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Situation
Tanaka’s first action upon being named subsidiary president was to dispose of a part of the assets and inventory in order to offset liabilities, a course that had been rejected by his predecessor, Mr. Yang. His second action, after just one week in Taiwan, was to shut down the manufacturing of heating and cooling equipment, a decision completely opposed by the all-Taiwanese staff. This action, resulting in the layoff of eighteen workers and the reassignment of twelve more, drew considerable heat from the workers. Tanaka’s third action, after just one month on the job, was to introduce a radically new management system. This last decision finally outraged the executives to a point where both the vice-president for operations and the plant superintendent resigned. The middle- and upper-level managers sent a letter to the President of MIE, James Hill, expressing their dismay with Tanaka and seriously questioning his policies. Hill who had worked closely with a number of the letter’s signatories began himself to wonder whether Tanaka was maybe moving just a little too fast.
Role-Play -1
a) Act out a policy discussion between James Hill, President, MIE and Henry Tanaka, President, MIE-Taiwan:
James Hill, President, MIE:
You make sure that Tanaka got a copy of the letter sent to you by Lo and thirteen others. You are disappointed that the firm had to lose Hu (vice-president for operations) and Lee (plant superintendent) and Tanaka couldn’t persuade them otherwise. You understand that the staff in Taiwan are upset. Morals hasn’t been so hot for some time there, and it seems the situation has gone from bad to worse and that’s counterproductive. You wonder if may be Tanaka could hold off a bit on the reorganization as with all the other changes going on this is not the best thing to take on at the moment. When Tanaka reorganized at his previous place, it worked fine because he was not perceived by middle-management as an outsider. But in Taiwan things are different. Tanaka is making the key decisions, and that’s what you expect him to do, but he has got to have cooperation if his decisions are truly to be implemented. You know that in traditional Chinese companies seniority is regarded very seriously. It is highly unusual to fire a senior manager, and rarely do lower-level employees resign except in case where personal honour is at stake. Thus, resignations of Hu and Lee must be regarded as very serious matters. The appeal to you on the part of remaining managers must be looked at as rather unprecedented. You do not take seriously Tanaka’s conclusion that part of the resentment toward him is because he is Japanese-American. You advise him to make an effort to communicate, to talk everything out with the staff, to get their advice. You are sure they know and care a lot about the business.
Make use of the helpful phrases:
§ Well, I’m calling for couple of reasons … .
§ I’ll get the small matter out of the way first… .
§ I see. Well, how are the things there now?
§ That may be true, but … .
§ I’m not questioning your fiscal policies.
§ My personal feeling is that … .
§ But you’re not running Taiwan by yourself.
§ What does that have to do with it?
§ Oh, come on.
§ I just hope that you are right and that the attitudes won’t get in the way of making a profit.
Henry Tanaka, President, MIE-Taiwan:
You saw the copy of the letter sent to Hill by Lo and thirteen others. You were surprised by the resignations of Hu and Lee. You think that they felt they had to resign to save face. They didn’t give you much of a chance to persuade them otherwise because they had their minds made up. You have got some thing of a rebellion on your hands at the moment. Though you are sure it’ll pass soon. Once the managers realize that the changes you want to make are for their own good, there will be some real changes in attitude. The former President, Yang pleased everybody in the company for years while driving it to the point of bankruptcy. You are not interested in alienating the people that you have to work with, but at the same time you are not trying to win any popularity awards. Certain measures had to be taken and taken immediately. You took them. Already the company has current assets in excess of current liabilities. You are sure that you are resented because you are not Taiwanese. The Chinese don’t like Japanese. That’s a matter of history. At the same time you are doing what you feel you have to do to save this subsidiary. And a reshuffle is one of those measures. But you may have moved a little too fast with reorganization. As you start to make a profit again, the attitudes will change.
Make use of the helpful phrases:
· What’s up?
· Okay. Next
· Thanks for considering this proposal.
· But I guess … .
· To be honest, James, it’s tough going. In fact … .
· The point is we can’t wait for people to be happy with every decision.
· I’m well aware of that.
