About Pernille Rudlin

Pernille Rudlin was brought up partly in Japan and partly in the UK. She is fluent in spoken and written Japanese, and lived in Japan for 9 years.

She spent nearly a decade at Mitsubishi Corporation (the Fortune 100 $190bn Japanese investment and trading conglomerate) working in their London operations and Tokyo headquarters in sales and marketing and corporate planning and also including a stint in their International Human Resource Development Office.

More recently she had a global senior role as Director of External Relations, International Business, at Fujitsu, the leading Japanese information and communication technology company and the biggest Japanese employer in the UK, focusing on ensuring the company’s corporate messages in Japan reach the world outside.

Pernille Rudlin holds a B.A. with honours from Oxford University in Modern History and Economics and an M.B.A. from INSEAD and she is the author of several books and articles on cross cultural communications and business.

Since starting Japan Intercultural Consulting’s operations in Europe in 2004, Pernille has conducted seminars for Japanese and European companies in Belgium, Germany, Italy, Japan, the Netherlands, Switzerland, UAE, the UK and the USA, on Japanese cultural topics, post merger integration and on working with different European cultures

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Here are my most recent posts

NEC aiming to be safe and secure in Europe through acquisitions

Japanese IT company NEC seemed to have given up on Europe these past few years, preferring to focus on developing countries, but it has come back with a bang, acquiring UK’s Northgate Public Services and Denmark’s KMD Holdings in 2018. This total spend of Y200bn ($1.8bn) is the largest investment NEC has made since it acquired Packard Bell in the 1990s.

On the face of it, NEC’s focus on what it calls “safety” businesses seems a good strategy: “creating safer and more secure urban communities” as they put it. It sounds better in Japanese: 安心安全な町 (anshin anzen na machi) but as is so often the case, it’s rather difficult to translate into snappy English. “Anshin” means a sense of being able to relax or relief, so “secure” is near enough and is also alliterative with “safe”. “Machi” can mean town as well as city, hence “urban communities” as the translation.

NEC’s safety businesses are already 5% of its turnover and reaching an EBITDA of over 20%. KMD will add to this business as it provides IT solutions for the Danish government, central bank and local authorities for security, tax etc. Northgate Public Services also has customers such as the London Metropolitan Police for crime prevention IT systems.

Up until now NEC’s overseas businesses have been loss making. As the Nikkei points out, NEC stands for Nippon Denki (Japan Electric) (NOT the National Exhibition Centre in Birmingham, stop sniggering at the back there, Brits) underlining its very domestic focus, and the domestic Japanese market is where most of its profits are made.

It was not able to expand upon its acquisition of Packard Bell. It made some other large acquisitions like the Netcracker of the US but nothing replaced the dent that the loss of the semiconductor business made on earnings and instead NEC found itself shrinking down.

The problem it now faces is that KMD itself has been making losses. NEC executives claim they can return to profit and would not have acquired KMD if that was not the case.

NEC is cash rich and was able to buy both companies without borrowing. Toyo Keizai says KMD was relatively cheap, and there was no bidding war either. KMD was owned by the public sector, privatized in 2009 and by 2012 was owned by an American private equity company Advent, loaded down with debt. Advent had acquired 7 further companies in order to revitalize KMD and move away from legacy business. It was expecting to IPO but a series of law suits were brought against KMD’s subsidiaries.

NEC had listed up 50,000 companies in the safety business globally, started negotiations with KMD in September 2018, asked the Dutch operations of KPMG to conduct due diligence and after only a month announced they would acquire it. NEC says the losses in the past 5 years were due to the law suits and that the first phase of restructuring is finished and phase 2 60% complete.

There is a similar picture at Northgate Public Services – a lot of debt and losses. The world undoubtedly increasingly needs IT security solutions, but this does not automatically lead to profits it would seem. NEC executives say they want to become a “normal” company, by which they mean it can grow, slowly if necessary, and be sure of a reasonable profit. Large overseas acquisitions were “traumatic” but show that NEC has a sense of crisis, says the Nikkei, and an imperative to change. NEC might know how to make money out of public sector clients in Japan, but I wonder if this will translate well into Europe.

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Top 30 Japanese employers in Germany – Japan’s appreciation of German ‘monozukuri’ continues.

Although Japanese business people tend to think of Germany as being a fellow “monozukuri” (manufacturing/craftsmanship) country, there are actually proportionally fewer (28%) Japanese companies which are manufacturing in Germany than there are in the UK (36%).*

Of course this has a lot to do with the fact that Nissan, Honda and Toyota have factories in the UK and do not have any plants in Germany – as well as the supply chain of manufacturers that they have attracted, many of whom set up production to be as close as possible to their customers.

The biggest sector for Japanese companies in Germany is wholesale. Automotive wholesale is playing a role here, as Japanese suppliers try to diversify away from supplying Japanese car makers and target European car brands as well. It has been noticeable that one reaction to Brexit by UK based Japanese automotive suppliers is to open a branch or subsidiary in Germany and/or transfer customer accounts and sales functions to those branches.

Like the Top 30 in the UK, the biggest Japanese companies in Germany have grown through acquisition. IT services dominate the top spots with NTT at number 1 thanks to its acquisition of Itelligence, Cirquent and Net mobile, as well as Dimension Data.

Fujitsu – the biggest Japanese company in the UK – is the second biggest in Germany. Fujitsu bought out Siemen’s share of their joint venture in 2008. Fujitsu is about to shut down the last remaining computer factory in Europe – which was in Augsburg, and around 1800 jobs will be lost across Europe.

Duncan Tait, SVP and head of EMEIA (Fujitsu’s own regional acronym – Europe, Middle East, India and Africa) somewhat disingenuously claimed on the BBC news recently that Fujitsu’s regional headquarters had been in the UK for 20 years and that “there was zero intention of moving out of London” like Sony just announced. Actually it is Fujitsu Services that has been headquartered in London, with some offices in Europe, whereas Fujitsu Technology Solutions, the hardware side, was headquartered in Munich, with a rather more extensive network of operations across Europe.

But as Fujitsu shifts, like many other Japanese electronics companies, to IT services and B2B, so the locus of power has to shift to where the customers are. Over 80% of Sony Europe’s turnover was to non-UK EU countries, but this is not the case for Fujitsu Services. Because of Fujitsu Services’ legacy of acquiring ICL in 1990, the UK public sector is still a key customer. So it’s no wonder Tait does not intend to shift out of London any time soon.

More recent acquisitions in Germany by Japanese companies do include a fair number of manufacturers – Mori Seiki has finally consummated its marriage with Gildemeister, Lixil acquired Grohe, Musashi Seimitsu acquired Johann Hay and Nidec continues on its overseas M&A rampage. As you can see from the ranking below, Japan’s appreciation of German monozukuri continues.

Rudlin Consulting can develop a more detailed, customised list of Japanese companies in Europe (for a fee). Please contact pernilledotrudlinatrudlinconsultingdotcom with an outline of your requirements.

*2018 Japanese Ministry of Foreign Affairs – who identify 1814 Japanese companies (this is very loose, they include branches, joint ventures and companies established by Japanese entrepreneurs in Germany) . There are 21 categories including “other”. For Germany the top 4 are wholesale/retail 31% (of 1814), manufacturing 28%, hospitality 7%, IT 6%. UK is 36% manufacturing, 13% wholesale/retail, 8% financial, 8% “other”.

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Service sector dominates Japanese investments in the UK

Although most people think of car manufacturers such as Nissan, Honda and Toyota when they think of Japanese investment in the UK, our Top 30 Japanese employers in the UK very much reflects the way the UK economy itself has shifted from manufacturing to services.

The three car groups are still in the Top 30 – in the Top 10 in fact – employing over 18,000 people – although many hundreds of them are not actually working on the factory floor, and are design engineers or in sales and marketing.

