Japanese business culture : Understand the heirachies

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Japanese business culture. David Finn shares his knowledge.

I’ve been doing business in Japan for over 25 years. If you are looking to build business relationships with Japanese companies, one of the difficulties that Australians often face is dealing with the intricacies of the hierarchy within their structure.

Japanese businesses have a strict and highly structural process they adhere to, which can delay dealings if not fully understood. For an Australian looking to do business in Japan, knowing the correct pathway into a company and learning the nuances of Japanese business culture can save you much time and frustration.

Having worked for Japanese companies for most of my career I have observed these intricacies first hand – I have also  fallen victim to them myself from time to time and discovered some good learnings.

Patience

First and foremost, it is important to understand that business processes in Japan take time and consideration. There is no such thing as a quick result. Japanese business is very much a hierarchy and if you want to reach the person at the top, you need to be prepared to speak to every level on the way through.

Each individual has their own responsibilities and before you can speak to the decision maker, you will have to deal with every individual respectfully first. This is unavoidable so get used to the frustration. You can’t bypass a more junior rank and go straight to high level management otherwise you risk undermining certain individuals, and your negotiations will stop dead in their tracks.

So be prepared to start from the bottom and work your way up. It can be a long and laborious process but worth it in the end.

Communication

Working for a Japanese company with a global network of branches can provide its own complications and I have experienced my fair share. When I began my career with Kyocera 17 years ago, I started alongside a colleague who through various promotions and overseas assignments now holds a very senior position in Japan. Due to the hierarchical positioning in Japan, it would be frowned upon for me to communicate with him directly despite being long term colleagues. Within the workplace we have to both go through the established hierarchical processes to communicate.

The problem that arises with this is that elements of the message can often be lost. As the message is filtered down through the levels, details can be left out leaving room for misinterpretation. So it’s really important to have clarity in all your communications.

Decision making

All the major business decisions in Japan are made behind closed doors, often before the meeting has even taken place. So don’t expect to turn up for a meeting and dramatically change the participants’ minds, as they will have already formed their opinions before they step into the room.

Preparation

Preparation is key when it comes to business meetings in Japan so a good tip is to put your agenda and requests forward beforehand to ensure there are no surprises, and to give your colleagues time to think. If you come into a meeting with an agenda that you haven’t disclosed then it is very likely you won’t achieve anything.

Culture

Business culture in Japan is a fluid system, and not necessarily fixed. As with any country, each organisation will have its own unique culture. Some Japanese companies are quite forward thinking, whereas others will prefer to hold on to the more traditional business ideals.

The culture of an organisation is determined by the individual at the top and this can change when an individual changes position, which will often happen through retirement as there is a mandatory retirement age of 60 in Japan.

For this reason, it can be difficult to navigate through the cultural expectations of Japanese companies at the outset, and unfortunately there is no specific book on how to do it. It’s something you need to figure out with patience and respect.

In the past, I’ve found it works well to think of doing business with Japan as a process of Osmosis. When dealing with a hierarchical business structure, you will achieve the best results if you let negotiations filter through nice and slowly. If you try and force your business dealings you’ll invariably lose favour, and that is where most westerners come unstuck.

In my experiences, Australia is certainly well positioned to do business with Japan and the two countries have a strategic partnership expanding over 50 years. For the savvy and considerate businessman there are plenty of opportunities to establish successful business relationships with Japan.

 David Finn is the Managing Director of Kyocera Document Solutions, began his career in the IT Industry in 1984 with IBM. David spent 10 years as General Manager at Epson before commencing his 17 year career with Kyocera in 1997.

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