UNIVERSITY OF BANJALUKA

FACULTY OF ECONOMICS

SEMINAR PAPER

Theme: Doing business in Japan

Subject: Business English Language

Mentor: Milica Bogdanović, MA

Student: Ljiljana Ilić, 32/11

Banjaluka 2013

CONTENTS

1. INTRODUCTION ......................................................................................................................................... 2

2. JAPANESE ECONOMY ................................................................................................................................ 3

3. JAPANESE BUSSINES CULTURE .................................................................................................................. 4

3.1. The Japanese company ...................................................................................................................... 4

4. BUSSINES MEETINGS ................................................................................................................................. 5

4.1. Meeting and greeting ........................................................................................................................ 5

4.2. Introduction ....................................................................................................................................... 5

4.3. Relationships ...................................................................................................................................... 5

4.4. Communication and body language .................................................................................................. 6

4.5. Meetings and negotiations ................................................................................................................ 7

5. JAPANESE PEOPLE ..................................................................................................................................... 8

6. ENTERTAINING AND DINING ..................................................................................................................... 8

6.1. Drinking .............................................................................................................................................. 8

6.2. Dining ................................................................................................................................................. 8

7. DRESS CODE ............................................................................................................................................ 10

8. WOMEN IN BUSINESS IN JAPAN ............................................................................................................. 10

9. THE RITUAL OF GIFT-GIVING ................................................................................................................... 11

10. CONCLUSION ......................................................................................................................................... 12

11. REFERENCES .......................................................................................................................................... 13

1. INTRODUCTION

In this seminar paper I will try to highlight the differences between Japanese and Western

cultures and explain the importance of that knowledge for successfully doing business in Japan.

So, what is the biggest obstacle in understanding the Japanese business culture? It is that

many foreign companies (in this case Western ones) never start business in Japan or enter the

Japanese market trought a distributor simply because of the infamous ''myths'' of doing business

in Japan. However, it is easely overcomed by studying Japanese culture. It is important to

differentiate relevant from irrelevant and to learn what should or should not be avoided. There

are many examples of entering Japanese market and successfully doing business in Japan, e.g.

Yahoo!, BMW, Mercedes-Benz, Chanel, Louis Vuitton, etc.

But, the most important question is what does it make Japanese culture so different?

What makes it specific is it's cultural inheritance which evolved from its specific geographical

location of islands surronded by sea and for the most part of their history they were isolated from

other cultures. These elements and many more have produced a modern socitey with unique

values, traditions and customs. But, they are not so close-minded about Western cultures and you

can easely find many Japanese professionals who are well-educated in doing business with the

West and they would probably modify their behaviour for successfully cooperating with you.

However, you should also, just like them, prepare yourself for doing business by learning their

culture, etiquette and everything else that could be helpful to your company.

Their culture will remain an enigma and a mistery for us if we do not learn diligently

about their culture and customs. They are extremely productive and efficient society and that

should be remebered at the begging. As an advice, most foreigners will need to prepare

themselves as much as possible, so that they do not experience cultural shock and bewilderment.

But what is explained in this paper may not be everything need to be learned but it is crucial to

do when doing business with the Japanese.

2. JAPANESE ECONOMY

Throughtout the history Japan emerged as the most developed nation in Asia. In 2012,

Japan was the third largest national economy in the world, after United States and China (in

terms of nominal GDP) and the forth largest national economy in the world, after USA, China

and India (in terms of purchasing power parity).

The service sector accounts for three quarters of the GDP (gross domestic product). Japan

has a large industrial capacity and is one of the largest and most technologically advanced

producers of motor vehicles, electronics, machine tools, steel, ships, chemical substances,

textiles and processed foods. Only 13% of Japan’s land is agricultural. Japan accounts for nearly

15% global fish catch.

In 2010, Japan’s labour force consisted about 65.9 milion workers and Japan is the

country which has one of the lowest unemployment rate of around 4%.

Japan is the second largest producer of automobiles in the world. Some of the world’s

largest companies are Japan’s, e.g. Toyota, Nintendo, Canon, Honda, Sony, Panasonic, Toshiba,

Sharp, Nippon, etc. As well as that, in Japan some of the world’s largest banks are stationed and

the Tokyo Stock Exchange stands as the second largest in the world by the market capitalization.

Japan is a world leader in fundametial scientific research, having 16 Nobel laureates in

physics, chemistry and medicine, and many other well-acclaimed prizes. Japan leads in robotic

production by possesing more than half of the world’s industrial robots.

Japan’s main imports are machinery and equipment, fossil fuels, foods, chemicals,

textiles and raw materials for its industries.

They have their own variant of capitalism which has its own dinstictions, among which

''keiretsu'' enterprises, lifetime employment and seniority-based career advancement are most

noteable.

