan managers left the company to join competitors. Focusing on these knowledge materials, the author analyzes the transfer of knowledge in the department store industry.


Introduction
1-1. "Buyers Manual" and "Merchandising (MD) Notes" The materials in this study are the "Buyers Manual" created by the National Retail Merchants Association (NRMA), and the "Merchandising (MD) Notes" based on the "Buyers Manual" edited by Isetan, a Japanese department store.
The "Buyers Manual," created by the National Retail Merchants Association (NRMA), concretely describes all of the steps involved in merchandising in the retail industry from merchandise planning were organized into a card book called "MD Notes" for buyers and sellers to carry with them at all times.
These "MD Notes" were utilized in Isetan's merchandising operations such as merchandise planning, merchandise assortment and stock control.
This study attempts to describe the actual situations in which merchandising knowledge was transferred from the U.S. to Japan, and between Japanese department stores, by referring to the "Buyers Manual" and the resulting "MD Notes." This illustrates an example of an active introduction of knowledge from foreign department stores during the recovery period of their Japanese counterparts in the 1950s and 1960s.While the introduction of the "Buyers Manual" from the U.S. by Kosuge of Isetan is noted in the corporate history of Isetan and is widely known among researchers of the department store industry (Fujioka 2004), the existence of the Japanese translation of the "Buyers Manual" published by Depato Shimbun has gone largely unrecognized.This is because the Japanese translation was sold by Depato Shimbun to department stores on a made-to-order basis, and there is no copy in the National Diet Library.During interviews on MD knowledge transfer with department store staff, I came across a copy at the Tokyu Department Store.This manual was available to every department store in the early 1960s, so it will not be a surprise to find that many department stores other than Isetan referred to it.What were the actual situations of transfer of knowledge?
Relationship between managers transfering between department stores and

MD knowledge transfer
In the Japanese department store industry, management staffs sometimes left to work for different department stores as shown in Figure 1 and How was the knowledge described in the U.S.
"Buyers Manual" and presented in Isetan's "MD Notes" transferred when these management people left Isetan?This study attempts to explore the actual situations in which the tangible knowledge materials entitled "Buyers Manual" and "MD Notes" were transferred with an awareness of them. 4Three patterns have been confirmed as regards the movement of management personnel between department stores.First, during the era of high economic growth, railroad companies established department stores in urban areas in quick succession, and mainly in the 1970s, recruited operation leaders from kimono-shops-turned-department-stores.The move of Yamamoto Munekazu from Isetan to the Toyoko Department Store (currently the Tokyu Department Store) was the first example of this pattern.Second, major department stores tend to dispatch managers to their affiliated companies to support management.The move of Yamanaka Kan from Isetan to Matsuya and the Tobu Department Store was intended to reinforce the Isetan-sponsored group of department stores (ADO).Recently, a third pattern has emerged where talented managers are scouted regardless of affiliation or partnerships.The movement of people from Isetan to Matsuzakaya, Odakyu Department Store and others follows this pattern.
It was about 50 years ago that the knowledge provided in the U.S. "Buyers Manual" was introduced into Japan.However, this knowledge transfer is not simply a management topic of the past related to the history of the department store industry.
I believe that this theme has remained alive from the   Japan's department stores were born from knowledge studies carried out by business people who visited department stores overseas in the early days (Takahashi, 1972).Since then, as part of their growth, Japanese department stores have learned about store design from their peers overseas through study tours.Shiraishi and Toba (2003)  The available and effective approaches to knowledge transfer are still being studied (Kim   2002).Previously published work discussing knowledge transfer includes studies by Nonaka and   Takeuchi (1996), Almeida and Kogut (1999), and Leonard and Swap (2005).They describe their approaches to knowledge transfer as follows: "the interaction between implicit knowledge and explicit knowledge occurs on an individual basis" (Nonaka   & Takeuchi, 1996), "knowledge in its context is transferred via human beings" (Almeida & Kogut,   1999), and "Deep Smarts are fostered through guided experience" (Leonard & Swap, 2005)  "to sell produced goods" was being replaced with a new marketing method "to make suppliers produce goods that are sure to sell well."Managing Director Kosuge Toshio toured the U.S. commerce industry in the middle of the "Marketing Revolution," when all the plans and schemes for creating "things that sell well" or "merchandise that sells well" were comprehensively called MD, and every retailer was concentrating wholeheartedly on the establishment of merchandising. 6rchandising is a scientific method for consistently planning, undertaking and controlling every stage from product planning to purchasing, and from the assortment of goods in each department to sales trend analysis.This was a very fresh idea for Japanese department stores in those days.The NRMA "Buyers Manual" was a document that covered all the ideas and steps involved in merchandising in a systematic way.
Kosuge Toshio brought this "Buyers Manual" (assumed to be the 1949 edition) back to Japan, and At that time, Yamamoto was holding study meetings on merchandise categorization almost every day with members of the merchandise division.
Yamamoto is said to have taken the initiative in fostering human resources and inculcating the basic 7 In his paper "Digital information revolution and fashion industry" (Okawa, 2002)   During his first four years at Toyoko, he launched a series of structural reforms. 13This was because in those days, Toyoko was overwhelmed with 13 Saito, N. (1994) original "Buyers Manual" nor the merchandise categorization found in the "MD Notes" provided by Yamamoto Munekazu.

