A perspective on Panasonic's philosophy of running water

Panasonic fortunately in the long-term business management, formed its own unique business philosophy. To sum up, "Water philosophy", "dike-type operation" and "glass-style management" is the most important.　　In particular, "philosophy of Water", is Jiazhi as the fundamental concept of business, and as a title to his autobiography. Water philosophy Matsushita Electric appliance production was founded on March 7, 1918, but Jiazhi helped to set the company's entrepreneurial anniversary in 1932 May 5.　　The reason for his absence was because of the day he put forward "philosophy of water". In Jiazhi's opinion, the body of enterprise is far from the spirit of enterprise. Although Panasonic has been running for more than 10 years, it was just a non-virtualized with other companies before the "philosophy of water" was born. Until this day, in Jiazhi help mind long circled, hard to ponder the question finally has the answer, he understood the enterprise mission.　　So, this day is the beginning of Panasonic's entrepreneurship. The so-called "philosophy of water" is a metaphor for the company's mission. The simplest expression of this mission is the elimination of world poverty and the prosperity and affluence of humankind. Jiazhi help himself to say: "What is the mission of the enterprise?" For a few days I thought about the problem until late at night and finally got the answer. In short, it is to eradicate world poverty. For example, the water inside the pipe is of course valuable, but drinking the roadside tap water without paying is not to blame, because the water resources are relatively rich. Is the responsibility of the enterprise not just to enrich the world to eliminate all inconvenience? "The ultimate aim of the business is not to benefit, but to express the hope of the masses on our shoulders to fulfill our obligations to society." The responsibility of the enterprise is to make the things that the public need become as cheap as tap water.　　"In the words of Jiazhi, business is to create" there "from" none "and to bring rich and abundant life to all human beings through productive activities. From the essence, "philosophy of Water" is through the means of industrial production, the original can only be enjoyed by a few luxuries into the general public can enjoy the popular goods. Business operators should keep an eye on people's desire for progress, rather than on the customer's purse. The market is to rely on the products of cheap and inexpensive to create, and not rely on dealers rebate discount calculated, but not by cheat deceive customers to sell out. From this, laid the basic policy of Panasonic operation: Quality must first, price must be low, service must be considerate.　　It is this business policy, so that Panasonic customers trust, through one after another difficulties, gradually embarked on the road to growth. The birth of "philosophy of running water" is itself the accumulation and sublimation of the previous operating experience of Panasonic company. As early as 1927, Panasonic set up the first electric department, plans to produce iron. At that time, all Japanese electric irons sold no more than 100,000 a year, each price in 4~5 yuan. Jiazhi help thinks: "So convenient things, but because the price is expensive, a lot of people want to use can not afford." Therefore, as long as the price is lowered, many people will buy it. AsMany people want to buy, at first glance 10,000 per month seems to be more, but in fact can be sold out; "So Panasonic decided to reduce the price by mass production, production of 10,000 a month, sales price of 3.2 yuan, the result was a great success." This case is almost the Japanese version of the US Ford T-car. So American media reports equate Panasonic's blessing with Henry Ford. In this respect, Jiazhi to help himself summed up: "The production of popular products, not only to introduce better quality, the price is also cheaper at least 30%." "The philosophy of running water has great power in the era of Jiazhi, it is bound to bring Panasonic company to the road of large-scale operation." Home appliances in Japan and even in the world's rapid popularization, Panasonic company.　　America's poor can drive cars, thanks to Ford, and today's beggars can watch TV, thanks to the help of the year. This philosophy of water, so that the operation of Panasonic company special focus on customer-oriented, attention to public demand. Panasonic in product development to imitate the main, take fast route. Once a promising new product is found, Panasonic will take it and make a "new product" that is even more expensive and cheaper than the original inventor. "Imitation of innovation" so that Panasonic has achieved business success. Its products, generally have large quantities, low cost, high quality, good service these four characteristics, to win a higher market share. However, in the real original is slightly inferior. The original innovation, which leads the industry pioneer, will be limited by the philosophy of running water. Panasonic developed a computer example, is a good explanation. Panasonic was also committed to computer research when the computer was just emerging. By 1964, Panasonic had invested a billion of in the computer industry, with seven computer companies, including Panasonic, funding 200 million, setting up the Japan Electronics Revitalization Council to jointly develop computers. But the vice president of Chase Manhattan Bank of the United States said in a chat with Jiazhi, the world's computer manufacturers are poorly run, the United States and only the IBM family continue, even GE is powerless, Japan has seven companies are not too much. Jiazhi help decisive decision, resist the pressure of public opinion, give up the computer. In the eyes of Jiazhi, it is advisable to abandon the project with high cost. This abandonment, however, is likely to give up future prospects as well.　　