Pernille Rudlin - Rudlin Consulting

About Pernille Rudlin

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

She spent nearly a decade at Mitsubishi Corporation 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.

Pernille is a non-executive director of Japan House London, an Associate of the Centre for Japanese Studies at the University of East Anglia and she is also a trustee of the Japan Society of the UK.

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Here are my most recent posts

Mitsubishi Chemical to end methacrylate production in UK

Mitsubishi Chemical UK has announced in its latest annual report that following a global review of Mitsubishi Chemical’s methacrylate business in October 2022, and a consultation with employees at its Cassell site in Billingham, UK, it will close the methacrylate production at the Cassell site. Over 200 jobs are likely to be affected.

This is due to the “significant increase in natural gas prices” but also the downturn in the European economy due to high inflation and instability from the war in Ukraine having a detrimental effect on the demand for methacrylate monomers. Mitsubishi Chemical has 10 other methacrylate monomer plants around the world and has also delayed an investment decision into a new methyl methacrylate plant in Louisiana, USA.

Workers at Mitsubishi’s separate electrolyte business at the same site, which is used for electric vehicle battery parts, are not affected.

Mitsubishi Chemical Group’s European HQ is in Germany. The group has 69,784 employees in total – with around 40,000 in Japan and 30,000 outside, of whom around 4,000 are in Europe, according to our estimates.

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Japanese automotive supplier Nitto Denko to stop production in UK

Japanese automotive supplier Nitto Denko is to stop production in UK and will turn its UK operation into a satellite office. According to their annual report this is due to the global decline in automotive markets, the pandemic, the semi conductor shortage and Brexit.

Nitto Denko UK employed 138 people at a 2017/8 peak. This is now down to 50 in 2021/2.

Nitto Denko’s EMEA headquarters in Belgium, with a turnover of 360 million euro in fiscal year 2019-2020 employing around 1,725 across Europe.

Nitto Denko has manufacturing and converting operations in Belgium, Czechia, Hungary and Turkey and sales offices elsewhere, manufacturing and selling films, foam, fabric, sealing materials, reinforcing and damping materials and various kinds of industrial adhesive tapes which are used in worldwide markets such as automotive, electronics, furniture, paper production, aerospace and metal processing.

Toridoll expands restaurant business further in Europe

Tokyo listed food company Toridoll Holdings (owner of Marugame Udon + Wok to Walk) has acquired The Real Greek + Franco Manca owner Fulham Shore for £93 million. It acquired 40% of UK based Shoryu Ramen in 2016 and Netherlands based Wok to Walk in 2015.

Marugame Udon Europe’s headquarters is in the UK, employing around 100 people, with 11 restaurants. It has plans to open 150 restaurant outlets across Europe by 2027, creating 10,000 jobs.

Marugame Udon had 7 restaurants in Russia, operating as franchises, but these seem to have disappeared from its network.

Wok to Walk has restaurants in 12 European countries.

Nihon Nohyaku first acquisition in Europe

Nihon Nohyaku has acquired all shares of Interagro (UK) (13 employees), an agricultural materials manufacturer, through its UK subsidiary, Nichino Europe. The aim is to expand the business portfolio beyond synthetic agrochemicals, to become a leading company in life sciences.

Nichino Europe is Nihon Nohyaku’s only subsidiary in Europe, employing 20 people in Cambridge. It has other overseas subsidiaries in Korea, Vietnam, Colombia, Brazil, India, Taiwan, China and the USA.

Koyo Bearings Europe changes name to JTEKT Automotive England

Koyo Bearings Europe in the UK has changed its name to JTEKT Automotive England. It decided in 2021/2 to stop serving European market and transfer some production to continental Europe. UK employees at Koyo Bearings Europe have fallen to 205 from 279 in 2016. Koyo UK has become JTEKT Sales UK and has 20 employees.

JTEKT ‘s European headquarters is in the Netherlands, coordinating 28 subsidiaries across the region, employing 6,699 people in 2022 – of whom 365 are in the UK, across 4 subsidiaries.

Koyo was the bearings brand name of JTEKT since Toyoda Machine Works and Koyo Seiko merged in 2006 to form JTEKT. Now all businesses and brands are being rebranded to JTEKT globally.

