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Communication and Decision Making Across Cultures: Japanese and American Comparisons

Author(s): Richard Tanner Pascale

Source: Administrative Science Quarterly, Vol. 23, No. 1 (Mar., 1978), pp. 91-110
Published by: Sage Publications, Inc. on behalf of the Johnson Graduate School of Management,
Cornell University
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Communication and Based on measures across a variety of dimensions, this
Decision Making across paper reports on the communications and decision-
making practices of Japanese firms operating in Japan
Cultures: Japanese and and the United States compared to American firms
American Comparisons operating in the United States. The findings document
substantial similarity among these firms. Contrasting
Richard Tanner Japanese firms in Japan with American firms in the U.S.,
Pascale the findings dispute some of the traditional characteriza-
tions of the two management systems. Many similarities
were found in the form and volume of communication
across the two cultures. Further, contrary to sterotypes,
managers of Japanese firms were not found to utilize a
consultative decision-making process more extensively
than American managers do. From a methodological
standpoint, the findings suggest the desirability of first
examining cross-cultural phenomena from the vantage
point of universalistic organizational theory, and, sub-
sequently, examining the mediating effects of par-
ticularistic factors such as culture.*

A number of studies, the majority descriptive in nature,
have characterized Japanese and American management
methods as different in a variety of ways. The Japanese are
reported to communicate more extensively with other man-
agers and to more extensively utilize a consultative
decision-making process. These depictions of differences
between the Japanese and American managerial systems
are generally explained on the basis of two kinds of argu-
ments. The first holds that the Japanese culture is different
from the American and that these cultural differences are
reflected in their communication and decision-making pro-
cess. The Japanese emphasis on interdependence and
harmony within work groups (see, for example, Doi, 1973
and Rohleen, 1976) leads to extensive consultation whereas
Americans, according to this argument, are more indi-
vidualistic and conscious of excessive authority and will
demarcate "zones of authority" within which they can op-
erate with relative independence (Burrage, 1972).
The second argument states that even while the Japanese
and American managerial systems serve the same overall
purpose of accommodating the organization to the envi-
ronment, societies can achieve similar objectives through
different but parallel institutions. West Germans use
codetermination in industrial relations; Americans use col-
lective bargaining. Both systems achieve the same result of
determining wages, employee benefits, and so forth. This
? 1978 by Cornell University. "functional equivalence" argument does not look to culture
0001-8392/78/2301-0091 $00.75 as an explanation of differences but rather points to the
functions which these differences serve. Thus, the
Japanese consultative decision-making system is explained
This research was supported by the Na-
tional Commission on Productivity. In a as serving the rational function of furthering peaceful rela-
complex four-year project such as this it tions among labor, management, and shareholders -a key
is impossible to credit each individual requirement for the success and legitimacy of Japanese
contributor. However, I wish to thank
Mary Ann Maguire, Assistant Professor, ma nageme nt.
Catholic University, who contributed im-
portantly to the design, conduct, and Juxtaposed to the cultural and functional equivalence argu-
analysis of this research. ments is the convergence hypothesis which states that in-
March 1978, volume 23 91/AdministrativeScience Quarterly

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dustrialization imposes a number of common forces on a
society including moves away from an agrarian base, a
technological ethos, secular values, and shifts to educated
manpower and management.
The purpose of this research on Japanese and American
management methods is to examine the extent to which
the "imperatives" of industrialization overshadow cultural or
functional differences and result in common solutions to
managerial communication and decision making.
Relevant Research
This study constitutes an intersection of two research tradi-
tions, one providing empirical descriptions of managerial
communications and decision making generally, and the
second contrasting these processes as a function of cul-
ture. A number of studies have documented activities and
communications patterns of managers. Carlson's (1951)
classic study was based upon nine senior Scandinavian
managers recording the details of each activity they en-
gaged in. Subsequent researchers have empirically docu-
mented the volume, hierarchical direction, and purposes of
managerial communication (for example, see Burns, 1954;
Landsberger, 1961; Kelly, 1964; Horne and Lupton, 1965;
and Stinchcombe, 1974).
Additional studies have investigated communications and
decision making among managers and their impact on the
quality of decision making and implementation (see, for
example, Vroom and Yetten, 1973). Lawrence and Lorsch
(1969) found that effective upward communications and in-
fluence from lower and middle levels of management in-
creased the quality of decision making and of implementa-
tion. Vroom (1970), in his studies of both autocratic and
participative decisions, found that allocating problem solving
to groups required a greater investment of time but pro-
duced higher acceptance of decisions and increased the
probabilitythat the decision would be executed efficiently.
Cross-cultural research efforts have contrasted managers in
x Japan with their counterparts in other cultures. However, a
Isi uzrakstit par so petijumu x close look at the methodology of these studies as they per-
rezultatiem un noradit, ka x tai n to the Japa nese ma nagerial process indicates that they
are not based upon empirical measures of Japanese mana-
tos kritizeja sa raksta autors, jo: x gerial practices but rather upon (1) researcher impressions,
(2) attitudinal measures, and (3) decision-making experi-
x ments in laboratory settings. For example, Abegglen (1958:
x 83) reporting on his observations in Japanese firms noted
x striking differences between the Japanese and American
x approaches to decision making. Abegglen reported more ex-
tensive lateral and hierarchical communication in Japanese
x companies and more extensive reliance on consultative de-
kopsavilkums, kads x cision making. Ten years later, Yoshino (1968), again basing
tad ir sis sagrozits x his reports on clinical observation, largely echoed
priesstats, skatit x Abegglen's characterizations. Yoshino noted the high de-
nakosaja lapa (A) x gree of immersion of Japanese managers in the communi-
cations process, their ability to communicate quickly and
x easily up and down the hierarchy, and their emphasis on
x consultative decision making. A subsequent study by
x Johnson and Ouchi (1974), based upon open-ended inter-
x views with managers of Japanese companies in the United

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Communication and Decision Making