3-3. Transfer accompanying personal moves
The transfer of the "Buyers Manual" and "MD Notes" among corporations was the direct result of Finally I found that the simpler the format of a knowledge material is, the more easily the knowledge is transferred and spread.Isetan's "MD 15 Training in the Manager System conducted as part of business improvement was also given by external consultants.(Saito, 1994, pp.188-190). 16The Japanese version of the "Buyers Manual" was published between 1961 and 1963, while new department stores opened during these years (Odakyu Department Stores, Tobu Department Stores, etc.) and many department stores nationwide purchased it, but how it was took into practice is unclear.It is assumed that, rather than introducing and utilizing merchandising knowledge from the "Buyers Manual," these new department stores placed more importance on inviting ready-to-work human resources into management from established kimono-shop-turned-department-stores such as Mitsukoshi, Takashimaya, and Daimaru to achieve earlier practical operation.
Notes" were so simplified that users were able to keep only the headline of each item in mind.
Employees easily understood what they should do, and the notes were portable so that users could always carry them for ease of reference.Thus, it was a very effective format by which to transfer knowledge.In contrast, Yamamoto Munekazu Genkouroku [Words of Yamamoto Munekazu] used in the Tokyu Department Store also provided standards for categorized merchandising, and was designed as a portable book, but its contents were expressed in sentences, so users were required to read and understand it.I assume that this is why it did not take root in Tokyu Department Store.

Isetan's development of "MD Notes" and its fruits
Isetan created "MD Notes" in-house based on the "Buyers Manual," and here, I will show how these unique "Notes" were developed by comparing them with the original "Buyers Manual" produced by NRMA.
In It is significant that over many years there was no standard for merchandising items at Isetan other than categorized merchandising, and a belief permeated the employees that simply reciting these items and applying them would constitute complete merchandising.Since the idea of categorized merchandising was a concept applicable to every domain of merchandise sold at a department store, and the items of categorized merchandising were universal standards for merchandising, categorized merchandising took root in this company.

