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Keep in mind that these are general answers, and will
not fit all situations or companies.
Given Japan’s long economic
stagnation, what business opportunities exist for western
firms?
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Thankfully, Japan’s long economic
downturn seems finally to be over, though the heady
days of 5-10% economic growth are gone. Also disappearing
are many of the management practices that defined Japan
during the 1960’s through the 1980’s, like
lifetime employment and seniority-based promotions.
The protracted recession of the 1990’s forced
many Japanese industries to reinvent themselves. Many
firms needed foreign investment and had to also accept
the accompanying executive oversight. The most public
example is Nissan. Nissan went from being Japan ’s
proud number 2 auto-maker in 1990 to a subsidiary of
Renault by 2000. Carlos Ghosn, the European CEO of
Nissan has managed to return the firm to profitability
and growth by drastically downsizing Nissan in Japan
and changing the management culture. Beyond Nissan,
the retail sector is also in the midst of a dramatic
reorganization, largely spurred by the entry into Japan
by Wal-Mart and Carrefour.
The net result of all of the management changes is a
more open, more global mindset in Japanese corporations.
Western firms with competitive products to sell now have
more opportunity to develop business with large Japanese
firms than ever before, either by acquiring a Japanese
company or by developing customer service capabilities
directly.
Section I of our Unmasking
Japan Business course, Understanding Japanese Business Behavior, covers this topic in greater detail with specific strategies
and advice for American firms.
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What influences Japanese decision making and why does the
decision-making process take so long?
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Typically, decision making at large
Japanese firms is participatory. Depending on the significance
of the decision being made, many different staff levels
and several departments and sections can become involved.
Japanese individual managers usually do not have the authority
to make decisions unilaterally. This fact partly accounts
for the "longer" decision making you may be
experiencing in Japan.
In addition to the numbers of people involved, the process
itself can be time-consuming because it is consensus based.
A lower-level team typically is assigned to evaluate a
particular project or proposal. They gather and analyze
information, and gradually arrive at a recommendation
for action. In order for that recommendation to be promoted
and accepted, consensus must be reached within the organization,
potentially all the way to the top. Reaching consensus
involves extensive behind-the-scenes lobbying to sway
all parties towards the recommendation. Of course there
will be dissention, but the proponents of the recommendation
must provide enough factual information to convince others.
Or, conversely, the dissenters must convince the organization
of the reverse. Either way, it can be a lengthy process.
Remember, one final hold-out manager in the company may
just "agree to agree" in the end, rather than
preventing a decision from being made.
Please keep in mind that the above description
is common in Japan, but will not necessarily apply in
your specific situation. Some companies are known for
their speedier efforts. Similarly, there are parts of
many Japanese companies, new product development for
example, which are very capable of making decisions
quickly.
A final point.... once a decision is made
within a Japanese organization implementation can be
fast, partly because all of the relevant groups have
been involved in the decision making and have already
thought through their implementation strategy. Japanese
business people are often frustrated by the time it
takes American companies to act, once the Japanese have
finally made a decision.
Section II of our Unmasking
Japan course, on Inside the Japanese Company, covers
this topic in greater detail and includes specific strategies
and advice for American firms.
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How long does it really take to develop business relationships
with corporate Japan?
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Some U.S. firms establish commercial
relationships after one meeting with Japanese, others
spend years building even a relatively small business
in Japan. Building relationships with Japanese firms does
not need to take years, as the common myth would imply,
but it does take face-to-face contact. This point cannot
be over-emphasized. Of course, the quality and cost of
your product or service will initially determine a Japanese
company's interests, but every aspect of the subsequent
business relationship will be easier if you have built
personal relationships. Investing time in relationship
building is a good idea between business people from the
same country; the process becomes crucial when people
come from different cultures, speak different languages,
and live in different time zones. Miscommunication will
be less frequent, difficult issues can be brought up with
less trepidation, and the day-to-day dealings will probably
happen faster and with more energy if personal relationships
exist. These relationships should be built at both the
executive and functional management levels.
To help establish and maintain relationships, participate
in evening socializing while you are in Japan, invite
your Japanese colleagues to your home, keep track of information
Japanese tell you about their family and hobbies so that
you can be interested and informed, and learn a few Japanese
words or phrases.
Section III of our Unmasking
Japan course, on Building successful Business Relationships,
covers this topic in greater detail and includes specific
strategies and advice for American firms.
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I am frequently frustrated by a seeming lack of progress in
meetings with my Japanese counterparts. Why do they appear to
drag their heels so much?
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The "dragging of heels"
impression is more often the result of US-Japanese cultural
communication and decision making differences than a deliberate
negotiation tactic.
First of all, Japanese learn a different method of persuasion
and presentation than do most Westerners. Japanese logic
tends to be more holistic, rather than linear/incremental,
and more sensitive to the feelings of others. Japanese
arguments can seem circuitous, with the main point coming
at the very end. As a result, Japanese meeting communication
often appears vague and inefficient to American observers,
while Americans can appear aggressive and insensitive
to Japanese.
In terms of the business process, Japanese
attendees at meetings usually are representatives of
larger groups, and are obligated to seek consensus from
their organizations to answer your questions. This requires
frequent telephone calls back to the office, or even
a recess until the next day if the meeting is in the
U.S. and the Japanese participants cannot receive approval
immediately because of the time difference.
