The solution, by Western standards, would be painful but clear-cut: business is down, so pare costs and, if necessary, lay off workers.
But in Japan, where lifetime employment is the custom, rescuing the company requires a different set of standards and savvy. Among those trying to rebound without laying off workers is Japan Air Lines, a partially government-owned air carrier which, like many airlines worldwide, is struggling to survive in the face of rising costs and stagnant demand for air travel.
Japan Air Lines (JAL) is 37 percent owned by the Japanese government. This does not, however, entitle the airline to any special favors, says President Yasumoto Takagi. ''It's no secret that we may be headed for a deficit this year, '' he said, adding, ''We don't include layoffs among our plans.''
The alternative is to cut costs wherever possible and to appeal to employees to enhance JAL's reputation for reliability and service. This reputation suffered a severe blow last February when a JAL flight coming into Tokyo's Haneda Airport came down in the water short of the runway. Several people were killed in the incident, and the pilot was found to have mental problems.
A couple of less serious mishaps later in the year didn't help, either. Next year, United Airlines, the world's largest airline, will begin services to Tokyo , if an interim air agreement between the United States and Japan is reached. JAL will also gain the right to fly from Seattle to Chicago.
The addition of a formidable competitor to the crowded Pacific air lanes cannot but be a source of concern. As president of troubled JAL, Mr. Takagi sits squarely in the hot seat. He is a genial, modest, but toughminded man, used to public criticism and speaking softly in return.
The president says he obtains consensus through a series of informal discussions among board members. Sometimes, though, when there is no agreement, Mr. Takagi says he has to tell the board he feels the time has come to act.
Unlike most Japanese companies, JAL's 22,000 employees are divided among four labor unions - a cockpit union, a cabin-attendants' union, and two ground-personnel unions.
Also unusual for a Japanese company, JAL has the reputation of being prone to strikes. By Western standards, these are infrequent and short (rarely lasting more than a few hours). But some are long enough to cancel flights.
Mr. Takagi's remedy is to seek understanding between the various branches of the airline staff, especially between ground personnel and cabin and flight crews. Every new employee, whether headed for cabin service or not, must spend at least four months doing ground work. Mr. Takagi personally tries to meet with employees as much as possible.
A recent issue of the company magazine described in detail the plight of the world's leading airlines. It pointed out that in JAL's case, interest payments on new aircraft had almost wiped out operating profits. It also forecast large deficits, beginning in 1984. (These deficits may start this year.)
Mr. Takagi's own answer to this gloomy outlook is to stress the need for safety and reliability. He is also scouring for ways to cut costs and to vigorously exploit new investments in the hotel and leisure industries.
When accidents occur, JAL's entire machinery swings into action. Mr. Takagi himself visits the injured and bereaved; employees attend to the needs of victims' families.
In the US, some companies may be reluctant to contact a victim's family except through lawyers in cases where it does not wish to admit liability. But in Japan the first concern is to express sympathy and give personal assistance. This requires manpower. Mr. Takagi recalls cases where families came to consider the JAL employee as family and showed real regret when his visits ceased after the victim recovered.
''If an accident happens abroad, or involves non-Japanese victims, we will of course follow the legal requirements and practices of the country concerned,'' Mr. Takagi said. ''But we try to add our Japanese touch as well.''