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061
Strong earthquake strikes off
northeastern Japan
December 07, 2012
A magnitude-7.3 earthquake struck off the coast of northeastern Japan
in the same region that was hit by a massive earthquake and tsunami
last year. Tokyo high-rises swayed for minutes, one city reported
a small tsunami and at least two people were reported injured.
The Japan Meteorological Agency said the earthquake had a preliminary
magnitude of 7.3 and struck in the Pacific Ocean off the coast of
Miyagi prefecture at 5:18 p.m. on Dec. 7. The epicenter was 10 kilometers
beneath the seabed and 240 kilometers offshore.
The tsunami warning was issued for Miyagi Prefecture, while tsunami
advisories were issued for the prefectures of Aomori, Iwate, Fukushima
and Ibaraki. The warning and advisories were canceled at 7:20 p.m.
There were no immediate reports of injuries from the earthquake
and tsunami or structural damage.
According to the Nuclear Regulation Authority, no reports had been
submitted about problems at the Fukushima No. 1 nuclear power plant,
operated by Tokyo Electric Power Co., the Onagawa nuclear power plant,
operated by Tohoku Electric Power Co., or the Tokai No. 2 nuclear
power plant, operated by Japan Atomic Power Co.
TEPCO officials held a news conference and said there were
no irregularities at the Fukushima No. 1 or No. 2 nuclear plants.
Monitoring posts also did not detect any unusually high radiation
readings.
The Nuclear Regulation Authority also said there were no problems
at the nuclear fuel reprocessing facility at Rokkasho, Aomori Prefecture,
operated by Japan Nuclear Fuel Ltd.
After the quake, which caused buildings in Tokyo to sway for
at least a minute, authorities issued a warning that a tsunami
potentially as high as 2 meters could hit. Ishinomaki, a city in Miyagi,
reported that a tsunami of 1 meter hit at 6:02 p.m.
Miyagi prefectural police said there were no immediate reports of
damage or injuries, although traffic was being stopped in some places
to check on roads.
Shortly before the earthquake struck, NHK television broke off
regular programming to warn that a strong quake was due to hit.
Afterward, the announcer repeatedly urged all near the coast
to flee to higher ground.
The quake and tsunami warning forced Prime Minister Yoshihiko Noda
to cancel campaigning in Tokyo ahead of a Dec. 16 election.
Noda was on his way back to his office, but there was no immediate plan
to hold a special Cabinet meeting.
Public spending on quake-proofing buildings is a big election issue.
Phone lines were overloaded, and it was difficult to contact residents
in Miyagi.“Owing to the recent earthquake, phone lines are very busy,
please try again later,” the telephone operator said.
The End
062
New measures to inspect aging tunnels
came too late for fatal site
Ｄｅｃ．3，2012
The fatal cave-in of ceilings inside a Chuo Expressway tunnel
in Yamanashi Prefecture on Dec. 2 occurred just after
its operator Central Nippon Expressway Co. (NEXCO Central) and
two other expressway companies started looking at measures
to inspect and repair aging roads last month.
Experts pointed to the possibility of aging as the cause of
the accident at the Sasago Tunnel in Otsuki, which left
nine people dead, and called for a review of inspection methods
and early detection of the cause of the accident.
According to NEXCO Central, the 4,784-meter Sasago Tunnel,
whose service commenced on Dec. 20, 1977, is located 82.7 kilometers
from the Takaido Interchange in Tokyo's Suginami Ward,
which is the starting point of the Chuo Expressway.
Each of the precast-concrete ceiling panels that fell off
inside the tunnel over an approximately 130-meter section measured
5 meters in width, 1.2 meters in depth, 8-9 centimeters in thickness
and weighed some 1.2-1.4 metric tons.
The ceiling boards are placed on the right and left sides
of the tunnel, with their ends fixed to the tunnel walls and
the central part fixed to metal fittings hanging from the top
of the tunnel.
The metal fittings are placed at an interval of 1.2 meters
-- the same as the depth of each ceiling board -- and partition walls
are set between those fittings, dividing the space above the ceiling
boards into right and left. One of the partitioned spaces is
for ventilating exhaust gases and the other is for supplying fresh air
into the tunnel, comprising the so-called transverse ventilation system.
In the accident, the metal fittings also fell off while the ends
of the ceiling boards were still fixed to tunnel walls, causing
a V-shaped cave-in.
The construction of the tunnel was undertaken by a consortium
of Taisei Corp. and Obayashi Corp. between August 1976 and September 1977,
with Central Nippon Highway Engineering Tokyo Co. taking on inspection
work thereafter.
According to Central Nippon Highway Engineering Tokyo, technical
experts regularly conducted visual checks and hammering tests
on the tunnel's ceilings. "Experts can estimate to a certain degree
whether the equipment is deteriorated or not based on the hammering
sound and reactions," one company official explained.
"Hammering tests are the most reliable method and are applied
to other tunnels and used by other contractors as well."
In recent years, however, the longitudinal ventilation system
-- which is free of ceiling boards and can ventilate with jet fans
and the movement of cars -- has become mainstream due to its low cost.
The transverse ventilation system, on the other hand, is more costly
with more structural objects needed.
"Although we weren't planning to update the tunnel, we'd thought
the longitudinal ventilation system was better in terms of cost
and because the ceiling boards (in the transverse ventilation system)
give drivers a sense of pressure. However, it's not easy to replace
the system because tunnels need to be closed to traffic for a long
period of time for the work," said a NEXCO Central official.
The End
063
Fat and Happy
from Beating Japan
by Francis McInerney and Sean White
The old Soviet Union's central planning organization,
Gosplan, could have taught Japan Inc. a few things about
stream-lined bureaucracy.
From headquarters in Tokyo, layer after layer of management
masterminds Japan Inc.'s every step. Somehow, the process works
in Japan. Personal networking can overcome organizational
complexity to serve Japanese customers.
Said Guy de Jonquieres in the Financial Times,
"To the western eye, the system may appear inefficient because
it occupies so many people. It works because it encourages highly
efficient diffusion of information. Not only do face-to-face
communications at every stage of product development forge
close links between different corporate functions, regular rotation
of staff ensures that all concerned understand each other's jobs.
"That's great in Japan. Unfortunately, overseas managers and
their customers are simply excluded from the process.
Companies exclude customers at their peril.
We have seen Japanese companies with as many as ten layers
between frontline employees and the CEO. Sometimes these layers
are triplicated, once in the U.S. holding company,
again in the Japanese line division,
and finally in the Japanese regional marketing organization.
In such a case, for example, a computer disk drive salesman
in Atlanta who has a request from a customer that requires
a change in the product would send a memo to the disk drive
division in suburban Tokyo. At the same time, the sales rep would
copy his memo to the North American marketing group at headquarters
in downtown Tokyo. The disk drive engineering and manufacturing
managers then study the feasibility of the request, since they
would have to make any changes in the product that are ultimately
required.
Within this line organization, an endless number of meetings
between managers, market planners, development engineers, and
product engineers takes place, each generating further meetings
and studies. The headquarters marketing people, with a disk drive
sales quota for North America to meet, analyze the market potential
of a product change and keep tabs on the disk drive line people
to make sure the request doesn't get swept under the carpet.
