Good Evening ladies and gentlemen, thank you for joining us.
In March, 2010, I initiated the concept of “Englishnization” in Rakuten which required exclusive use of English as an in-house language in the next two years.
I intend to make Rakuten not only the number 1 company in japan but the number 1 Internet service company in the world. Japan’s GDP in 2050 would shrink from 12% in 2006 to 3%, keeping this in mind we needed to expand globally and the only way to sustain that level of growth was through Englishnization. I also feel that fast and direct communication is the only way to integrate across various businesses in different nations and to insert Rakuten into non-Japanese market. Change was necessary for the global growth that we were aiming at.
The initial goal to achieve TOEIC score, over 650 by April 2012 was set. Lots of foreign media such as CNN, Financial Times, covered our challenge and Harvard Business School made a case study about Rakuten’s Englishnization. However, this is not a temporary campaign or a astunt for publicity, but a must-do thing in order for Rakuten to become a globally successful company. This is good thing for Rakuten employees because English will open up their vision to what’s happening all over the world. I strongly believe that Rakuten’s success in Englishnization will change the conservative custom and system in Japan.
I had instructed three primary phases consisting of assessment and measurement, first where the staff was required to do a two hour reading, listening and comprehension for business English. Second was wherein guest lectures were invited to teach English. Third was proficiency where the people are encouraged to communicate their ideas, present and defend logical arguments. It does not make sense to teach until you actually apply.
The initiative was faced with a lot of resistance on its implication. First was a time constraint as they had to manage both their official work as well as denote time to learn English, for instance my production team showed a backlog, as they had problem managing time. Second factor was when the team learnt they had to pay for their own lessons; my reason behind doing this was to instigate self-motivation in employees. One other factor was that most of the employee had domestic customers and they felt it was not necessary for them to learn English, we overcame this by explaining them that we are now a global company and they should not limit their extent only to japan.
After overcoming all the initial glitches, Rakuten is ready for Englishnization. The average TOEIC score among Rakuten employees is 700. It has risen by 170 points over the past 18 months. 86% of total employees achieve the scores. Some of the management meetings have already been conducted in English. This year we hired foreign nationals that amount for about 30% of total new employees. Also, the documents used in the meetings are written in English. One of the employees is saying "it became easier for them to share information with staff at our foreign affiliates."
Englishnization is now becoming greater in Rakuten due to the globalization in the business. In the first quarter of 2012, the gross transaction volume reached 360 million dollars that is more than two times higher than the last year. Last November, we acquired a top-ranked E-commerce company, Play.com, in England, and then, last January, acquired one of the leading e-book company, Kobo in Canada. Our goal is to do business in 27 countries.
Today, I declare to move on next steps in Englishnization. From July 2 2012, company’s policy will be changed to speak only in English during business meetings. After the switch to English, using Japanese at in-house meetings will be banned although chatting with colleagues in Japanese is allowed. At all of its group companies, 70 to 80 percent of meetings are held in English. Regarding TOEIC score, employees who cannot achieve the score will get a salary cut. In addition, they will not be allowed to be promoted.
To sum it all up we at Rakuten are very optimistic about the approach of “Englishnization” and this will get us closer to our aim of becoming the number 1 Internet service company in world.