After entering the 21st century, Panasonic company in the operation of various problems, and even can not take off the "imitation King" hat, and this philosophy of water closely related. But it seems premature to say that the philosophy of water is outdated. Although Panasonic now has limited Jiazhi to help the business strategy of the year, however, the philosophy of water in the service concept, customer first concept, to promote social prosperity and the desire for wealth is not outdated. It is not contradictory to inherit the idea of Panasonic's creation and change the strategy of Panasonic's past. What we need to think about is the relationship between ideas and strategies. The deep value of the philosophy of water is to put the Enterprise missionOn social responsibility. It is this logic that makes the philosophy of running water widely praised by many scholars, including Drucker. [Page] The levee-type operation "Dike-type management" is the logic of "philosophy of running water" in enterprise operation. In February 1965, Jiazhi helped to present this concept at the Kansai Business Seminar and made a presentation entitled "Operation of the dike and proper operation". "I would like to promote a" dike operation "approach to effective business practices," he said. " Why repair the dike? In order not to let the river water not to create any value of the flow away. If the river's water surges, it will turn into floods, causing great disasters, and if the weather is dry, the water will be reduced. Therefore, the dam should be built in the proper position of the river to adjust the flow of water and to use hydroelectric power. The purpose of the dam is to cherish every drop of water that God has given and to use it effectively. This will not only guarantee security, but also create value. Is the rationale for running a company not the same? Operations also require dams. "I said that the levee operation, from the outset should have a back-up equipment, how much is how much." In this way, even if there are some changes in the economy or changes in demand, but also to ensure that the supply of goods, will not lead to price increases, as long as the operation of back-up equipment. Conversely, if there are too many commodities, the equipment can be suspended. This is the same reason to adjust the dam's storage as needed. Money, inventory and talent also need ' dams '. "The correct understanding of the significance of the operation of the dike, can make the operation become more stable and obtain high profits." The dike operation can bring real stability and prosperity to the society. "The essence of the dike-type operation is to avoid the cyclical shocks in the process of operation and reduce the impact of uncertainty on enterprises." There are more than one kind of dams built by entrepreneurs, and markets are like rivers that operate like dams. Dams have a variety of functions, such as impoundment, flood control, water supply, power generation and so on. For enterprises, the need to establish the main dike: (1) Equipment dams: Can not make equipment 100% put into operation, the "full load" of the idea, there may be the enterprise running the string stretched too tight, the environment a little bit of trouble, will pull the bow string. In general, a business is still profitable only if the equipment is running at eight or nine. Capacity to maintain the remaining capacity of one or two, is the basic condition of enterprise contingency. (2) Inventory Embankment: The right amount of product inventory, these stocks have two function direction, internal as the production line when the problem of buffering, external as the market fluctuations in the buffer. As is the case in ancient China, the "regular flat", the harvest is buy, the crop is properties, to maintain the general balance of market supply, so that prices remain stable. Jiazhi's idea of "levee-style operations" is, in itself, inspired by the battery price of United Carbide (Union Carbide Corporation). Its batteries sold for 15 cents 30 years ago and now sell for 15 cents. Jiazhi, 30 years, the raw materials, technology, the market must haveGreat changes, and this product can be 30 years to maintain the price unchanged, even from the impact of inflation, is undoubtedly in the operating mechanism has a solid "dike." (3) Funds Dam: New construction projects on the horse, also need to have a buffer dam. A 1 billion Yuan project, need to have 2.2 billion of the funds ready to start, otherwise, it is likely to cause "rotten tail", not only builders