Sanford Jacoby, a professor of management, policy studies, and history at UCLA, has produced a fine comparative study of corporate management in Japan and the United States. It can be read as a work in business administration or in business sociology. It is also explicitly historical, and as a student of Japanese economic history, I will focus here on its Japanese and historical sides.

Jacoby deals with personnel systems, a subject that builds on his earlier books on U.S. employment practices (Employing Bureaucracy: Managers, Unions, and the Transformation of Work in the 20th Century [revised edition, Erlbaum, 2004] and Modern Manors: Welfare Capitalism since the New Deal [Princeton University Press, 1997]). In U.S. corporations, as Jacoby indicates and as I can testify from my own pre-academic work, personnel/HR departments generally have a peripheral status. The hiring of professionals and managers is conducted by the units concerned, as are promotion and reassignment decisions. Most U.S. employees deal with HR staff only on the day or two after they are hired, the day that they leave, and when they have questions about their insurance or other benefits. The gendered division of labor and the low status and “service” character of HR is indicated by the fact that this is one of few U.S. corporate functions in which women routinely become executive managers. There have been significant ups and downs in the position of U.S. personnel departments, as Jacoby's history indicates in summary but satisfying detail. Wartime labor shortages, labor disputes, and government regulations especially enhanced the importance of the personnel department, with World War I bringing a first “personnel boom” (p. 81).

When it comes to Japan, Jacoby's subject has, if anything, a more pivotal importance than he himself claims for it. As the scholar of Japanese law John Owen Haley once memorably described it, the only American institutions in which the central personnel administration has an authority comparable to that of a Japanese corporate personnel department are the branches of the U.S. military and the Catholic Church. A key similarity here is permanent membership—or the lack of a good “exit” option, as Jacoby puts it—as regular male “members” (seishain) of a Japanese corporation belong to the organization for their entire careers. The authority of the personnel department in the classic Japanese big corporation extends throughout a company member's career, from recruitment and hiring to training, performance evaluation, transfers, and promotions. These decisions largely determine who will come to sit on corporate boards. The personnel function is both authoritarian and welfare oriented, as its duties include labor relations (with company unions, whose offices are often physically housed within the personnel division), setting salary and allowance policies, and managing recreation, housing, and other welfare functions. The personnel department's power over tightly held information is backed by its function of maintaining dossiers on all company members. Thus, like the U.S. military or Catholic Church, the classic Japanese corporation might aptly be compared as an employing organization to a ministry or firm in a classic socialist state. All of this makes the personnel department a powerful and prestigious part of the Japanese corporation, and managers on the elite management track routinely cycle through an assignment there on their path to the top. However, as Jacoby also details, this authority has tended to break down to an extent amid the recession and restructuring of the 1990s.

By means of survey data and careful field studies of Japanese and U.S. companies in diverse industries, Jacoby also indicates that this is not a case of undifferentiated national contrasts. He examines comparable Japanese and U.S. companies in the electrical, electronics, auto-parts manufacturing, package delivery, construction, and financial securities industries, revealing various industry-specific dynamics that create their own consistent cross-national similarities. This book thus becomes relevant to the study of the corporate “cultures” specific to individual industries and firms as well as to the dynamics of national-level business cultures.

Among the larger subjects that Jacoby brings into play are the complexities of intra-corporate power politics—usefully analyzed here as distributional struggles—and their systematic relationship to larger macro-social shifts (e.g., in the mix of “market” and “bureaucratic” logics within corporations). This is the social “embeddedness” to which he refers in his title. Among these macro-social dynamics are globalization and financialization; here, against the prevailing impression, Jacoby concludes that Japanese and U.S. corporate practices and governance are now diverging more than they are converging.

Altogether, this is a important comparative study of the modern corporation as such, rich in detail and insight, philosophically and methodologically attuned, and much bigger in its scope than its subject matter might suggest at first glance. It is also nuanced, balanced, and well written. It could function well as a classroom text and is first-rate as a contemporary business book. The footnotes are extensive; unfortunately there is no bibliography, which would have been very useful. As a work of both business and labor history, it complements histories of Japanese employment practices such as those of Andrew Gordon and belongs next to the classic institutional studies of R. P. Dore. Combined with recent work on the transformation of the Japanese employment system by scholars such as Charles Weathers and the many valuable contributions on the subject in the Social Science Japan Journal, it brings a new deepening of the ongoing English-language dialogue on the Japanese employment system.