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Effective Japanese Business Practice

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  1. Effective Japanese Business Practice Patricia Gercik Israel Business Conference December 12, 2010

  2. The Islands of Japan

  3. Dominant Culture • Japanese notion of the company as family • Japanese notion of Bushido as value • Japanese notion of inside/outside

  4. Japan– Core Values • Inside-Outside • Tatmae/Honne • Hierarchy • Family + Business • Obligation • Empathy • Nationalism/Shinto • Face

  5. Vertical Structure

  6. Japanese HistoryDomination of Clans 1467-1568 Sengoku 1568-1601 Momoyama 1601-1867 Tokugawa 1867-1912 Meiji 2500 B.C. Joemon & Yayoi 646-784 A.D. Nara 784-1185 Fujiwara 1185-1333 Kamakura(Minamoto) 1333-1465 Ashikaga

  7. Meiji

  8. Meiji

  9. Clan and the Corporate ValuesIndividual vs. Group • Bushido- Way of the sword • Loyalty • Obligation • Self and the Group • Ideal of the Family

  10. Feudal StructureOrganization of Japanese Company • Enterprise Union • Life-long Employment • Seniority Pay • Board Insiders

  11. Inside/Outside: Roadmap to the Inside TANIN Outer ENRYO Hesitation NINJO Individualization Giri – Obligation Go

  12. RoadmapInside/Outside TaninEnryoNinjo Continuing Networks World“hesitation”“Individualize” “other”scrutinyUchi-inside Soto-outside hesitation family no relation testing spontaneity natural amae

  13. Stages of Relatonships • Stage I: Know Me - Preparation • Stage II: Trust Me - Scrutiny/Testing • Stage III: Believe Me - Working Together • Stage IV: Marry Me - Union

  14. Preparation is the ActStage I: Know Me • What does it mean to prepare? • Human Network • Human Resources • Go-between • Nemawashi • Network & use of network

  15. What it Means to Prepare • Information • History of the company • Assessment of situation • Documentation • Aisatsu ceremony • Reveals preparation • Rituals of commitment • Gifts, cards, history, and seating

  16. Hierarchy

  17. What’s Important?

  18. What it Means to Prepare • Self-Presentation • Dress • Timing • Etiquette • Preparation for each task • Degree and net worth • E-mail • Conference call

  19. Preparation and Zen

  20. Preparation

  21. Preparation

  22. Preparation and Information • 1915- 2004 new drugs • Medicine for the people • Toru Iwadare • Founder of Banyu Pharmaceuticals • Chemist from University of Tokyo

  23. Stage II: Trust MeScrutiny/Testing • Bonding Enablers • On • Giri • Mentor Commitment • gishin • Documentation • Sincerity • Group Ethic • Role of Etiquette

  24. Case of Max-- Aerospace MITI Japanese High Speed Engine Consortium Japanese companies Members of Japanese High Speed Engine Consortium Ito Facilitator (on loan to MITI) Choose 2 foreign companies to participate: John U.S. Bernard France Tom U.K. Max U.S.

  25. Case of Max-- Aerospace I. Critique of proposal II. Demands by foreign companies Intellectual property Finance III. Invitation from MITI to Max to be on committee to assess proposals Side Letter Success

  26. Loyalty

  27. Mentoring Head Mentor A Mentor A Mentor B Mentor B Mentor B Mentor B Mentor B Mentor B Mentee Mentee Mentee Mentee Mentee Mentee

  28. Ranks & Ages • Division Manager (Bucho) 48 • Section Manager (Kacho) 38 • Group Manager (Kakaricho) 30

  29. Training • 2-6 months job rotations • Case of bank employees and village

  30. Advancement in Japanese Corporation • Tests • Attitude • Mentor • Age

  31. Opportunities for Networking in the Lifecycle of a Japanese business person Incoming trainees in a company High School University

  32. Obligation – Human Feeling

  33. Obligation • Never able to be repaid • Teachers • Emperor • Country • Institution • Ability to pay in kind • Business • Personal

  34. Obligation • Personal • Gifts reflect relationship • Dress, timing, cards – reflect respect for relationship • Information and knowledge – reflect respect for the relationship

  35. Stage III: Believe Me Working Together • Understanding the Work Group • Consensus • Language • nintai—patience • ringi group (role) • socializing (role) • Strategies to Facilitate • tatemae / honne • go-between • haragei—silence • Amae • use of human resources • Mentor • ningenkankei--people contact

  36. Bonding

  37. Process in Approach to Task • Prepare with: • E-mail • Phone Calls • Video Conference Calls • Involve Japanese through preparation • Agenda • Studies • Information

  38. Meeting PreparationPreparation is the act • Circulate the agenda via e-mail • E-mail as communication and off record conversation • E-mail as involving people from both sides • Involvement of the Japanese is critical • Topics should be given on both sides • Communication around topics is essential • Reveal preparation and commitment on topics • Show willingness to understand issues from others

  39. Effective Communication • Empathy • Context • Do not personalize

  40. Empathy

  41. Empathy

  42. Letters/Harmony • Create Context • Make the request generated by the situation • Use institution to create empathy • Do not personalize request

  43. Letters/Harmony

  44. Implication of Japanese Decision Making Documentation Order of Circulation Matomaru – Upper Management (Unity of thought and purpose) Second guess issues Middle Management Meeting on issues Final Meeting on Division (Hanko) Request responsible parties Division Originating Request Division A Division B Division C

  45. Implications of Obligation • Company • Personal • Rituals in Aisatsu

  46. Strategies for a Consensual Society:Managing and Negotiation Japanese Style • Hanashiai- talk with one another • Sasshiai- creation of a good atmosphere • Settokusuru- persuade • Nattaku- understand and accept • Nintaiyoku- patience • On/giri- obligation

  47. Strategies for a Consensual Society Language: How the Japanese Say No • “I’ll check on it and do whatever I can.” • “I’ll do my best after I talk with my senior executive.” • “I’ll think about it.” • “I’ll handle it the best I can.” • “It’s very difficult.” • “I’ll consider it in a forward-looking manner.” • “I’ll make an effort.” • “I’m not sure.”

  48. Implications of the Architecture of the Japanese House