Transition from Ethno-centric to Global Operation

Abstract

Shipping business based in Japan has drastically changed since the Plaza Accord in 1985 along with transplant of Japanese manufacturing companies. Besides the conventional strategy of globalization of shipping business such as hiring seafarers of developing countries and flagging out its fleet to Flag of Convenience countries, Japanese shipping companies increased cross trading services bypassing Japanese ports and established regional headquarters to manage area operation in Asia, North America and Europe more efficiently and effectively. They had originally expanded overseas routes from and to Japanese ports with typical ethno-centric management style since their early incorporations. However, findings demonstrate that global operation of Japanese shipping companies have started from 'unintentional global operation' then shifted to 'reactive global operation' following their customers and was further developed to 'proactive global operation'. If structure follows the strategy as Alfred Chandler Jr. mentioned, their typical ethno-centric management style must change in accordance with global operation.This paper analyzes the current situation and the future form of their operation through tramp shipping of major Japanese shipping firms.