This paper explores the “longevity” of firms, particularly of big businesses in postwar Japan, and investigates some features of Japanese firms from this aspect. Organizational growth and decline process have been studied in organization theory and business history, though the quantitative aspect of this process has not been examined. I therefore studied this aspect by investigating the longevity of firms, based on studies of organizational ecology and related research. Consideration of longevity presents a new perspective from which to study the activities and organization of firms. From an analysis of the average number of years in which firms are ranked by total capital, and an event history analysis of the duration of listing in the first section of the Tokyo Stock Exchange, I will show that big businesses in the postwar period have especially long lifetimes, and there is no “liability of newness” or “liability of aging” about them; that is, there is no relation between the duration of listing and the rate of elimination from the first section of TSE. Therefore, these big businesses can be regarded as stable entities. It seems reasonable to believe that this stability is related to the Japanese longterm employment system. I will also show that their longevity increased gradually in the postwar period, but not without fluctuation; it decreased in the first half of the 1960s. This seems to reflect the magnitude of economic change during this period, sometimes referred to as the “transformation period.”
The major reason for the rapid development of the Japanese steel industry after World War II was the strong competition among six major steel companies. This paper analyzes the formation process of the competitive oligopolistic system, referring mainly to the investment activities of Fuji Iron & Steel Co., Ltd., in the first half of the 1950s. Fuji Steel was established in April, 1950, a split off from Nippon Steel. This company included inherent management problems from before World War II. The first problem was the restoration from war damages, and the second problem was poor steel and rolling mill production capacities as compared to its iron production capacity. The third problem was its limited variety of steel products, which was also biased by market conditions. Therefore, the company aimed to solve these problems through its marketing strategy. The company seized a lucrative opportunity through special procurements for the Korean War. The company planned a large-scale reformation and was relatively successful around 1955 when the Japanese economy began its dynamic growth. Fuji Steel's reformation meant a reduction of the pig-iron supply. The company's long-term production plans, after attaining the reformation's objectives, showed a three-fold increase in what, but only a 160% increase in pig-iron supply. These plans threatened the three major open-hearth furnace manufacturers, Kawasaki Steel, Sumitomo Metal Industries, and Kobe Steel. This was the major reason they began pig-iron production. It was the beginning of the competitive oligopolistic system of the six major manufacturers, which coincided with the completion of Fuji Steel's first reformation.
The first purpose of this article is to analyze the business development of the convenience store business in Japan since the oil shock. The second is to argue the reason Japanese convenience store enterprises selected the franchise system. The conclusions of this article can be summarized as follows : The basic factor that enabled quick growth of the convenience store business from the 1970s to the 1990s was the favorable business environment, particularly the diffusion of a rapid consumption pattern. In order to win business opportunities, convenience store enterprises (e.g., Seven-Eleven Japan Co.) selected not a regular chain system but a franchise system, because of shortage of human and financial resources. The franchise system of convenience store enterprises was also beneficial to traditional small-size retailers. It is more profitable for many small retailers (e.g., liquor stores) to transform themselves into franchisee shops in convenience store chains. Simply put, the franchise system was adopted because of the mutual benefits for convenience store enterprises as franchisers and traditional small-size retailers as franchisees. Moreover, this article points out the importance of incentive design, which was built into the franchise system of convenience stores business in Japan. This is why the franchise system expanded after convenience stores enterprises solved the problem of shortage of resources.