States, provided impressions which coincided with these

characterizations. Further, the American respondents then
x employed by Japanese subsidiaries but formerly employed
x in American firms reported higher quality day-to-day deci-
x sion making and implementation in the Japanese firms. The
x empirical research reported here was designed to test the
veracity of these clinical impressions.
More recently, several researchers have begun to at least
partiallychallenge elements of the traditional characteriza-
tions of Japanese and American management. Unfortu-
nately, these works have not reported on the managerial
issues that are the focus of this paper but have concen-
trated principallyon structural and worker-related factors of
Japanese companies, such as lifetime employment, worker
turnover, and span of control. In a study of employee at-
titudes toward the automation of production technology in a
Japanese plant, Marsh and Mannari (1973) found greater
concern of management with the technical problems than
with the human implications and concluded that both work-
ers and management attitudes were more similar than dif-
ferent from those that might be expected to accompany
such a change in an American plant. Parallelworks by Cole
(1971), Okochi, Karsh, and Levine (1973), and Azumi and
McMillan (1974) have lent further support to the Marsh and
Mannari findings.
Interestingly, there have been no published empirical
studies in the tradition of Burns (1954) and Kelly (1964)
tracking the volume, hierarchical direction, and purpose of
communication of Japanese managers in contrast to Ameri-
can managers. Nor have there been, in the tradition of
Vroom and Yetten (1973), attempts to empirically contrast
the actual frequency of autocratic, participative, and
mixed-mode decisions among managers of Japanese and
American companies.
This research intends to fill these gaps.

A composite picture drawn from existing descriptions of
Japanese management tends to portray management as
different from and/or superior to the prevailing approach
toward managerial communications and decision making as
practiced by most American companies in the U nited
States. It is useful to summarize these characterizations as
four propositions: -
(1) Volume: The volume of communications among manag-
I ers of Japanese companies is greater than among manag-
I ers of American companies.

a I
(2) Direction: Managers of Japanese companies have a
greater proportion of communication initiated on them by
subordinates than do managers of American firms.
I (3) Consultation: Managers at Japanese firms more fre-
I quently employ a consultative approach in decision making.
I (4) Quality: Owing to the consultative decision-making pro-
cess, there will be greater acceptance by managers of deci-
I sions in Japanese firms and a greater probability of deci-
I sions being implemented effectively.

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Examination of these propositions permits two kinds of ob-
servations. First, we see the broad levels of generalization
which they encompass. A number of questions can be
raised. What are the limits of these characterizations? Do
they apply to the foreign subsidiaries of Japanese com-
panies or only to operations in Japan? Are the characteriza-
tions true of all firms which operate in Japan, regardless of
national ownership, or only of Japanese-owned companies?
As these questions suggest, the propositions may require
qualification. Second, from the vantage point of the cultural,
functional equivalence arguments, and/or convergence
hypothesis, each of the propositions assumes differences
between Japanese and American methods. While neither
the propositions nor the design of this research can indicate
whether the cultural argument or the functional equivalence
argument is responsible for these differences, it is clear
that differences are assumed and that the convergence
hypothesis (predicting similarity in managerial processes)
represents the null finding.
This research thus has two objectives. First, to examine the
validity of these propositions as a function of ownership
and location. Second, to shed light on the larger question of
whether highly industrialized nations differ in their manage-
rial processes (whether for reasons of culture or functional
equivalence) or whether they tend to display predominant
similarities in their managerial practices.
Major Constructs
In an effort to test the four propositions -volume, direc-
tion, consultation, and quality- four basic constructs will be
utilized: (a) managerial communication, (b) decision style, (c)
the relation of decision style to perceptions concerning the
quality of decisions, and (d) perceptions concerning the
quality of implementation. Managers of all cultures are con-
fronted with the task of acquiring information from the en-
vironment, transmitting and analyzing it through a com-

Information from the

? -111-_ Environment-


Decision Making Decision Implementation Results -

Figure 1. Schematic relationship of constructs. Note: Items in ovals represent majorconstructs in the research;
items in rectangles represent minor constructs and are included in the diagram for completeness.


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Communication and Decision Making

United States Japan
1 ~~~~~~~~3
American American parent firm American
2 4

Japanese Japanese subsidiary Japanese parent

(U.S.) (Japan)

Figure 2. Schematic diagram of research design.

munications process, and utilizing it, as appropriate, in deci-

sion making. This process, in turn, evolves outputs.
Through an iterative process the organization adjusts to en-
vironmental stimuli. These constructs are presented
schematically in Figure 1.
While we examined 13 operating units of
Japanese firms in the United States, Method
only 10 of these firms were accessible
for research purposes in Japan. Of the Figure 2 schematically presents the research design. Com-
14 American firms in the U.S., only 3
had wholly owned activities in Japan.
parison along the diagonal dimension between cells 1 and 4
(Joint ventures were excluded since they permits contrast of Japanese and American managerial
confounded the managerial effects practices in their home cultures. Comparison between cells
under study.) To bolster the sample of
American firms in Japan, three additional 4 and 2 in Figure 2 permits investigation of the extent to
American companies were recruited. which Japanese firms are "Americanized" by their opera-
While these companies were chosen to
be in similar industries to those in the
tions in the U.S. Comparison between cells 1 and 2 shows
U.S. sample, they were not the same in- a contrast between Japanese and American managerial
dustries. As a result of these design dif- practices within the United States.
ficulties and the small number of firms
(six) in the American-firms-in-Japan cell, Sample configuration: As shown in Figure 3, the sample
a breakdown of the findings for this cell
involved 43 operating units in Japan and the United States, x
is not considered sufficiently reliable to
be reported. and encompassed a total of 261 managerial respondents.' x
operating units 43
respondents 261

United States Japan

operating units 27 operating units 16

responde ts 212 respondents 49

American Japanese American Japanese

owned owned owned owned

respondents 104 respondents 108 respondents 17 respondents 32

Figure 3. Composition of sample. Note: The 261 total respondents refers to managerial respondents only. This
pool included managers from senior management to the supervisory level; over 75 percent of respondents were
middle-level managers.


