“Lucian Blaga” University of Sibiu The Faculty of Economics Master in Business Management, C1

Doing Business in Japan

2013
Introduction

Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south. The characters that make up Japan's name mean "sun-origin", which is why Japan is sometimes referred to as the "Land of the Rising Sun".
Japan is an archipelago of 6,852 islands. The four largest islands are Honshu, Hokkaido, Kyushu and Shikoku. Together, these four islands hold about 97 percent of Japan's land area. Japan has the world's tenth-largest population, with more than 126 million people. Honshū's Greater Tokyo Area, includes the de facto capital city of Tokyo and several surrounding prefectures. It is the largest metropolitan area in the world, with more than 30 million residents.
Japanese culture has evolved greatly from its origins. Contemporary culture combines influences from Asia, Europe and North America. Traditional Japanese arts include crafts such as ceramics, textiles, lacquerware, swords and dolls; performances of bunraku, kabuki, noh, dance, and rakugo; and other practices, the tea.ceremony, ikebana, martial.arts, calligraphy, origami, onsen, Geisha and games. Japan has a developed system for the protection and promotion of both tangible and intangible Cultural Properties and National Treasures. Sixteen sites have been inscribed on the UNESCO World Heritage List, twelve of which are of cultural significance.

Facts About Japan An ancient culture which has evolved within the geographical boundaries of an island has produced a modern day society with unique values, traditions and customs. Doing business in Japan arguably poses the most potential for cross cultural misunderstandings. Located in Eastern Asia, Japan is an island nation located between the Korean Peninsula and North Pacific. With a population of approximately 130 million people, Japan has a very high density of people in relation to its geographical size.
Japan's capital city is Tokyo, which is one of the largest cities in the world. The literacy rate in Japan in 99% which is very good by world standards and is just about the same as the United States of America. Japan's ethnic makeup is almost entirely ethnic Japanese, and the almost the entire population speaks traditional Japanese. Surprisingly, due to Japan's relatively large population, Japanese is the 6th most spoken language in the world. Japan is a powerful industrial nation with the 2nd largest GDP in the world, following the United States of America. Japan's leading exports are automobiles, semiconductors, and office machinery. However, Japan's professionals are well educated in doing business with the West and will try to modify their own behaviors to accommodate you. Nonetheless, doing business in Japan necessitates preparing oneself by understanding areas such as business culture, business etiquette, negotiation and meeting protocol.
Introduction to Japanese Business Etiquette The Japanese have a very complex and developed society with an equally established set of business standards. One should be very well aware of this intricate business etiquette when traveling to Japan to do business. There are many different aspects of Japanese business etiquette that exist, however it would take years of face to face experience to master everything. In this project we will focus on the basic of Japanese business etiquette, which is what your Japanese counterparts will likely expect from you on your first few trips to Japan for business. Perhaps the most important thing to acknowledge is that the Japanese are very relationship oriented. In Japanese business culture, employees are often hired for life. This means that there is a mutual understanding that the employee will likely remain with the company for the rest of his or her working life. Relationships are critical in Japanese business etiquette, which means that a foreigner traveling to Japan for business purposes should focus on building a relationship just as much as any other objective during the trip. Fortunately, the Japanese host will likely present many opportunities to cultivate a good relationship. This will be evident by the fondness of the Japanese to go for social activities after work, usually in a group setting.
Group Orientation Altruism, team-work and group cohesiveness are all areas greatly stressed within Japanese society. Individual identity is defined by the social group. Consequently, when doing business, the Japanese stress compromise and self-discipline.
Hierarchy
With its roots in Confucianism, hierarchical structures classify an individual's position within a group and in society. Status is determined by factors such as age, employment, company and family background. The hierarchical system dictates that due respect be afforded to those of higher status. When doing business in Japan be aware of hierarchy and adapt your behaviour accordingly. Respect In order to preserve harmony in society and to maintain the clarity of the hierarchical structure, showing respect to others acts as a crucial social lubricant. Respect is conveyed through language, behaviour, etiquette, body language and other subtle forms of non-verbal communication.
Building Relationships When doing business in Japan a successful relationship with a Japanese colleague or client is based on three factors: sincerity, compatibility and trustworthiness. Sincerity means that you are compromising, understanding and you want to conduct business on a personal level. Compatibility is established when you are seen to be concerned about the personal relationship, the well being of the company and not just focused on financial gain. Trustworthiness relates to the faith put in you to protect from loss face.
Communication
The emphasis in Japanese culture on maintaining harmony has developed in such a way as to allow very vague forms of expression. The cultural logic behind this is that by avoiding direct or explicit statements one has a better chance of not causing offense. When doing business in Japan clarify meanings and dig deeper for more information. The Japanese are implicit communicators. An explicit communicator assumes the listener is unaware of background information or related issues to the topic of discussion and provides it themselves. The Japanese however assume the listener is well informed on the subject and minimises information relayed on the premise that listener will understand from implication. Thus the saying, "Say one, understand ten," i.e. you will be expected to understand nine additional points.