Meanwhile, the U.S. holding company management could get
dragged in if the change has an effect on another division or
raises legal or regulatory questions.
Confused ? Imagine how the poor salesman feels six months
after making his request. Customers, however, are not confused
by all this - they have long since moved on to another supplier.
Examples like this are not only real but common in Japanese
companies. Ironically, if the customer were in Japan,
the organization would work well, expanding and contracting
organically to meet the needs of customers, who are close at hand
(particularly big government customers and other buyers
from the keiretsu).
To control overseas operations while meeting the number one goal
of leaving cozy relations at home intact, complex matrix structures
are required. When confronted with elaborate, multilayered,
three-dimensional organization charts, Japanese executives will retort
that these charts don't reflect the real links that connect real
decision-makers. They are right: often as not, you can circle
the University of Tokyo graduates and draw lines between them
to see where the real power flows.
Unfortunately, none of their overseas employees or customers are
likely to be Todai grads, and so are off the power grid.
Competitors willing to flatten their own organizations and decentralize
decision-making can run circles around such Byzantine bureaucracies.
Of course, the Japanese do not have a monopoly on bureaucracy.
AT&T's notorious failure in computers can be traced to the extraordinary
number of layers of management between customers and decision-makers.
AT&T tried to solve its problem in computers by acquiring NCR,
avoiding the root cause of its woes. For too long, General Motors
refused to deal with the layers of management that make the company
inward-looking and all but oblivious to the needs of its customers,
preferring to hack away at the factories and blue-collar workers
who got left holding the bag.
The main purpose of the bureaucratic ramparts at GM was to protect
top management from the assaults of customers and shareholders.
And IBM continued to push all important decisions up to its celebrated
management committee at the top of the huge Big Blue bureaucracy
long after it was clear that IBM's agenda and not that of its customers
was being served.
One expensive example: IBM thought that it could rejuvenate its
mainframe business by making PCs into perfect mainframe access points;
the result was OS/2, a new generation of PC software perfectly designed
to solve IBM's problem. Selling OS/2 to other customers has proved
a big challenge.
To deal with its own inefficiencies, the bureaucratic morass
in Japan grows and grows. Teams of managers study information
about overseas markets, without ever actually talking to overseas
customers. As one Japanese executive said to us, "the biggest
problem in our company is that we have too many general managers."
Meanwhile, salesmen in the field methodically gather from customers
information which is carefully transmitted in detailed memos back
to headquarters, where it disappears, as light into a black hole
at the center of some distant galaxy, never to be seen again.
In one company we looked at, the salesmen on the ground in the States
were patching together account plans from out-of-date press releases,
newspaper clippings, and handwritten notes. Meanwhile, the market
planners in Tokyo had detail on customers in the United States
that would make the NSA blush. But this bureaucracy was not supporting
sales; quite the reverse.
Most American businesses once worked this way, but competitive
pressures during the 1980s -largely from Japan - forced American
industry to thin or eliminate layers of middle management.
By the early 1990s, even the biggest and most successful companies
in America, like AT&T and GM, finally had to face 'fully the horrors
of these irresistible pressures. Throughout America, the process
continues, as layoff after layoff decimates the ranks of white-collar
workers.
Japan's middle managers have been spared such restructuring.
Flush with cash from the appreciation of the yen in the mid-eighties,
Japan spent its way to growth. As with carpet bombing, however,
occasionally you hit something strategic. Successes are in spite of
decisions laboriously made in Tokyo, not because of them.
While in the United States "fat and happy" now means
"dead and gone," in Europe government-sponsored industrial
policies encourage mergers and consolidations to keep
the bureaucratic dinosaurs alive. Europe will probably take longer
to face the music than even Japan.
With a degree of wishful thinking that can only be called
inspirational, former Prime Minister Edith Cresson of France decided
in 1991 to combine state-owned nuclear power, biotechnology, and
information technology into one high-tech powerhouse.
Colbert would be proud. By contrast, Japan's Asian competitors
are not living in a dream world. Change may be coming to
the companies from which Japan has the most to fear.
Daewoo, a diversified Korean conglomerate with its sights set
on information technology, fired a third of its middle managers
in 1991 to speed up decision-making.
Japan cannot resist this tide of change.
Honda, for one, has tried to come to terms with its own bureaucracy.
Honda was a superstar of the 1980s, but its growth slowed dramatically
in the early 1990s, forcing the company to admit that it could not act
fast enough. Consensus decision-making was resulting in
designed-by-committee cars that were boring. Honda will now make managers
individually, not collectively, responsible for their operations.
Layers of management will be reduced. Honda is on the right track,
but there is little indication it is transferring real power
to the United States, where most of its sales are. Nevertheless,
this change is bad news for American competitors.
During the 1990s, the swollen ranks of Japanese corporate management
will break under the pressure. As Japan invests and manufactures overseas,
the inadequacies in its current management structure, designed for export,
will become ever more apparent. At the same time, the postwar era of
the great Japanese industrialists - like Shoichiro Honda of Honda Motor Co.,
Konosuke Matsushita of Matsushita Electrical Industrial Co.,
Koji Kobayashi of NEC Corp., and Akio Morita of Sony Corp. - is rapidly
coming to an end. Once these single-minded visionaries are gone
from the scene, the faceless, soulless bureaucracies must take over.
The transition will not be easy; the sheer willpower of these men,
which drove their companies forward, will disappear. Such change is
ongoing in the United States (as everywhere else).
DEC, for example, faces the retirement of Ken Olsen, a real leader
who has driven product development at DEC since day one.
But the United States made the big transition from the rule of
the great entrepreneur-industrialists -when the likes of Alfred Sloan
at GM, Thomas Watson at IBM, and J. P. Morgan reigned supreme -
to one of professional management during the immediate postwar period,
a time when its place in the world was unchallenged.
Japan will enjoy no such luxury. Bureaucracies - Japanese or otherwise
- insulate decision-makers from customers. In the bad old days,
suppliers could get away with such inefficiencies because they held
all the cards.
Governments could be counted on to stack the deck in favor of
business, especially national champions. Today, especially in America,
the customers hold all the cards, and they are aces.
The End
064
Potsdam Declaration
－Proclamation Defining Terms
for Japanese Surrender
Issued at Potsdam, July 26, 1945
(1)
We ? the President of the United States,
the President of the National Government of the Republic of China, and
the Prime Minister of Great Britain,
representing the hundreds of millions of our countrymen,
have conferred and agree that
Japan shall be given an opportunity to end this war.
(2)
The prodigious land, sea and air forces of the United States,
the British Empire and of China,
many times reinforced by their armies and air fleets from the west,
are poised to strike the final blows upon Japan.
This military power is sustained and inspired by the determination
of all the Allied Nations to prosecute the war against Japan
until she ceases to resist.
(3)
The result of the futile and senseless German resistance
to the might of the aroused free peoples of the world stands forth
in awful clarity as an example to the people of Japan.