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Thirteen Japanese firms with major operating units in the
United States were matched on an industry-by-industry
basis with 14 American companies. The pairing of operating
units within industries was performed to approximate
equivalence between the sample populations. The selection
of operating units was based on a number of criteria which
were designed to achieve comparability across a number of
The matching process, based upon the following procedure,
began with identifying every Japanese firm with major
operating units in the United States. While there are hun-
dreds of Japanese firms which export goods to the United
States and have regional sales organizations here, only 30
to 40 are involved in major production or service activities
which employ 30 or more Japanese and/or American man-
agers and workers.
The Japanese firms meeting these criteria fall within 10
basic industries. In some instances, of course, there are a
number of Japanese firms in the same industry -particu-
larly in automotive distribution and banking. Our selection
process began by selecting one firm from each industry.
Where more than one firm existed, we selected the
Japanese firm which had been in business the longest in
the United States and, conveniently, these firms had the
most extensive U.S. operations. In several cases, alternate
Japanese firms in a given industry were so closely compar-
able that two were contacted. A total of 14 Japanese firms,
representing 10 different industries, were asked to partici-
pate in the study; all but one accepted. The industries rep-
resented were retailing, banking, food processing, airlines,
fasteners, bearings, motorcycle assembly, light aircraft as-
sembly, television assembly, and automotive distribution. As
the list suggests, the sample includes firms (1) operating in
manufacturing, distribution, and services businesses, (2)
utilizing batch and continuous process production methods,
(3) varying in capital and labor intensivity, and (4) with both
high and low technological concentrations.
Analysis was made of each of the Japanese firms selected.
Details concerning the product and market segment of each
were compiled. U.S. industry associations were then con-
sulted to identify an American firm in each of the 10 indus-
tries whose product and market segment was most closely
comparable to their Japanese counterpart. It was found that
Japanese firms with the skills and resources necessary to
establish subsidiaries in the U~nitedStates tended to be high
performers within their industries in Japan; the American
firms chosen tended to be their strongest U.S. competitors.
We approached the chosen American company in each in-
dustry to determine their willingness to participate in the
study, and whether they had an operating unit in the U nited
States which was comparable to the Japanese operation
with which they were paired. Of the 15 American firms
asked to participate in this research, only one declined. The
criteria for identifying the closest match, in the order of
importance, were (1) plant facilities (that is, technology, pro-
duction methods, and capacity), (2) range and quality of
product produced, (3) size and composition of work force

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Communication and Decision Making

(by sex, age, and ethnic group), (4) geographical location

(urban, suburban, or rural),and (5) structural characteristics.
Appendix I compares the Japanese and American operating
units in the sample across a variety of structural characteris-
tics. It should be noted that the American units were larger
(mean size of 1 159 versus 197 employees) and older (mean
age of 19 versus 8 years).
Challenges. It is useful at this point to contemplate the
challenges that might be raised concerning the validity of
the sample. The same challenges must be faced by all
studies which attempt to examine the management effect
by holding other factors constant or purport to test longitu-
dinal influences (such as the extent of adaptation of
Japanese subsidiaries to U.S. managerial practices) by our
proposed method of equivalence. And it is a test to which
most studies fail to provide satisfactory answers.
The challenges might be posed as follows: (1) In comparing
Japanese companies in Japan and the U.S. with American
companies, how can we be sure that any differences iden-
tified are the result of different management processes
rather than intrinsic differences in the companies them-
selves? (2) How can we be sure that any observed differ-
ences in Japanese companies in the U.S. result not from
the nature of Japanese practices but rather because the
Americans who chose to work for them are differentially
recruited on the basis of already existing psychological
traits? Or, alternately, (3) How can we be sure that these
Japanese firms in the U.S. are sufficiently "Japanese" to
represent a valid basis of comparison?
The first challenge is whether the paired Japanese and
American companies in the sample are similar enough in
other respects to approximate isolation of the management
effect. In an ideal world, our sampling procedure would
function perfectly to ensure that in each of the cells all other
things were indeed equal. Alas, in a non-experimental study
of this kind, it was not always possible to maintain this
standard in the actual field conditions encountered. Insofar
as possible, Japanese and American companies were
matched as closely as possible within each industry. As Ap-
pendix I suggests, there was substantial similarity between
Japanese and American operating units in terms of the
number of organizational levels, number of functional de-
partments, and extent of formalization. Further, while the
operating units in the 10 industries spread across both ser-
vice and manufacturing enterprises and a broad range of
technologies, the entities chosen for comparison were all
engaged in highly routine, noncreative production activities.
That is, whether studying baggage handling in the airline
industry, or teller activities in branch ba nking, or the assem-
bly of ball bearings, the operating units involved were highly
similar in that their production function involved routine
mechanical or clerical activities. It was felt that the schedul-
ing, control, and general management of these activities
were highly comparable across the 10 industries involved.
All units studied clustered close together at the "high cer-
tainty" end of the market, science, and techno-economic
dimensions (Lawrenceand Lorsch, 1969).