There are over 200 companies in the Top 30 employers (each consolidated group is counted as one employer) and 15-20% are manufacturers. They employ over 33,000 (36%) of the 92,000 or so people employed by the Top 30. This reflects why countries want to retain manufacturing – manufacturers are relatively larger employers, providing decent jobs in often deprived areas, creating a ripple effect of suppliers and further jobs.

Comparing these numbers with Roger Strange’s 1991 figures given in his “Japanese Manufacturing Investment in Europe” shows that while Nissan has grown from 2,500 employees to over 8,000, Honda from 400 to over 7,000 and Toyota from 1,900 to over 3,000, some have shrunk. Sony used to employ 1,800 in Pencoed, making TVs – it is now a technical centre manufacturing high end audio visual products and employing around 500-600 people

Other companies have changed their product mix – Hitachi used to employ around 1,000 people in Aberdare, making TVs, video recorders and microwave ovens and another 500 at Maxell in Telford making audio tapes and floppy disks. Now most of its manufacturing employees are working at Hitachi Rail and there are around 85 employees at Maxell, making plastic moulded products for the food, pharmaceutical and automotive industries and another 100 or so in Horwich making engine control systems.

Some have stayed the same – Ricoh had 650 employees in Telford in 1991 making fax machines and photocopiers, and still has 650 employees there 27 years’ on, making printing devices.

Brother is in the Top 30 not because it grew its manufacturing operations in Wrexham (in fact there are only 164 people there compared to 634 in 1991) but through the other big Japan-UK investment story – acquisition. It now owns Domino Printing Sciences, who develop and manufacture printing systems in Cambridge.

Also growing through acquisition is NEC. A couple of years’ ago it seemed like it was fading out of the UK and focusing on developing markets. It was no longer manufacturing – for obvious reasons – video recorders, car telephones, TVs and faxes in Telford. But in 2018 it acquired Northgate Public Services and through its acquisition of JAE in Japan, their UK operation and now it has over 2000 employees in the UK. Other big acquisitions have been SoftBank acquiring ARM, Dentsu acquiring multiple marketing agencies, Sumitomo Rubber acquiring tyre dealer Micheldever and Outsourcing acquiring various recruitment and debt collection agencies. The reason Fujitsu is still at the top of the ranking – just – dates back to its acquisition of ICL in 1990. All, notably, service sector companies.

A final thought on the current hot Brexit topic of location of regional HQ. It’s becoming increasingly difficult to identify one country location as the sole European headquarters – I’ve left the HQ column in the chart below, largely on the basis of where the historic HQ was and where most of the key regional people are based – but many companies are moving to a more virtual, dispersed structure, with Brexit and Japanese tax haven laws providing added incentive to do so.


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How will Hitachi weather the storms of Brexit and industry turmoil, not just in nuclear energy but also rail?

The Japanese business media is asking the question I’ve been wondering about too – what might the impact be on Hitachi Rail’s global HQ in the UK, now that Hitachi have shown they can take the tough decision to suspend their Wylfa nuclear power project, amid the continuing uncertainty of how Brexit will play out?

Toyo Keizai’s Naoki Osaka details the history of how Hitachi’s first step into the UK rail market was as a preferred bidder for the UK HS1 in 2004, supplying 174 carriages, which were built in Japan. Hitachi then won the IEP bid in 2012, for 866 carriages and a contract for First Great Western. They then invested £82m in the Newton Aycliffe factory i 2015, which is now making around 40 carriages a month for IEP and Abellio Scotrail. Not all parts are made in the UK. The 700 employees mostly do not have any rail manufacturing experience but are learning fast, according to Osaka. The 25 expatriate Japanese have been reduced to 6. Including the maintenance operations, there are now 7 sites in the UK, expecting to expand to 13 by 2020, employing around 2000 people.

