Efficiency vs. effectiveness orientation of global sourcing strategy: A comparison of U.S. and Japanese multinational companies

Masaaki Kotabe

Research output: Contribution to journalArticlepeer-review

86 Citations (Scopus)

Abstract

During most of this decade, Japan has been mired in its longest post-war recession. Some pundits predict that this will be the end of the Japanese corporate juggernaut. Indeed, our interest in Japan and Japanese competition has waned concomitantly in recent years. So has our learning from the Japanese. This is dangerously short-sighted. The pendulum of international trade has shifted from cross-Atlantic to cross-Pacific in recent years, as U.S. and Japanese multinational companies engaged in global sourcing strategy across the Pacific. Indeed, while struggling in the post-bubble economy, many Japanese companies have accelerated their move toward their Pacific Rim global sourcing paradigm. Based on Japan's regional ties with the rest of Asia, Australia, and increasingly other parts of the Pacific Rim, this paradigm builds on Japan's famed target costing, target exchange rate, new product development style, and keiretsu (interfirm alliances). While Japanese companies have slowed the pace of their onslaught on the U.S. market, they have begun their geographical diversification into the emerging parts of the world market. As a result, American companies are bound to face increasingly formidable Japanese competition around the world.

Original languageEnglish
Pages (from-to)107-119
Number of pages13
JournalAcademy of Management Executive
Volume12
Issue number4
DOIs
Publication statusPublished - 1998 Nov
Externally publishedYes

ASJC Scopus subject areas

  • Marketing

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