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Our response to the second and third challenges is that
these are precisely the issues which our design enables us
to examine empirically. If Japanese firms in the U.S. do
indeed differentially recruit a special breed of American em-
ployees, this would constitute an interesting aspect of the
overall differentiation between the Japanese firms and their
American counterparts. Since one of the Japanese firms in
the study acquired plant and personnel in entirety from an
American company, we were able to test if the profile of
these employees and their managerial processes differed
from those of Japanese subsidiaries which started from
scratch and engaged in the recruitment process. In the
same vein, our empirical data shed light on the question of
whether the Japanese operating units sampled in the
United States are "truly" or "sufficiently" Japanese. Un-
doubtedly the Japanese firms in the U.S. are likely to be a
hybrid of both cultures. All Japanese firms in the U.S. hired
American managers for line positions (which encompassed
all echelons from senior management to foremen and
supervisory personnel) and all had an American work force.
With the single exception of the banking industry, the pro-
portion of managers and workers of Japanese extraction
(that is, second- or third-generation Japanese-Americans)
was no higher in the Japanese-manbged companies than in
their matched American counterparts. The interesting re-
search question, and one which the empirical data pre-
sented here will address, is not whether the firms are
"pure" but to what extent they are different (regardless of
ethnic composition) along the dimensions reported in this
A second interesting research question stems from the re-
verse side of the above argument. This question centers
upon whether the Japanese hybrids, whatever their com-
position, are different enough, that is, is the "Japanese ef-
fect" a sufficiently strong "treatment" to cause Japanese
subsidiaries to behave differently? This question is antici-
pated directly in the research design. Since the same in-
struments were administered to the Japanese subsidiaries
as to their parent companies our findings will enable us to
determine the extent to which the subsidiaries behave in a
Japanese fashion. All the Japanese firms studied in the
United States were headed by a Japanese national and all
had two or three Japanese senior managers in key staff
positions (usually accounting, planning, and industrial en-
gineering). While the mean number of Japanese nationals
was 23 percent of the total number of managers in the
sample of firms (giving credence to the contention that the
Japanese subsidiaries were essentially "American" com-
panies) such an argument assumes that it is the proportion
of foreign managers that gives a subsidiary its "foreign
character." Others may contend that a subsidiary's charac-
ter derives from the parent company's procedures, control
system, planning process, and so forth. In essence this
argument asserts, "IBM France is still very American and
very IBM regardless of whether its entire management
team is comprised of Frenchmen." Here again our data may
shed light on an interesting issue. The sample was con-
structed with 4 of the 13 Japanese operating units in the
United States having 60 to 90 percent of their managers

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Communication and Decision Making

Japanese nationals. These firms' scores will be compared to

the mean scores of all Japanese subsidiaries in the United
States to determine whether or not and to what extent, the
proportion of Japanese nationals present in a subsidiary af-
fects its degree of Americanization.
A final question should be raised concerning the sample. Is
our selection of relatively high performing Japanese and
American firms properly representative of American and
Japanese firms in general? Since the sample includes over
50 percent of the Japanese firms with major activities in
the United States, it is probably representative of that sub-
set of companies. However, since these Japanese firms
tended to be among the Japanese equivalent of the "For-
tune 500," they do not represent small- and medium-size
enterprises. The same is true for the American firms in the
sample. The findings should be qualified accordingly.
The foregoing discussion is in no way intended to suggest
that the sample is perfect in all respects. Rather, the aim
has been to indicate the ways in which efforts have been
taken to approximate comparability within the very real limi-
tations of a non-experimental research design. As noted,
the research was designed to clarify many of the issues
which often confound empirical studies of this kind.

The study was conducted in two phases. Phase I began in
the summer of 1973 and was completed by the summer of
1974. In this phase, participation of companies was elicited
and exploratory unstructured interviews were conducted
with a sample of managers and nonmanagers. The objec-
tives of Phase I were to (1) establish clinical impressions of
the management process of Japanese- and American-
managed firms, (2) identify the major research issues,
and (3) develop a data collection methodology. In all, 142
open-ended interviews were conducted.
Phase 11involved the development and administration of
the empirical research. Research issues were identified and
data gathering instruments were developed and pilot tested.
These were administered to managers and workers in 43
Japanese and American sites, in both Japan and the United
States over the 12-month period beginning in February
1975. Seven instruments were used to collect the data: two
interviews, one for managers and one for first-line super-
visors; two questionnaires, one for managers and one for
nonmanage-rs; two non-participant observations of ma nag-
ers and non-managers; and, finally, a personnel data survey
concerning the organization as a whole.
This article reports on data obtained from the management
interview and questionnaire.2 Since the purpose of this
study was to analyze differences within and across cultures,
common sets of instruments were utilized in both Japan
and the United States. The questionnaire was translated
into Japanese, translated back into English, and subjected to
a panel of bilingual Japanologists to ensure accuracy. The
Findings pertaining to supervisory management interview was conducted in English both in
methods and employee relations are re-
ported in Pascale and Magu ire (1978c) Japan and the United States. In only 10 percent of the
and Pascale (1978a), respectively. interviews in Japan was a translatorneeded to assist the

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English speaking interviewers. At all but two research sites,
the size of the operating units permitted all senior and
middle-level managers to be interviewed. Where size dic-
tated a sampling of managerial respondents, this was done
largely on the basis of matching job title and function as
closely as possible between the Japanese and American
companies. A total of 261 managerial interviews were
As noted earlier, four major constructs were employed per-
taining to (1) the managerial communications process, (2)
style of decision making, (3) the outputs of that decision
process as manifested by the quality of decisions, and (4)
the quality of implementation. The variables and measures
utilized to translate these constructs into a useful research
tool will be discussed in order.
Managerial communications process. The primary forms
of organizational communications are of written and oral
character. Written communication includes formal typewrit-
ten memoranda and letters, and informal handwritten
notes. Similarly, oral communication takes a variety of
forms, occurring primarilyby telephone and through face-
to-face contact.
Appendix 11presents the communications measures that
were utilized in this study. The measures are classified on
the basis of communications volume, direction, and pur-
pose. It should be noted that "communications purpose" is
used here in a limited sense. A nine-item question in the
managerial questionnaire, scaled from 1 (always) to 5
(never), was designed to assess the respondent's use of
written communication for a variety of purposes such as
"requesting days off," "presenting solutions to problems,"
and so forth.
Measures of volume and hierarchical direction of communi-
cation relied on a detailed audit of the different kinds of
communication which took place in the organizations
studied. The methodology employed drew upon the re-
search methods developed by Burns (1954), Kelly (1964),
and Stinchcombe (1974). Managerial respondents were
asked to report the number of incoming and outgoing
phone calls, and face-to-face interactions each day, the ex-
tent to which these contacts were initiated by self or
others, the percent of these various types of contracts with
superiors, peers, subordinates, and the percentage of time
in a typical working day that was spent working alone.
Managers' secretaries were consulted to verify the accuracy
of these data. In addition, each respondent reported on the
number of formal and informal meetings attended involving
three or more persons, and the average number of people
attending those meetings. Respondents also reported on
the number of formal memos and letters, and informal
notes written each week. As a surrogate measure of the
volume of written communication, respondents noted the
thickness (in inches) of their previous year's outgoing corre-
spondence file.
In the interest of enhancing reliability,there was consider-
able overlap among measures. For example, the objective

