It is said that the Keiretsu are a peculiarity of the Japanese economy because they negotiate among themselves (the companies that comprise it) and sometimes agree on prices and become a barrier for other companies (outside their group) to sell their products to companies of a Keiretsu. In addition, the companies of a Keiretsu help each other, when they are in trouble they provide financing or administrators, etc. This makes these companies competitive in their field (however, with the gradual opening in the economy since the 1990s these ties will tend to become more tenuous). (Aquino, p.114)
Keiretsu are one of the three most used property models in Japan, they appeared after World War II as an evolution of the previous zaibatsu (財閥) or conglomerates. Its nucleus is made up of a bank, a general trading company and an industrial company; The companies grouped under the umbrella of the Keiretsu participate in the social capital of each other without ever gaining control of any one in particular, the participation usually does not exceed 5% of the social patrimony. In addition to the companies that make up the nucleus, there are a dozen corporations affiliated with the group and a hundred of them, much smaller, that are subsidiaries or subcontractors. These small businesses, which will serve as a cushion in case of problems,they generally produce under the just-in-time system and can be considered as maquiladoras at the command of the group; In them, the corporate culture model is different from that of the best-known Japanese companies: Workers owe loyalty to their company in smaller installments than in large companies. It is rarer to find workers and employees with a life contract. There is greater mobility and rotation of employees and workers. Employees and workers enjoy lower benefits. (Escandon)Employees and workers enjoy lower benefits. (Escandon)Employees and workers enjoy lower benefits. (Escandon)
Cervera explains that:
The term keiretsu refers to groups of thousands of companies that work for some enormous organization. Some keiretsu are made up of dozens of large firms (each of which in turn groups thousands of affiliated companies) that, linked together, give rise to gigantic industrial associations. It is not known for sure how many keiretsu corporations exist in Japan, about two thousand companies are listed on the stock exchanges and almost all have at least one group of subsidiaries and / or affiliates connected with their operations. Most likely, there are at least an equal number of companies large enough to subscribe for shares publicly, but who prefer not to do so, despite being in the vast majority of cases keiretsu structures.The Japanese use two common terms to classify keiretsu, depending on their essential characteristics: yoko (horizontal) and tate (vertical).
A horizontal keiretsu is a group of very large companies that maintain common ties with the same central bank, linked together through systems of shared ownership (also known as cross-share ownership) and through stable long-term commercial, strategic relationships, information and distribution. It can be argued that both the extensive cross-ownership patterns and the web of long-term informal relationships based on consensus constitute the "cement" that binds Keiretsu organizations together. Major companies within the Mitsubishi, Sumitomo, or Sanwa keiretsu are notable examples of the horizontal or yoko type of linkage.
For its part, a vertical or pyramidal keiretsu is made up of a very large company and hundreds or thousands of small companies subordinate to it. Representative examples of this type of vertical integration would be large manufacturers such as Hitachi, NEC, Toshiba or Toyota, the latter represented by its two vertically organized twin structures: a pyramid that manufactures products and the other that distributes and sells them.
Types of keiretsu. Source: Betancourt, p.42
Bibliography
- Aquino Rodríguez, Carlos. Introduction to the Asian economy: the economic development of East Asia and lessons for Peru, UNMSM, Faculty of Economic Sciences, 2000.Betancourt G. Benjamin. Organizational design. Contemporary structures. In: Cervera Aguirre, Manuel. Japanese Globalization: Lessons for Latin America, Siglo XXI, 1996.Escandón, Arturo. (1999): «The keiretsu or large Japanese industrial groups». In:
