Management Localization in Asia and Human Resources Development

The Case of Consumer Electronics Subsidiaries in Malaysia

Abstract

The ‘unmatured’ localization of Japanese subsidiaries in the world has been pointed out frequently. This means the insufficient localization of management in comparison with the US and European subsidiaries. In this article, ‘management localization’ means to transfer operation to subsidiaries and to authorize local staffs the decision and responsibility for operation. To confirm the facts the author selected Malaysia where most of leading electronics subsidiaries of Japan and US/Europe are located.

The author visited Matsushita Electric's factories and its Human Resource Development Center and interviewed local management as well as Japanese management in February 1998.It was found out that the transfer of operation in the areas of R&D, components procurement, financial control and human development made a progress while Managing Directors(Presidents)are still almost 100% Japanese. This is quite contrary to the US and European subsidiaries where local top management is popular. Such difference owes to the policy and culture of the headquarter in home country. ‘Internationalization’ of headquarter is a key issue. Thanks to ‘IT’, communication with subsidiaries becomes much faster and easier. The problem is the sense of foreigness among headquarter executives. In order to be a ‘matured’ global company, localization of management should be expedited in view of ‘the best management by most appropriate person’ concept, which will never be a ‘100% Japanese’ management.