The value of reconnecting

Looking back over 2022, I realise this has been a year of reconnecting, both personally and for work, as no doubt it has been for people all over the world. It has made me realise that while I enjoy my own company, I need to be able to connect face to face to others, to feel self-worth and vitality.

My family and friends live all around the world, and I had kept in touch with them, through Facebook and email, even before the pandemic. This year, visiting them in person for the first time in several years, I saw a big difference in wellbeing between those who are living near family, and have made friends in their community and those who moved away from friends and did not make any new friends. For the latter, now their family has grown up and moved away, they told me they feel not only lonely, but that they are living a worthless, selfish life.

In my work, too, there is no doubt that face to face training is preferable to online. It is hard, even if participants keep their webcam on, to gauge whether what I am saying is helping them and also to gain insights from them.

This need to collaborate to add value at work is apparent from research that has been done on executives in top global companies, by the IT Services Marketing Association. It shows that over 70% of executives are more interested than before the pandemic in collaborating with their IT suppliers to innovate and digitally transform their companies. The Japanese executives stood out as having an even higher interest in supplier collaboration than the global average.

This is presumably a legacy of Japan’s more group-oriented culture, and the ecosystems that have built up in Japan’s supply chains over the years. In more individualistic cultures such as Britain and the USA, suppliers and customers have been less collaborative and are more antagonistic towards each other.

One of the friends I reconnected with this year, a German film director I had not seen in 20 years, has made a film about a seaside community near where I live in the UK, during the 2019 Brexit negotiations. The film followed a group of dancers, comedians, singers and magicians who put on a variety show throughout the summer, and also a crab fisherman.

Although the performers were all British, they lived an internationally connected life and two of them moved to Spain as a consequence of Brexit. The crab fisherman worked by himself. His son did not want to follow him into the business. He said he had voted to leave the EU, because he felt the UK should not integrate with Europe on social or political issues.

My German friend is convinced that Britain has begun to realise that going it alone is not good for our wellbeing and is predicting that Britain will want to re-join the EU soon. I am not so sure, but I hope he is right.

This article by Pernille Rudlin first appeared in Japanese in the Teikoku Databank News in December 2022

The perils of car hire in Europe

Travelling around the UK and Ireland in the past couple of months has been an insight into the unpredictable impacts of the pandemic and the disruption of global supply chains on people’s everyday lives. I went to Ireland in August, to see my family in Cork, spending the first few days in Dublin. There was a very prosperous buzz there, but many young people were complaining about the cost of living, particularly rent and house prices.

Dublin was full of American tourists but in the holiday area on the coast of county Cork, there were very few Americans and most of the tourists seemed to be British. Usually, American tourists like to hire a car from Dublin airport and then tour around Ireland, often in search of their Irish ancestry. But this year they were quoted such high prices for car hire that they decided to stay in Dublin and travel by train or go on a coach tour to other locations.

The high price of car hire is due to the car hire firms being unable to take delivery of new cars at the rate they would normally expect, so there is a shortage of cars to hire if they retire old stock. Similarly, individual drivers are waiting longer for new cars so have to keep to their old cars longer, which then break down, and parts cannot be obtained easily for repair. They then have to hire a car while they wait for their old car to be fixed – putting further pressure on supply.

When I hired a car last month to drive to Kent, in the southeast of England, it broke down. The repair man was immediately able to spot the problem. The car needed a new battery as the existing one was too old to recharge properly. He also noticed that the coolant had completely run out. The car had clearly not been valeted as there were stains on the seats and dirt on the floor. The repair man told us that car hire firms are having to re-hire their cars so quickly, they do not have time to give them a proper service or clean.

Back in Ireland, my cousin, who is a conveyancer, told me that although there were fewer American tourists in Cork, she was selling more properties to Americans than before the pandemic. Cork has been a popular location for American IT and pharmaceutical companies for some years, but more recently American employees have relocated from the USA to work from Ireland. Now remote or hybrid working has become more acceptable, they felt happier about their families being raised and educated in Ireland, than having to endure active shooter drills at schools in the USA.

I am about to hire a car in France, where apparently second-hand cars are selling for the same price as new, and some people are resorting to hiring cars from individuals rather than car hire firms. I am bracing myself for what I might be about to experience.

