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I read in the Nikkei newspaper recently that Panasonic, Mitsubishi Estate and Rakuten are planning to make use of social networking site LinkedIn for recruitment outside Japan, including Europe. LinkedIn is the world’s largest professional networking site, based in California, with more than 270 million users worldwide, so it certainly represents an effective way to identify and attract new recruits.
I have been a member for more than 10 years, not to find a job, but to network with my European contacts in Japanese companies. It has been noticeable, however, that Japanese employees and Japanese companies in general are not very active on LinkedIn, even though LinkedIn launched a Japanese version and set up an office in Tokyo in 2011.
I assume this is primarily because LinkedIn is used for mid-career hiring and job seeking, which is still not a popular activity in Japan. Indeed, many Europeans dislike to display their skills and experience publicly, and signal thereby that they may be “for hire”. Based on my own analysis, the British and Dutch are not so cautious, whereas the privacy conscious (and possibly less comfortable in English) Germans and French hold back.
Many of my German contacts use Xing, a Germany based social networking site instead. However all Europeans (and people in multinationals in emerging markets such as Turkey) are aware of LinkedIn, and will take a look at it when they are considering moving to another company.
In other words, from an employer perspective, LinkedIn is a tool not just for searching for recruits based on skills and experience, but also for the company to present an attractive profile.
I recommend that any Japanese company reviewing their LinkedIn presence first of all ensure that the “official” company LinkedIn page is clearly labelled as official (to distinguish it from an alumnus site page run by an individual), and employees are encouraged to link their personal LinkedIn profiles to this official page.
More often than not, there are several pages already existing for the Japanese company. This needs to be tidied up, so that there is a headquarters page (in English), and any regional company pages are clearly identified as such. It is possible to interlink the regional company pages to the headquarters page, to show they all belong to the same company family.
These official pages need to be managed by someone either in marketing or HR at the headquarters and regional subsidiaries. They need a description of the company, including size, activities and a link to the correct website. The pages also need to be “branded” to look visually appealing and reflect the company image. Use should be made of the facility to add descriptions of products and services and add news about the company.
If this is done correctly, then “followers” of company will swiftly increase, both from potential recruits and also current employees, who will feel much happier now their employer has a clear and attractive LinkedIn presence they can associate themselves with.
(This article was originally written in Japanese for Teikoku Databank News)
- Proportion of women managers
- Work/life balance
- Use of women
- Equality between men and women
Other companies who have done well include All Nippon Airways (up from #6 to #3), and Mizuho – unlisted previously, and now at #17. As always, the life insurance companies do well (they traditionally have used a large number of women in their salesforces) as do non-Japanese companies such as IBM Japan (down from #3 to #6), Janssen (previously unlisted, now #13), Eli Lilly (#18, down from #14) and Accenture (previously unlisted, now #20, bumping Hewlett Packard out of the top 20).
The article that accompanies the rankings points out that in some ways Shiseido has become tougher on the women in its workforce. Previously there had been a big increase in female beauty consultants/shop assistants working “short shifts” so they could balance childcare with work, but now even those on “short shifts” are expected to take their turn to work on Saturdays or work in the evenings.
Okada Hyogo, senior manager at Microsoft in Singapore, sports what is known in Japanese as the ‘Regent style’ hairdo – apparently named after Regent Street in London, but usually known in the UK as a DA. He is photographed with his quiff, leather jacket and sunglasses for a recent interview with Diamond Online. He has written various articles for the magazine, including one entitled ‘60% is good enough’. The impact of Microsoft on his thinking is clear, in the way he recommends Japanese companies also adopt the “patch” mentality he saw in software development. “Aim for what is feasible, not the best”, was his lesson from his time working for Accenture in the USA.
He echoes a point I often make in my seminars about the Japanese pursuit of perfectionism, which is that the 80/20 rule kicks in when it comes to costs of making an effort. It can take 80% of effort, resources and time to achieve the final 10 or 20% to reach 100% perfection.
This might work in Japan where it is normal to work through the night to achieve “the best” but of course this kind of behaviour is not so well accepted outside of Japan. As Okada says, in some cultures a person who works late is regarded as someone who is not self disciplined. “They have a much stronger sense of priorities than the Japanese do.
“Japanese are lacking individual ‘core values’. At Microsoft we have 6 core values upon which we base our daily work. They are ‘Willingness to take on big challenges’,’Integrity’, ‘Openness’, ‘Constructive self criticism’, ‘Accountability’ and ‘Passion’. Akiyama Shin, the interviewer and President of Principle Consulting Group responds that it helps to define your own core values if you interact with people who are different to you.