4-2. Knowledge taking root inside Isetan
After introducing knowledge about merchandising through the "Buyers Manual" edited by NRMA in the U.S., and creating the "MD Notes" for internal use, how did Isetan enable this knowledge to take root in the company?Examining this process will clarify the fruits of knowledge transfer. 17Yamanaka, Isetan officers were teaching buyers and sales people about merchandising focusing on whether "categorization and organization" were implemented.Employees were instructed to be always aware of categorized merchandising described in "MD Notes" and take action at every stage of the merchandising process from merchandise planning to departmental assortment and the analysis of sales trends and results.
Second, standards of categorized merchandising were applied to each employee layer and position according the range under control, and analyzed and managed.In concrete terms, a large category (for a division) of standards of categorized merchandising was allocated to the head of a division at each store, a middle-size category (for multiple departments) to a section manager or buyer, and a small category (for one department) to the person in charge of a department, and each person was required to plan and manage based on the allocated standards.
Although concrete indices such as actual pricing within each price zone and detailed classification varied with the merchandise field, each employee was able to understand the MD standards for the new division or department immediately, and start activities such as planning, sales, analysis and management after personnel transfer because the dimension and the base MD categorization were common to all the fields.Buyers were required to make merchandising across several departments and stores, but the same standards of categorized merchandising were applied.
Third, dimensions of categorized merchandising such as usage and concern were employed in the analysis in the "Merchandise Information Analysis System."Although the dimensions employed were not unnecessarily detailed, dimensions usually recognized in categorized merchandizing were used, and were absorbed naturally by the employees.
Fourth, departmental development and organizational design were also defined, developed and operated based on the concept of categorized merchandising.Therefore, at a newly opened department store, the concept of the store and the composition of goods were easily understood from the viewpoint of categorized merchandising.At the "baby shop" and "teens shop" opened in the 1950s, for example, the targets were babies and teenagers, and products for these targets were displayed.In the 1960s, demand-driven departments such as "casual clothes shop," "small size shop", and "large size shop" were developed one after another, but the concept and the merchandise composition followed the rules of categorized merchandising, and the employees easily understood them.
Similarly, operational organizations were also defined based on the standards of categorized merchandising, so their target shoppers and the merchandise composition were clearly identified.
For example, the ladies' wear group division of the Shinjuku Store was developing the First ladies' wear department (targeted at young) and the Second ladies' wear department (targeted at young, adults and middle) with the demand-driven category of 'size,' and the Third ladies' wear department targeted at adults, middle and senior.Thus, target shoppers and merchandise assortment were defined with standards of categorized merchandising.This was widely different from conventional organizations based on physical floors in conventional department stores, where, for example, the first floor is the first ladies' wear department and the second floor is the second ladies' wear department.
As described above, Isetan regarded its categorized merchandising indicated in "MD Notes" as a "Merchandising Formula" inside the company, and while applying it to various business scenarios, continued to inherit the established merchandising structure over many years without modifying it. 18

4-3. Difference between Isetan and Seibu
The way in which the fruits of the knowledge about merchandising presented in the "MD Notes" penetrated the Isetan employees can be clarified by comparison with a department store where such knowledge was not introduced.As an example, Isetan is here compared with the Seibu Department Store in terms of designing a new department store concept and developing a department store. 19 18 It is evaluated highly that Isetan placed the essence of merchandising, that is, the concept that a department store should voluntarily carry out merchandise planning and assortment, at the core of its management, and materialized and practiced its philosophy as the "MD Notes," while most Japanese department stores concluded that American methods of merchandising did not fit their commercial conventions and practices and refused to introduce them. 19The case of Seibu Department Store is based on my own experience as an employee of the store and on The first difference is the standardization of the business terms in daily use by the employees.In Isetan, terms related to categorized merchandizing were given a common definition throughout the company.In contrast, in Seibu, terms related to merchandising used among management personnel were very sensuous, and their definitions and perception among employees were inconsistent.
From the late 1980s, for example, Seibu began calling a customer segment "Mature," but this term did not only mean a certain age cohort, but was a multi-sense word.
The The third one is that the managers who moved provided the buyers and sales staff at their new workplaces with practical education using the "MD Notes."For example, Yamanaka established the "PCA School" (Matsuya) and "Tobu School" (Tobu) to assess actual merchandising at actual sales sections, point out problems and suggest improvements.In addition to the transfer of the knowledge materials, practical guidance by managers promoted the utilization of merchandising knowledge.

