THE GERM OF ORGANIZATIONAL CAPABILITIES OF JAPANESE INDUSTRIAL ENTERPRISES

Japan, to its good fortune, avoided colonization, thanks to its quick emergence from self-imposed isolation and mutual restraint among the Western powers. Its continued independence was one way in which Japan differed from Korea or China. In fact, Japan not only managed to eliminate its unequal treaties with the Western powers by about 1910 but also turned Korea into its own colony and began working toward domination of East Asia.

The key to Japan's building a solid economic foundation while maintaining its independence under the impact of the West was industrialization. With its limited natural resources, industrialization was the only route to economic independence, a route Japan followed rapidly. Thanks in part to the effects of government protection and promotion immediately after the Meiji Restoration (1868), modern industries started up in the 1880s, and the economy began to achieve takeoff.1 During the modern business enterprise's sudden rise to power as the principal actor in industrialization, some of these modern business enterprises grew sufficiently large to set up a hierarchy.

Those who discuss the modern business enterprise in prewar Japan always talk about zaibatsu. The zaibatsu, like the chaebol in contemporary Korea, was a major presence in the business history of prewar Japan. One can define a zaibatsu briefly as a diversified enterprise group exclusively owned and controlled by a single wealthy family.