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Communication-and Decision Making

measure of thickness of the outgoing correspondence file

provided a cross-check on the respondents' assessment of
the number of formal letters and memos that they wrote
each day. The thickness measure also offered a means of
gauging the number of pages involved rather than the units
of correspondence alone.
Thirty-four measures of the volume, direction, and purpose
were employed to test the communications construct. Once
the measures were administered, the task now became one
of selecting the measures which were most reliable and
representative.3 Pearson correlations were performed, using
the individual as the unit of analysis, to identify the mea-
sures which seemed to be the most appropriate summary
indicators. The selection of measures was based on three
criteria: (1) whether the measure produced a reasonable dis-
tribution of responses; (2) whether the measure correlated
highly with other items that were hypothesized to measure
the same phenomena; and (3) interviewer assessments of
those measures that seemed most reliable. On this basis,
two variables -the total number of incoming and outgoing
telephone calls within the company and the number of
face-to-face contacts- were selected as best indicators of
communications volume. The number of face-to-face con-
tacts initiated on superiors and peers, respectively, was
chosen as the best indicator of the direction of communica-
tions flow. The thickness of the correspondence file was
selected as the most reliable indicator of written communi-
cations volume. Finally, an item from the management
questionnaire polling the extent to which respondents used
written communication to remind a colleague of prior com-
mitments was selected as the most representative measure
of the purposes for which written communication was em-
Decision-making style. A modified form of the Vroom and
Yetton (1973) scales was utilized to measure the decision-
making construct. Respondents were asked about the fre-
quency with which they used each of three decision-
making approaches in dealing with non-routine problems
that fell within their jurisdiction. Respondents were re-
quested to indicate the percent of decisions in which (1)
they made the decision essentially by themselves, (2) they
gathered the facts from relevant subordinates but ultimately
decided themselves, and (3) they consulted with subordi-
nates in making the decision. Respondents were also asked
to describe their boss's decision-making profile using the
same three categories.
Treatment of the decision-making responses required sev-
eral additional steps. There was high correlation between
the respondents' ratings of their own decision profile and
that of their bosses. However, during the data collection
phase, it was the assessment of interviewers that respon-
3 dents tended to bias their assessment of their own
Alternately, factor analysis might have decision-making style in the direction of being more consul-
been utilized. In light of the high correla- tative. Based on these assessments, the respondents' rat-
tion between measures, it was consid-
ered preferable to select several repre-
ing of their bosses' decision-making style was chosen to
sentative measures and preserve their enhance the reliabilityof this measure.
intrinsic meaning. This approach was
chosen rather than translate the sepa- It will be recalled that style of decision making was recorded
rate items into a composite factor. in terms of the percent of decisions (1) made alone, (2)


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Decides Alone

(2) (1)
[0] [32] Gets

(3) (2) H

[34] [47]

Decides Alone

(5) (4) L

[76] [11] Gets


(6) (5) H

[23] [48]

L-Low consult
H-High consult

Figure 4. Scoring system for style of decision making. Note: Parenthetical

numbers indicate the score in each cell; bracketed numbers indicate the
number of respondents scoring in each cell.

based on getting facts from subordinates, and (3) resulting

from consulting with subordinates; these percentages to-
talled 100 percent. There was a high correlation between de-
cisions made alone and decisions made based on "getting
the facts" when we controlled for decisions based on con-
sultation. As a result, the scoring system presented in Fig-
ure 4 was utilized to summarize the decision profile on a
scale from 1 to 6. The median score of 45 percent was
chosen to create two categories, high and low consult. Re-
spondents, indicating that 45 percent or more of bosses'
decisions were "consultative," were defined in the "high
consult" category. A composite score was then computed
for each operating unit.
Decision and implementation quality. Two scales were
utilized to measure the quality of decision making and qual-
ity of implementation constructs. Respondents were first
asked to name six recent decisions made by someone
above their level but which affected them. Interviewers en-
cou raged respo nde nts to co nsider a broad variety of deci-


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Communication and Decision Making

sions in the (a) personnel, (b) wage administration, (c) mar-

keting, and (d) production areas. The respondent was then
asked to summarize his overall impression of the quality of
decisions in these areas on a scale from 1 (poor) to 10
(excellent). Quality of implementation was recorded on a
scale from 1 (poor) to 5 (excellent). An additional question
on the care taken in making decisions scaled from1 (a little)
to 5 (a lot) was also asked in the interview.
Test for unit effects. As a result of the process described
above, a total of nine indices were selected -six summary
measures of the managerial communications construct (vol-
ume, direction, and purpose), one measure of the decision-
style construct, and one measure each of decision-quality
and implementation-quality constructs. An analysis of vari-
ance (ANOVA)was performed on each again, using the in-
dividual as the unit of analysis to determine whether the
variance within firms exceeded the variance between firms
on these indicators. The test was more conclusive than
not: in five of the nine cases -(1) total telephone calls, (2)
thickness of correspondence file, (3) purposes of written
communication, (4) quality of decisions and (5) quality of
implementation- the differences between firms were sig-
nificantly greater than within firms (p < .05). ANOVAs on
the remaining variables -(6) total number of face-to-face
contacts, (7) and (8), face-to-face contacts initiated on
superiors and peers, respectively, and (9) decision style-
revealed no significant differences in the variance between
and within firms.