5-2. Conditions for knowledge transfer
Isetan and Takashimaya discovered the U.S.
"Buyers Manual" almost simultaneously and translated it into Japanese, but they differed greatly in their subsequent continued in-house utilization.
While Isetan proceeded with in-house utilization and incorporated the material in its own "MD Notes," no influence of the "Buyers Manual" can be seen in the manual for buyers currently used inside Takashimaya.What factors have contributed to this difference in the transfer of knowledge?
Certain conditions regarding transfer are assumed to exist inside companies, as there are some differences in knowledge transfer among companies that touches the same or similar new knowledge at almost the same time.Isetan's case implies that the company needed to establish and enhance its sales power with knowledge about merchandising because of managerial situations to which the company was exposed and its position in the industry.In department stores with multiple outlets such as Takashimaya, merchandising leadership was often unstable, shifting to and fro between the headquarters-led system, the store-led system, and the regional division system.However, since Isetan's operations centered on its Shinjuku Flagship Store, cooperation between buyers and sales people was completed between the headquarters and the store front, so it was easier for Isetan than for other stores such as Takashimaya to extend the use of the "MD Notes," and apply them to sales section development and organization design.It can also be assumed that because Isetan retained the head-store-driven system, the merchandise division and the sales division did not become disconnected from each other, so the leadership was neither shifted nor conflicted.This  I assume that the requirements will depend on whether knowledge transfer is achieved and the extent of the transfer ("transfer of materials," "utilization," "rooting," or "affecting").This study collected and analyzed data based on the existence of tangible materials such as the "Buyers Manual" and the "MD Notes" as the criteria for knowledge transfer.If I succeed in obtaining further interviews to determine "the utilization stage", "the rooting stage", and "the affecting stage" for each company, the correlations between the conditions required for knowledge to be transferred and the extent of any transfer may be clarified in detail.

Figure 2 .
Figure 2. First, Yamamoto, Munekazu who had been involved in the internalization of the "Buyers Manual" and the preparation of the "MD Notes," moved from Isetan to the Tokyu Department Store (then Toyoko Department Store) in 1963. 4Later, Yamanaka, Kan moved from Isetan to Matsuya in 1976, and then to the Tobu Department Store in 1990.

Figure 1 .
Figure 1.Movement of executive managers between department stores (1) described the process by which Takashimaya transformed itself into a modern department store, before World War II, by making positive use of the knowledge obtained from overseas department stores mainly by visiting them.With respect to knowledge transfer in the retail industry, there are many studies such as Goldman (2001), which describe, in terms of global marketing, the process by which business styles and management knowledge are transferred when a retailer based in an advanced country branches out into a developing country.With regard to the business styles of department stores, Sekine and Oh (2003) concluded that the transfer of management techniques from Japan to Korea is attributable to technical tie-ups established for opening stores.On the other hand, I found very few studies undertaken from the organizational learning viewpoint and which focuses and analyzes the process by which the recipients of knowledge enhance their management and organizational abilities by introducing this knowledge.From this approach, Nakamura and Asakawa (2004) studied the pharmaceutical and bio industries, and identified four stages of knowledge transfer, namely exploitation, acquisition, digestion, and utilization, which is suggestive for this study.

