Keiretsus

A Japanese practice which is used in connection with the linkage of companies in an organization structure where there are more than one companies in a group. This refers to a situation in which organizations in which each company owns a small percentage of other companies in the group. There are long-term strong personal relationships among high-level managers in the different companies, and there are often interlocking directorships. Sometimes keiretsus are vertical, such as that between Toyota and its part suppliers. Sometimes keiretsus are horizontal. For example, the Mitsubishi group consists of core companies in which no single company predominates.