As for being able to speak English, Okada believes it’s not enough by itself – an open and forward looking mindset is needed. “You need to be interested in the other person, and be prepared to engage in discussion.” Akiyama says it’s tempting to become silent if someone else in the meeting speaks better English than you do”. Okada responds that he got over his own English complex when his boss said “you already speak English. What’s important is knowing what you want to say, and how you want to progress the discussion.” Okada’s recommendation, to those who are not confident about their English is to get to a meeting 10 minutes early and greet the other participants as they arrive with “nice to meet you!” or “Good morning!” – that way you get warmed up for communicating and also you ensure that you have a presence at the meeting.
Even in teleconferences he recommends getting a question in early like “when can I expect to finish this meeting?” as a warm up, otherwise you end up not saying anything. For presentations he uses physical warm ups like a few squat thrusts and also practicing his “Rs”.
Another tip for meetings is to get near the whiteboard and offer to write up the agenda and minutes on it. “That way you look intelligent and hardworking!”
He also recommends saying “Let me finish” and using your hands to signal this. “Japanese tend to preface their requests too much”.
He finishes by saying that Japanese companies don’t have a very good image in Singapore as employers, and this has an effect on the brand too. Japanese employers are seen as only promoting Japanese people, and demanding a lot of unpaid overtime. Products have too many unnecessary features which only appeal to Japanese, rather as Japanese companies unthinkingly promote uniquely Japanese ways of working – such as chourei (daily morning team meetings). There is not one Japanese company in the Singapore Top 100 employers chosen by students.
A new employment category, the ‘limited permanent employee’ has emerged in locations such as Singapore, where there are many locally hired Japanese employees, according to Diamond Online. They feature an interview with an anonymous former ‘limited permanent employee’, Mr A, of a major Japanese securities house’s Singapore subsidiary. According to Mr A, the category was somewhere between a contract worker and a permanent employee, and involved being treated in a way that resulted in him leaving.
Diamond journalist Norifumi Yoshida believes this category looks like to catch on in Japan too, to keep a cap on the ever expanding, insecure and badly paid “contract staff” category, in accordance with the government strategy for revitalising economic growth, while at the same time being easier to lay off than the traditional permanent, lifetime employee.
Mr A had been working for a major Japanese manufacturer, and was posted to their Singapore operation. He left the company while still in Singapore. He tried to start up his own IT company, but that failed. Then he heard that the Japanese securities company was looking for an new IT manager so interviewed for the position and was appointed. He was 35 when he joined the company, on around Y3.5m (US$28K) which was at the higher end for Singapore. However the Japanese expatriate IT manager, also 35, was earning around 3 times this.
There were around 150 expatriates from the Japan headquarters, including around 20 general managers who were in charge of the front and back offices, aged around 35 to late 40s.
These 20 had graduated from Japanese universities and joined the securities house straight after graduation. They had worked in Japan for 10 or more years and spoke good English. They initiated sales of securities or bonds and negotiated with local Singaporeans. They were also in IT or accounting or finance. They were good all round players but not professionals or specialists.
There was a second group of people amongst the 150 or so ‘permanent staff’, the front office people – 40 or so traders. They were ‘Anglo Saxon’, types who had worked for American or British firms previously, usually having been transferred to Singapore with those firms. They frequently changed employers, in some cases up to 10 different employers. There were a few Japanese traders, but most of them were not, and they were mostly rewarded through commissions and were often paid more than the Japanese expatriates – several hundred thousand dollars on average.
Mr A is not against this as such – in fact he points out that without these kinds of salaries, it would not be possible to hire highly skilled people, and if the company tried to stick to old ways of equal pay for all, it would surely collapse. Yoshida wondered whether Japanese companies aren’t using this as an experiment, and soon this system will be imported back into Japan.
Mr A felt the unfairness was more around how the third group of ‘permanent staff’, the ‘limited’ permanent staff, were treated. These people were mostly locally hired Singaporeans, on low level jobs, and accordingly paid low wages, with no prospect of promotion or transfer. At such low wages, it was not possible to hire high quality local staff anyway. The head of the IT department was Singaporean, and of the 12 staff in the department, 2 were Japanese expatriate staff and of the remaining 10, Mr A was the only locally hired Japanese. “Locally hired Japanese don’t last long. After 6 years I felt I was turning into an idiot, so I left”.
