An American view of the Omron culture
Extract from JimPinto.com eNews May. 21, 2004.
The management structure of Omron is no different than of any other
Japanese company. Each of the major Omron companies outside Japan has
a Japanese "watchdog" to oversee activities, as a primary Japanese link
with Japan HQ. Omron is divided into 5 geographic regions: Japan,
The Americas, Europe, South East Asia and China. Countries within a
region (e.g.: Canada, France, England, Australia, etc.) are typically
managed by locals, though each of the regions has a Japanese executive
responsible for that region.
The normal term for the Regional Japanese executive is 5 years. Some
are more active in the business operations than others, depending upon
the individual. Omron always gives the local management a lot of freedom
in operating the business. This includes business plan development,
personnel, marketing, sales, promotion, etc. No one is expected to do
something simply because it was being done in Japan. However, local
managers try to coordinate some activities which make sense globally.
There is no real difference from an operating division of an American
company. Managers are expected to achieve specific local targets and
corporate goals such as sales growth, profit ratios, etc. It seems that
Omron understands that other countries are different from Japan, and
to market products and manage a local organization successfully in
these other regions requires local management.
In Omron Japan, 99% of the staff joined Omron directly out of University.
Many are engineers, and begin their careers in sales or engineering to
gain that experience. Then, depending upon their skills, they are assigned
to areas in which their strengths can be best utilized. Though the process
of advancement into management is changing slowly, age and seniority
continue to be recognized as important criteria at Omron. In addition,
positive manager evaluations and management tests are required for
advancement. Many of those designated to be on the fast track are sent
to an overseas operation to gain global experience. It is interesting
to note that most of the present executive management of Omron have worked
in the US earlier in their careers, and English is their second language.
An important change which has taken place in the past few years at Omron
Japan is the implementation of a Management by Objectives (MBO) system.
The amount of a bonus earned is based upon MBO achievement, and not
seniority (which was the previous criterion).
In the past, Omron was similar to most Japanese companies whereas lifetime
employment was a given. Last year Omron Japan implemented early retirement
programs and reduced employment in Japan by 1500 employees to reduce
overhead costs. Japanese employees are being urged to think more on an
individual basis in decision making rather than the traditional group
thinking. In other words, Omron is becoming more Westernized in its
management thinking.
Like many Japanese companies, failed Japanese managers at Omron are
shifted to another position or put "by the window" until retirement.
In very rare exceptions they may be let go. This is not true for
non-Japanese management, who are given every chance to improve
performance, failing which they are terminated.
Industrial Automation - the Japanese players
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