Table Of ContentBUSINESS IN JAPAN
Business in Japan
A guide to
Japanese business
practice and
procedure
REVISED EDITION
Edited by Paul Norbury
and Geoffiey Bownas
©Japan Air Lines 1980
Softcover reprint of the hardcover 2nd edition 1980
All rights reserved. No part ofthis publication may be
reproduced or transmitted, in any form or by any means,
without permission.
First edition 1974
Second edition (full y revised) 1980
First published in 1974 by
THE MACMILLAN PRESS L TD
Second edition 1980 published by
THE MACMILLAN PRESS LT D
London and Basillgstoke
Compallies and representatives throughout the world
and
PAUL NORBURY PUBLICATIONS LTD
Yenterden, Keilt
British Library Cataloguing in Publication Data
Business in Japan. 2nd ed.
1. Business enterprises - Japan
2. Japan - commerce
I. Norbury, Paul 11. Bownas, Geoffrey
338.7'C 0952 HF3826.5
ISBN 978-1-349-05657-6 ISBN 978-1-349-05655-2 (eBook)
DOI 10.1007/978-1-349-05655-2
It all started thirty years ago when I first flew from my
native Brussels to Tokyo, stopping along the way for a
few weeks in Calcutta and Shanghai. On my second day
in Tokyo, I dimbed into a streetcar that obviously had
survived the war at great cost. As my eyes wandered over
the strange people and things surrounding me, my
bewilderment grew. Wasn't there somewhere some-
thing familiar my eyes could ding to? Suddenly, in a
corner near the ceiling of the streetcar, I recognised
familiar symbols. Something was written in English. At
dos er scrutiny, it read 'Made in Japan'. In Calcutta and
Shanghai, what I had seen of the East was its misery, and
whenever I saw a familiar convenience, it was always
made in England, in France, or in the U.s. A. The 'Made
inJapan' mark I saw in the streetcar, however, carried a
different message: Japan was and yet was not the East. Of
course, the ready explanation was that the Japanese were
imitating us; but I could not ans wer the question of why
the Indians and the Chinese had not done the same.
I was soon to discover that many other seemingly
familiar things were also 'Made in Japan'; for example,
eggs. In those early post-war years, the taste of eggs in
Japan was that of feed given to chickens - fish. Eggs
looked perfecdy familiar, but their taste was not.
At any rate, the words 'Made in Japan' were to haunt
me for the following three decades. And in trying to
understand the phenomenon behind those words, I
found litde help in visiting the traditional old temples,
where I would join throngs of Japanese who were
likewise 'visiting' their past. The challenge was not in the
past but in the present.
ROBERT BALLON
In 1972Japan Air Lines introduced theJAL EXECUTIVE SERVICE to aid
the international business traveller visitingJapan and the Far East. As
part ofthis service aseries ofbooklets was produced by JAL entitled
Business in Japan - Guidelines for Exporters. These booklets were
brought together to form part ofthe first edition of Business inJapan
published at the end of 1974. This new edition contains a
considerable amount of new material as weIl as some of the original
chapters now fully revised.
Contents
Foreword IX
Editors' Preface Xl
Glossary of Japanese terms used in the text Xlll
SECTION I UNDERSTANDING THEjAPANESE
1 The Logic Gap Martyn Naylor 1
2 Japan's Unique Group Dynamic Gregory Clark 5
SECTION II THE NEW INDUSTRIAL POLICIES OF
JAPAN
3 Japanese Industries to 1985 Shinzo Katada 10
4 Japan and the New Industrial Countries of East Asia 21
Charles Smith
SECTION III APPROACHES TO THE MARKET
5 Working with Japan's Free Market Structure Gene 29
Gregory
6 Pointers to Success and Failure Sadao Oba 36
7 Japan's New Superconsumers Teruyasu Murakami 40
8 Rationalising the Distribution System Masao Okamoto 57
9 The Value of Market Research Andrew Watt 63
10 The Role and Application of Advertising David Gribbin 68
11 The Japanese Housewife: a Marketing Appraisal George 76
Fields
12 Marketing Tailpiece: the 'Tranny' and the Fridge 82
Masaaki Imai
SECTION IV FINANCE AND THE BANKS
13 The Japanese and their Changing Economic 85
Environment lohn Kirby
14 Foreign Banks in Japan lohn Robinson 94
15 Services of a Japanese Bank Kunihiko Kobayashi & 98
Takashi Sugiyama
16 Stocks, Securities and the Brokerage Market Simon 102
Grove
SECTION V STRA TEGY & MANAGEMENT
17 Aspects of Japan's business interre1ationships Micha-el 109
Isherwood
18 Management Style Robert Ballon 115
19 Japanese Trading Companies in Transition Sadao Oba 131
20 Joint Ventures Robert Ballon 137
21 Business and the Law Sumio Takeuchi 155
SECTION VI ADJUSTING TO JAPAN
22 Setting up a Small Office Simon Grove 163
23 Smiths Industries: A European Case-Study Jonathan 173