embarrassed, and early investment is likely to be wasted. (4) Product embankment: In a product at the zenith of the sun, it is necessary to launch the next new product, which requires a product into production even before the production, follow-up new product development will begin. (5) Psychological dike: Economic rise and Fall, any enterprise, the business process can never be smooth sailing. Therefore, from the Chairman of the general manager to grass-roots staff, must have enough psychological preparation for environmental change, in the psychological quo, in action to Chance change, to achieve the autonomy of the operation. [Page] The principle of the levee-type operation is very simple, nothing more than the rigidity of the operation into flexibility, set aside to adapt to the changes in the environment. However, the real operators are often not good at this. According to Jiazhi, Japanese businesses have been operating on loans and have not embarked on a levee-style operation. To build a variety of dams, first of all need not rely on loans to operate. This, Panasonic has done it. However, it is difficult to build dams and to care for dams. Jiazhi that nursing dams are actually still a matter of concept. The first thing to consider is how to use the dam, if you can not improvise, even if the establishment of the dam, will not be based on the changes in the amount of water to adjust. The second is to clarify the use of dams, the dike is for consumers to serve, not for the enterprise itself services. Deviating from customer orientation, the effect of dams is counterproductive.　　Also pay close attention to a variety of information, if the water is exhausted but do not know, or the overflow of water pipes but ignored, the dam has lost its meaning. The essence of glass-style operation is openness and transparency. This openness and transparency is based on trust in employees.　　All the operating conditions, such as glass is generally clear visible, without disguise. Glass-style management is not the product of Matsushita's thoughtful, nor the result of pedantic logic, but the "last resort" in business practice. In the Jiazhi of the management thought, glass-style management is the first to be born. When Panasonic or a small workshop of several people, production and sales together, the invention, development and manufacturing can not distinguish, even production and life are integrated into one. In this case, there is no such thing as a line between a boss and a hired hand, and everyone is a partner, so Jiazhi helps to keep the business informed to others at any time. Thus, the "glass-style" habit of Jiazhi is formed. His openness, the symmetry of information, is the basic way to survive his early venture. With the expansion of the business, the increase in personnel, although the line between the boss and the workers began to become clear, the original intimate relationship between the beginning of the hierarchy, but the public transparent "glass State" but noRetired, had been kept down. This kind of "glass state" can develop continuously, and form a kind of management thought, with Jiazhi to help oneself of management experience inseparable. The first is daily accounts, when the operation of a slight expansion, the beginning of standardization, Jiazhi Help to turn it into a monthly settlement profit and loss, to all employees announced. In Panasonic, this is customary and normal, and compared with other companies at the time, it is a maverick. Jiazhi help quickly found that this practice has obvious operating advantages, because other enterprises do not do, some bosses I also confused, once the great big business is not clear the overall operating conditions, do not have the basis of open and transparent. Jiazhi Help is not the same, he to the operating conditions, public profit and loss, at the same time summed up the contribution of each person easily. This initiative, the positive effect is very clear.　　Compared with the employees of other enterprises, Panasonic employees can clearly see their efforts, but also can feel the sincerity and trust of the boss, thereby creating a sense of ownership of employees, improve staff morale. The essence of the glass-style business law is that employers and employees are honest with each other and trust each other. What is valuable is that Panasonic has been kept up after rapid growth. It is simpler for small workshops to operate in glass style, and medium-sized companies have difficulty, and large companies are even more difficult. Panasonic can always adhere to the glass-style operation, to a large extent, thanks to the development of Panasonic is a natural growth, is to comply with the needs of the market growth, no harmful artificially expand the scale. A bit like China's private enterprises in the company's practice, the growth of the desire and momentum, not from the top of the pressure, but from the lower level of consciousness. Jiazhi help oneself also feel in the practice, this kind of practice can encourage the morale effectively, can guarantee the mind, can deeply review the business gains and losses and dissolve the conflict, also can cultivate highly independent middle manager and work backbone.　　