3. JAPANESE BUSSINES CULTURE

Japanese business culture is different from the USA's and Europe's business culture, but

these references do not make it more risky to start business in Japan than it is in the rest of the

world. Some of the aspects of Japanese business culture, as stable long-term relationships and

sense of loyality between partners, present a good climate for foreign companies to start a

business that understand how to swim in that cultural tide.

Wherever you go, to Japanese store or a bar, you will be greeted by shouts of ''welcome''.

The difference between and us is that they are very service oriented. This makes sense because

service is the main basis of Japanese business culture. In Japan, personal service is part of the

service, unlike the USA where you have to pay for personal service with tips. In Japan there is no

tipping and it is considered to be offensive.

Many people notice that the Japanese people are extremely polite. It may seem annoying

but being polite is a great part of doing their job and they will almost do anything to please their

costumers, directed by slogan ''a happy costumer will come again''.

3.1. The Japanese company

The structure of Japanese society looks very like the structure of the Japanese company,

and sometimes there can not be made a clear distinction between the two. A Japanese man and

his family are socially ranked by the reputation of the company he works for and by the position

he achives there. Japan is a nation of ''company man'' – ''salaryman''. Morever, in Japanese

business culture you still have the concept of ''lifetime employment''. Almost every Japanese

man, after he graduates from college and enters successful company, believes that he will stay

there until he retires around the age of 65. This promise of lifetime employment is still mostly

true for the majority of employers in Japan.

A Japanese company is like a ''corporate family'' for a Japanese man. The hierarchy of a

company is similar to the hierarchy of human family. So it is not unusal that strong ties exists

between companies and their suppliers. If you want to try to start business with one of their

companies by trying to break these ties you will probably not succeed. It is better to work around

those bounds by creating a partnership with a trusted company or a seller.

If you want to employ a good Japanese worker offer him a paycheck (or some other

privilege) which is superior to anything he already has in his current company. In addition,

Japanese workers loyal to their companies and you will have many difficulties to find someone

who is ready to immediatly switch to a new job.

4. BUSSINES MEETINGS

4.1. Meeting and greeting

A the first meeting you have to show proper respect and sense of professionalism. The

respect is showed throught language, behaviour and non-verbal communication.

When you meet a Japanese delegation for the first time you have to set your mind on two

things – the bow and the exchange of business cards. Considering that you are Westerner you

will not expected to bow but you will greeted with a handshake and a slight nod of the head as

the compensation for the bow so pay attention and do the same.

The exchange of business cards is like some sort of ceremony and you should treat the

given card with respect the same way you will treat the actual person who gives you the card.

Recieve it both hands and read it on the spot. As a piece of advice is recommended for you to

invest in carry case for storing cards. It is important that you do not casually put the card in your

pocket because it will be considered as extremely rude. Also when you give your card you offer

it with both hands (the same way you recieve it) and on one side you should print the translation

of the card's content in Japanese. Do not forget to put your name and your position in the

company you represent. It means a lot to them because according to your postion they will know

how to treat you. If you do it like this it will show that you placed a great importance to this

meeting.

4.2. Introduction

As you can see greetings are very formal and ceremonial. You have to show respect equal

to status of the person you are dealing with. If it is possible wait to be introduced because do not

and introduce yourself without permission it will be seen as rude. If you decide to bow you

should remember that the deeper your bow is the more respect you are showing to the person you

are bowing to.

4.3. Relationships

The Japanese prefer to do business on the basis of personal relationships. If you are

introduced (or recommended) by someone who has a good relationship with the company you

are dealing with that is very helpful as it allows the Japanese to know how to rang you according

to their hierarchy.

When building relationships we have to look out for these three things: sincerity,

compatibility and trustworthiness. The first means that you should be understanding and

compromising. The second means that you should be focused for the well-being of the company,

not just for your personal gain. The third relates to the effort you put to protect your ''face''.

Try to build relationships with everyone, not only with ones that are ranked the biggest in

the group. Everyone must be included, so do not ignore anyone. Every contact is valuable in

Japan, and the more contacts you have you are more respected. Never insult or even make a joke

about your company, it will be considered as very unprofessional.

4.4. Communication and body language

It is important to be a good correspondent (spokeperson) of your company. The Japanese

hold this in high esteem. You have to be in control of your emotions. The Japanese are implicit

communicators – they assume that you are well-informed of the subject and they will minimise

the information assuming that you will understand what are they implying to. So prepare

yourself for the meeting and do your homework like a good little Japanese. You will be expected

to understand a lot more than what is actually said.

Be careful of non-verbal communication. Nodding is very important, so when you are

listening to a Japanese person you should nod to show you are interested in what they are saying

and that you understand them. For the Japanese, silence is natural and they are not uncomfortable

with long pauses filled with silences. So do not chatter casually – it is considered impolite.