Osaka was told when he visited the factory last December that there were plenty of future projects to bid for, so no worries for the future. However Diamond magazine says their Hitachi contact told them that since Hitachi lost the London deep tube bid last year and also lost their attempt to overturn the decision, they only have an order book through to the end of 2019, and no orders beyond that, as yet. Diamond describes the formerly warm relationship between Hitachi and the UK government as “frosty” as a result of both this and the failure of the government and Hitachi to agree on how to move forward on the finances for the Wylfa nuclear power project.

If there is a no deal Brexit, customs inspections will be significant for carriage manufacturing, says Osaka. 70% of the parts are made within 40 miles of the factory. So although there are fewer logistical concerns, there will be plenty of issues around rules of origin that are likely to cause supply chain problems for suppliers to Hitachi.

Furthermore, the Italian factory which Hitachi acquired in 2015 is improving productivity beyond expectations and will no doubt play an important role in developing Hitachi’s rail business in Continental Europe.

Hitachi is also keeping an eye on the Siemens/Alstom rail business merger. It may well be blocked by the EU, and as Alistair Dormer, CEO of Hitachi Rail predicted, Alstom is offering to sell of some of its businesses to avoid this, for which Hitachi could be a buyer. Hitachi was hoping to become one of the Big Three of the global rail business, with a target of Y1trn turnover – Siemens and Alstom’s merger will produce a Y2trn business. Now it has turned its back on nuclear business, can Hitachi become a global player in the rail business, in the face of storms caused by Brexit and industry restructuring?


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Is “chutzpah” in Israel the same as “not reading the air” in Japan?

Japanese investment in Israel has shot up the past five years.  According to JETRO there are 66 Japanese companies based in Israel as of 2017, 16% up on the previous year.  Nikkei Business estimates the total of investment asY130bn (around $1.1bn) – the main contributor being Mitsubishi Tanabe Pharma’s acquisiton of Neuroderm for $1.1bn in 2017.


PM Abe’s visit to Israel in 2015 brought about many further visits from Japanese business people. The attraction is, unsurprisingly, Israel’s expertise in IoT, AI, cyber security and other technologies.  But the big obstacle, certainly according to many people I have spoken to about this, is the big cultural communication gap.

According to Shintaro Hirado, who has set up a business support company in Israel, it can be seen as a positive, that Israelis are very straight with you, and once you get over the shock of that, then you can build good trusting relationships.

Japanese expatriates in Israel compare “Chutzpah” (cheek, nerve, audacity) to the KY (Kuuki Yomenai) phenomenon in Japan of a few years ago, when younger Japanese were accused of not being able to “read the air” (usually of disapproval).

Israeli owners of companies acquired by Japanese companies such as Rakuten have asked for earn outs before the final agreement was signed, or left due diligence meetings days before they were over, not out of anger, but just “I’ve said all I need to say.”

Japan Intercultural Consulting – whom Rudlin Consulting represents in Europe, Middle East & Africa – has just started a partnership with Charis Intercultural Consulting, who have a presence in Israel, so this communication gap could be a business opportunity for us too.

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What role did Carlos Ghosn’s status as a foreigner have in terms of his downfall?

And what does this mean for any other foreigner leading or looking to reach the top of a Japanese company?

Obviously the Nissan story is evolving hour by hour, so what follows is based on my current understanding as of 20th November.

The specific accusations are that Carlos Ghosn received share price-related compensation and the Dutch holding company of which he was a director along with Greg Kelly, as part of the Nissan-Renault alliance, used its funds to acquire and refurbish houses which were his residences. These were not declared, not as an income tax issue, but as a fiduciary/governance issue, in terms of declarations to the Japanese securities and exchange commission.

Is the way this possible misuse of funds was exposed specifically because Ghosn was not Japanese? Actually a lot of Japanese Presidents and Chairmen are allowed to use company funds for personal reasons, and because of the blurring of personal/private and employer in Japanese companies, it is quite common for companies to provide housing and other benefits far beyond the norm in the West, particularly to senior executives, who are not, on paper, paid that well. This is particularly true of companies where the President is also the founder or has a high degree of autonomy.

