Japanese keiretsu

One of the Japanese business structures that has received interest from Western business is the keiretsu. Keiretsu is a term used to describe Japanese business consortia based on cooperation, coordination, joint ownership and control. 

The keiretsu possesses the particular characteristic of having ownership and control based on equity exchanges between supply chain members. Despite the complexities of their ownership structure, keiretsu represents a supply chain model that helps to explain the organisation of most companies in the automotive and electronics sectors in Japan. 

The system that has acted as a model for Western auto inbound logistics is being dismantled by Nissan. What are the implications for Western supply chains Discuss. 

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Japanese keiretsu are the most widely known network structures. However, the European, or to be more precise, the Italian example confirms dependence on social capital when creating stable and competitive supply chains. Italian regions are often described as perfect examples of network systems they are territorial units that include a multitude of small and medium-sized enterprises that operate according to the principles of both solidarity and competition, and which may, thanks to this, achieve a competitive edge comparable to that of large companies. ... 

Key issues What are supplier associations, and the Japanese keiretsu ... 

The Extended Enterprise has also drawn the attention of the business press in an article authored by Jeffrey Dyer. It is offered as a case study of transferring the respected Japanese supplier relationship model, referred to as keiretsu, to the United States. Dyer describes the motivations and the impact of the Extended Enterprise partnership philosophy on product cost and development cycle time. 

Inspired by the Japanese version of supply relationships with partners, outlined in the introduction to this chapter under Sako s obligationaT description. Western auto manufacturers have been developing their own versions. The model for these has been the keiretsu structure shown in Figure 9.6 below, which is similar to the structure we showed in Figure 1.2. A number of lead suppliers like Robert Bosch and Delphi supply to their customers worldwide and have developed sophisticated marketing, development and logistics capabilities. 

Dyer, J. H. (1996). Does governance matter Keiretsu alliances and asset specificity as sources of Japanese competitive advantage. Organization Science, 7(6), 649-666. 

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