The might that now converges on Japan is immeasurably greater
than that which, when applied to the resisting Nazis,
necessarily laid waste to the lands, the industry
and the method of life of the whole German people.
The full application of our military power, backed by our resolve,
will mean the inevitable and complete destruction of
the Japanese armed forces and just as inevitably
the utter devastation of the Japanese homeland.
(4)
The time has come for Japan to decide whether she will continue
to be controlled by those self-willed militaristic advisers
whose unintelligent calculations have brought the Empire of Japan
to the threshold of annihilation,
or whether she will follow the path of reason.
(5)
Following are our terms.
We will not deviate from them.
There are no alternatives.
We shall brook no delay.
(6)
There must be eliminated for all time the authority and
influence of those who have deceived and misled the people of Japan
into embarking on world conquest,
for we insist that a new order of peace, security and justice
will be impossible until irresponsible militarism is driven from the world.
(7)
Until such a new order is established and
until there is convincing proof that
Japan’s war-making power is destroyed,
points in Japanese territory to be designated
by the Allies shall be occupied to secure the achievement of
the basic objectives we are here setting forth.
(8)
The terms of the Cairo Declaration shall be carried out and
Japanese sovereignty shall be limited to the islands of Honshu,
Hokkaido, Kyushu, Shikoku and such minor islands as we determine.
(9)
The Japanese military forces, after being completely disarmed,
shall be permitted to return to their homes
with the opportunity to lead peaceful and productive lives.
(10)
We do not intend that the Japanese shall be enslaved as a race
or destroyed as a nation, but stern justice shall be meted out
to all war criminals, including those who have visited cruelties
upon our prisoners.
The Japanese Government shall remove all obstacles to the revival
and strengthening of democratic tendencies among the Japanese people.
Freedom of speech, of religion, and of thought, as well as respect
for the fundamental human rights shall be established.
(11)
Japan shall be permitted to maintain such industries as will sustain
her economy and permit the exaction of just reparations in kind,
but not those which would enable her to re-arm for war.
To this end, access to, as distinguished from control of,
raw materials shall be permitted. Eventual Japanese participation
in world trade relations shall be permitted.
(12)
The occupying forces of the Allies shall be withdrawn from Japan
as soon as these objectives have been accomplished
and there has been established in accordance with
the freely expressed will of the Japanese people
a peacefully inclined and responsible government.
(13)
We call upon the government of Japan to proclaim now
the unconditional surrender of all Japanese armed forces,
and to provide proper and adequate assurances of their good faith
in such action.
The alternative for Japan is prompt and utter destruction.
The End
065
An overview of Japan's wars
in the Showa Era
by YOMIURI SHIMBUN
Manchuria - start of the slide into war
More than 60 years have passed since Japan's surrender
to the Allied Powers.
The responsibility for waging the war was dealt with
by the International Military Tribunal for the Far East,
known as the Tokyo Tribunal.
The manner and circumstances in which the tribunal was administered
has long attracted criticism and its verdicts were not those of
the Japanese people.
Now is the time to reexamine the miseries of the war on Japan's own
and to identify the responsibility of the war era's political and
military leaders for their failure to avoid war.
To address this task, the Yomiuri Shimbun established an in-house
investigative panel, the War Responsibility Reexamination Committee,
comprised of members of the newspapers Editorial Board,
the Yomiuri Research Institute and senior writers from a range of
departments of the Editorial Bureau.
The outcome of this protect, undertaken by the team in collaboration
with experts from Outside the Yomiuri Shimbun, was originally published
in a 27-installment series in the newspaper between August 2005 and
August 2006.
Looking back now at the wars of the Showa Era (1926-89),
there arise a number of problems and doubts.
These can be divided into five broad questions in connection
with the Yomiuri Shimbun committee's quest concerning war responsibility:
①
Why did Japan extend the lines of battle following the 1931
Manchurian Incident, plunging the country into the quagmire of
the Sino-Japanese War ?
②
Why did Japan go to war with the United States in spite of extremely
slim prospects for victory ?
③
Shortly after victories in the initial phase of the Pacific War,
what foolishness caused the Japanese military to employ' banzai attacks,'
to command its soldiers and sailors to die-but-never-surrender, and
to resort to"kamikaze' suicide aircraft attacks after the rapid
deterioration of Japan's position ?
④
Were suffident efforts made to bring the war to an end and
was it possible to prevent the civilian devastation caused
by the atomic bombings of Hiroshima and Nagasaki ?
⑤
What were the problems with the Tokyo Tribunal in which
the Allied Powers tried Japanese political and military leaders
charged with war crimes ?
On September 18, 1931, the tracks of the South Manchurian Railway
Company's (Mantetsu) line were pounded with bombs at Liutiaohu
in the suburbs of Mukden (now Shenyang) in northeast China.
A group of high-ranking Officers of the Kwantung Army,
Japan's field army in Manchuria, including Senior Staff Officer
Seishiro Itagaki and Operations Officer Kanji Ishihara,
were responsible for plotting an explosion that would mark
the beginning of the Manchurian Incident -the conquest of Manchuna
by the Kwantung Army.
The Cabinet at that time, headed by Prime Minister Reijiro Wakatsuki,
was deeply alarmed by the incident and initially adopted a policy of
localizing the affair.
The Wakatsuki administration, however, was unable to hold in check
the intensification of military operations by the Kwantung Army and
proved to be incapable of bringing the Army under control.
The Manchurian Incident, coupled with the 1932 establishment of
a puppet state - Manchukuo -by the Kwantung Army, constituted
the start of Japan's international isolation.
Why were the government and the upper echelons of the military
in Tokyo unable to halt reckless acts perpetrated by the Kwanrung Army ?
It is worth noting that at the time Japan had an array of rights and
interests, such as Mantetsu in Manchuria, that had been acquired as
the result of Japan's victory in the 1904-05 Russo-Japanese War and
other armed conflicts.
Ishihara and his Army allies espoused the theory that Japan must
prepare for a "final war" with the United States and the Soviet Union
by harnessing natural resources from Manchua and Inner Mongolia.
In December 1931, the League of Nations formed the Lytton
Commission to determine the causes of Japan's military campaigns
in Manchuria following the railway bombing near Mukden.
Rejecting Japan's claim that the incident was in self-defense,
the five-member commission released the Lytton Report in October 1932,
denouncing the Manchurian Incident as an act of aggression by Japan.
In March 1933, following the adoption of the Lytton Report
by the General Assembly of the Leagued Nations In February,
Japan announced its withdrawal from the world body.
In an attempt to keep its interests in Manchuria intact,
Japan began the North China Separation Operation, aimed at bringing
part of northern China under Japanese control.
The operation, however, only served to add fuel to China's armed
resistance.
On July 7,1937, a clash between Chinese and Japanese troops
known as the Marco Polo Bridge (Lugougiao) Incident took place
on the outskirts of Beijing and triggered the full-scale phase of
the Sino-Japanese war.
In the early stages of the 1937-45 war, Japanese troops occupied
Nanjing, giving rise to the incident known as the 'Nankin Gyakumini
in Japanese and the "Rape of Nanking" abroad that took place between
December 1937 and January 1938. There remain disputing views
over how many Chinese were killed in the incident.