Terrie Lloyd, a long term resident and entrepreneur in Japan wrote an interesting piece on this recently – https://www.terrielloyd.com/terries-take/tt-970-imploding-one-man-shacho-listed-companies-e-biz-news-from-japan/

You also can’t help wondering what had been going on over the years in terms of internal checks and corporate governance at Nissan if they did not know and challenge what kind of “benefits” and compensation Ghosn was getting – as illustrated by this blog post from a Japanese corporate insider https://bdti.or.jp/en/blog/en/nissanltr/?77

So the next question is, as it often is with Japanese corporate scandals, why is this particular accusation being exposed and why now? The official story is that it was made by a whistleblower, which necessitated an internal investigation, and then this led to a plea bargain which would reduce the penalties to Nissan.* There is only one other instance of this happening – with Mitsubishi Hitachi Power Systems and a Thai bribery case – and it was a Japanese manager who was involved.

But I suspect, as do other analysts, that Nissan chose to pursue this and publicly expose it because they didn’t like the direction Ghosn was taking the company in and couldn’t work out another way to get rid of him. There was undoubtedly a long running worry about the degree of control/interference by Renault and the French government and Ghosn’s intention to make the alliance irreversible by the time he finally stepped down in 2022. I also just read a story in the Nikkei Business magazine that Ghosn was very keen for the alliance to partner with Google, Microsoft and Daimler and Chinese companies to create a CASE (Connected, Autonomous, Shared, Electric) strategy. That degree of “foreignness” and with the US, and China, and Daimler with whom Mitsubishi Motors already had a failed alliance might have elicited an allergic reaction from Japanese executives at Nissan and Mitsubishi Motors.

But also, which accounts for the strong words from current President Saikawa, indulgence of senior executives is tolerated so long as they still seem to be working for the good of the company, and Ghosn not turning up for the public apology after the inspection scandal, and the sense that it was his corporate culture of imposing aggressive targets on employees that might have caused that scandal – and yet he blamed Saikawa, might have tipped Nissan executives further into exposing the issue publicly rather than dealing with it in the usual way.

The usual way (see Fujitsu/President Nozoe resignation in 2009), when other executives decide that a President has to go sooner than the usual carousel of 6 years as President and another 6 years as Chairman because they think he’s gone beyond what is morally acceptable and/or they don’t like his strategy, is that they try to let the executive exit honourably, by getting him to resign due to illness or some similar blamefree excuse.

Maybe this option was offered to Ghosn – who had after all been leading Nissan as President and Chairman for nearly 20 years, so way beyond the norm for Japan. But I can imagine that he refused it – and this could be attributed to him being “foreign” – instead of understanding Japan’s “shame” culture, he would have gone down the Judaeo-Christian and legalistic route of saying he had a contract until 2022 and as far as he was concerned he had done nothing wrong, innocent until proven guilty, so bring it on.

There may also be a political aspect – again nothing specifically to do with Ghosn being foreign – but Nissan may have got the hint from Japanese government agencies that they would be supported in taking Ghosn down because they were not politically in favour of the direction he was taking the alliance in – see what happened to Horiemon/Livedoor.

So in summary, I doubt Ghosn was treated differently because he was foreign per se, but because he was foreign he probably reacted differently, just as Michael Woodford did when asked to resign after uncovering scandals at Olympus, believing his own innocence and not fearing public exposure.

But underlying this there could be a resistance in Nissan and beyond, to any further globalizing, whether it results in French or Chinese or American or German control or influence. If I was a foreign executive, particularly if I was Christophe Weber at Takeda, I would be watching further developments in this case like a hawk and making sure I built as many strong, trusting relationships with my Japanese executives as possible.

*The story has indeed evolved – it now turns out that Nissan itself was not part of the plea bargaining deal, it was the two officials, one non-Japanese SVP who managed the Dutch subsidiary and one Japanese who was Ghosn’s chief of staff, who agreed to cooperate with the investigation under a plea bargain.

I was also quoted in the New York Times on this subject.

