The most essential difference between management accounting in the United States and Japan is philosophical. Accounting plays more of an "influential" than an "informational" role in Japan. In general, Japanese accounting systems are designed to be consistent with corporate strategy, not independent of it. There is a more direct linkage than in the United States between management accounting practices and overall corporate goals.

In the past, cheap, centralized power and efficient but expensive production machinery tipped the competitive advantage toward large companies. Now low-cost computing and communications are tipping the advantage to a new organizational form: the "value-adding partnership". VAPs are groups of small companies that perform different steps along the value-added chain. The partners share information freely and perceive the whole chain as one competitive unit. VAPs have the benefits of both large and small companies: focus and flexibility as well as coordination and sharing. However, VAPs require a delicate balance of power between partners: What happens if one partner tries to take over another?

Competitive advantage is a constantly moving target. Leading Japanese companies provide a window on strategic change and its progression from the 1940s to today. Since World War II, Japanese competitors have shifted their strategic focus at least four times. They began by exploiting their low labor rates to gain entry to various markets, then moved to a scale-based strategy. From there they shifted to focused factories and finally to flexible manufacturing. This latter strategy gave the Japanese both lower costs and a greater variety of products. One result was the outbreak of variety wars in the early 1980s. The variety wars signaled a shift to time-based competitive advantage. The leading Japanese companies today recognize that time is the most critical competitive yardstick of company performance. McKinsey Award Winner.

Multifunctional teams are the most effective way for companies to design products strategically. The team needs to: determine the product's character; subject the product to a rigorous functional analysis; design parts for productibility, exploiting the best available materials and methods; design the assembly sequence to facilitate the parts' and quality control testing; and design a factory system stressing standard work methods, quick repair of equipment, and employee motivation.

Students will read the case and prepare an action plan for class. In class the students will discuss their action plan for the formation of a new company.

An Tai Bao is the world's largest open-pit coal mine and is located in China's Shanxi province. After eight years of planning and negotiating, Occidental Petroleum, the foreign partner in the deal, is about to sign an ownership and financing agreement for $475 million that involves $20 million of its own equity and limited recourse. The deal contains a number of unusual features including the tying of recourse to nonconcurrent, partial competition tests, and a covenant forcing sponsors to buy back the entire project from the joint venture owning it in the event of postcompletion default. Students are required to determine if the terms of the deal are attractive to each of the parties involved.

1980 was a critical time for John Hancock with high inflation, high interest rates, increased competition, and the desertion of policy holders seeking new investment opportunities. A new lower level (of vice presidents) task force was set up by the executive committee (also struggling to build cooperative teamwork) to come up with new strategic visions and directions. The task force has group problems. A rewritten version of an earlier case.

Describes what happened after the apparent eruption and traumas within the task force described in the (A) case. The task force moved from being "the very worst committee" according to one member to becoming "the very best." Tries to explain how and why. Also describes some of the longer term outcomes.

Describes the continuous flow process used to process cranberries into juice and/or sauce. Requires student to analyze process flows to determine where the bottlenecks are and to decide how, and whether, to expand capacity. Original version written by J.G. Miller and R.P. Olson.

Synthesizes a wide range of literature and experience concerning comparative government-business relations, focusing especially on Japan, Europe, and the United States with some references to Brazil and Mexico. Designed for discussion in two consecutive class sessions. The first class should address the first 26 pages which relate to the different conceptions of the role, purpose, and structure of governments. The second class should consider pages 26 to 40 which concern the different roles, purposes, and structures of business. At the end are some discussion questions. Makes use of ideology as an analytical concept and as a framework for comparing different national systems.

Discusses the growing competition faced by U.S. producers of civil aircraft due to the success and expanding product line of Airbus Industries. Designed to foster discussion of international trade policy as it affects producers in the industry and to encourage firm managers to consider competitive strategies, given their influence over trade policy negotiations. A rewritten version of an earlier case.

Presents partial resolution of problem. Cites points still to be resolved in trade dispute between U.S. aircraft manufacturers and Airbus Industrie. To be used as a handout after discussion of the case.

Describes the development of Matsushita's international operations and the building of its dominant competitive position in the consumer electronics industry. Picks up the major challenges facing the company in 1987 as both its product focus and geographic posture are brought into question. The president is implementing two projects, Action 86 to shift the business focus from consumer to industrial electronics and Operation Localization to shift more of the value added offshore.

An office lease can create financial difficulty if a tenant ignores provisions that landlords can use to gain extra income. The author points out some of the more arcane clauses and tells you how to protect yourself.

If government policies are important to an industry's competitive future, then political activism deserves as much executive time and energy as other business priorities. The challenge is to create and sustain political advantage - to develop a stable, ongoing relationship that makes Washington an ally in the battle for global competitiveness. The political effectiveness of the semiconductor industry during the past five years shows what it takes to succeed, even with limited political assets.

Excess cash and unused debt capacity make up a company's financial inventory. Too little can be crippling. But too much costs money and invites takeovers. To determine the proper balance, CFOs must understand three factors: the cost of holding reserves, the risks that reserves protect against, and the needs that reserves may have to cover.

George Gilder, in the March-April 1988 HBR, attacked MIT's Charles Ferguson for believing that many, small, entrepreneurial companies will do more for U.S. competitiveness than a few, large, integrated ones. Gilder claimed that advanced computer technology (engendering the "law of the microcosm") lowers barriers to market entry and promises to make talk of a national industrial policy obsolete. Here Charles Ferguson joins the debate and refutes Gilder's claims with an analysis of the U.S. semiconductor industry. Ferguson shows that U.S. companies lose out, not to nimble, small companies but to huge, protected Japanese complexes that are embedded in stable, concentrated, coordinated alliances.

The old performance appraisal system at American Cyanamid Co. had so many detractors it became a target in the company's effort to find ways to improve employees' quality of life. An experiment in the Medical Research Division substituted three ratings for the ten in the old review procedure and called for no recommended distribution. The new plan assumed that almost all employees perform capably and conscientiously at their jobs, though in a few cases performance is so impressively good or egregiously bad that it should get special recognition. Supervisors were now encouraged to stress positive instead of negative aspects of each subordinate's work.

Manufacturing companies striving to compete on quality must design products that not only are technically elegant and manufacturable but also reflect customers' desires and tastes. For optimal results, marketers, designers, engineers, and strategists should work closely together from product conception to end result. A Japanese innovation, the house of quality, can help get interfunctional-team conversations started. Presented here in clear, step-by-step exhibits, the house is a conceptual map on which interdisciplinary teams can display and organize the evidence they need to set targets for design. Once all relevant facts are on the grid, the team makes its choices. The process has clarified opportunities, stimulated negotiation, and helped set an agenda. And the format is flexible. Once engineering targets have been set, the team can draw up new houses.