Social Interaction A large part of Japanese business etiquette is a heavy emphasis on personal relationships. This is present in many aspects of Japanese culture. Building relationships is a vital part of Japanese business etiquette and social interaction is the foundation of any relationship. As a foreigner looking to build trust and establish good personal relationships, one must take advantage of any opportunities that are presented. The Japanese frequently meet at bars, restaurants, and karaoke lounges after work to relax unwind. If you are invited to a social outing after a business meeting, you should make every possible effort to go. The Japanese love to drink, and use it as a way to relieve stress and unwind. If your counterparts are drinking then you should try to drink. By making time to interact with your Japanese counterparts outside of the workplace will help very much in establishing good relationships for future business opportunities.
Japanese Business Meeting Etiquette In Japanese business etiquette protocol is very important during any type of business affairs. Even for foreigners there is still an expectation of at least some understanding of the business customs. Nevertheless, the Japanese are usually forgiving to outsiders that show an effort to understand the Japanese business etiquette. The Japanese host will often try to help in any way possible. A conservative demeanor is advisable, as it is not customary for Japanese businessmen to be brash or arrogant. Arrogance will take away from ones trust and image, which will lead to a lack of respect from your Japanese host. Upon the initial meeting with a Japanese host, one must honor the Japanese cultural traditions. This includes bowing before shaking hands. Your Japanese host will likely offer a handshake, at which point a handshake will be appropriate. In Japanese business etiquette seating positions are very important as they are in indicator of status. The highest ranking person will sit at the head of the table furthest away from the door. Always wait to be seated, and never be the first one to sit down. Show interest in the meeting and acknowledge everyone's participation. You may want to take notes to help you remember the discussion. Taking notes will also make you look more attentive. It is very important to look as though you are interested in what is happening.
Japanese Business Card Etiquette Japanese business cards are a very important aspect of Japanese business etiquette. Exchanging business cards is without a doubt a standard protocol in Japanese business culture, regardless of the occasion. It is part of a formal introduction, and business cannot start until this process is complete. The Japanese word for business cards is "meishi" and foreigners are expected to have them. Japanese translated business cards or Japanese bilingual business cards are 2 sided business cards with the Japanese and English languages on them. To attend a business meeting in Japan without Japanese bilingual business cards would be a very risky move. Japanese bilingual business cards are a bare minimum requirement for anyone doing business in Japan. Because Japanese and English bilingual business cards are such an important part of Japanese business etiquette, it makes a lot of sense to invest in high quality bilingual business cards. Make sure that the materials, colors, and the actual translation is of high quality. Research reputable suppliers on the internet by searching "Japanese business cards" or "Bilingual business cards".
Japanese bilingual business cards are to be exchanged at the very start of any meeting. Take special care to make sure that you always have enough cards on you for everyone you may encounter. Cards are exchanged very often in the Japanese business environment, so bring a lot of cards with you wherever you go. When presenting a Japanese bilingual business card to your Japanese counterpart, use both hands and bow your head slightly while offering the card. You should use the same technique when accepting cards as well. When you take a card from someone NEVER put the card in your pocket. Use a card case, file folder, or briefcase to store the cards. In a business meeting setting, place the cards in front of you so that they are in order based on the seating positions of everyone at the table.
Dress Code and Appearance Dress code and appearance hold a very high value in Japanese society. The Japanese frequently dress very formal and ones attire is often linked to their social and corporate status. The rule of thumb is to always play it safe and dress formally. Use darker colors such as black or dark blue. You may end up removing your shoes quite often so its advisable to wear shoes that are easy to put on and take off. Dressing well can go far in making a good impression, therefore you should make every effort to dress very well. In Japan there is a saying, " the nail that sticks out gets hit with the hammer." This saying definitely applies to the dress code in Japanese business etiquette. Men should strive to wear conservative yet well appointed business suits that are dark in color. A low key and classy look is optimal, the goal is to impress without standing out too much. Your attire should be of decent quality. Your Japanese host will likely pay attention to your clothing, so invest in good business attire. For Women, a conservative look is also recommended. Dark colors are best, and short skirts and pants are never to be worn. Heels should be avoided also as they are seen as informal. Women should minimize the amount of accessories that they wear also. Much of the same rules apply to women as they do with men in Japanese business etiquette. Ones appearance when speaking should be of a calm nature. It is not acceptable to raise your voice or speak too loud. Avoid using excessive hand gestures or pointing when you speak as it is considered informal. Some hand gestures also have different meanings in Japanese culture, so they may be misinterpreted.
Conclusion
These above examples point to a few considerations one must make when doing business in Japan. Cross cultural awareness in areas such as meeting etiquette, business protocol and approaches to doing business are ways of enhancing your business trip and maximizing your potential. In conclusion Japan is a nation that is primarily in the information age. The Japanese government believes in sharing advanced medical technology with it's general polulation to prolong their lives which inturn lengthens their time to help produce for the nation. In the area of economics Japan's result's speak for themselves, they went a non factor nation to a economic world leader in a short amount of time. In the area of education Japan continues to move forward, they take education extremely serious because it is the foundation for your future success in your career, socially, and life. Japan is a strong nation of teamplayers who are all on the same page. Many nations could learn alot from the Japanese.

Bibliography

1. http://www.japanesebusinessresource.com/
2. http://www.kwintessential.co.uk/etiquette/doing-business-japan.html
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4. http://en.wikipedia.org/wiki/Japan
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