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Some Japanese companies in the UK see Brexit as a business opportunity

In an article for the Teikoku Databank News in October 2016, I wrote about how Japanese business people in the UK were surprised that many British people’s reaction to Brexit was to try to be positive and seek out new business opportunities – I particularly pointed to Africa and the Middle East, infrastructure projects in the UK and M&A in the UK.

Now Nikkei Business magazine also has an article on Japanese companies in the UK that have indeed seen there are business opportunities in Brexit.

First up is NTT Data, who expect that clients will be looking to introduce new IT systems as a result of Brexit. For example, to cope with any new tariff and customs checks, goods might need IC tags.  Also, there will be more need to check the work permits of EU citizens in the UK.

NTT Data has added over 200 IT consultants and digital design specialists in the past year, to its existing 700 staff and expects to add another 100 this year.  It also acquired UK software development MagenTys company in May 2018 and opened up a design studio in London aimed at collaboration with start-up companies.

Brexit may also mean that the UK’s distribution system needs to adapt – there will be more need for warehousing and holding zones. The Japanese logistics company Nippon Express is therefore looking at strengthening its warehousing business. “We get a lot of enquiries for warehousing, so we want to be ready for any needs arising from Brexit”, says UK MD Toshinori Sakai.

Japanese security company SECOM is also expecting there to be greater needs for security systems arising from Brexit. Up until now security companies had been able to rely on hiring low wage immigrant security guards but if immigration is cut back then there will be greater need for SECOM’s security cameras and other automation, to replace those guards. SECOM’s UK MD, Minoru Takezawa predicts that the cost of providing security will rise as a consequence of cutting off the supply of cheap labour, so technology-based solutions will become more competitive.

SECOM started a new service in 2017 alerting retail chains when people with criminal records are entering their outlets.  They have increased the staffing of their monitoring centre from 40 to 100 and acquired a Northern Ireland headquartered Scan Alarms & Security Systems in March 2017.

Nikkei Business acknowledges that many of Japan’s manufacturers – particularly in the automotive sector –  are preparing for the worst, in terms of Brexit related disruption. But many multinationals in the IT sector, such as Google and Apple, have invested further in London, Cambridge and Oxford, in pursuit of a high skilled workforce and overall Japanese investment into the UK continues to increase in 2016 and 2017, and not just because of SoftBank acquiring ARM in 2016.

Law firm Ashurst’s Hiroyuki Iwamura points out that the UK is a pivot to global markets, particularly to the US. Theresa May is showing particular consideration for Japanese businesses – If they worry too much about the negative impact of Brexit, they may miss some good business chances, Nikkei Business London bureau chief Takahiro Onishi concludes.

If you would like to purchase a detailed list (address, company size etc) of acquisitions made by Japanese companies in the UK in 2016 (24 companies), 2017 (21 companies), 2018 (8 so far), please contact Pernille Rudlin (pernilledotrudlinatrudlinconsultingdotcom)

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Nissan and Ghosn – the cycle of coups d’état reaches back to the 1960s

I always prefer coincidence or cock-up to conspiracy, and former journalist and PR consultant Masaki Kubota clearly feels the same way, judging by the first few paragraphs of his article on Carlos Ghosn and Nissan in Diamond magazine.

As he says, in his years as a journalist, it was the standard defence of any Japanese executive caught up in a scandal that it was a conspiracy of people out to get him.

With Ghosn, you could easily claim, as many have, that this was a conspiracy, born of some kind of alliance between insiders at Nissan who wanted to get rid of Ghosn, his ex-wife and the Japanese government, and this kind of accusation is handy both for Ghosn and the French government or Renault who might have wanted Ghosn to continue to be influential.

But then Kubota does a classic kishotenketsu twist, pointing out the history of Nissan, going back to Ghosn’s installation and even before, is one of a cycle of coup d’etats.

Starting with the most recent history, of the inspection scandals – the exposure of the problem was a way of resisting the inspection system that Ghosn’s management team had introduced, shortly after Saikawa (identified as one of Ghosn’s team) became the new President of Nissan. It was in effect an abortive coup d’état.