Figure 3 .
Figure 3 shows the flows of the introduction of knowledge from the U.S., and its transfer inside the Japanese department store industry.The "Buyers Manual" (English version) edited by NRMA was transferred from the U.S. to Japan via two routes.One was its introduction by Kosuge Tanji III of Isetan, and the other was the publication of the Japanese version by Depato Shimbun, the publisher of a trade journal for the department store industry.(Later, Matsuya translated NRMA's "Buyers Manual" (1979 edition) into Japanese in-house to produce a private version.)Inside Japan, Isetan created its "MD Notes" based on concepts presented in the "Buyers Manual.""MD Notes" was transferred to other department stores, and its promptly instructed Yamamoto Munekazu (then Senior Manager of the Merchandise Division) and Yamanaka Kan (then Section Manager of the children's clothes department) to translate it into Japanese.Furthermore, these two managers focused on the concept of merchandising standards.They modified the translation to fit Isetan's actual business practices by adding Isetan's own categorization by 6 Secretariat to Corporate History Editors, Public Relations, Isetan (1990), p. 118.shopper, usage and attention level to the price zone, price line and seasonal factors described in the original document.Thus, the concept first applied to the children's clothes department in Isetan's Shinjuku Store.Based on the unprecedented concept of "categorization by usage," clothes, childcare goods, sundry goods, and furniture were gathered together in the baby goods department.Despite the baby-boomer era and its explosive demand for baby goods, the children's clothes department was less integrated into a complete department than the kimono, men's wear and ladies' wear departments that were core business divisions.This delay in integration allowed Isetan to take a leading role.The success of this attempt led to applications to other departments, and the organization of corporate-wide categorized merchandising as the MD's core function.
young employees in the directors' meeting room.He started a series of training sessions for the sales staff at each floor section called "PCA School" (commonly known as Yamanaka School), where the person in charge of a section analyzed his or her counter based on the concept of categorized merchandising, and presented improvement plans for discussion by the participants.Thus, Isetan's MD knowledge was transferred to Matsuya. 12 At the same time, Matsuya continued studying the NRMA "Buyers Manual."In 1989, 19 Matsuya staff members translated the 1979 edition of the NRMA "Buyers Manual" and created Matsuya's in-house version using a word processor.Then, Matsuya 12 The following descriptions about Matsuya are based on an interview with the Personnel Department of Matsuya in June 2004.

Figure 4 .
Figure 4. Knowledge transfer of "Buyers Manual" and "MD Notes" the movement of management staffs to other corporations.The time-line of the movement of department store managers to other department stores is shown in Figure 1 and Figure 2. First, Yamamoto, who had taken charge of the internalization of the "Buyers Manual" and the sophistication of merchandizing at Isetan, moved to the Tokyu Department Store (then the Toyoko Department Store) in 1963.Next, Yamanaka moved to Matsuya in 1976, and then to the Tobu Department Store in 1990.The "Buyers Manual" and the "MD Notes" were both transferred to the department stores by the two senior managers.Recently, certain managers have moved from Isetan to Matsuzakaya, Odakyu Department Stores, and others.Since these people had experienced merchandising at Isetan based on only the "MD Notes," and not the "Buyers Manual," were transferred to the new workplace.They brought only the knowledge they had been given.This transfer was the direct result of personnel changes.As regards the "MD Notes," not only was the tangible material transferred, but also the new managers applied and inculcated merchandising knowledge by directly training employees at the actual business sites of the new workplace, and established education opportunities such as "PCA School" (Matsuya) and "Tobu School" (Tobu Department Store).When Yamamoto Munekazu moved to the Tokyu Department Store (1960s), both the "Buyers Manual" and "MD Notes" were introduced.For several years after joining Tokyu, Yamamoto was too busy with management reorganization and business improvement to satisfactorily educate merchandisers on an OJT basis, unlike during his days atIsetan. 15 This is quite different from the case with Yamanaka, who actively worked to transfer merchandising knowledge to Matsuya, then to the Tobu Department Store.This is assumed to account for the fact that merchandising knowledge did not take root in the Tokyu Department Store.163-4.Easier transfer of knowledge with an intensive, simple concept scheme of categorized merchandising, and edited into the "MD Notes."I speculate that the period during which these steps were followed for the in-house creation of the "Notes" comprised the time following the return of Kosuge Toshio to the time just before Yamamoto Munekazu quit, that is, 1952 to 1963.The 1965 edition of the NRMA "Buyers Manual" includes the section "Merchandising by Classification" (pp.18-192 of the 1965 edition), emphasizing the importance of "planning and analysis by each customer's demand."When this

