The beginnings and progress of Matsushita although were very different from Philips, however, in its progress and growth it outstripped Philips, as it became the leader in electronic products.
The strength of the company lies behind its organizational structure and the cost cutting measures. The fact that the company had a 250-year corporate plan in 1930’s is astounding. However, the core strength is the divisional system of the organization with one product one division with the corporate treasury acting as a bnk to the divisions. This created a kind of competition between various divisions each trying to meet or surpass its targeted sales and profits. The diversification of the organization into retail proved to be very successful as the manufacturing units were able to know firsthand about any shortcoming and consumer reactions. Another strength is the strong ties and link between the various international subsidiary units and the central product dictions this has made interaction and exchange of knowledge much more easier.
The company has not invested much in it its central research laboratory, consequently, it has proved to be a copier of technology instead of becoming an innovator. This has become a weakness when the competition from China and Korea has sent the prices crashing and the number of products in the market is ever increasing. There is a need to innovate at this time. Another major weakness is that there is a lot of rigidity in the organizational hierarchy with most of the international managers being from Japan then being hired locally, and the control of the central divisions METC on the subsidiaries makes decision making very limited and there is almost no room for maneuvering.