Going further back to 1999 the then President Yoshikazu Hanawa was in negotiations with Daimler Chrysler and Ford but instead installed three Renault executives, without even consulting the previous Presidents who were advisors to the company at the time. “It was a kind of a coup d’état” the Nikkei said at the time.

Purging the Don

Even further back, to the 1980s, when the Chairman and former President for 16 years from 1957 was Katsuji Kawamata, there was a coup which led to the purge of union power at Nissan in Japan. It was well known that Kawamata gained his power through cooperating with the Nissan group labour union leader Ichiro Shioji. But then in 1984, Shioji, who was seen as the main obstacle to Nissan opening its factory in Sunderland UK and before that in the US, was hit by a scandal – photos appeared in the weekly magazine Focus, of Shioji on a yacht with a beautiful young woman.  Criticism of Shioji, as “the Don”, mounted and he resigned on 22nd February 1986. The Nikkei reported on this as “the 2.22 coup d’état” a reference to the 26th February Incident, a failed coup attempt in Japan in 1936. It was said that the power behind the 2.22 coup was Takashi Ishihara who was in favour of global expansion, and was the President at the time.

Ishihara had been involved in an earlier coup, when he was still at managing director level in 1969. Documents were leaked to the media about an incident involving a Nissan microbus.  It became clear that this was done in order to purge the upper ranks of the company.

As Kubota says, when there is a fraud in a company, this is often results in a clear out of those in the upper levels of management who are to blame.  In fact, this kind of incident has been quite rare at Nissan, so when it happens, it is likely that it is part of a major change in strategic direction.  So, Kubota asserts, it is definitely a coup d’état.  In Kubota’s experience, it is hard to change a corporate culture that easily, so if Nissan is used to changing strategies by coup d’état, then it will continue to use this mechanism.

Corporate culture will not change just because foreign executives are put in place. Kubota reminds us that for Saikawa to criticize Ghosn so strongly, when Ghosn has not yet been put on trial, is certainly a change from the usual crisis management of Japanese companies.

Kubota sees this singling out of Ghosn by Saikawa, who worked so closely with Ghosn for many years, as a kind of personal insurance.

So where does Saikawa fit in? Kubota has dug out the fact that Saikawa was executive assistant to the President from 1992, Yoshifumi Tsuji. Tsuji had taken over from Yutaka Kume, who had succeeded Ishihara, the instigator of the coup against union Don Shioji.  Saikawa was therefore part of the team that survived the Renault coup.

So it goes round. As Kubota puts it, even in the midst of this coup d’état, there will be people wondering whether they will be the next to be stabbed.

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5 types of Japanese colleagues who are “workstyle reform” blockers

I was surprised to see this explanation of  five generations of “workstyle reform” blockers in the Nikkei Business magazine came with a big red caution notice to readers not to take offence. The categories are not to be taken as hurtful stereotypes but based in research, and do not apply to all people of a particular age group, they explain.

So with that in mind, here’s a precis of the 5 types identified. Even though I’m not Japanese, I’m afraid I do recognise aspects of myself in the “middle manager” category, and am trying not to take offence. Although some of the characteristics are obviously derived from each age group’s experiences of the Japanese domestic economy and society, I am also reminded that there is plenty of evidence each generation around the world has complained about the other generation for the past thousand years or more.

1. The Veteran

Born between 1947-1951, so 66-71 years’ old

  • Work comes first
  • Believes in the virtue of hardship
  • Over strong sense of competition
  • Clings to past experiences of success
  • No intention of changing how they work
  • Gets angry if their way of working is rejected
  • Will oppose competitors’ opinions regardless of content
  • Caught up with “how things were” in the past.