Western business people often view a meeting
as a place to exchange information, discuss issues,
make decisions, and assign responsibilities. The Japanese,
on the other hand, may have a completely different expectation
of the meeting, viewing it more as a consensus-building
tool rather than a decision-making forum.
Section IV of our Unmasking
Japan course, on Effectively Communicating with
the Japanese, covers this topic in greater detail and
includes specific strategies and advice for American
firms.
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How can the keiretsu system of industrial family groups affect
my business in Japan?
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The keiretsu,
or industrial groups, system need not affect you negatively
in Japan, but it is wise to do some homework to determine
to which keiretsu, if any, your Japanese partners belong.
The six huge horizontally consolidated industrial keiretsu
are centered around a main bank and a general trading
company, and are comprised of dozens of firms from various
industries. Many firms do not belong to these huge groups,
but may control or be part of a distribution or manufacturing
group such as the Seibu Group or the Toyota Group. Companies
do not deal exclusively with other "family"
firms by any means, but long-standing relationships between
the companies do exist, and may affect your relationships
with Japanese partners or potential customers.
Section II of our Unmasking
Japan course, on Inside the Japanese Company, covers
this topic in greater detail and includes specific strategies
and advice for American firms.
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What hurdles do American businesswomen face in doing business
with Japanese firms?
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Foreign women are typically seen
by the Japanese as foreigners first, and then as female,
and so cannot be compared with Japanese women. That
being said, American business women do face some unique
challenges in Japan. Most Japanese men have never worked
with women in positions of management, and are unfamiliar
with what the woman's true role is. They will be looking
for clues on the American business woman's position
and ability.
Competency counts, so the success
or failure of the American woman in Japan depends more
on ability and personality than gender. Japanese place
much stock in titles, and although they may never have
worked with female managers before, if the business
card says Vice President, they they will most often
treat her as a Vice President.
Japanese men will also take clues from
the other members of the American team as to how the
woman should be treated. It is important for American
men to support their female colleagues in meetings.
For example, Japanese men often will subconsciously
speak to the American men, even regarding topics for
which the female colleague is responsible. American
men should not answer for their female colleague, but
rather defer questions or issues to her.
On the interpersonal level, there may
be many times when the American woman will feel somewhat
taken aback or even offended by a comment or question
from Japanese, such as "Who's cooking for your
husband and children while you are here in Japan?".
This question is not necessarily asked in a demeaning
way, but rather from lack of experience with professional
women in the workforce. The role of professional women
in Japan in the 1990's is not too dissimilar from what
women in the U.S. experienced in the 1960's. Rather
than feeling offended by inappropriate comments, it
is more constructive to treat them as an opportunity
to educate the Japanese man from whom it originated.
American women often are able to build respectful, professional
relationships with Japanese businessmen starting from
just such a conversation.
Section III of our Unmasking
Japan course, on Building successful Business Relationships,
covers this topic in greater detail and includes specific
strategies and advice for American firms.
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My Japanese counterpart sometimes tells me one thing in private
and then says something contradictory in front of our customers.
This seems two-faced to me. Which version should I believe?
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It is important to understand
the role of honne and tatemae in Japanese inter-personal
communication. Honne is one's true feelings (private face),
and tatemae is one's publically-stated view (public face).
Japanese are taught that not only is it OK to have two
faces, but that it is correct social behavior. The "public
face" statement allows for sensitivity towards the
listener, who might otherwise be offended or embarrassed
by hearing the true feelings. Which "face" is
chosen often depends not only on the relative hierarchy
and closeness of the relationship between the two parties,
but also on the circumstances of the conversation. For
example, Japanese business contacts are much more likely
to tell us what they really think over a beer at a sushi
bar than over a conference table at the office. Japanese
tend to be very good at judging whether they are hearing
someone's honne or tatemae. It is the foreigners who are
not as well practiced!
Section I of our Unmasking
Japan course, Japanese Business Culture, covers this
topic in greater detail and includes specific strategies
and advice for American firms.
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My company's Japanese representatives often seem more loyal
to our Japanese customers than they are to our own company.
Is this the case?
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Probably not. Company loyalty
is a highly-regarded cultural value in Japan, so your
Japanese representatives likely feel more loyalty to your
firm. The explanation probably has more to do with the
hierarchy in Japanese customer-supplier relationships,
and also to the public face/private face issue described
above. The 'customer is king' in Japan, and suppliers
are expected to have a somewhat subservient posture towards
their customers. As a result, your Japanese representatives
are not permitted to argue, or to directly say 'no' to
the customer. This is difficult for most Americans to
accept, but your representative in Japan knows, and must
follow, the rules of his/her market. This doesn't mean
that you are required to do absolutely everything asked
of you, but many American firms end up doing things for
Japanese customers that they don't do for their customers
anywhere else in the world because customers demand special
treatment, and can get it from your Japanese competitors.
Keep in mind that your Japanese colleague may actually
be acting in the best interests of your firm within the
context of the Japanese business culture - do not assume
disloyalty.
Section III of our Unmasking
Japan course, on Building successful Business Relationships,
covers this topic in greater detail and includes specific
strategies and advice for American firms. |
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