A score for each of the nine summary variables was com-
puted for each of the 43 sites in the sample. Table 1 pre-
sents a summarization of these scores arrayed by location
and ownership. For the sake of completeness, the scores
for the six American firms in Japan are included. However,
Table 1

Summary Statistics for the Nine Indices of Communications, Style of Decision Making, and Output Quality

In U.S. In Japan

American Japanese American Japanese

firm firm firm firm

Total telephone calls 37.0 34.0 30.0 35.0

Face-to-face contacts 60.0 52.0 55.0 81.0
Face-to-face initiated on superiors 3.0 3.3 2.8 8.9
Face-to-face initiated on peers 5.5 5.4 3.2 10.7
Thickness of current file 3.3" 2.9" 3.4" 3.2"
(in inches)
Purposes of written 3.3 3.3 2.3 2.5
communication (score)
Decision-style score 3.4 4.0 3.7 3.6
Decision quality 6.8 6.4 6.7 7.6
Implementation quality 3.1 3.5 3.5 4.9

Telephone callswithinthe firmonly..


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given the smallness of the sample size in this cell, these
scores should be viewed as highly tentative and will not be
treated in the discussion that follows.
Several overall impressions can be drawn from Table 1. We
find basic similarity in the volume of telephone calls in col-
umns (1), (2) and (4). In contrast, managers in Japanese
firms in Japan engage in over 30 percent more face-to-face
contacts each day than managers in either Japanese or
American firms in the U.S. do. There is also more lower-
to-higher and lateral face-to-face communication among
managers at Japanese firms in Japan than among their
counterparts in the United States. Finally, Japanese firms in
Japan score themselves somewhat higher on decision qual-
ity and substantially higher on implementation quality.
An analysis of variance using firm scores as the unit of an
analysis was run for each of the nine summary indicators.
T-tests were performed in those instances where signifi-
cant ownership, location, or ownership/location interaction
effects were identified. Two-tailed tests of significance
were utilized since the point of inquiry taken was one of
questioning the four propositions stated earlier by seeking
to determine, on an empirical basis, the actual direction that
those relationships would take. These findings are sum-
marized in Table 2.
As can be seen, there are no significant differences in any
of the summary variables between Japanese subsidiaries in
the U.S. and their American counterparts.
More interestingly, there are relatively few significant dif-
ferences among these variables between Japanese firms in
Japan and American companies in the U.S. Of the nine
variables, only three revealed significant effects.
Recalling the four propositions to be tested, it is of interest
to review our results. Proposition 1, higher volume of com-
Summary of Findings for Operating Units, by Location and Ownership

ANOVA Statistics t-tests

American firms Japanese firms American firms

in U.S. in Japan in U.S.
Owner- Ownershipl vs. vs. vs.
ship Location location Japanesefirms Japanesefirms Japanesefirms
Constructs & Summary Indicators (significance of F) interaction in Japan in U.S. in U.S.

Managerial commu nications construct

Thickness of correspondence file .999 .999 .999 - -
Total number of telephone calls .999 .999 .999
Face-to-face .999 .076 .040 no significance 81 .0(p < .05) 52.0 no significance
Purposes of written communication
(score)" .001 .999 .999 3.3 (p < .001) 2.5 2.5 (p < .01) 3.3 no significance
"Lower-to-higher" (face-to-face
initiated on superior) .058 .018 .031 3.0 (p < .05) 8.5 8.9 (p < .05) 3.3 no significance
"Lateral" (face-to-face initiated
on peers) .173 .305 .060 - -

Decision-style construct
Decision-style (score) .174 .999 .151
Decision-quality construct
Perceived quality of decisions .999 .131 .093 - -
Implementation-quality construct
Perceived quality of implementation .057 .011 .149 3.1 (p < .01) 5.0 5.0 (p < .05) 3.5 no significance

Two-tailedtest of significance. The notation "-" signifies that not-testswere performed since theANOVA revealed no significant locationlownership effects.
The terminology "no significance" appears for those variables where the ANOVA confirmed significance location/ownership effects but subsequent t-tests
found no significant differences in the cells as indicated.

Indicates extentto which written commu nicationsare used for relatively routine matters such as reminding a colleague of a previous commitment. Scaled on the
basis of frequency of use from 1 (often) to 5 (never).


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Communication and Decision Making

munication, receives only limited support from these find-

ings. Japanese firms in Japan exhibit a significantly higher
vienigas atskiribsa, ko apstiprina sis petijums, number of face-to-face contacts. Otherwise, there are no iemesls-
start USA un Japan companies significant differences in the volume of telephone contacts
or written correspondence. sk nakosas
lapas augsa
Proposition 2, which predicted a greater amount of lower-
to-higher communication in Japanese firms, is supported by
the data. In contrast, the findings pertaining to proposition 3
contain a major surprise: there were no significant differ-
ences noted in style of decision making determined by
either ownership or location. This finding runs contrary to
the longstanding view that Japanese managers more ex-
tensively utilize a consultative process of decision making.
Finally, there is only partialsupport for proposition 4. There
were no significant differences in perceived decision quality
across the cells. However, managers at Japanese firms in
Japan perceived the quality of implementation at their firms
to be higher than did their counterparts in U.S. locations.
Table 3 presents the intercorrelations of the nine summary
measures for the entire sample. Of particularinterest is the
strong positive relationship between face-to-face interac-
tions with lower-to-higher communications, perceived deci-
sion quality, and perceived implementation quality. These
findings tend to confirm the relationships reported by
Vroom (1970) which indicated that personal involvement
and initiative in the decision-making process significantly
increase the acceptance of decisions and enhance their
likelihood of successful implementation.
Further, these findings suggest an explanation for the
Table 3

Correlation of Relationships of Nine Summary Measures

C ~~~~~~~~~co
U) = , 0 ~~~
- +_
? U)
nt E
0 = C ?c
C C 0
Maao 0c 0E _
C3 0 0U) 00 -2 C V V
o 4- X 4- a D a

