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How to Successfully Penetrate the Japanese Market?

עודכן: 28 באפר׳ 2021

Reducing the value of Japanese customer requirements, lack of understanding of Japanese business culture, managing of the local office by a company employee (expatriate) or from Headquarters will lead you to fail in Japan.

I used to tell my customers “penetrating the Japanese market is the same as a diver entering the sea and then understanding that there is not enough oxygen in the balloon to get out of the water. Is it dangerous? Yes. I’m sure they have been practicing such scenarios many times.”

So, why not practice and prepare your team company for such a scenario and successfully penetrate the Japanese market?


Soft skills don't count?

C-Level executives believe in hard skills only?

The importance of Soft-Skills

Covid-19 challenged us all and created a new normal. Work from home (WFH) has become almost the norm; cross cultural barriers have become far more significant than ever before, thus starting to understand the importance of soft skills.

Businesses recognize the importance of building soft skills in their employees in order to harness the broader benefits. Yet without objectively and comprehensively measuring soft skills, it is difficult to measure the impact of this investment.

Academic literature has found a consistent relationship between human capital and economic growth. According to the study these were the top 10 most relevant and important soft skills include:

  1. Communication. Oral and written skills, presenting, listening.

  2. Courtesy. Manners, business etiquette, gracious. Says ‘please’ and ‘thank you’, respectful.

  3. Flexibility. Adaptability, willing to change, lifelong learner. Accepts changes, adjusts, teachable.

  4. Integrity. Honesty, ethical, high morals. Has personal values, does what is right.

  5. Interpersonal skills. Nice, personable, sense of humor. Friendly, nurturing, empathetic, has self-control, patient, sociability, warmth, social skills.

  6. Positive attitude. Optimistic, enthusiastic, encouraging, happy, confident.

  7. Professionalism. Business-like, well-dressed, appearance, poised.

  8. Responsibility. Accountable, reliable, gets the job done, resourceful, self-disciplined, wants to do well, meticulous, common sense.

  9. Teamwork. Cooperative gets along with others. Agreeable, supportive, helpful, collaborative.

  10. Work ethic. Hard working, willing to work, loyal, initiative, self-motivated, on time, good attendance.

5 tips guaranteeing successful penetration to Japan

The tips below reflect more than 30 years of practical and academic experience: living and working as an expatriate in Japan; building and maintaining a long-term business and personal relationship; guiding and consulting accelerators, startups, established companies; conducting workshops; mentoring programs and lectures in the Academy.

TIP 1 - Don't Under Valuate of Japanese Customer Needs

You will be surprised in your first business meeting in Japan. Best case scenario you arrived at the meeting maybe with an interpreter or with your colleagues while the other party come with +4 participates.

Business decisions in Japan are taken bottom-up, during the meeting you will be asked the same question in a different way, the reason, checking your “repeated answer”, consistency.

  • At the beginning of the meeting questions might be focused on the technology aspect, be prepared to answer technical questions, else bring with you the CTO or R&D manager.

  • The documentation presented or provided to the Japanese party is superficial, details are missing (WYSIWYG), and some cultures' business behavior is based on improvising on the spot - not in Japan.

  • Lessening the importance of meeting deadlines. True story: A deal was signed between Japanese & Western company to provide two containers of roses for Valentine's Day. The container has been delayed and arrived one day after Valentine's. The Japanese firm decided to cancel the deal. The foreign company was surprised and complained that “It's only one day late". Failure to meet deadlines, for example a promise to send technical/ marketing material result in - loss of credibility.

  • Lack of openness in giving free courses or tutorials. Build trust, one of the pillars to doing successful business.

TIP 2 - Avoid Lack of Understanding Business Culture

It seems that C-Level, executives are starting to understand following the COVID-19 the importance of soft skills, cross-cultural communication skills, business code & ethics and more.

  1. It is crucial to make all necessary preparations (seminars, workshops and lectures) prior to arriving in Japan. Know with whom you are going to meet, seniority , gender, fixed agenda, sitting arrangement, exchanging business cards, do’s & don’t, meeting expectations etc.

  2. Companies were sending emails and got surprised why the response took time (most of the time almost no answer). First build personal relationship only than business will follow.

  3. Reducing the value of developing a long-term relationship. Who are you? And then what do you do? Focusing on short-term revenue makes you - Lose credibility.

  4. Language limitation causes a lack of understanding of how to fulfil the customer's needs which leads to a waste of time and resources - Bring an interpreter that you know and trust.

TIP 3 - Don't Hire a Local Manager Based on English Skills Only

Foreign companies tend to make the same mistake and recruit the one who speaks English, but it rarely turns out that the candidate is a good manager, a leader or executive, salesman.

As a result of a lifetime employment (Shūshin koyō), University graduates and candidates are looking for the big companies or governmental offices thus the number of candidates is very small. Today you could find more and more young people (Y Generation) establishing their own startups - the magnitude of fear from failure is lessening (but not drastically).

TIP 4 - Don't Manage Office by Company Expatriate

Companies are trying to save time, keep the cards close to their chest, for better control, maintain organization culture (very common with multinational companies - MNCs) and cutting costs. This results in - failure. Why?

  1. The expatriate is lacking business connections and experience in the region. It takes at least three years till the firms generate brand name recognition and market awareness (unless you invest a huge amount of money).

  2. Expatriate: costs are very high

  3. Cross-cultural barriers and language

  4. Managing Japanese employees, not an easy task. Expatriates should have the necessary soft-skills and business organization understanding. Such barriers could lead to disharmony and conflicts, lower motivation and less productivity.

TIP 5 - Don't manage Remotely from the Head Office

Some companies made a decision to manage the Japanese subsidiary office from their head office due to many reasons such as: limited resources, not fully committed, evaluating the market needs but wanting to have a presence!

Where does this lead the company?

  1. Beauty is in the eyes of the beholder” Japanese customers sees the situation as the company's lack of commitment, long response times with not enough frontal meetings

  2. The time zone difference shortens the call times and causes difficulties

  3. Who provides support? It is a must!

  4. Language barriers who will call the customer when an immediate answer is needed?

  5. Sales cycle might be longer, market forecasting and identification of new trends is limited.

Quick tip of the “Hashi” Choopstick

  1. Be patient, it takes time to build trust, “giri

  2. Keep in mind these two questions: In Japan who are you? And only then what do you do? In contrast to western countries.

  3. Reaching a consensus takes time “nemawashi”, decisions are made bottom - up. The Japanese are thorough, and they look not only at the full picture but also at the puzzle pieces.

  4. Great patience must be maintained during all business relating aspects.

  5. The secret sauce is long term relationship “nagai tsukiai

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