Unable to come up with a plan for peace negotiations, the then
cabinet, headed by Prime Minister Fumimaro Konoe, kept hesitating.
The Konoe Cabinet finally issued a statement declaring
japan was determined "never to consider the Nationalist (Kuomintang
government of China) as Japan's negotiatng partner."
Aims of war ill-defined
Japans national purposes for engaging in the war with China
were unclear.
A government statement issued in August 1937 said the war was
designed to "punish acts of violence committed by Chinese troops."
In November 1938, the second Konoe Cabinet issued a statement
that set the goal of the war as establishing a "New Order in East
Asia."
It is widely considered today, however, that the statement
by the Konoe Cainet was nothing but an ill-grounded cover for
glossing over Japan's bid to acquire political and economic dominance
over China.
Why was the extension of the boundaries of the Sino-Japanese War
left unchecked ? This Is a question of crucial importance
in reexamining the processes that led to the Pacific War.
In developments after the Manchurian Incident, the Japanese
military continuedued to intervene in politics.
In the wake of two coup d'etat attempts by groups of Imperial
Japanese Army officers in 1931, there were a spate of assassinations
in February and March 1932 of influential polibcal and business
leaders in what became known as the League of Blood Incident.
On May 15, 1932, a group of Imperial Japanese Navy officers broke
into the official residence of then Prime Minister Tsuyoshi Inukai
and shot him to death.
Of particular significance to the rise of militarism was a coup
d'etat attempt by a group of radical young officers of the Imperial
Army on February 26. 1936.
The rebels temporarily seized the heart of Tokyo, killing major
figures such as Lord Keeper of the Privy Seal Makoto Saito and
Finance Minister Korekiyo Takahashi.
The event, known as the February 26 (2/26) Incident, was organized
by a faction of officers called the Kodo-ha (Imperial Way Faction),
which was replaced after the incident by its rival faction,
the Tosei-ha (Control Faction), which aimed to consolidate the leadership
of the military establishment.
Such developments are considered to have paved the way for
the nefarious tendency toward influencing politics by means of terrorism.
They resulted in an end to government based on party politics,
and movements calling for a "one nation, one party" system gained ground.
In 1940. a tbtallmrian organization, Taisei Yokusan-kai (Imperial Rule
Assistance Association), was founded, leaving the Diet utterly powerless.
Even before coming under military-imposed censorship, newspapers
at the time played a key role in instigating Japan's move toward war
in the Manchurian Incident.
In this respect, the Japanese mass media should not be excluded
from responsibility for helping encourage the emergence of militarism.
Three mistakes lead to war with U.S.
Japan misread the prevailing international situation in 1941
when it went to war against the United States.
Its first mistake was its alliance with Germany and Italy
that was concluded in September 1940 by Prime Minister
Fumimaro Konoe's second Cabinet.
By this time, Germany had invaded Poland, an attack that erupted
into World War Ⅱ, ultimately pitting the United States and Britain
against Germany and Italy.
However, Japanese Foreign Minister Yosuke Matsuoka insisted
that if the three Axis nations joined forces with the Soviet Union,
the United States would be discouraged from entering the war.
Naval leaders - Mitsumasa Yonai, Isoroku Yamamoto and
Shigeyoshi Inoue - initially opposed the allaiance, but many other naval
officials wanted to advance into Southeast Asia.
This sentiment prompted the Imperial Japanese Nary to support
the alliance. Some observers argued, therefore, that the much-touted
public perception that the Nary opposed going to war with Britain
and the United States was wrong. Saying that it was the greatest
mistake of his life, Matsuoka later regretted having concluded
the Tripartite Alliance !
Japan's second blunder was the order by Konoe's third Cabinet
in July 1941 to advance into Indochina.
Japan and the United States were holding talks to avoid war
at the time. Japan proposed halting its advance into Southeast
Asian countries and pulling out of some areas in China.
But Germanys invasion of the Soviet Union led Japan to continue
its advance.
Washington froze Japan's assets in the United States as a warning
to Tokyo, but the Cabinet decided to move south anyway, an action
that restdted in a U.S. ban on oil exports to Japan.
Japan's final mistake made in the lead-up to the Pacific War
was a conference held on September 16, 1941, which was attended
by Emperor Showa.
Konoe was exploring the feasibility of talks with U.S. President
Franklin D. Roosevelt to avert war, but at the conference,
he unilaterally set a dead-line and decided that Japan would go to
war against the United States if negotiations failed.
During the Sino-Japanese War until briefly before the Pacific War,
Konoe was at the center of power for four years.
He was popular, but he did not have a finn support base and was
subsequently criticized for populism.
Hideki Tojo, who succeeded Konoe as Prime Minister, and the other
war-time Prime Ministers have to be held accountable as leaders
during the war.
Tojo, War Minister in the Konoe Cabinet, repeatedly refused U.S.
demands to pull out of China.
After Konoe stepped down, Foreign Minister Shigenori Togo continued
negotiatons with the United States.
The Hull Note, a proposal made by then U.S. Secretary of State
Cordell Hull which Japan regarded as an ultimatum demanding that it
withdraw from Indochina and China, was also a significant factor.
In addition to holding the posts of War and Home Affairs Ministers,
Tojo also served as the Chief of Army General Staff and thus wielded
tremendous power in mobilizing the public for Japan's war efforts.
War fought with an 'armchair plan'
Once a country engages in a war, it must discuss how and when
to exit from hostilities. How did Japan envisage it might end
the Pacific War ?
A war strategy document was drawn up by the Imperial Headquarters-
Government Liaison Conference immediately before the war.
The document outlined the military's rather self-serving plan
to speed up the end of the war against Britain, Chiang Kai-shek
(then leader of China), the Netherlands and the United States.
The document argued that the military should destroy the British,
Dutch and U.S. strongholds in the Far East and establish a system
of salf-sufficiency and self-defense.
Second,the strategy called for areas under Japan's control
to be expanded to push Chiang Kai-shek to step down from power.
Third, it called for Japan to work with Germany and Italy
to force Britain into submission and to discourage the United States
from continuing with the war.
Based only on such a haphazard plan, the government and japan's
Imperial Headquarters went to war against the United States
despite its overwhelming war fighting capacity.
Moreover, initial successes in the war deluded Japan into
overestimating its potential and to expand the front beyond
Japan's geogaphlcal ability to maintain its own strength.
The Guadalcanal campaign, which began in August 1942
on the southernmost end of the Solomon Islands, was nothing
but a tragedy born in a war fought without strategy.
The Imperial Japanese Navy was building an airfield
on the island as a front-line base for dividing U.S. and
Australian forces when U.S. troops mounted a full-scale offensive.
But the Imperial Headquarters made the mistake of sending
small units of troops into battle one after another, only to
have each routed by U.S. troops. The biggest factor in Japan's
defeat at Guadalcanal was its inability to transport enough
troops and supplies to the island.
Following the crushing defeat in the Battle of Midway
in June 1942,Japan gradually began losing control of the seas
in the Pacific.