CU1 Ee 0E
&E 4-'E cn 7D (.
.C0 0
) xo (D =
F-o H W. WX 0 (D (D

Thickness of correspondence file
Total telephone calls .14
Number of face-to-face interactions .08 .03
Purposes of written communication (score) -.1 1 -.07 -.12
Extent of lower-to-higher communications .07 .13 *5 -.19
Extent of lateral communications -.09 -.06 *33e .04 .620
Decision-style construct
Decision-style score -.18 .06 .11 .11 .19 .20
Decision-quality construct
Perceiveddecisionquality .08 -.04 .50 .05 .19 -.04 .14
Implementation-quality construct
Perceived quality of implementation .23 .07 .32 -.07 .36g .17 .15 .600

Notes: N =43 operati ng u nits

*= p < .05 (two-tailed test of significance)
..= p<.01


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higher Japanese scores on perceived quality of decision im-
plementation. The Japanese work setting encourages face-
to-face communication in a variety of ways. First of all, the
Japanese written language does not lend itself to mechan-
ical word processing. Since most written communication
must be rendered by hand (rather than typed), managers
find it more efficient to talk out problems rather than handle
them on paper. Secondly, the Japanese work setting is
crowded and open with numerous levels of hierarchy lo-
cated in the same open work space. Face-to-face communi-
cation is the dominant medium of exchange and problem
solving in these circumstances. We see here the ways in
which particularisticaspects of the work setting have signif-
icant impact on the frequency and use of face-to-face in-
teraction. Given the interrelationship between face-to-face
communication and implementation quality noted above, it
is not surprising that the Japanese firms in Japan, whose
work setting encourages face-to-face communication, also
score highly on perceived quality of decision

The conceptual point of inquiry of this paper has been the
extent to which two highly industrialized nations, Japan and
the United States, will evolve similar management pro-
cesses or retain differences in approaches owing to the
forces of culture or functional equivalence. Our findings can
no doubt be marshalled to support both sides of the argu-
ment. However, when we consider the propositions ad-
vanced at the onset of this paper, assertions of wide-scale
differences based on cultural factors (and regardless of loca-
tion or ownership) appear unjustified. While there are dif-
ferences, the preponderance of evidence suggests wide
areas of commonality between Japanese and American
communications and decision-making practices.
One challenge that might properly be raised at this point is
whether the empirical measures utilized in the study tap key
differences between Japanese and American firms. Our
Limitations of the studymeasures focus heavily on the quantifiable aspects of
communication and decision making. In doing so, there is a
real risk of missing qualitatively important features of sig-
nificance. Culture is sometimes referred to as a system of
shared meanings which need not be communicated ex-
plicitly but nevertheless create the context of meaning for
social interactions.4 The methodology used in this study fo-
cuses on the volume, and to a limited extent the content,
examples - p. 103 of communication, and the perception of decision and im-
plementation quality among managers. Such measures are
insensitive to implicit meanings which are often created by
the cultural context; this is a real limitation. However, it
should be noted that the dimensions selected for empirical
measurement (such as volume and direction of communica-
tions and extensiveness of consultative decision making)
were not arbitrarychoices but often cited dimensions along
which the Japanese and American systems are said to dif-
of the non-quantifiable
fer. Thus while our measures did not exhaust all possible
For a discussion
findings of this study, see Pascale differences between the two management systems, they
(1 978a). did attempt to move the frontiers of understanding forward

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Communication and Decision Making

a small step by subjecting some of the most commonly

employed dimensions of comparison between the American
and Japanese communication and decision-making ap-
proaches to systematic analysis.
At a more functional level, this inquiry illuminates the ways
in which either the cultural or functional equivalence argu-
ments are too easily employed to rationalize those
phenomena which can't easily be explained by alternate
means. The concepts of culture and functional equivalence
serve a desirable role in legitimizing and calling attention to
unique aspects of society. But often these cultural
paradigms are advanced as the principal explanatory vari-
ables in circumstances where better theory is needed. In-
appropriate application of these paradigms often obscures
the need for better theory. Perhaps, rather than approach-
ing cross-cultural phenomena with the assumption that cul-
Ieteikums ka petijuma rezultata ture or functional equivalence are apt to be the dominant
izpausme explanatory variables, we should look first to basic organiza-
tional theory and treat culture and functional equivalence as
mediating variables. As a research procedure, perhaps it is
preferable to look for the mediating effects of these later
mechanisms on communications processes and decision
processes, not for the mediating effects of communications
and decision making on the cultural or functional equiva-
lence effects.5
We have thus far sidestepped the issue of adaptation of
Japanese subsidiaries to the U.S. environment. As noted
For an excellent presentation of the
"universalistic" versus "particularistic" earlier, no significant differences between Japanese firms
arguments, see Azumi (1974b). in the U.S. and their American counterparts were found.
Table 4

Summary Indices for Japanese Firms in the United States

0 0D
' - I s X . 9 EC) Co)
- o C. 0 4C 4.2 1.4
Y ~ 00 C =
(D t
Airlines 0 c 20 0.
co O co 3.8
F e o. 50 3 76 4.30
4-arD 4-s 0004
20 0
C C~ 0
Mass retailingassembly
Motorcycle 2.64.30
0 12 35
~ 46
33 7.83.9
3.70 2.80
0 Z
2.17 I.3
. D
Lharts b40 o 35
6 04
41 04
50 00
5.3 --E0
3.8 2co.1
Food processing 5.5 -6.c

Firmswith 60% or moreJapanese nationals

Mass retailing 2.6 12 49 33 5.8 3.7 3.6 2.1 2.4
Banking 3.2~~~~~~~~~~0
3.3 51
31 42 45 6.3
6.8 3.03.03.
2.2co 1.4 .
Banking 3.8 20 47 55 6.5 3.5 3.2 4.2 1.4
Foodprocessing 5.5 6 41 50 5.3 3.3 3.8 2.1 6.3
Mean 3.8 17 45 46 6.1 3.6 3.2 3.7 3.0