First, since the
days of Yamamoto and17  Based on interviews with a director and a managerial executive officer at the Sales Headquarters of Isetan(November and December 2004) second difference was in the understanding of the sales section concept.Since Isetan devised the concept of a new section based on the MD Notes, its target shoppers, price zone, type of concern, and usage of merchandise were clear, and its merchandising policy was evenly shared among people from top management to sales staff at the shop front.In Seibu, although an integrated, uniform store was constructed under the leadership of the headquarters' staff, the concept did not penetrate to the sales front.The third difference lay in sure materialization and improvement of sales departments.When a department required a refit, Isetan completed the new department as intended by the top management during the planned period.A post-opening report was made using terminology common throughout the company, and so the employees could detect issues and understand instructions as regards required interviews with former colleagues.modifications.As a result solutions and modifications were realized smoothly.On the other hand, Seibu often started a refit before the ideas about the target customers, usage and concern had been fully shared among buyers and shop developers, and the refitting work took a long time.Moreover, there were many cases where the top management would check the department immediately before opening, and point out some imperfection, and then the department had to be refitted again through the night.When Yurakucho Seibu opened in 1984, for example, some departments including fashion departments were modified just before the opening.Nevertheless, the top management found further unsatisfactory points, and staff members were forced to correct them.The existence of "MD Notes" is thought to account for this difference in knowledge sharing.5.Summary and discussion5-1.Transfer of merchandising knowledge in department store industryThe first finding in this study is that knowledge transfer in the field of merchandising activities in the department store industry is shown to exist from the examples of the "Buyers Manual" and "MD Notes."Knowledge in merchandising accumulated by department stores in the U.S. was introduced into Japan with the "Buyers Manual," the knowledge was internalized as the "MD Notes" by Isetan, and spread from Isetan to various department stores.The second finding is that materials containing knowledge about merchandising were transferred along with management people who had been in charge of merchandising at Isetan, and then moved to other department stores.The expression "along with management people" represents three cases.The first case is that when a manager moved, that manager brought merchandising knowledge material into the new workplace.The management staff that moved had been trained at Isetan, or had the same knowledge.When Yamamoto Munekazu moved from Isetan to the Tokyu Department Store, and Yamanaka Kan moved to Matsuya and the Tobu Department Store, both the "Buyers Manual" and the "MD Notes" were transferred, but when Isetan's managers moved recently to Matsuzakaya and Odakyu Department Store, only the "MD Notes" used personally by the managers at Isetan were transferred.This is the second one.
Karstadt Department Store, a member of the Continental Department Store Association, and dispatched multiple staff members to the German company to acquire operational knowledge.Then, Takashimaya reformed its merchandising headquarters organization in 1963 based on what it learned from Karstadt to prepare for multi-store development toward the 1970s (from four stores in 1963 to sixteen in 1979). 21 enabled the company to maintain consistent merchandising operations based on the "MD Notes" over a long period.I sought the conditions for knowledge transfer by analyzing related cases, in addition to Isetan, Matsuya, and the Tobu Department Store, where knowledge transfer took place, and Takashimaya and Mitsukoshi, where the knowledge found in the "MD Notes" was not transferred, and defined the conditions as (a) requirements for knowledge to be transferred, and (b) requirements for enterprises to introduce knowledge as shown in Figure 5. 22 22 Prior to World War II, Takashimaya and Daimaru were operating a research division with think-tank-like functions their headquarters, and collecting various types of information on issues from management to floor section development from department stores overseas, and studied application (Takashimaya was publishing an in-house material entitled "Research Materials," and Daimaru issued "Research Material on Daimaru Kimono Shop").Two postwar books on the history of department stores edited by Shimizu and Tsuchiya (1951) and Tsuchiya (1955), were written (a) The requirements for knowledge to be transferred include (i) the format (shape) of the knowledge, (ii) the possibility of substitution with other knowledge, (iii) personal abilities involved in the succession of knowledge on the side of the knowledge recipients, and (iv) methods of transfer (training at recipients' workplaces).(b) The requirements for enterprises to introduce the knowledge include (i) the size of the organization (not only the number of employees, but whether it is a single-or multi-store operation), (ii) managerial features at the time of introduction (in a managerial crisis, or as part of evolution), (iii) strategicjointly by staff members of department stores, and Mitsukoshi wrote about the purchase and sale of merchandise, which suggests that Mitsukoshi was equipped with operational knowledge of a certain level in this field from prewar days.

Figure 5 .
Figure 5. Requirements for knowledge transfer and extent of transfer . p. 121.