This article by Pernille Rudlin first appeared in Japanese in the Teikoku Databank News in November 2022

Top 30 Japanese companies in the UK – what’s changed over five years

The total number of UK employees of the top 30 Japanese company groups fell 2.6% from 2019/20 to 2020/2021 – a strengthening of the downward trend in employee numbers since 2018/9. The peak of employment by the 30 largest Japanese company groupings in the UK was 97,827 in 2018/9 and this has now fallen by 5,000 to 92,851 employees. The top 30 represent around two thirds of the 137,000 people employed by 1,200+ Japanese companies in the UK.

It’s taken longer than usual to compile the top 30 Japanese companies in the UK for FY 2020, because some of the biggest employers have been very late in filing their accounts at Companies House. Like their Japanese parents, most Japanese companies in the UK run their financial year from April to March. We are defining the financial year as the year in which the majority of trading took place. So if FY2020 ended in the first half of 2021, companies then have nine months to file with Companies House, which would mean filing at the beginning of 2022. Some companies (we are looking at you NEC) did not file until the beginning of 2023, however. In most cases this seem to have been due to a mixture of the impact of the pandemic, coinciding with major acquisitions and restructuring.

2020/21 was the first year after the UK left the EU, on January 31 2020, so it may seem too early to assess the impact of Brexit. But as has been noted in this blog many times before, Japanese companies are risk averse, long term planners, so actually many of the plans were already in place and in progress, largely based on worst case scenarios. There is also a longer term trend of a shift from manufacturing (particularly automotive manufacturing) to services, in terms of who is in or out, or up or down the top 30.

Who’s shrinking

The company groups with above average decreases in employee numbers were MUFG (-21.91%), Konica Minolta (-20.13%) and Denso (-18.8%). MUFG Bank is a branch of MUFG Bank Europe NV, however, so there is no official figure for the number of employees in London. The decrease is largely based on the reports that MUFG offered 500 managers of its 1500 staff redundancy in 2019 and that this would have fed through by FY2020. It’s perfectly possible, however, that MUFG were simultaneously hiring more staff in other areas. There are another 670 or so employees at MUFG Securities, which is incorporated in the UK and shares an office with MUFG Bank. There are a further 250 so in a separate London office housing Mitsubishi UFJ Trust, Trust and Banking and Asset Management. MUFG usually says it has “around 2000” employees in London.

Konica Minolta acquired various UK companies before Brexit, but since Brexit has shrunk down and consolidated its operations in the UK and is focusing more on their European HQ in Germany and also the Czech Republic. The longer term trend of shifting away from manufacturing in the UK, to manufacturing elsewhere in Europe is seen at Denso, the Toyota group automotive parts manufacturer – UK employee numbers peaked in FY2018, and have been falling since, and are now 27.5% below the FY2014 level, whereas employment in the rest of the region is up 4.3% and global employee numbers, excluding UK, have risen 16% since FY2014.

Who’s growing

Company groups with the strongest growth over FY2019/20 to FY2020/21 were SoftBank, Mitsubishi Electric and Panasonic. SoftBank was fulfilling its promise to the Takeover Panel to double its UK workforce to 3,500 people in the UK after acquiring ARM in 2016, but it has recently become clear that it has since lost 40% of those it hired and there are now around 2,800 people at ARM in the UK. This will not be reflected until the 2021/22 reports.

Mitsubishi Electric is also, like MUFG, a branch of a European HQ in the Netherlands, so the employee total is an estimate, but it employs nearly 1,500 people at its air conditioning company and factory in Scotland, which is a UK incorporated company. Air conditioning has been a high growth area for several Japanese manufacturers in Europe.

Panasonic‘s growth is due to the acquisition of American software company Blue Yonder, which has around 300 employees in the UK. The bulk of Panasonic’s employees are in Panasonic UK and Panasonic Business Support Europe, which are both branches of Panasonic Marketing Europe in Germany – in Panasonic UK’s case since 2011. The European HQ was moved from the UK to the Netherlands in 2018 and it has not been disclosed what the trends in employment in these UK operations has been since then. The website says it employs over 400 people in its Bracknell offices, which is considerably lower than the 1,389 employees it had in 2018/9. If these figures can be regarded as comparable, then Panasonic has actually shrunk in the UK over the past few years, despite the Blue Yonder acquisition.