Firmswith less than 60% Japanese nationalIs

Airlines 5.00 11 31 34 6.0 4.00 2.90 0.7 3.8
Fasteners 3.70 55 13 76 8.2 4.30 4.80 0.9 12.7
Bearings 3.20 51 24 55 6.3 3.60 3.60 3.8 1.9
Bearings 41 23 34 5.9 2.70 2.60 1.2 4.2
Automotivedistribution 4.00 25 30 42 5.9 2.70 2.60 5.5 2.2
Motorcycleassembly 4.30 60 35 46 7.8 3.90 2.80 2.2 3.9
Lightaircraftassembly 4.50 35 44 44 5.3 3.00 3.20 2.2 6.7
Televisionassembly 4.30 13 28 105 8.0 4.70 3.60 6.4 13.2
Automotivedistribution 4.00 35 29 55 6.6 2.40 3.80 5.7 8.3
Mean 4.10 35 29 55 6.6 3.40 3.00 3.2 6.5
Grandmean forentire sample 4.00 29 34 52 6.4 3.50 3.30 3.3 5.4
Standard deviation .80 18 11 20 1.0 .77 .70 2.2 3.9


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Furthermore, Japanese subsidiaries were found to differ
from their parent companies in the use of (1) face-to-face
communication (p < .05), (2) written communication
(p < .01), (3) lower-to-higher communication (p < .05),
and (4) perceived decision quality (p < .05). In each case
these significant differences were in the direction of the
Japanese subsidiary being more like American companies.
Two alternate explanations for the "Americanization" of
these subsidiaries might be advanced. First, that Japanese
firms in the U.S. adapt exclusively to U.S. managerial prac-
tices. Alternately, given that few major differences in the
managerial process were found, it is not surprising that a
Japanese subsidiary with a predominantly American man-
agement team and work force would erase any residual
Japanese characteristics.
A test of this alternate possibility was conducted by examin-
ing whether the proportion of Japanese nationals present in
a Japanese subsidiary in the United States affected its ex-
tent of Americanization. Table 4 presents a breakdown of
company scores in which those Japanese subsidiaries
whose proportion of Japanese nationals exceeded 60 per-
cent of the total managerial force are compared to the
Japanese subsidiaries with 60 percent or less Japanese na-
tionals. The mean scores for each subset of firms are
shown. Overall these data indicate that the mean of all
operating units with a high proportion of Japanese nationals
falls within one standard deviation of the total sample of
Japanese firms in the United States.
Two principal differences of the "high-percent Japanese"
firms were in their lesser reliance on written communica-
tion and face-to-face interactions initiated on peers. The
most plausible reason for these differences appears to stem
from the communication difficulties in companies with pre-
dominantly Japanese and minority American staffs. These
firms used written communication less often for routine
matters, thereby significantly lowering the overall use of
written communication. In addition, interviewer impressions
indicated that those firms where the Americans were in the
minority tended to splinter along nationality lines, possibly
inhibiting interaction between Japanese and American
managerial peers. This inhibition is believed to account for
the comparatively low scores of these firms on the lateral
communication items. In summary, these findings do not
support the contention that it is the proportion of Japanese
managers present (in a Japanese company in the U.S.) that
drives the process of adaptation and Americanization.
One final challenge noted earlier concerns whether the
Japanese subsidiaries in the U.S. attracted a special breed
of American employee. One of the Japanese subsidiaries in
the study had been purchased outright from an American
company and thus inherited its American managers and
work force intact. There were, however, no significant dif-
ferences between the managerial responses of this operat-
ing unit and those of the other Japanese subsidiaries in the
sample. These findings fail to support the selective recruit-
ment argument.

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Communication and Decision Making

Several propositions characterizing the practices of major
Japanese enterprises appear to overstate the contrast be-
tween Japanese and American managerial processes. Our
contingent approach, based on data by location and own-
ership, reveals that important qualifications need to be
made in generalizing about managerial characteristics both
within and across cultures. In a broader context, these find-
ings point out the risks of approaching cross-cultural
phenomena with the presumption that culture or functional
equivalence are the dominant explanatory variables. The
findings suggest that these mechanisms may need to be
applied in a narrower and more parsimonious fashion.


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APPENDIX I: Summary Statistics of Selected Structural Factors
Japanese and American Firms in the United States
Structural Factors American firms in the U.S. Japanese firms in the U.S.
For operating units studied (N=42)
Total number of employees
mean 1159 197
mode 450 250
range 28-4500 55-700
Number of levels in organization
mean 6 6
mode 6 4
range 4-9 4-10
Number of functional departments
mean 6 6
mode 7 7
range 3-11 3-14
Formalization score A-1
mean 4 3
mode 5 3
range 3-5 1-5
Age of operating unit
mean 19 8
mode 8 4
range 3-35 years 2-20 years
For parent company (N=42)
Years in operation
mea n 67 105
mode 37 40
range 28-170 years 26-340 years
Total number of employees, world-wide
mea n 47,890 33,700
mode 50,000 15,000
range 1000-230,000 1500-250,000

APPENDIX II: Summary of Measures for the Managerial Communications Construct

Written Communication Variables Oral Communication Variables
Volume: Interview audit of number of formal letters and Interview audit of number of a) incoming and b)
memos written per day. outgoing telephone calls to persons c) within
and d) outside the firm.
Interview audit of number of informal notes
written per day. Interview audit of the number of face-to-face
Thickness of previous year's correspondence
file (in inches). Interview audit of the frequency, length, size,
and composition of meetings.

Direction: Interview audit of the relative percentage of

written communications to headquarters, Interview audit of the percent of telephone calls
intraorganization, and extraorganization. a) received and b) initiated with 1) superiors, 2)
peers, and 3) subordinates.

Purpose: Questionnaire items asking the respondent to Interview audit of the percent of face-to-face
indicate the extent to which written interactions self-initiated and the percent of all
communication is used fora variety of purposes interactions with 1) superiors, 2) peers, and 3)
ranging from routine to non-routine activities. subordinates.

The formalization score was based on
five written indicators of formalization,
with one point awarded for each: (1)
union contract, (2) procedures manuals,
(3) production schedule, (4) organization
chart, and (5) job descriptions.


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