· Anyway it doesn’t matter. What matters is that … .
b) Act out a conversation between Hill and Lo concerning his letter about Tanaka:
C. Lo, Executive Director, Finance Division:
You wrote to James Hill on behalf of the middle- and upper-level managers at MIE-Taiwan as a last resort. While you understand the need for sweeping changes for cost-effective reasons, you take issue with two of Mr.Tanaka’s actions - his decision to halt production of heating and cooling systems and his reorganization plan. Tanaka’s decision does not take into consideration a number of factors. One, the decline in sales has been due chiefly to artificially low prices set by competition (mainly with Japanese manufacturers) in an attempt to drive MIE-Taiwan out of the market, under certain conditions MIE-Taiwan could compete in this price war. Two, layoffs have resulted in depressed morale among the workers on other assembly lines. Besides you are discouraged by Mr.Tanaka’s American-style (or Japanese-style) reorganization plan. In your opinion it is extremely unwise. (1) The plan consolidates sales in one division, and it may seriously affect the reputation and sales of MIE Taiwan. Under Mr.Tanaka’s plan, salesmen will sell all MIE products, even those that they may not be familiar with, a situation that could backfire if the product sold is not appropriate to the client’s needs. (2) Mr.Tanaka has so far not appointed the heads of different divisions after the reorganization, which creates unfair anxiety among the middle- and upper-level managers. (3) Mr.Tanaka has created his plan without consulting you and your colleagues and without having any knowledge of the intricacies of doing business in the Republic of China.
Make use of the helpful phrases:
§ Although none of us would argue that … .
§ It is clear that … .
§ Surely, … is not the only viable solution available to smb.
§ The other matter that concerns me is … .
§ There are three main problems with it. First, … . Second, … . Third, ….
§ We also feel that … .
§ I’m sorry to have to bring this matter to your attention, but … .
§ Thank you for your time and attention to my plea.
James Hill, President, MIE:
The financial situation in MIE-Taiwan has necessitated a number of changes designed to increase its profitability. Among the measures instituted by President Tanaka are partial liquidation, cessation of manufacturing heating and cooling systems, and managerial reorganisation. In the past the parent company attempted to be responsive to local management. Now the strategy has backfired. The head office cannot allow the subsidiary to continue losing money. Maybe Tanaka has moved fast in order to try to stem the losses. You disapprove of the fact that Tanaka’s actions have been interpreted by the local managers as being totally insensitive to the workers. As a result, a major rebellion is underway with the security-conscious Chinese fearing for their own jobs. Still, the subsidiary is surviving on a loan of $3 million from the parent company and is not at all self-supporting. You try to make them pick up on the fact that Tanaka is highly regarded as a manager by the parent company, he obviously works fast and is quite decisive. Even before he arrived in Taiwan he was already taking rather radical actions and within a month has already devised a new management system.
Make use of the helpful phrases:
§ As you are well aware… .
§ I’ll begin with general comment … .
§ It is clear that … .
§ Don’t be so offensive about it.
§ You should treat the man according to his merits.
§ I’m sure Mr. Tanaka will rise admirably to the occasion.
c) Act out a conversation between Tanaka and Lo after Tanaka has talked to Hill:
Henry Tanaka, President, MIE-Taiwan:
You are disappointed that Mr. Lo did not speak to you first before writing to Mr. Hill. You understand that he is upset, but you are only doing what you feel you have to do for the company. You do not understand why Lo calls your style “Japanese-style management” – you are a second-generation Japanese. You know very little about Japanese management and barely speak Japanese. You try to talk about the reorganization. You understand that you may have been a bit hasty in your actions but in the given situation you felt that you had few options. You are trying to convince Lo to stay.
Make use of the helpful phrases:
§ Won’t you have a seat? I have ordered coffee for both of us if that is acceptable.
§ I’m sorry to hear that … .
§ However I feel sure that you will understand that it cannot alter our attitude to … .
C. Lo, Executive Director, Finance Division:
You present the main objections to Tanaka’s plans. You are offering to resign, telling Tanaka that you can’t accept his way of doing business. Tanaka’s measures are unnecessary. He is not taking into account the cultural as-pects of the matter, nor is he using sound business tactics. Tanaka has done nothing to show that he is concerned with the welfare of the remainning managers, only with balancing his books. Still you acknowledge that the financial situation is quite serious and demands immediate handling.
Make use of the helpful phrases:
§ Allow me to put my case … .
§ I am, of course, not for one moment doubting that you have the full backing of … .
§ There are no circumstances in which I would … .
§ Then I am sorry to inform you that … .