Even if no other measures are taken, they are well guarded against the kind of "habitual defence" Aguilis points out. With the expansion of enterprises, Jiazhi help to standardize the operation of glass. If the employee's financial status is regularly disclosed to the employee, the company's planning objectives are regularly explained, and the management and trade union organizations maintain effective communication and consultation. In this respect, Jiazhi helped to bring it up to business philosophy. said: "Business operators should adopt a democratic style, can not let subordinates have to rely on the boss of the psychological and blind obedience." Individuals should work independently under the premise of being responsible in an autonomous spirit. Therefore, entrepreneurs have a greater obligation to keep company staff informed of all the facts of the business. In short, I believe that a modern operator must be able to let everyone know, not to allow anyone to rely on the understanding, in order to arouse a vigorous vitality among colleagues to promote the development of the whole business. "Glass-style management will make leaders ' focus on the staff." Enterprises are big, glass-style business mind, coordination will occur difficulties. In this respect, Jiazhi help the "spiritual Lighthouse" to guide the direction of staff, enhance the cohesion of enterprises. We are now constantly concerned about the corporate culture that is being done in the Panasonic companyWith the glass-style business closely combined. In order to make the staff truly into the enterprise, and the open and transparent business thinking, Panasonic in the expansion of the formation of a set of "education" approach to employees. Through the determination of the spirit of the company's credo (that is, Panasonic seven spirit), singing "Matsushita song", playing "Panasonic March" and so on, so that employees with a near "brainwashing" of piety really into the company. Therefore, Panasonic from the staff into the factory began, on the solemn to enter the community education, read aloud, recite the "Panasonic spirit", cooked singing "Panasonic Society song", Learn Jiazhi Help "quotations", visit the company undertaking exhibition. After the formal work, every morning before work in the collective recitation of the spirit of Panasonic and singing club song, each month in the group to conduct a public speech on the company's spirit and corporate social responsibility, each year to organize a grand delivery of products (from the factory to dealers) ceremony, each Panasonic must constantly answer "what I really want to do?" "What do I need to learn?" "What faults do I have?" "And so on. Through these ways, the staff's autonomy and cohesion can be enhanced. Some people have doubts about this practice, Jiazhi to help answer: "Morning, sing social song, recite the Seven Great Spirit, is the tradition of Panasonic, must comply with the implementation of the end." Once the matter has been decided, must persist in the end, not oneself lose direction, or be confused by others words and deeds, otherwise will not succeed. Business is also the same, must carry out ambition. "It needs to be pointed out that in China's opening process, Panasonic's" corporate culture "has been favored by many Chinese managers, in some companies to adopt similar practices have received the corresponding effect. But we must not forget that Panasonic's success is an organic combination of external rituals and connotations. And this kind of connotation, is realizes through the glass type management. If lost connotation, just sing the social song, chant the Creed, even the manager thought book to learn, will only form the superficial perjury, does not help the staff to the company's high approval. More importantly, Panasonic this way of formation process, is with Jiazhi help the personality charm close combination. Therefore, although the company is huge, but has been rejecting bureaucracy, but also consciously to eliminate the hierarchy, and even in a sense to retain the basic pattern of family business, in order to maintain the effectiveness of glass-style business. Once there is no such personal charm, in a highly bureaucratic or hierarchical organization, trying to build this corporate culture is likely to go to the opposite. Even Panasonic itself has some potential problems in promoting employee autonomy and improving employee identity. "------------ When Panasonic died, the problem became apparent.　　Panasonic will be able to get out of the halo of Support, which is a new issue after the 21st century. The spirit of Panasonic's help, in the management of the mind will undoubtedly affect the long-term, and Panasonic fortunate to help himself, it belongs to the 20th century. His management thought, especially the enterprise social responsibility in the philosophy of water, the coping uncertainty strategy contained in the dike-type management, the idea of the staff autonomy contained in the glass-type management, has got the theoretical explanation and academic argumentation in Drucker.。 Try to transfer Panasonic's operating methods intact to other enterprises, continue to 21st century, it is likely to be handan, but thus denying the future value of Panasonic management ideas, it is certainly maiduhuanzhu.