Inderscience Publishers

The globalisation of Japanese subsidiaries: a case in the UK

Since the early 1990s, the Japanese economy has been trapped in a long-term recession signified by zerobound interest rate, little or no inflation, and imperceptible growth. The most visible outcome is, strangely enough, a significant drop in foreign direct investment. One would have thought intuitively that if they cannot spend money internally, at least they should be able to enhance foreign direct investment in search of better interest rates. It is not happening yet. This is bound to have some effect on Japanese subsidiaries. In terms of marketing, survival should mean innovation in products and services, integration with local economies, and more vigorous search for exports. In terms of management, it may mean enhanced quality, more supply chains, more integration and more adaptive globalisation. By using an old Japanese subsidiary in London and re-examining the literature, we hope to provide a more balanced view of the Japanese subsidiaries abroad. The company we have studied is one of the oldest cases of Japanese direct investment anywhere in the world. Its emergence as a Greenfield investment and survival is quite interesting, and compares well to the flood of subsidiaries and joint stock companies that came to life during the pre-crisis optimism. With the help of an Ramp;D-oriented sister-company in Sweden, and a vigorous pursuit of quality, the old entity in Old Woking is hobbling on into the 21st century faced with many challenges.

Keywords: Japanese subsidiaries, FDI, foreign direct investment, evolution, locality, autonomy, suppliers, technology, UK, United Kingdom, globalisation

Customer comments

  1. By Lewis Combstock on

    During the 1980s and 1990s, the growth of Japanese FDI accelerated, although this did not, in many cases, create changes in the way the UK did business. Here is a Japanese subsidiary that didn't embrace electronic communication until 1999, however, good customer relationships had been developed since their establishment in the UK in 1972.