Why Do Major Companies like Toshiba Decline? It's Because Skilled Politicians Who Lack Work Capability but Excel at Undermining Others Dominate the Company, Leading to Irrational Management Ignoring Market Changes and Customer Perspectives.
It seems that Toshiba has accepted the acquisition proposal from the Japan Industrial Partners Union and is heading towards delisting.
Since Toshiba's major businesses have already been sold off separately, the acquisition amount is 2 trillion yen.
Still, it feels quite high.
"Major companies representing Japan" are falling one after another. The situation has become unstoppable.
Why do major companies decline?
In major companies, the status within the company rises for the business divisions that generate profits.
With a higher status for the division, they can utilize more of the management resources of "people, goods, and money."
Naturally, the "performance" of employees working in that division improves. Moreover, both personnel evaluations and rewards are performance-linked, so personnel evaluations improve, and rewards increase.
It's a win-win situation.
In such a favorable division, individuals skilled in internal politics (known as "corporate politicians") gather, aiming to reap the benefits without much effort.
Originally, the business divisions that generate profits and grow have many employees with abilities and determination, who have won competitions against other companies and improved performance. That's why they have been able to expand their performance.
However, with the expansion of the organization due to improved performance, internal politicians gather like "ants swarming around sugar."
They are constantly searching for which department within the company they should go to in order to climb the corporate ladder.
Corporate politicians may lack work capability, but they possess a rare ability to undermine others. Compared to them, serious and hardworking individuals are like children.
These corporate politicians, through cunning tactics, gradually gain control over the people in the departments where they originally belonged.
Once this happens, nobody can oppose the corporate politicians anymore. Decent individuals are expelled from the department, and the corporate politicians and their subordinates take control, leading to a black business division.
Since corporate politicians dislike work, they find it too bothersome to engage in "straightforward business" involving cost, technology, and sales competition. They start looking for quicker ways to make profits and engage in the realm of corporate politics.
They pursue the creation of "black mechanisms" that can generate profits without putting in much effort, saying things like "as long as the business is profitable, the results are fine" and "compliance can go to hell."
However, if they continue like this, it's only natural that their competitiveness significantly deteriorates.
As competitiveness deteriorates, they become even more reliant on black mechanisms, falling into a vicious cycle.
Thus, the leading business division within the company becomes blackened and loses its competitiveness.
This alone is a significant problem, but the corporate politicians who have climbed up the ladder using the leading business division as a stepping stone extend their control to the management department.
At this point, there is no stopping them.
Eventually, even the management team prioritizes immediate profits and disregards "straightforward business."
Although large companies have an abundance of talented individuals, nobody pays attention to changes in the market environment or customer perspectives. They avoid discussing important matters, touching the core issues, and even lose sight of the economic rationality, which is the instinct of businessmen.
It's beyond salvation. The growth potential of the company significantly deteriorates.
Many major companies decline through such a process.