Cleverly severing Japan's supply routes one by one,
the U.S. forces seized the islands that were Japan's strategic
points one after another as if they were stepping stones.
Of more than 20,000 Japanese troops who died in the Battle
of Guadalcanal, 15,000 are believed to have died of
starvation or illness.
Despite the deteriorating war situation, the Imperial
Headquarters failed to advise the government of the details
of the operation, shieldng themselves behind the independence
of the supreme command. They also concealed unfavorable
information from the public when reporting the war.
There had been an idea of "an absolute defense area" -
selected zones in the Pacific that must be protected at all costs
in the downsized battle front - but the whole idea turned out
to be no more than an armchair plan.
In May 1943 on Attu, part of the Aleutian Islands,
the first contingent of troops was wiped out in a battle
described as an "honorable defeat."
About 2,500 troops left on the island ran out of ammunition.
Instead of sending more troops in support, the Imperial
Headquarters wired Attu, "When it comes to the end,
we hope you will gracefully choose honorable deaths,
with determination to show the flower of the spirit of
Imperial military personnel."
The U.S.forces appealed to the soldiers to surrender,
but the Japanese soldiers charged forward to their deaths,
binding each others'legs together with rope so that no one
could hesitate.
In July 1944,troops in Saipan chose a similar fate.
And the government and the Imperial Headquarters began
ordering airmen to carry out suicide attack with planes
on enemy ships
without trying to bring about the end of the war.
The End
066
JAPAN'S WAR PLAN
from The Ｅｆｆｅｃｔ of Ｓｔｒａｔｅｇｉｃ Bombing
on Ｊａｐａｎ’ｓ Ｗａｒ Ｅｃｏｎｏｍｙ
ｂｙ United States Strategic Bombing Survey
Japan's decision to go to war with the United States
and the war plan upon which it counted to achieve
its objectives can be understood only in the light
of the background sketched above.
The tradition of success, with limited commitments,
the imminence of Germany's victory on the European Continent
- these counted for more in the minds of Japan's war planners
than any careful balancing of Nipponese and American war potentials.
Above all, they biased the thinking of the high command
toward the notion that the war would not be a lengthy enterprise.
Total war, annihilation of the enemy,
and occupation of the United States
never entered the planning of the Japanese military.
One or two crucial battles were expected to determine
the outcome of the conflict.
The Pacific war, was to follow the pattern set
by the Russian-Japanese hostilities in 1905.
A terrific blow at Pearl Harbor would inflict
a disastrous Cannae on the American Pacific fleet.
Combined with Russia's defeat and England's inevitable doom,
this would assure American willingness to enter peace negotiations.
A settlement satisfying most Japanese demands
would be in sight within 6 months.
The End
067
The Lytton Report
LEAGUE OF NATIONS ASSEMBLY REPORT
ON THE SINO-JAPANESE DISPUTE
The following report was adopted by the Assembly
on February 24th, 1933.
REPORT
The Assembly, in view of the failure of the efforts
which, under Article 15, paragraph 3, of the Covenant,
it was its duty to make with a view to effecting a settlement
of the dispute submitted for its consideration under
paragraph 9 of the said article, adopts, in virtue of
paragraph 4 of that article, the following report containing
a statement of the facts of the dispute and the recommendations
which are deemed just and proper in regard thereto.
PART I
Events at The Far East.
Adoption of The First Eight Chapters of The Report of
The Commission of Enquiry. Plan of The Report
The underlying causes of the dispute between China and Japan
are of considerable complexity. The Commission of Enquiry sent
by the Council to study the situation on the spot expresses
the view that the "issues involved in this conflict are not
as simple as they are often represented to be. They are,
on the contrary, exceedingly complicated, and only an intimate
knowledge of all the facts, as well as of their historical
background, should entitle anyone to express a definite opinion
upon them."
The first eight chapters of the report of the Commission of
Enquiry present a balanced, impartial and detailed statement
of the historical background of the dispute and of the main facts
in so for as they relate to events in Manchuria. It would be
both impracticable and superfluous either to summarise or
to recapitulate the report of the Commission of Enquiry,
which has been published separately; after examining
the observations communicated by the Chinese and Japanese
Governments, the Assembly adopts as ・・・・・
The Lytton Report on the Manchurian Crisis
The report of the Commission of Enquiry appointed
by the Council of the League of Nations, upon the relations
between China and Japan affecting Manchuria, generally known
as the Lytton Report,' was officially circulated to the Council
and the members of the League on October 1, 1932, having been
signed at Peiping early in September.
The appointment of the commission followed proceedings initiated
by the Chinese Government before the League under Article XI of
the Covenant which declares that "any war or threat of war,
whether immediately affecting any of the members of the League
or not "is" a matter of concern to the whole League."
It is significant that the action of the Council was initiated
under this article rather than under the more forceful provision
of Article X which speaks of "external aggression" and "territorial
integrity"; or under the categorical provisions of Article XII
dealing with "any dispute likely to lead to a rupture" and
providing for a submimion to arbitration or inquiry by the Council.
Article XI is more comprehensive in scope and allows greater
latitude in method.
The appeal by the Chinese Government to the Council requested it
to "take immediate steps to prevent the further development of
a situation endangering the peace of nations"
Two resolutions adopted by the Council on September 30 and
December 10,1931, respectively, were directed toward the taking
of such interim measures as were deemed essential to prevent
any aggravation of the situation growing out of the events
at Mukden on September 18-19,1931.
The resolution of December 10 went beyond the scope of
the earlier one, in that it expressed the desire of the Council
"to contribute towards a final and fundamental solution
by the two governments of the questions at issue between them."
The Council accordingly decided to appoint a commission of
five members "to study on the spot and to report to the Council
on any circumstances which, affecting international relations,
threaten to disturb the peace between China and Japan,
or the good understanding between them upon which peace depends."
It is important to note that both contending governments had
already proposed a neutral commission of enquiry to be sent
to the same of the dispute.
The commission of enquiry authorised by the Council was
to be purely advisory in character. It differed thus from
the commissions envisaged under the treaties of the First and
Second Hague Peace Conferences ・・・・・
068
Death on the Silkroad
by Richard Hering & Stuart Tanner
This extraordinary undercover report from China
exposes the suffering of thousands of Chinese
whose lives have been destroyed by nuclear testing.
It presents exclusive evidence from inside China of
spiraling levels of cancer and birth deformities
among the population of Xinjiang province -
part of the Great Silk Road -
which was opened to tourists in 1985.
Up until 1996, China had carried out extensive
nuclear tests in the Zinjiang province,
which is in the northwest corner of China,
bordering Kazakhstan. But Xinjiang is not unpopulated
and isolated, as was Bikini Atoll.
The filmmakers interviewed both victims and the doctors
who are struggling to cope with their medical problems
in the region's hospitals.
The documentary reveals that the tests were carried out
under highly dangerous conditions, which could have
consequences beyond China's borders.
The End
069
Ends and Means of
an Accounting System
from Introduction to Management Accounting
by Charles T. Horngren
An accounting system is a formal means of gathering data
to aid and coordinate collective decisions in light of
the overall goals or objectives of an organization.