The top 3

Less significant changes in employee totals have resulted in a reshuffle of the top 3. The Hitachi group was the largest employer in the UK in FY2020, taking over from Nissan, which dropped to #3. Itochu moved up from #3 to #2. In Hitachi’s case, the growth was at Hitachi Energy (the recently acquired ABB power grids business), Hitachi Solutions and what was Hitachi Capital. The latter may have to be dropped from the total in future years as Hitachi now only owns 27% of it, and it has been renamed Mitsubishi HC Capital. Similarly 51% of Hitachi Construction Machinery is being sold to Itochu and Japan Industrial Partners, so it will leave the Hitachi group.

Itochu has considerable presence in the UK thanks to its acquisition of Kwik-Fit, with over 5,000 employees in FY2020 and Stapleton’s Tyres, with over 1,000 employees. There were rumours that Itochu was considering the sale of Stapleton’s and Kwik-Fit in 2020, but nothing seems to have developed since.

Key changes compared to FY2015

Five years’ ago, Fujitsu was the largest Japanese corporate group in the UK, with 9,892 people. It has lost 3,000 employees since, and was the fourth largest Japanese group in the UK in FY2020. As of FY2021, Fujitsu has 6,348 employees in the UK, 45% down on FY2016, compared to a 21% decrease globally, excluding the UK. Growth at Fujitsu has been in India (and Fujitsu’s CTO is Indian) and in its global delivery centres in countries such as Poland and the Philippines.

Honda was at #3 in FY2015 and had already fallen to #5 by FY2020 – before Swindon closed in July 2021. The closure of the Swindon plant will mean that Honda drop out of the top 30.

Companies that have dropped out of the top 30 since FY2015 include Calsonic Kansei, which is now Marelli, since merging with Italy’s Magneti Marelli, with KKR as the main shareholder. KKR is American, but it is KKR Japan that has the stake. Marelli has over 1,700 employees in the UK, so maybe we should keep it in the top 30. The Marelli website indicates the global headquarters is in Japan – but the management team has plenty of non-Japanese on it. It’s another example of how it has become increasingly complex to define what a Japanese company is.

Another automotive company to drop out of the top 30 is Yazaki. It had 1,345 employees in the UK in FY2015, and now has 890. Olympus has just dropped out of the top 30, not due to shrinkage so much (it had 1,362 employees in FY2015 and now has 1,389) as other companies growing more. JTI (Japan Tobacco International) has also dropped out of the top 30, since the closure of its Gallaher factory in Northern Ireland in 2017.

Newcomers to the top 30 over the past five years are:

NTT following their acquisition and consolidation of many IT services companies including Dimension Data, itelligence, Everis and Keane
Outsourcing, who have acquired various recruitment and outsourcing companies in the UK
NEC, who acquired Northgate Public Services
Mizuho – who expanded organically – but total employees are an estimate, as Mizuho Bank is a branch of Japan

Predictions for 2021/2

Around two-thirds of the 1200+ Japanese companies in the UK have filed their annual reports for 2021/2. The data from these reports suggests a further 10,000 drop (-7.6%) in employment numbers, from 137,000 to 126,000. 4,000 of this will be due to the closure of Honda’s Swindon plant, and a further 750 or so due to the closure of related automotive companies. For the top 30, there looks to be an overall decline in employee numbers, apart from Toyota.

There have been no major acquisitions in the past couple of years so we do not expect there to be any new entrants to the Top 30. The shift to services will continue, as will the increasing lack of transparency as to how many people are actually employed in the UK by Japanese companies, thanks to many of the UK operations becoming branches, with the shift of the regional headquarter functions to the EU.

Click the link below for a pdf of the Top 30 Japanese employers in the UK:

DOWNLOAD OF TOP 30 JAPANESE EMPLOYERS IN UK

Japanese with foreign MBAs are beginning to change corporate Japan

One swallow does not make a summer, and I am not entirely convinced by Nikkei Business’s assertion that there is an upcoming group of Japanese who did MBAs overseas in the 1990s and 2000s and are now taking over and changing corporate Japan.