2. The Executive

Born between 1952-1960 so 57-66 years’ old

  • Don’t rock the boat – doesn’t want to challenge
  • Laissez-faire
  • Always talks about “ideally”
  • People are people, I am what I am
  • Rather than change workstyle, is interested in what happens after retirement
  • Uninterested in reform, regardless of content
  • Just wants results, doesn’t make concrete proposals
  • Won’t listen, as retiring soon anyway

3. The middle manager

Born between 1961 and 1970, so 47 to 57 years’ old

  • Superficial
  • Thinks too highly of self
  • Extremely hedonistic
  • Sees everything in cost/benefit, mercenary terms
  • Reform should be done cheerfully, enjoyably without trying too hard
  • Won’t do it if not fun
  • Will oppose anything which increases own workload
  • Tells everyone to do their best and doesn’t do anything themselves
  • Will change the content of any reforms on a whim

4. The shop floor leader

Born between 1971 and 1986, so 31-47 years’ old

  • Pessimistic
  • Not good at interacting with other people
  • Prioritize risk avoidance
  • Strong sense of resignation – “they won’t understand”
  • “If this reform fails, there is no future for me”
  • Won’t promote reform if don’t trust the company
  • Too busy watching others’ reactions to say own conclusions

5. The staff member

Born between 1987 and 1994, so 23 to 31 years’ old.

  • Little sense of crisis
  • Not good at making an extra effort
  • Prioritizes personal life
  • Everything in moderation
  • “Is reform really necessary?” Won’t do it unless feels it’s necessary
  • Let other people take up new challenges or jobs requiring some thought
  • No empathy with the reasons behind the reforms
  • Doesn’t take the company so seriously, ignores directions

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Mitsubishi Corp reinvents itself again

Mitsubishi Corporation has evaded the perennial “death of the sogo shosha” (trading company) threat again, this time by shifting away from resources and commodities.  Non-resource related business now accounts for 70% of its profit, a complete about face from 2011, when it first started categorising its revenues in this way, and non-resource business was 30% of profits.

One contribution to this was Mitsubishi Corp’s acquisition of Norwegian fish farmer Cermaq in 2014, for $1.4bn.  Not only is its production ending up as sashimi in Japan, but it has outlets in the US via supermarket chain Costco. Mitsubishi has also been acquiring businesses in chemicals, automotive, fertilisers and materials sectors and recently raised its stake in Toyo Tires.

Nonetheless, higher resource and commodity prices were a key driver of its recently announced 22% increase in net profit for the last quarter and it has lifted its forecast for the full year to a record level.

It is not being complacent however, as it also announced in its new mid-term plan – to take it through to 2022 – that it will be revising its HR system for the first time in 20 years.  The main change is that the amount of time it will take before a graduate hire can take up a “kacho” grade management position from 20 years (ie not until early 40s) to 10 years. After 10 years, management appointments will be made on merit rather than seniority or which division the person originally came from.

Salary will be based on complexity of the job role, achievement of individual objectives and performance. Depending on performance, salary could be 50% higher than current levels.  Employees above a certain level will also be awarded shares on retirement in order to ensure that company performance is reflected in their compensation.

The current 7 business groups will be split into 10.  6 groups such as “natural gas” and “automotive” will be designated as profit drivers and encouraged to increase profitability. 4 groups such as “petroleum and chemicals” and “industrial infrastructure” will, through restructuring of industries and creation of new businesses, be the growth drivers.

As, like many Japanese companies, particularly the trading companies,  businesses were run on very vertical lines, there was a lack of cross fertilization between groups, so people will be appointed to develop businesses that cut across business groups. A Chief Digital Officer and digital strategy department will also be set up to respond to digitization, artificial intelligence and the Internet of Things.

The Nikkei points out that rivals Mitsui and Marubeni already have Chief Digital Officers and are investing in digital start ups but also that being behind on this does not seem to have impacted Mitsubishi’s top performance amongst trading companies – so far.

It’s often said that Mitsubishi is about organisation and Mitsui about people, if you want to get anything done. So this seems like (a somewhat familiar, from my own experience there 20 years’ ago) attempt to move the company forwards by tweaking the organisation, but also trying to make sure the organisation doesn’t squish the younger people coming up through the ranks – who are an increasingly precious resource in Japan’s ageing and shrinking population.

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