Both Mr A and the interviewer agree that treating all limited permanent staff the same way, without opening up any opportunities or pay rises to the more high potential or high performing staff will result in more dissatisfied and overworked locally hired specialists, who will keep quitting their Japanese companies. Mr A clearly feels very bitterly about generalist lifetime employees, who have no specialist knowledge of IT, being paid three times as much as him, plus expatriate allowances. “Globalization means the company has to become more focused on competency.”
Personally, I’m not so sure this is a new thing for Japanese companies in the global financial services sector. I remember a friend of mine from university being warned after he joined a Japanese securities house in London in the late 1980s, that locally hired staff were either “whores” or “coolies”. And locally hired staff in Japanese companies in quite a few sectors will ruefully recognise the “no prospect of promotion or transfer” limited permanent staff category.
Yes, it really is spelt Tokio Marine, and they have to stick with it because there is a shipping company called Tokyo Marine. Tokio Marine Holdings is historically part of the Mitsubishi group of companies, founded in 1879 as Japan’s first non-life insurance company. The President, Tsuyoshi Nagano, was appointed in 2013 and seems determined to carry on his predecessor’s overseas M&A strategy, which included the acquisition of UK Lloyd’s underwriters Kiln, for £442m in 2007. He explains in a recent interview with Nikkei Business that overseas acquisitions are not just for growth, but also to spread Tokio Marine’s own risk, avoiding the “all your eggs in one basket” of business being too focused on earthquake, typhoon and volcano prone Japan.
Currently overseas business represents around 1/3 of Tokio Marine’s insurance premiums and around 40% of profit. “Domestic growth, if we did nothing proactive, would be around 0-1% a year, or 2-3% if we take a more proactive stance. Overseas growth is around 7-8%.” Around half of the overseas profit is from the US. Nagano is now looking at developing markets for further growth, but is still interested in finding further good partners in North America or Europe. Tokio Marine has three regional holding companies in North America and Europe, and some profits are retained for further investment, and to protect against currency fluctuations.
Nagano believes that the longevity of Japanese companies (there are over 3100 Japanese companies who have survived more than 200 years) is to do with their focus on “how to make sure customers choose us, rather than how do we sell”. The same approach will hold for overseas, he says – to be the company of choice, a company that is useful and “plays a part” in the region, upholding the Group Message of “To be a Good Company”.
“It’s not enough for me to say nice words” Nagano admits – in-house training is needed, and to that end around 20 future leaders are selected each year from around the world, who undertake training in the US, UK and Japan. The Japanese part includes a discussion with Nagano himself, and a visit to the Tohoku area to see for themselves the devastation caused by the 2011 earthquake and tsunami and meet the people impacted by what happened.
Practically every globalizing Japanese engineering company has a ‘Way’ thanks to the success of the ‘Toyota Way’ so it’s no surprise that the highly admired, globally acquisitive Nidec has come up with a ‘Nidec Way’ too. It’s being rolled out at the same time that Nidec is reorganising itself globally, setting up 5 regional headquarters including an HQ in the Netherlands for the European region.
The Netherlands was chosen because of its low tax rates and a regional CFO will be appointed, who will be tasked with reinvesting profits made by the local subsidiaries back into the region. All regions will be measured by the same cash conversion cycle standards and the company is also aiming to adopt the IFRS accounting standard by 2017.
The Nidec Way is also presumably going to be a common global standard. It is based on the current corporate philosophy of Passion, Enthusiasm and Tenacity. I haven’t found an English translation yet (which I suspect is proving problematic, as I couldn’t work up a good direct translation, as is so often the case with Japanese corporate values) but here roughly is what it appears to be:
- Passion – 卓越への挑戦 – daring to transcend, taking up the challenge to be preeminent
- Enthusiasm – 顧客満足のために to satisfy customers
- Tenacity – 知的ハードワーキング intellectually hardworking
As well as 「創造性」「敬意」「協働」「王道」 – creativity, respect, collaboration and the virtuous path/just rule (literally ‘the road of the king’).
Leaders are also expected to have the characteristics of 「決断力」「チームスピリット」「人材育成」 – decision making ability, team spirit and human resource development.
I’ve just been updating our Customer Relationship Management (CRM) database of Japanese companies and their suppliers in Europe. I recently shifted the database to a new cloud-based provider, which enables me to cross reference our customer data with social networking sites such as LinkedIn – a very popular business networking site across Europe and the USA. The way our new CRM interface works has also forced me to focus much more on how our Japanese corporate clients are organising their operations across Europe, including where they have placed their headquarters.
