Inside the System: The Japanese Construction Company

by Charles K. Heidengren, Construction Mgr.; Osaka Airport, Japan,

Serial Information: Worldwide Projects, 1993, Vol. 1, Issue 1, Pg. 26-30

Document Type: Feature article

Abstract: Despite their diverse activities, Japanese construction companies are first and foremost Japanese companies, functioning as extended families with a spirit of cooperation that might surprise their western counterparts. The major contractors are financially strong, well-managed and poised on the cutting edge of their industry's technology, and seem ready to take giant steps in any direction they or their country feel is propitious. The relationship between clients and their traditional contractors is important. Cost, while important, does not override such factors as long-term relationships, on-time completion and the quality of the finished project. Management style is less take-charge than collectivist, seeking harmony and consensus. The division of labor differs from U.S. practice as well: most Japanese general contractors, for example, subcontract nearly every task and do not directly employ skilled workers on job sites. Safety and orderliness characterize construction sites. Barriers to foreign incursion include the belief that only Japanese contractors understand the quality and safety demanded on Japanese job sites, but this is hard to accept. A more convincing explanation is fear of foreign competition. It is not at all clear that Japanese contractors offer their Japanese clients the option of low cost and basic quality—an issue that need not be faced so long as Japanese clients are protected from foreign contractors. But Japan's housing and infrastructure have not kept pace with the country's wealth, and Japan should open its doors to foreign firms. The close link between government and business will determine how the Japanese construction companies react to the idea.

Subject Headings: Construction industry | Japan | Management | Management methods | Cooperation | Competition |

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