Doing Business in Japan

What You Should Know

Navigating Corporate Hierarchies

The structure of Japanese companies tends to be very hierarchical, with a great deal of deference to superiors.

Japan's system, however, often has been compared to an "escalator" on which employees rise gradually, but slowly, along with their peers.

Senior Staff Come First

In negotiating with Japanese corporations, it is important to keep this structure in mind.

For example, senior persons are deferred to during outside meetings and they are the ones to whom any questions should be addressed. This applies even when day-to-day negotiations are conducted with more junior staff.

It is important to give a personal touch to all business relationships that are current. It is also useful to spend time with Japanese counterparts learning about broader aspects of the company, not just the particular product or service that is under discussion.

Head Office or Subsidiaries?

In establishing a business relationship with a Japanese company, many foreign companies view the Japanese company's local subsidiary or representative office as a logical first contact point. A differentiation needs to be made, however, depending on the final goal and the size of the Japanese operation abroad.

Building Trust

Same Words, Different Meanings. A classic example is the expression "We will consider the

matter in a forward-looking way" ("Mae-muki ni kentoo shimasu"). While the expression sounds positive to most listeners in English, often it means "probably not" in Japanese.

Should You Have an Opinion? In the majority of Western countries, people tend to have

opinions on most things and voice them gladly. In Japan, however, people who constantly voice their opinions tend to be seen as annoying and may be shut out.

Building Trust

Is Power Respectable? "Power," with its aura of forcefulness, is something that

most Americans respect. The Japanese, on the other hand, tend to scorn the person who resorts to force. Whereas you could have dignity without real power, you could never have power without dignity.

An Emphasis on Difference. In many countries a good argument is considered to be a

spice of life, and people are expected to have different viewpoints. In Japan, however, a differing viewpoint indicates a poor relationship, or a problem.

Building Trust

To "Do" and to "Become." While the foreigner is always "doing" (suru) things to

achieve his purpose, the Japanese would rather allow things to "become" (naru). Thus it takes time for a relationship to "become" what it is meant to be through a natural progression.

Seeking Flexibility. Japanese business people use a great many English

expressions in their daily business life. Two of the most widely used are "case by case" and "TPO" (time, place and opportunity). The popularity of these expressions indicates clearly the degree to which flexibility is viewed as an important part of any business dealing.

Communications: A Multi-level Affair

In order to maximize good communications, making a conscious effort to locate a Japanese partner with a similar corporate culture can be very effective.

For instance, a family-owned business with decades or centuries of tradition behind it is likely to find it easier to communicate with a similar company in Japan.

Communications: A Multi-level Affair

Aside from the quality of communications, it is also important to consider the frequency of contact.

By keeping a steady stream of communications in the form of memos, materials, miscellaneous information and agendas for up-coming meetings, a foreign company can make clear the extent of its commitment.

Here Are 12 Useful Dos and Don'ts

Take things slowly. English comprehension may not be as good as it appears. Keep interventions simple and straightforward. The same is true if an interpreter is used. Make your interventions in short, easily translatable burst. Don't use sporting metaphors. If you must make jokes, keep them very simple.

Here Are 12 Useful Dos and Don'ts

Construct a short but warm introductory statement for each meeting. This should not be a sales pitch. It should explain why you're there, how long you'll be there, the sort of people you are seeing during your visit, and any particular previous contact you've had with Japan.

Here Are 12 Useful Dos and Don'ts

Then, after you and your interlocutor have made your respective introductory statements, make your sales pitch. But try to use the same sales pitch for all your meetings. In effect, decide what the five or six crucial points you want to get across during your entire visit are, and keep repeating them with all those you meet and in speeches you make.

Here Are 12 Useful Dos and Don'ts

Personal posture is important. Sit firmly in chairs at meetings even if they are armchairs. Don't slump, don't cross your legs and do maintain a fairly formal style. Don't blow your nose noisily. Don't drink tea offered to you before your host has indicated that you do so. Shake hands at the beginning and end of meetings. Never be late. Don't overrun the designated period for the meeting unless your interlocutor clearly wants to extend it. Don't hog the conversation.

Here Are 12 Useful Dos and Don'ts

Do not be worried if you feel you wish to read out a previously prepared note. Your interlocutor may well do this. Indeed, in making an impact, it's often more useful to read out a note and then leave it as an aide memoire.

Take business cards with you and have plenty available. They should be printed in Japanese on the reverse.

Here Are 12 Useful Dos and Don'ts

If you are taking gifts, make sure they are well wrapped, if possible professionally. They indicate a discourtesy to the recipient. Do not give the gift until the end of the meeting.

Don't be phased if you have given a gift and not received one. You will have scored a point. Don't open the gift after receiving it; if it's not very good it will embarrass your host. If you open it, your host will also have to open yours and that could embarrass you.

Here Are 12 Useful Dos and Don'ts

Don't be afraid of silences. Sit tight and wait for something to happen. It's a common Western flaw in the Far East to feel that silences have to be filled.

Do pay self-evident respect to Japan's extensive history, unique culture and enormous economic achievements. No need to go over the top, but it does no harm to indulge in some well-placed flattery.

Here Are 12 Useful Dos and Don'ts

Enquire about your host's education, background, family, hobbies etc. Give information about your own. This is part of the sharing of contacts which helps build up a relationship.

For formal speeches, have a prepared text for distribution beforehand. The audience will follow this as you give it, dramatically improving comprehension.

Here Are 12 Useful Dos and Don'ts

On taking the first drink at meals, toast your host by raising your glass to him and to those around you before you drink. Don't drink until it is time for those toasts to take place.