The accounting system is the major quantitative information
system in almost every organization. An effective accounting
system provides information for three broad purposes or ends:
(1)
internal reporting to managers, for use in planning and
controlling routine operations;
(2)
internal reporting to managers, for use in strategic planning,
that is, the making of special decisions and the formulating
of overall policies and long-range plans;
(3)
external reporting to stockholders, government, and other
outside parties.
Both management (internal parties) and external parties share
an interest in all three important purposes, but the emphases
of financial accounting and of management (internal) accounting
differ.
Financial accounting has been mainly concerned with the third
purpose and has traditionally been oriented toward the historical,
stewardship aspects of external reporting.
The distinguishing feature of management accounting is its
emphasis on the planning and control purposes. Management accounting
is concerned with the accumulation, classification, and interpretation
of information that assists individual executives to fulfill
organizational objectives as revealed explicitly or implicitly
by top management.
What means do accounting systems use to fulfill the ends ?
Accounting data can be classified and reclassified in countless ways.
A helpful overall classification was proposed in a research study
of seven large companies with geographically dispersed operations:
The research team found that three types of information,
each serving as different means, often at various management levels,
raise and help to answer three basic questions:
1. Scorecard questions:
Am I doing well or badly?
2. Attention-directing questions:
Which problems should I look into?
3. Problem-solving questions:
Of the several ways of doing the job, which is the best ?
The scorecard and attention-directing uses of data are closely
related. The same data may serve a scorecard function for a foreman
and an attention-directing function for the foreman's superior.
For example, many accounting systems provide performance reports
in which actual results are compared with previously determined
budgets or standards. Such a performance report often helps
to answer scorecard questions and attention-directing questions
simultaneously. Furthermore, the actual results collected serve
not only control purposes but also the traditional needs of
financial accounting, which is chiefly concerned with the answering
of scorecard questions. This collection, classification, and
reporting of data is the task that dominates day-to-day accounting.
Problem-solving data may be used in long-range planning and
in making special, nonrecurring decisions, such as whether to make
or buy parts, replace equipment, or add or drop a product.
These decisions often require expert advice from specialists
such as industrial engineers, budgetary accountants, and
statisticians.
In sum, the accountants task of supplying information has
three facets:
1. Scorekeeping.
The accumulation of data. This aspect of accounting enables
both internal and external parties to evaluate organizational
performance and position.
2. Attention directing.
The reporting and interpreting of information that helps managers
to focus on operating problems, imperfections, inefficiencies,
and opportunities. This aspect of accounting helps managers
to concern themselves with important aspects of operations
promptly enough for effective action either through perceptive
planning or through astute day-to-day supervision. Attention
directing is commonly associated with current planning and control
and with the analysis and investigation of recurring routine
internal-accounting reports.
3. Problem solving.
This aspect of accounting involves the concise quantification
of the relative merits of possible courses of action, often
with recommendations as to the best procedure. Problem solving
is commonly associated with nonrecurring decisions, situations
that require special accounting analyses of reports.
The End
070
Business Realities
from Managing for Results Page ３～１４
by Peter F. Drucker
That executives give neither sufficient time nor sufficient thought
to the future is a universal complaint.
Every executive voices it when he talks about his own working day
and when he talks or writes to his associates. It is a recurrent theme
in the articles and in the books on management.
It is a valid complaint. Executives should spend more time and thought
on the future of their business. They also should spend more time and thought
on a good many other things, their social and community responsibilities
for instance.
Both they and their businesses pay a stiff penalty for these neglects.
And yet, to complain that executives spend so little time on the work of
tomorrow is futile.
The neglect of the future is only a symptom;
the executive slights tomorrow because he cannot get ahead of today.
That too is a symptom. The real disease is the absence of any foundation
of knowledge and system for tackling the economic tasks in business.
Today's job takes all the executive's time, as a rule;
yet it is seldom done well. Few managers are greatly impressed
with their own performance in the immediate tasks.
They feel themselves caught in a "rat race," and managed
by whatever the mailboy dumps into their "in" tray.
They know that crash programs which attempt to "solve" this
or that particular "urgent" problem rarely achieve right and lasting results.
And yet, they rush from one crash program to the next.
Worse still, they known that the same problems recur again and again,
no matter how many times they are "solved."
Before an executive can think of tackling the future,
he must be able therefore to dispose of the challenges of today in less time
and with greater impact and permanence.
For this he needs a systematic approach to today's job.
There are three different dimensions to the economic task:
①
The present business must be made effective;
②
its potential must be identified and realized;
③
it must be made into a different business for a different future.
Each task requires a distinct approach. Each asks different questions.
Each comes out with different conclusions. Yet they are inseparable.
All three have to be done at the same time: today.
All three have to be carried out with the same organization,
the same resources of men, knowledge, and money, and
in the same entrepreneurial process.
The future is not going to be made tomorrow;
it is being made today, and largely by the decisions and
actions taken with respect to the tasks of today.
Conversely, what is being done to bring about the future directly
affects the present. The tasks overlap. They require one unified strategy.
Otherwise, they cannot really get done at all.
To tackle any one of these jobs, let alone all three together,
requires an understanding of the true realities of the business
as an economic system, of its capacity for economic performance,
and of the relationship between available resources and possible results.
Otherwise, there is no alternative to the "rat race."
This understanding never comes ready-made;
it has to be developed separately for each business.
Yet the assumptions and expectations that underlie it are largely common.
Businesses are different, but business is much the same,
regardless of size and structure, of products, technology and markets,
of culture and managerial competence.
There is a common business reality.
There are actually two sets of generalizations that apply
to most businesses most of the time: one with respect to the results
and resources of a business, one with respect to its efforts.
Together they lead to a number of conclusions regarding the nature
and direction of the entrepreneurial job.
Most of these assumptions will sound plausible, perhaps even familiar,
to most businessmen, but few businessmen ever pull them together
into a coherent whole.
Few draw action conclusions from them, no matter how much
each individual statement agrees with their experience and knowledge.
As a result, few executives base their actions on these,
their own assumptions and expectations.
1.
Neither results nor resources exist inside the business.
Both exist outside. There are no profit centers within the business;
there are only cost centers.
The only thing one can say with certainty about any business activity,
whether engineering or selling, manufacturing or accounting, is that
it consumes efforts and thereby incurs costs. Whether it contributes
to results remains to be seen.
Results depend not on anybody within the business nor on anything
within the control of the business. They depend on somebody outside--
the customer in a market economy, the political authorities
in a controlled economy.
It is always somebody outside who decides whether the efforts of
a business become economic results or whether they become
so much waste and scrap.
The same is true of the one and only distinct resource of any business:
knowledge.
Other resources, money or physical equipment, for instance,
do not confer any distinction.
What does make a business distinct and
what is its peculiar resource is its ability to use knowledge of all kinds
--from scientific and technical knowledge to social, economic, and
managerial knowledge.
It is only in respect to knowledge that a business can be distinct,
can therefore produce something that has a value in the market place.
