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Organizational Deadweight and the Internal Functioning of Japanese Firms: An Explorative Analysis of Organizational Dysfunction

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Dynamics of Knowledge, Corporate Systems and Innovation

Abstract

In this chapter we examine a cause of organizational dysfunction from a new perspective. Some researchers have insisted that excessive bureaucratic management such as emphasis on a priori planning is ineffective. In addition, others have discussed that Japanese firms adopt an alternative system which incorporates plenty of “organic” characteristics and promotes proper emergent strategy and innovation. However, the Japanese management system can also have serious side-effects. Massive efforts for coordination among members are required and valuable resources are uselessly dissipated, when organic characteristics are excessive in an organization. For discussing the issue, we propose the concept of “organizational deadweight,” critical interference with efficient and effective management in an organic system. Inside quantitative and qualitative data of business units was collected in some major Japanese firms. The results of the analysis show that the “organizational deadweight” has significant relationship with important organizational characteristics, and imply that a balance between mechanical characteristics and organic ones is the key to manage a business organization.

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Notes

  1. 1.

    In the factor analysis, the factor loading of the seventh item is the least among the 12 items (0.451), as shown in Table 6.1. Moreover, after extracting the factor, the communality of the seventh item is 0.203, barely more than the criterion generally used (0.16).

  2. 2.

    The score is higher than that including the ratio in the case of withdrawal.

  3. 3.

    The estimated time is only indicated in the columns of the descriptive statistics. In the statistical analysis, the original scales are utilized.

  4. 4.

    Cronbach’s alpha is 0.763.

  5. 5.

    Strictly, the score of the length of the path is equal to the number of layers plus two, because a respondent and the general manager are excluded from the former number.

  6. 6.

    The formula is the following: {(3) * (100 – (4)) + (5) * (100 – (6)) + (7) * (100 – (8)) + (9) + (10))/5. Cronbach’s alpha is 0.845.

  7. 7.

    The standardized total effect from size of organization to organizational deadweight is 0.223, and the effect on coordination ratio is 0.232.

  8. 8.

    The total effect from average age to organizational deadweight is 0.021, and the effect on coordination ratio is 0.078.

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Authors and Affiliations

  1. Graduate School of Commerce and Management, Hitotsubashi University, Tokyo, Japan

    Toshihiko Kato & Tsuyoshi Numagami

  2. Institute of Innovation Research, Hitotsubashi University, Tokyo, Japan

    Masaru Karube

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  1. Toshihiko Kato
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  2. Masaru Karube
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  3. Tsuyoshi Numagami
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Correspondence to Toshihiko Kato .

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Editors and Affiliations

  1. Graduate School of Management of, Tokyo University of Science, Fujimi 2-11-3, Tokyo, 102-8152, Japan

    Hiroyuki Itami

  2. Graduate School of International, Hitotsubashi University, Hitotsubashi 2-1-2, Tokyo, 101-8439, Japan

    Ken Kusunoki

  3. Fac. Commerce & Management, Hitotsubashi University, Naka 2-1, Kunitachi, Tokyo, 186-8601, Japan

    Tsuyoshi Numagami

  4. Faculty of Economics, Kyoto University, Yoshida-Honmachi, Kyoto, 606-8501, Japan

    Akira Takeishi

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Kato, T., Karube, M., Numagami, T. (2010). Organizational Deadweight and the Internal Functioning of Japanese Firms: An Explorative Analysis of Organizational Dysfunction. In: Itami, H., Kusunoki, K., Numagami, T., Takeishi, A. (eds) Dynamics of Knowledge, Corporate Systems and Innovation. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-04480-9_6

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