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By: Gupta, V; Sirisha, D;

2003 / IBS Center for Management Research


The case discusses in detail the reforms in the liberal human resource management policies at Matsushita and the lifetime employment policy at Japanese corporations. Matsushita was a traditional Japanese company that followed the policy of 'lifetime employment'. However, due to various problems like falling revenues, company posting losses and slowdown in the global economy, the company was forced to change its employment policy. The case discusses how Nakamura, the President of Matsushita, introduced a new personnel system at the company with the objective of reducing human resources costs to the company. Finally, the case talks about the benefits reaped by the new system. The case is structured to enable students to: (1) understand the concept of 'lifetime employment', an integral part of Japanese style of management; (2) identify the circumstances that led to the change in the employment policies at Matsushita; (3) understand the salient features and the benefits of the new personnel management system at Matsushita; and (4) analyse whether the new policy would achieve its objectives in the long run. The case is aimed at MBA/PGDBA students and is part of the human resources management curriculum. The teaching note does not contain an analysis of the case.