Role-Play -2
Act out a meeting Tanaka has arranged with the executives of MIE-Taiwan to introduce the management reorganization and to explain how the new changes will affect personnel:
Henry Tanaka, President, MIE-Taiwan:
You want to see the staff in action before you make a decision who will be in charge of what division after the reorganization. The resignation of two top managers does not seem to bother you nor does the fact that the remain-ing managers are questioning your decisions. You absolutely believe that you are doing what you need to do and that your mission is not to get along with your staff, but simply to turn MIE-Taiwan into a profitable operation.
You determine exactly what the major changes are:
1. Manufacturing is consolidated into one department.
2. The departments previously under the supervision of the Finance Executive Director, with the exception of accounting, are made independent departments. This would result in the probable promotion of the existing directors to executive directors.
3. The duties are more equally distributed across department lines, with the new departments with executive directors having greater responsibility.
4. The sales department is consolidated into one unit under the direction of the Executive Director of Marketing.
You are sure that the result of the proposed reorganization would probably be a reduction in overhead due to the consolidation of staff and a greater streamlining of operations.
Make use of the helpful phrases:
§ Let’s come to the merits of the matter … .
§ I intend to clear out MIE-Taiwan’s Augean stables.
§ The floor is yours, Mr. … .
§ Now to … .
§ It sticks out like a sore thumb.
§ I’m afraid it doesn’t fit in with the schemes.
§ And in addition I shall personally see to it that … .
§ How can this be relevant?
§ Only thus the firm will be able to go from strength to strength.
C. Lo, Executive Director, Finance Division:
Mr.Tanaka has created his plan without consulting you, and without having any knowledge of the intricacies of doing business in the Republic of China. Since you and your colleagues are all native Chinese with years of accumulated business experience, you deeply resent his manner of dealing. The lack of regard for those of you who have served the company has already resulted in the resignations of Mr. Hu and Mr. Lee, two able and expert managers. You feel that the situation has become so serious that it is imperative that something should be done about it.
Make use of the helpful phrases:
§ The point is, … .
§ You could avoid such embarrassment, of course, by simply consulting me and my colleagues … .
§ If that is the case, we shall … .
§ Apparently not.
Director (Purchasing)
Artificially low prices set by competition (mainly with Japanese manu-facturers) in an attempt to drive MIE-Taiwan out of the market. It is clear that their profit margin (if any) is small and therefore cannot continue nor be indicative of the fair market value of the product. If MIE-Taiwan were to lower their prices substantially, they too could compete in this current price war.
Make use of the helpful phrases:
§ …I assure you,… .
§ We can establish, beyond reasonable doubt, that … .
§ I don’t think that’s the point.
§ I did give it some considerable thought but I came to the conclusion that … .
Trade Union Leader:
Mr.Tanaka is ignoring hardships placed on laid-off and reassigned workers, within the factory, these layoffs have resulted in depressed morale among the workers on other assembly lines. Halting production of these systems is not the only viable solution available to Mr.Tanaka.
Make use of the helpful phrases:
§ Would you not consider such action a little precipitate?
§ If that remains the case, sir, … .
§ Furthermore… .
Executive Director (Marketing):
In your mind the reorganization plan is unwise because it consolidates sales in one division. Although this may be more immediately cost effective, in the long run it may seriously affect the reputation and sales of MIE Taiwan, since sales of its equipment are dependent upon its sales force having specialized knowledge of the product they are selling. Under Mr.Tanaka’s plan, salesmen will sell all MIE products, even those that they may not be familiar with, a situation that could backfire if the product sold is not appropriate to the client’s needs.
Make use of the helpful phrases:
§ Let me assure you, Mr. Tanaka, that… .
§ And we may also have to reconsider … .
§ I’ll affirm you that … .
Director (Personnel):
There is no indication from the chart itself that any key staff would lose their position; in fact it seems that some would be promoted. Furthermore, the consolidation of sales personnel in one unit does not necessarily indicate that all salespersons would sell all products, as all other managers believe. What seems clear is that the problem with the reorganization is simply that Tanaka has not really endeavoured to communicate why he is changing the chain of command and now it will really affect the staff.
Make use of the helpful phrases:
§ Of course, sir, your reputation goes before you.
§ I am certain of one thing, … .
§ We are not warranted in believing … .[20]
§ Let’s not crowd the mourners.[21]
§ And another thing, … .
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