My conclusions are not entirely scientific, as my own business is based in the UK and therefore biased towards UK based Japanese companies, but it does seem that the UK is the most popular base for European headquarters of Japanese companies. Of the 96 European headquarter companies I have identified in my database, 53 are in the UK, 24 in Germany, 10 in the Netherlands, 5 in Belgium, 2 in France, 1 in Switzerland and 1 in Poland.
Of course there are many Japanese companies who do not have a European headquarters, but the trend among those who have been in Europe for a longer period is unmistakably towards consolidating across Europe in terms of functional areas such as purchasing or HR or finance. This seems to be to the benefit of the UK, which is the undoubted European if not world capital of professional services – with many globally capable financial, marketing, legal, consulting and HR firms in London.
The UK has long been a favourite destination for Japanese foreign direct investment, for various reasons ranging from the English language, to golf to the UK’s open economy. Germany has also been very popular, particularly with Japanese engineering companies who feel an affinity with German process orientation and risk aversion, as well as having historical ties such as Fujitsu with Siemens or Denso with Bosch. The North Rhine Westphalia region was particularly active since the 1960s in encouraging Japanese companies to set up there, although Sony decided initially to set up in Berlin, largely, it was rumoured, because of Norio Ohga’s love of the Berlin Philharmonic.
More recently, the Netherlands became popular because of the tax advantages offered, and also, along with Belgium, was an obvious logistical centre for Europe. Lately, however, there seems to be a shift of these headquarters to the UK. Canon has moved from the Netherlands to Uxbridge, near London. Denso and Bosch recently announced their break up, and although Denso continues to be headquartered in the Netherlands, there seem to be several senior managers with European roles based in the UK. Fujitsu and Siemens parted ways in 2009, with the Fujitsu European operations being split between Continental Europe, the Nordics, and UK and Ireland.
Sony sold its Berlin headquarter building in 2008 and is currently in the process of consolidating its sales and marketing across Europe, to be based in Weybridge, a few kilometres south west of London. However, it seems to be shifting towards a “virtual” European structure, with shared HR services now set up in Turkey, and individual senior executives with European remits being based in whatever location they prefer. This pattern has also become evident in other IT and telecoms companies such as NTT Data.
Even this virtual European company structure seems to benefit the UK the most, as senior executives of all nationalities are can be found in, or seem relatively happy to relocate to, London and its suburbs. With more than 40% of London’s population were born outside the UK, London has truly become a global capital and a place to develop global careers.
This article by Pernille Rudlin originally appeared in Japanese in the 10th April 2013 edition of Teikoku Databank News
Sony introduced a new personnel system in April 2015 for its Japan hired employees whereby all seniority based pay is abolished – for both junior and management grades. The current role will be the only basis for evaluation for compensation. According to documents that the Nikkei Business has seen, around 60% of Sony’s employees are likely to face a pay cut as a consequence. It will be gradual, but ultimately an employee could find themselves losing as much as $13,000 a year. The early retirement scheme which had been set up 20 years ago is also coming to an end. This was a highly favourable incentive to leave the company, representing up to around 72 months’ salary – a 50 year old kacho (team leader) grade employee could reach nearly $700,000 in a golden goodbye lump sum.
“Even a child can appreciate that rather than be bullied by the new pay system, it would be better take the money and go” says a former Sony employee, who has done just that. Another current Sony employee says that there has been a negative impact on morale. Apparently some staff went home immediately, with pale faces, on being told their new pay grade. “Since last year 2 people have been having to do the work formerly done by 4 people. Physically, it’s difficult to take.”
There has been sniping from former Sony executives about the strategy too, even though results have improved and the share price has revived. “The medium term plan is just about pleasing shareholders” says one, complaining that there is a lack of leadership or any sense of where Sony is going.
The Nikkei Business summarises the 10 reasons Sony won’t change as:
- Interest bearing debt
- Too many employees
- Lack of a long term view
- Overcautious product development
- Unprecedented successes in the past
- Too much reliance on the strength of the brand
- Walls/silos inside the company
- Talent walking out the door
- Fewer “odd” people
- Increase in employees who are “too smart for their own good”
Although critical of current President Kazuo Hirai, some former employees say the rot set in 20 years ago, and can be traced back to the reforms that former President Nobuyuki Idei introduced, “bringing in American style management, destroying the ‘ordered chaos’ of the engineers, who had given the company its competitive edge”. Hirai of course defends his new plan, particularly the spinning out of business divisions, in an interview in the second part of the article, and the Nikkei then ends its hatchet job with an article concluding that whilst Apple has grown up, Sony remains a troubled teenager.