Rice
24 Etiquette and Behaviour George Fields 177
25 Check your own Check-list Michael Isherwood 183
Epilogue Reflections on Relationships Helmut Morsbach 190
Bibliography 196
List of Contributors 203
Anatomy 01 a Japanese trading company (Dia gram) 206
Index 207
Foreword
Japan represents not only the largest industrial and consumer market
in Asia, it is the third largest market in the world. Although it was
often liberalised to foreign imports tardily and apparently somewhat
reluctantly, it is now, by and large, an open market. There are, it is
true, major changes in economic structure which are needed before
Japan's imports of manufactured goods are increased to bring them
doser to the same relative levels as those of the European
Community or of the United States. It will take time, and efforts on
both sides, before the economies ofthese three principal partners are
more fuHy integrated with one another. But individual European
companies that have persevered have done excellent business in
Japan (EC exports to Japan have increased five-fold between 1968
and 1979). They have also helped maintain their position in third
markets by preventing potential Japanese rivals from gaining
strength on their own horne ground.
Japan's successful export drives to the European market have been
based on a lot ofhard-won knowledge ofEurope and ofEuropean
industrial and business practices. It goes without saying that
Europeans, or indeed any exporter, cannot hope to succeed in the
Japanese market without a similar sustained commitment to leam
about Japan. I can think of no better starting point than Business in
Japan which contains both lucid analyses ofJapan's 'business culture'
and much shrewd advice on how to enter this difficult but rewarding
market.
ENDYMION WILKINSON
Endymion Wilkinson spent six years in Japan (1974-9) as head of the economic and
commercial department of the EEC's Delegation in Tokyo. He is currently at the
China desk of the EEC Commission, Brussels.
Editors' Preface
In this second edition of Business in Japan we have endeavoured to
cover as before the main practical elements of doing business with
the Japanese. There are many differences and there are some
similarities; above all, however, there are countless nuances and
subtleties within the framework of what we could call Japan's
business culture. Whatever the dos and don'ts may be, whatever the
specific points of reference in law, in finance, in joint ventures, in
distribution and in trading generally may be, the businessman will
be thwarting his own long-term future associations if he does not
approach Japan ona broad socio-cultural basis. For the deeper our
grasp and understanding ofJapanese society, the better are we going
to be served and serve ourselves in our dealings with Japan.
Hence the first section entitled 'Understanding the Japanese'.
Through the varied views and interpretations put forward the
message is: search for both an intellectual and emotional grasp of
who the Japanese are. But remember that however dose you come,
you are dealing with the world's greatest ethnic monoculture that
Gregory Clark likens to the original 'particularistic' tribaI societies
we all onc e were - exclusive to outside people but not to outside
ideas.
Another point to bear in mind is the conslderable and, at times,
devastating element of surprise and apparent contradiction which
pervades Japanese society (as perceived by the outsider). It is often
said that after two weeks in astrange country one can write a book
about it. After two months things seem a little more complicated.
After two years we realise that we are faced with a life-Iong study
and even then the real level of understanding might not be much
more than surface deep. The more familiar we become with Japan
the less able, it seems, we are to predict or to generalise; the more we
observe and experience this 'particularistic' society, the more we
become aware (and wary) of what are essentially alien thought and
emotional responses. Martyn Naylor, the other contributor in the
first section, calls this the 'logic gap'.
This new edition of Business in Japan, therefore, could be said to
have grown up somewhat since it was first publishedin late 1974. In
a very real sense the world as a whole has grown up, too, at least in
economic terms: it has had to face the harsh realities of a withering
recession after the 1973 oil crisis and finite resources.
Japan, the most resource-dependent of all the world's major
economies, harboured a.s it is alongside the troubled continent of
Asia, has come to terms more successfully than anyone else with all