Especially do not beckon older people and do not beckon with your forefinger, but simply wave

to the person with whom you want to speak.

Avoid touching and close contact with Japanese person. They like their personal space

unlike Western people who feel the need to touch the person with whom they are speaking. You

should also avoid hugging and back-slapping in public. Staring is also considered rude so do not

be suprised if they are not looking you straight in the eyes, they do listen to what you are

speaking even if they do not look directly at you. If you are listening to their speach stand still or

still with both on the ground and never cross your legs.

The Japanese (while working) are famous for their poker faces seeming that they do not

have any expressions at all. If they close their eyes while listening to you it actually means they

are paying close attention. Do not mistake it for sign of tiredness or even boredom. Their

seriousness comes from their great respect for their workplace and you seldom see them laugh

during a meeting.

4.5. Meetings and negotiations

Let's get down to business! At a meeting you will always deal with a team. Bring

assistance if you are not sure that you will handle all the questions you will recieve. When you

start the greeting, first greet the most senior employee than others in descending order.

On meetings you will discuss only one of these three reasons:

1. to build raport,

2. to exchange information,

3. or to confirm previously made decisions.

You will rarely make decisions in a meeting. You will need a lot of patience because

decision-making is a really slow process for Japanese and they do everything by consensus.

Everyone on the team is included and consulted. The team is unitied without competition – either

all succeed or all fail.

Meetings are always very formal and you should leave humor in front of the door. Allow

polite conversation (like discussing weather) before changing the main topic. Never bring a

lawyer with you, it is important that you build relationship based on trust. If you must, than use a

Japanese lawyer, it will be seen a gesture of goodwill.

Silence is a virtue. If things go quiet in a meeting do not panick. Never interrupt the

silence, they are probably considering your proposal. Note that the Japanese avoid confrontation

so be careful that they do not lose ''face''. You should really try to avoid saying ''no'' and find a

polite way to say that you do not agree with something.

They like dealing with quiet and compromising individuals. Remain humble, indirect and

non-threating. The use of diplomatic language is a must. You will look brash and arrogant if you

are very loud and extroverted.

If you have intrepreter, you should him/her to test the Japanese impressions and

reactions. They will be more forthcoming to him/her because they are not directly rejecting but

him/her. If they are directly speaking to you and are not interested in you product/service, they

will try to find any possible way to politely refuse you so be extra careful in this case.

5. JAPANESE PEOPLE

One of the most common qualities of Japanese business man are:

they are loyal to their company,

they are consistent,

they never critize their coworkers,

they are reliable and obsessed with details,

they are conservative,

they conform,

they work together for the greater good.

6. ENTERTAINING AND DINING

Entertaining and socializing after work is very crucial for business. You will be judged

by your behaviour during and after business hours. If you are invited to the dinner or for a drink

after work do not refuse. It is common for a inviting party to pay and your host will insist on

paying. Make at least a weak attempt to pay and do not worry, they will not let you, but it is

polite thing to do and they will appreciate it.

6.1. Drinking

Drinking is a group activity and ''yes'' is a must when offered a drink. If you want to stop

drinking, keep your glass half full and they will not pour you more. Remeber to never pour your

own drink. Let a Japanese person do it for you, and when he is finished do the same for him.

Toasting is very important, so wait for a toast before you start drinking. Respond to each

toast with a toast. Remeber the phrase: ''Work hard, play hard.'' After a day of hard work they are

ready to relax and to cut loose. It means that it is important to not let work let dominate your life

and that you have to find balance in everything you do. When you are releasing tension with

your coworkers you are signalising that you want remain part of the group. Bars and clubs are

places where coworkers share information and make bonds.

6.2. Dining

If you are invited to a dinner wait for the honored quest (the most important person) to

begin eating. If the honored quest is you, wait for everyone to be ready and until the food is on

the table. When you are offered food it is polite to hesitate before you accept and if you are not

very hungry, you do not have to eat much but at least try to sample each dish. You can slurp the

soup (or the noodles) because they believe that slurping makes it taste better. Do not finish the

soup immediately, it should accompany your meal. So finish other food before the soup.

Do not mix rice with other food. If you do not want more rice, finish every grain in your

bowl. If you learn to use chopsticks it will yield tremendous dividends. Remeber to never point

your chopsticks and never cross them when putting them down. It is not common to chat during

eating. They like to savour their food in silence and without disturbances.

If you are invited to a Japanese house (it is very rare) consider it as a great honour and

accept it with wholehearthly. You can be a little late (but no more than 5 minutes) but strive to

arrive on time. Remove your shoes before entering and wait to be told where to sit because there

is a protocol to be followed.

