In Japan, in the context of the ‘kaisha’ principle, employees of all levels are considered as ‘part of the firm’s cost structure’; this results to the effort of Japanese firms to keep their employees in the long term. This trend is opposed with the practice of Western firms, which are likely to seek for employment schemes of a particular, usually short-term, duration. The above phenomenon is also highlighted in the study of Keeley, which emphasizes on the importance of ‘worker loyalty and paternalism’ for Japanese firms; at the same time, it is made clear that such values do not characterize the Western corporations which are based on the rules of the ‘capitalism-industrial society’. Another aspect of the Japanese management style is presented in the study of McMillan; in the above study it is noted that in Japanese firms, in opposition to the Western firms, the criteria for hiring top management staff are not always related to the candidates’ skills and level of education. Rather, emphasis is given on their ability to develop effective strategic plans.
The different characteristics of US and Japanese management styles, as indicatively presented above, have different consequences and implications for firms and managers in US and Japan. In this context, it has been proved that the financial performance of US and Japanese firms is highly affected by their management style; same assumptions have been made in regard to the remuneration of managers in US and Japanese firms. The specific phenomenon