Yet knowledge is not a business resource. It is a universal social resource.
It cannot be kept a secret for any length of time.
"What one man has done, another man can always do again" is old and
profound wisdom. The one decisive resource of business, therefore,
is as much outside of the business as are business results.
Indeed, business can be defined as a process that converts
an outside resource, namely knowledge, into outside results,
namely economic values.
2.
Results are obtained by exploiting opportunities,
not by solving problems.
All one can hope to get by solving a problem is to restore normality.
All one can hope, at best, is to eliminate a restriction on the capacity
of the business to obtain results.
The results themselves must come
from the exploitation of opportunities.
3.
Resources, to produce results, must be allocated to opportunities
rather than to problems. Needless to say, one cannot shrug off all problems,
but they can and should be minimized.
Economists talk a great deal about the maximization of profit in business.
This, as countless critics have pointed out, is so vague a concept as
to be meaningless.
But "maximization of opportunities" is a meaningful, indeed a precise,
definition of the entrepreneurial job. It implies that effectiveness rather than
efficiency is essential in business. The pertinent question is not how to do things right
but how to find the right things to do,
and to concentrate resources and efforts on them.
4.
Economic results are earned only by leadership,
not by mere competence.
Profits are the rewards for making a unique, or at least a distinct,
contribution in a meaningful area;
and what is meaningful is decided by market and customer.
Profit can only be earned by providing something the market accepts
as value and is willing to pay for as such.
And value always implies the differentiation of leadership.
The genuine monopoly, which is as mythical a beast as the unicorn
(save for politically enforced, that is, governmental monopolies),
is the one exception.
This does not mean that a business has to be the giant of its
industry nor that it has to be first in every single product line,
market, or technology in which it is engaged.
To be big is not identical with leadership. In many industries
the largest company is by no means the most profitable one,
since it has to carry product lines, supply markets, or apply
technologies where it cannot do a distinct, let alone a unique job.
The second spot, or, even the third spot is often preferable,
for it may make possible that concentration on one segment of
the market, on one class of customer, on one application of
the technology, in which genuine leadership often lies.
In fact, the belief of so many companies that they could or
should have leadership in everything within their market or industry
is a major obstacle to achieving it.
But a company which wants economic results has to have leadership
in something of real value to a customer or market．
.
It may be in one narrow but important aspect of the product line,
it may be in its service, it may be in its distribution, or it may be in its ability
to convert ideas into salable products on the market speedily and at low cost.
Unless it has such leadership position, a business, a product, a service,
becomes marginal.
It may seem to be a leader,
may supply a large share of the market,
may have the full weight of momentum, history, and tradition behind it.
But the marginal is incapable of survival in the long run,
let alone of producing profits. It lives on borrowed time.
It exists on sufferance and through the inertia of others.
Sooner or later, whenever boom conditions abate,
it will be squeezed out.
The leadership requirement has serious implications
for business strategy. It makes most questionable, for instance,
the common practice of trying to catch up with a competitor
who has brought out a new or improved product.
All one can hope to achieve thereby is to become a little less marginal.
It also makes questionable "defensive research" which throws scarce
and expensive resources of knowledge into the usually futile task of
slowing down the decline of a product that is already obsolete.
5.
Any leadership position is transitory and likely to be shortlived.
No business is ever secure in its leadership position.
The market in which the results exist, and the knowledge
which is the resource, are both generally accessible.
No leadership position is more than a temporary advantage.
In business (as in a physical system) energy always tends toward diffusion.
Business tends to drift from leadership to mediocrity.
And the mediocre is threequarters down the road to being marginal.
Results always drift from earning a profit toward earning, at best,
a fee which is all competence is worth.
It is, then, the executive's job to reverse the normal drift.
It is his job to focus the business on opportunity and away from problems,
to re-create leadership and counteract the trend toward mediocrity,
to replace inertia and its momentum by new energy and new direction.
The second set of assumptions deals with the efforts
within the business and their cost.
6.
What exists is getting old. To say that most executives spend most
of their time tackling the problems of today is euphemism.
They spend most of their time on the problems of yesterday.
Executives spend more of their time trying to unmake the past than
on anything else.
This, to a large extent, is inevitable. What exists today is of necessity
the product of yesterday. The business itself-its present resources,
its efforts and their allocation, its organization as well as its products,
its markets and its customers-xpresses necessarily decisions and actions
taken in the past.
Its people, in the great majority, grew up in the business of yesterday.
Their attitudes, expectations, and values were formed at an earlier time;
and they tend to apply the lessons of the past to the present.
Indeed, every business regards what happened in the past as normal,
with a strong inclination to reject as abnormal whatever does not fit
the pattern.
No matter how wise, forward-looking, or courageous the decisions
and actions were when first made, they will have been overtaken
by events by the time they become normal behavior and the routine
of a business.
No matter how appropriate the attitudes were when formed,
by the time their holders have moved into senior,
policy making positions, the world that made them no longer exists.
Events never happen as anticipated; the future is always different.
Just as generals tend to prepare for the last war, businessmen always
tend to react in terms of the last boom or of the last depression.
What exists is therefore always aging. Any human decision or
action starts to get old the moment it has been made.
It is always futile to restore normality; "normality" is only the reality
of yesterday. The job is not to impose yesterday's normal
on a changed today; but to change the business, its behavior,
its attitudes, its expectations -- as well as its products, its markets,
and its distributive channels -- fit the new realities.
7.
What exists is likely to be misallocated. Business enterprise is not
a phenomenon of nature but one of society. In a social situation,
however, events are not distributed according to the "normal distribution"
of a natural universe (that is, they are not distributed according to
the bell-shaped Gaussian curve).
In a social situation a very small number of events at one extreme --
the first 10 per cent to 20 per cent at most-- acount for 90 per cent
of all results; whereas the great majority of events accounts for 10 per cent
or so of the results.
This is true in the market place: a handful of large customers out of
many thousands produce the bulk of orders; a handful of products
out of hundreds of items in the line produce the bulk of the volume;
and so on.
It is true of sales efforts: a few salesmen out of several hundred
always produce two-thirds of all new business.
It is true in the plant: a handful of production runs account for
most of the tonnage.
It is true of research: the same few men in the laboratory are apt
to produce nearly all the important innovations.
It also holds true for practically all personnel problems:
the bulk of the grievances always comes from a few places
or from one group of employees (for example, from the older
unmarried women or from the clean-up men on the night shift),
as does the great bulk of absenteeism, of turnover, of suggestions
under a suggestion system, of accidents. As studies at the New York
Telephone Company have shown, this is true even in respect to sickness.
The implications of this simple statement about normal distribution
are broad.
It means, first: while 90 per cent of the results are being produced
by the first 10 per cent of events, 90 per cent of the costs are incurred
by the remaining and resultless 90 per cent of events.
In other words, results and costs stand in inverse relationship
to each other. Economic results are, by and large, directly
proportionate to revenue, while costs are directly proportionate
to the number of transactions. (The only exceptions are the
purchased materials and parts that go directly into the final product.)