If it is your turn to take them to dinner pick a restaurant that is the most similar to your

cuisine. They will love it.

7. DRESS CODE

Never dress casually. Appearance is important in Japan and people are often judged by

the way they dress. Men should wear a dark suit, shirt and a tie. Even if you ''casual'' invitation

dress smartly for parties. Dress to impress. For shoes, it is better wear slip-ons because you will

have to remove them every now and then.

Women should dress conservatively and formal business dress is almost a must – it is not

common for women to wear trousers in Japan when doing business. Accessories should be

minimal. Women should wear low-heel shoes to avoid towering over men. And you choose a

kimono (a Japanese traditional costume) remeber that it should be wrapped left to right. If you do

it opposite, it will simbolize death.

8. WOMEN IN BUSINESS IN JAPAN

Foreign women (or non-Japanese women) are treated very politely. The Japanese

understand that they are more successful and ambitious than Japanese women. There is not many

difficulties for Western women working in Japan except when working with older Japanese male

colleaques. Otherwise they will be treated as an ''honorary man''.

In Japan most women decide to quit their jobs. Mostly so they can stay at home and take

care of the household and children. For women who decide to work it is not that easy. The

average income for women in Japan is at around 30% lower than the income of their male

colleaques. Even thought they are equal rights between the genders, there remains a strong

discrimination (between the lines) towards women who are in business.

9. THE RITUAL OF GIFT-GIVING

Things to be remebered: the ritual of giving gifts is sometimes more important than the

gift itself. Just like the ritual of business cards, give and recive gifts with both hands and if you

want to take it to end, add a bow. The Japanese like to play ''hard to get'' so they will hesitate

once or twice before accepting your gift. If you decide to buy a gift, buy them for everyone, do

not forget anyone! It is appropriate to give and recieve gifts on the first meeting (or dinner, etc.).

Gift should always be wrapped and of good quality. It does not mean that they should

very expensive, but choose them with taste. For wrapping choose pastel colours. When you

recieve gift do not open it on the spot. If other party insists that you have to open it on the spot

do it so and show signs of gratitude. On the other hand, open the gift at the end of the meeting.

If you are not sure what to give find someone to help you who is experienced with their

culture and who has been in the same situation before. Do not give gifts in quantities of four or

nine because they are unlucky numbers, especially number four as it sounds like word for death

in Japanese. Avoid sharp objects – it could mean that you want to end a relationship. Good gifts

are alcohol (especially good whiskey or brandy), good chocolates and souvenirs from your

country. Do not give lilies, camellias, lotus blossoms or anything in white colour as they are

associated with funerals. Do not give potted plants (meaning: sickness) but a bonsai tree is

always a good choice. Do not mistake gift-giving as bribery or even corruption. Gift-giving is

seen as a sign of goodwill.

10. CONCLUSION

Lessions to remember:

Dress to impress.

Work hard, play hard.

Keep a straight face (do not show open display of affection).

Value personal space.

Punctuality and silence.

Tipping is not expected.

Ritual of gift-giving.

Never address someone by their first name.

''Maybe'' generally means ''no''.

The number four and nine are unlucky.

Keep your hands out of your pockets while speaking to someone.

Do not point out someone's mistakes and avoid causing them to ''lose face''.

Treat the card of your Japanese contact with respect – the card is the man.

The Japanese are very traditional and conservative nation. They have their set of rules

that marks almost every part of their life, especially business. It may seem difficult to learn all of

their customs, but they see great importance in them, so should we. Harmony is the key value

and guiding philosophy for their families and business and for the society as a whole. We maybe

can not fully appreciate how deeply intervined are the relationships between all aspects. They

can sometimes seem too difficult or punctual for us foreigners to understand, but it just shows

how commited they are to everything. We can learn from them not just for our business but also

to improve ourselfs and not always strive only to satisfy our individual needs but to do

something for the universal good as well. In addition, we can addapt from them their

professional appearance and conduct because ensures that the work will be done and productivity

will increase. Not only that they teach us to respect our work but also not to let our work

dominate our lifes. Morever, they tell us that eveyone has same purpose and that often elder

people can give insight in some pressing matters.

They are a collective nation and should be respected greatly, and if we want to do

business in their country we should behave towards them as we may hope that they behave

towards us, and show them that we do not dome to them just to ensure our own profit but to

ensure something for them too. Japan still remains a major force in world commerce, despite

staying stubbornly Japanese and old traditions and loyalities still linger. To do business with

them we need to adapt quickly to their ways and do even the extra mile that may seem pointless

to our mindset, just to ensure our success. It is important to know how to swim with the cultural

tide and not to struggle against it. The one who learns and adapts is the one who will be

successful.

11. REFERENCES

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