Japan: Let's Make a Deal!
From ExecutivePlanet.com
Let's Make a Deal!
Connections and relationships are golden in Japan. It doesn't necessarily get you the deal up front, but it gets you in the door, which can be the hardest step of all. In order to cement those relationships, it does require effort. Keeping in touch, a dinner or karaoke from time to time, holiday cards, maybe golf and more, depending on the type of relationship, can all be prerequisites to a successful long term partnership.
Having a dual language business card is certainly helpful - English on one side, Japanese on the other. Not having it won't shut you out, but it does show an effort up front for doing business in Japan, and the Japanese counterpart will take notice. Don't cut corners on the fonts though. Either do it right and make it look nice, or don't do it at all.
When exchanging business cards, generally the upper level members will exchange cards first followed by others in order of seniority. The business card is to be presented with two hands, then let one hand go to receive your counterpart's card, and then put two hands on the counterpart's card taking a good look at it. Don't stuff it in your pocket or wallet at that moment. Keep it in your hand and manage to do this as you go around the room exchanging cards. Then when you sit down, try to order the cards in front of you so that you can start trying to remember a name, title and face. Be very careful to store your cards away at the end of the meeting. Dropping a card on the floor is a sign of disrespect!
If you get to the point of needing legal counsel, you do have options. Your Japanese counterpart will, of course, have their internal Japanese legal team, and they will be very Japanese oriented on how they want the contract formulated. There is no reason why you can't use your own legal team to engage with them, if things aren't too complicated. If you are negotiating a very significant deal with manufacturing and the like, then you'll probably want to make use of one of the local foreign legal entities in Japan, or sign one up in your own country, which has affiliates located in Japan.
When making use of 'outside' information, be careful not to use it in a way that would be insinuating that you are trying to contradict what you’ve heard from the Japanese counterpart. Instead, mention that you've been trying to understand the market more and to determine what might need to be done to make your relationship more fruitful. Mention that you've come across some areas in which you need more clarity and ask for assistance so it seems that both parties are discussing information together.
Japanese are very traditional in their ways, so if looking to introduce a new idea, it could be a long process, but don't be disheartened. Using Japanese technique, gradually introduce the idea from different angles, but never force it upon your counterpart. You want to continue to bring it up in the right way to somehow allow the Japanese counterpart to start to internalize the idea as his own. This could take a week and it could take months. Also, to be fair, many younger generation Japanese with some English skills, will be more open to new ideas at a quicker pace.
When sitting at meetings, it's important to address your counterparts in a professional manner. That means no slouching and crossing of legs, while generally keeping arms on the table. If you make yourself look too comfortable, it can have an effect of lacking respect. It doesn't mean you have to lean in somebody's face, but just don't overdo it in either direction. Remember, Japanese society is all about modesty, keeping the 'wa' (peace), and fitting in.
When entering a meeting room, you as the guest will usually be sitting on the farthest side of the room. Let the most senior members sit in the middle with the less senior ones on the ends. Don't be surprised if many, many members from the Japanese company attend. Every department wants to know what's going on, as well as to see the foreigner so, of course, have plenty of cards and Japanese materials when coming for the meeting. Make a professional pack of English material in a nice folder and prepare to pass one to each member.
You should check beforehand on how communication will proceed at the meeting though. Will you need to prepare a translator or to find out if they have someone internally who can handle the situation? These details should be figured out well ahead of time. Will your Japanese counterparts be able to understand your standing in front of them presenting in English with a powerpoint? Visual materials, by the way, go a long, long way in Japan. Do not rely on lots of words and technical explanations, and don't print slides with too many words. Stay visual and short and simple as much as possible - it allows the Japanese to process easier and not fall asleep! Also talk clearly and stay away from colloquial English sayings.
The business pace in Japan is relatively slow, possibly the slowest in Asia. Be prepared for many rounds inclusive of visits to each other's place of business, teleconferences, emails and possibly some entertainment. Generally speaking, within a Japanese company, the internal approval process is a long procedure. It's not just one person saying yes, but rather many rounds of consensus building among various levels of the organization. To get a contract concluded in Japan might involve one of the longest experiences you've ever been through in your life.
Don’t assume anything is final in your business agreement or negotiations until it is clearly written and signed in a contract by both parties. There might be a Memorandum of Understanding or a Letter of Intent, or emails saying 'yes' to something, but be wary. 'Yes' could simply mean 'I understand' rather than 'Yes that is how we will do it.' Right until the final contract, always be aware of potential pitfalls that might suddenly appear, that were never expected. Look at it as a kind of test of building up long term trust. Build it well, and your long term business prospects will be good in Japan.
The Japanese are very analytical in their process. They want everything analyzed as much as possible. It frustrates many Westerners how detail-oriented the Japanese can be on issues or points that we would never pay any attention to. This is seen very often in product quality, as in which bugs in the product are critical by Japanese standards, and which are by Western standards.
Company policy is very strict and to deviate from policy is rare. If the company has a way of doing things, then it has to be done that way, or it is likely that they will walk away from an opportunity even if they realize it's a profitable opportunity for the business. So the best way to deal with this is always respect and try to understand the Japanese policies and then make great efforts to make adjustments to fit those policies, if you want to do business the right way in Japan.
The Japanese person wants to be seen as putting the company first. He will show a lot of pride in his company, and making sure everything fits the way his company does business will be of utmost importance to him. But, to be fair, while national honor was most important in the past, even over market share and profits, as Japan has become more in tune with the rest of the world, more attitude changes are evident today towards the needs for profits and market share as well. Overall you will still see much more loyalty to the company than is experienced in most Western organizations today.
That loyalty and adherence to the tenets of the corporation also leads to a very important concept of 'saving face.' The Japanese will do everything possible to avoid embarrassment, deviate from the norm, while simply trying to stay on track. They don't want to get themselves or anyone hurt, as that is equivalent to losing face in front of their peers.
