Chapter 4: Culture
Japanese companies that are successfully operating in the domestic market are increasingly having difficulty expanding their business globally (Iwatani, Orr & Salsberg, 2011). Chapter 4 highlights some of the observations Third Way Forum participants see as limiting Japanese company success when expanding their business internationally.
The major reason Japanese companies have difficulty in expanding internationally is that they follow the domestic business culture rather than the global business culture. This phenomenon, known as organizational bias, prevents companies from seeing the reality of how global business organizations function successfully and miss information critical to success.
Organizational Bias
When a group of like-minded people gather they often have similar backgrounds, values, information and ways of seeing the world, which they create into an organization and regarded as the only ‘correct’ way to operate. (Verna Meyers, 2016)
1. Corporate Culture Continues to Focus on Conservative Traditions
In Japan, it is not so much what you study at university that is important to the corporate hiring team but your self-determination to pass the difficult entrance exam! Often times the entrance exam is purposely made more difficult than the final exams at the university! The amount of societal pressure felt by young Japanese people to attain post-secondary education takes up their late teenage years so that they have no other opportunities to develop other skill sets, such as English conversation or STEM skills. Once having completed university, the place of employment that the alumni goes to, will typically be his or her place of employment for an extended period of time, and often, for their lifetime or if women, until they marry. The ‘lifelong employment system”, devised by Matsushita Konosuke, (founder of Matsushita Electric /Panasonic) to address unemployment of the 1930s depression, has been shown to be good for stabilizing unemployment during times of economic growth, but limits the incentive to take risks and for adapting to global changes (Sakaiya, 2003).
Japanese employees feel a strong sense of responsibility and perfection towards their employer which is ingrained from a young age through the education system and social structures within the culture. This sense of responsibility and viewing of the company as a family produces very loyal employees on the path towards “lifetime employment” but obscures new ways of seeing the world and its changes.
The company is the group or box you belong to now, and as long as you are participating, you are adding value. Generalists who are good at relationships in the company are valued more than skills in the lifelong employment system (Ito, 2006). Managers feel by adding value to the company, the company adds value to society. At some point, your path may go apart from that company but many of our Japanese colleagues do not see things this way. For them, the company is t