A second implication is that resources and efforts will normally
allocate themselves to the 90 per cent of events that produce
practically no results. They will allocate themselves to the number of
events rather than to the results.
In fact, the most expensive and potentially most productive resources
(i.e., highly trained people) will misallocate themselves the worst.
For the pressure exerted by the bulk of transactions is fortified
by the individual's pride in doing the difficult--whether productive or not.
This has been proved by every study. Let me give some examples:
A large engineering company prided itself on the high quality and
reputation of its technical service group, which contained several
hundred expensive men. The men were indeed first-rate.
But analysis of their allocation showed clearly that while they worked hard,
they contributed little.
Most of them worked on the "interesting" problems--especially those
of the very small customers--problems which, even if solved,
produced little business.
The automobile industry was the company's major customer and
accounted for almost one-third of all purchases. But few technical
service people had within memory set foot in the engineering department
or the plant of an automobile company.
"General Motors and Ford don't need me; they have their own people"
was their reaction.
Similarly, in many companies, salesmen are misallocated.
The largest group of salesmen (and the most effective ones)
are usually put on the products that are hard to sell,
either because they are yesterday's products or because they are
alsorans which managerial vanity desperately is trying to make into winners.
Tomorrow's important products rarely get the sales effort required.
And the product that has sensational success in the market,
and which therefore ought to be pushed all out, tends to be slighted.
"It is doing all right without extra effort, after all" is the common conclusion.
Research departments, design staffs, market development efforts,
even advertising efforts have been shown to be allocated the same way
in many companies--by transactions rather than by results,
by what is difficult rather than by what is productive,
by yesterday's problems rather than by today's and tomorrow's opportunities.
A third and important implication is that revenue money and
cost money are rarely the same money stream.
Most businessmen see in their mind's eye -- and most accounting
presentations assume -- that the revenue stream feeds back
into the cost stream, which then, in turn, feeds back into the revenue stream.
But the loop is not a closed one. Revenue obviously produces the wherewithal
for the costs. But unless management constantly works at directing efforts
into revenue-producing activities, the costs will tend to allocate themselves
by drifting into nothing-producing activities, into sheer busy-ness.
In respect then to efforts and costs as well as to resources and
results the business tends to drift toward diffusion of energy.
There is thus need for constant reappraisal and redirection; and
the need is greatest where it is least expected: in making the present
business effective.
It is the present in which a business first has to perform with effectiveness.
It is the present where both the keenest analysis and the greatest energy
are required.
Yet it is dangerously tempting to keep on patching yesterday's garment
rather than work on designing tomorrow's pattern.
A piecemeal approach will not suffice. To have a real understanding
of the business, the executive must be able to see it in its entirety.
He must be able to see its resources and efforts as a whole and
to see their allocation to products and services, to markets, customers,
end-uses, to distributive channels.
He must be able to see which efforts go onto problems and
which onto opportunities.
He must be able to weigh alternatives of direction and allocation.
Partial analysis is likely to misinform and misdirect.
Only the over-all view of the entire business as an economic system
can give real knowledge.
8.
Concentration is the key to economic results. Economic results require
that managers concentrate their efforts on the smallest number of products,
product lines, services, customers, markets, distributive channels, end-uses,
and so on, that will produce the largest amount of revenue.
Managers must minimize the amount of attention devoted to products
which produce primarily costs because, for instance, their volume is too small
or too splintered.
Economic results require that staff efforts be concentrated on the few activities
that are capable of producing significant business results.
Effective cost control requires a similar concentration of work and efforts
on those few areas where improvement in cost performance will have significant
impact on business performance and results--that is, on those areas where
a relatively minor increase in efficiency will produce a major increase
in economic effectiveness.
Finally, human resources must be concentrated on a few major opportunities.
This is particularly true for the high-grade human resources through which
knowledge becomes effective in work. And, above all it is true for the scarcest,
most expensive, but also potentially most effective of all human resources
in a business: managerial talent.
No other principle of effectiveness is violated as constantly today
as the basic principle of concentration. This, of course, is true
not only of businesses. Governments try to do a little of everything.
Today's big university (especially in the United States) tries to be all things
to all men, combining teaching and research, community services,
consulting activities, and so on. But business --especially large business--
is no less diffuse.
Only a few years ago it was fashionable to attack American industry
for "planned obsolescence." And it has long been a favorite criticism of
industry, especially American industry, that it imposes "deadening
standardization." Unfortunately industry is being attacked for doing
what it should be doing and fails to do.
Large United States corporations pride themselves on being willing
and able to supply any specialty, to satisfy any demand for variety,
even to stimulate such demands. Any number of businesses boast
that they never of their own free will abandon a product.
As a result, most large companies end up with thousands of items
in their product line-- and all too frequently fewer than twenty really sell.
However, these twenty or fewer items have to contribute revenues
to carry the costs of the 9,999 non-sellers.
Indeed, the basic problem of United States competitive strength
in the world today may be product clutter. If properly costed,
the main lines in most of our industries prove to be fully competitive,
despite our high wage rate and our high tax burden.
But we fritter away our competitive advantage in the volume products
by subsidizing an enormous array of specialties, of which only a few recover
their true cost.
In electronics, for instance, the competition of the Japanese portable
transistor radio rests on little more than the Japanese concentration
on a few models in this one line--is against the uncontrolled plethora of
barely differentiated models in the United States manufacturers' lines.
We are similarly profligate in this country with respect to staff activities.
Our motto seems to be: "Let's do a little bit of everything"
- personnel research, advanced engineering, customer analysis,
international economics, operations research, public relations, and so on.
As a result, we build enormous staffs, and yet do not concentrate
enough effort in any one area.
Similarly, in our attempts to control costs, we scatter our efforts
rather than concentrate them where the costs are.
Typically the cost-reduction program aims at cutting a little bit -
say, 5 or 10 per cent - off everything. This across-the-board cut is
at best ineffectual; at worst, it is apt to cripple the important,
result-producing efforts which usually get less money than they need
to begin with.
But efforts that are sheer waste are barely touched by the typical
cost-reduction program; for typically they start out with a generous budget.
These are the business realities, the assumptions that are likely
to be found valid by most businesses at most times, the concepts
with which the approach to the entrepreneurial task has to begin.
They have only been sketched here in outline; each will be discussed
in detail in the course of the book. That these are only assumptions
should be stressed. They must be tested by actual analysis;
and one or the other assumption may well be found not to apply
to any one particular business at any one particular time.
Yet they have sufficient probability to provide the foundation
for the analysis the executive needs to understand his business.
They are the starting points for the analysis needed for all three
of the entrepreneurial tasks: making effective the present business;
finding business potential; and making the future of the business.
The small and apparently simple business needs this understanding
just as much as does the big and highly complex company.
Understanding is needed as much for the immediate task of effectiveness
today as it is for work on the future, many years hence. It is a necessary tool
for any executive who takes seriously his entrepreneurial responsibility.
And it is a tool which can neither be fashioned for him nor wielded for him.
He must take part in making it and using it. The ability to design and develop
this tool and the competence to use it should be standard equipment
for the business executive.
Ｔｈｅ Ｅｎｄ
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