The examples cited are:

Minato Koji (University of South California Business School MBA 2003), formerly of Oracle Japan, who was headhunted for a CEO position at Itoki, an office furniture manufacturer
Takahashi Hidehito (Columbia MBA 1992), President of Resonac Holdings (formerly Showa Denko)
Matsuoka Yoko (known as Yoky) who is founder of Yohana, a Panasonic subsidiary – who hasn’t got an MBA, but went out to the USA when younger, to become a tennis pro.

Nikkei Business characterises them as familiar with technology, having learned Western-style management through study abroad, including an understanding of how to take risks, and having had the experience of putting this knowledge into practice at foreign-affiliated companies.

Another example is Morimoto Masaru, now chairman of Showa Aircraft, who gained an MBA at Harvard in 1993 when he was working at Sumitomo Trust Bank. He says that in the 1990s, around 20 people a year were sent to study abroad from Sumitomo Trust Bank. “Large companies were competing to see who could send students.” Students studying abroad surged in the 1990s, reaching 83,000 in 2004.

As I was working in Japan in the 1990s (and was sponsored by my Japanese company, the first ever non-Japanese, to do an MBA at INSEAD, in 1997) I saw this for myself. The issue then was that companies did not know what to do with their newly minted MBAs when they returned. Corporate finance, or maybe send them to the USA, was the usual offer – MBAs were jokingly known as Managing Business in America. Many of the MBAs became frustrated and joined foreign companies – which is exactly what Morimoto (Club Med, Coca Cola), Minato (Sun Microsystems, Oracle), Matsuoka (Google) and Takahashi (GE, GKN) all did.

I do agree, however, that it would be positive for Japanese companies if more Japanese employees and young people studied abroad – so long as Japanese companies can work out what to do with them afterwards – perhaps the new job-type systems will help with this. The Japanese government has just announced that it wants the numbers studying abroad to reach 100,000 a year by 2027. This was achieved before, but even in 2019, before the pandemic hit, there were only 77,953 Japanese students abroad, compared to the record high of 115,146 in 2018.

Which companies pay women the best in Japan?

I thought the top companies paying 30 year old women the most in Japan would be mainly foreign companies, but actually over two thirds of the top 30 companies are Japanese, according to OpenWork – and in sectors that are traditionally male dominated such as IT, finance, pharmaceuticals and automotive. In the past, ambitious Japanese women generally preferred to join foreign companies as the perception was they would be treated more fairly, and remunerated on the same terms as the men, for performance rather than seniority.

The highest paying Japanese company is the misleadingly named Nomura Research Institute, which is affiliated with Nomura Securities, but is actually a management consulting and IT services company. Women there are earning around US$65K at the age of 30, and can expect to earn around US$87K by the time they are 40. None of the other big Japanese ICT companies appear in the Top 30 apart from NTT Data (19) and NTT Docomo (25). Whereas foreign companies Oracle, Salesforce and IBM are all in the top 30.

The second highest paying is the advertising and marketing giant Dentsu. I hope this is not related to them continuing to overwork their young female graduate recruits to the point where they take their own lives, as in the past. One Dentsu respondent to the OpenWork survey says “The rank determined at the annual evaluation meeting is reflected in the base salary. Bonuses are basically linked to performance. A few years ago, a new evaluation system was introduced, and some young people have become managers.”

P&G Japan is third, then PwC is fourth and Deloitte fifth, with other foreign professional services companies such as EY (10th) and Accenture (12th) also in the top 30, but no sign of KPMG. Nomura Securities are 7th and other Japanese financial services companies such as MUFJ Trust and Banking, Daiwa Securities and SMBC Nikko Securities are all in the top 30. Also surprising to me is that pharmaceutical companies Astellas and Eisai are ranked 8th and 9th. My impression had been that Japanese pharmaceutical companies were very traditional, hierarchical, male dominated organisations, and many Japanese women therefore joined Pfizer, Johnson & Johnson (who are ranked 17th) or GSK in Japan instead.

Similarly, Nissan (at #30 with average pay of US$47K at age 30 rising to $64K by 40) and Toyota also appear in the top 30 – although Honda does not.

The data that is lacking from this ranking, which could possibly explain more, is what the proportion of women in the workforce is for each of the companies – perhaps the high remuneration reflects a very small number of women, who are outstanding enough to succeed in very male dominated sectors. It would also be interesting to see to what extent there is a gender pay gap.

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