Speech at Asia House, 25th September 2015

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A Great Day for Japan UK Business Understanding – Hitachi Rail Newton Aycliffe Factory Opening Ceremony

Posted on 7 September 2015 in Market Insight, News -
Sarah Parsons ~ Hitachi (2)

I was so excited to have attended the Opening Ceremony of Hitachi Rail’s Newton Aycliffe Factory last week. Hitachi Global CEO Alistair Dormer, George Osbourne and Prime Minister David Cameron spoke proudly of the massive boost for the regional economy, for British manufacturing and of course for the “northern powerhouse”.

Stephenson's rocket (2)The wonderful shadow puppetry performance highlighted the historical connection of the NE to train building-on a tour we were shown how the factory is built a mere metres away from Heighington Station where Stephenson’s Loco 1 was first assembled and many references were made to how train manufacturing was coming home. Indeed a very emotional and proud day for the NE & a perfect fit of Japanese Technology with British manufacturing. It was also a great day Japan UK Business Understanding.

Many of the engineers I spoke to had been out to Japan and undertaken Japanese style training there and although Hitachi Rail has shifted around its management structure to reflect a more localised structure in a globalising world, the roots of Hitachi Rail are still Japanese and will hopefully be celebrated and further Japan UK links will be developed within the local community too.

What was not so evident in the overall ceremony was that upon listening to the speeches of Japanese Ambassador Hayashi and Hitachi CEO Nakanishi san, there was a sense of a slightly more sentimental and long-term Japanese view towards business-worth taking note of for any businesses wishing to deal with the Japanese.

They both spoke of how Hitachi Rail’s commitment to the UK is in some sense “returning the favour” granted by the British people towards the Choshu 5-a pioneering delegation of Japanese who came over and studied in the UK 150 years ago and took their knowledge about rail manufacturing back to Japan, one of whom became the “Father of the Japanese Railway” and contributed to the immensely successful development of their railway system. There were poignant comparisons between the first Hitachi engineer having arrived in Southampton and who then travelled up north to the recent arrival of the first pre-series Class 800 Hitachi Rail train for the Intercity Express Programme, which did a similar journey from Southampton up to the north in March this year.

These key factors of doing business with Japan that came up-a shared history and trust, returning “favours” and honouring obligations, all oil the cogs of Japan Inc. although they do have very cultural different manifestations and are not as simplistic as just doing someone a favour and getting business back. Nakanishi san’s declaration that Hitachi takes a long-term view and are here to stay is typical of the longevity of business relationships that are carefully nurtured and preferred by the Japanese. Although building up trust within these relationships can be slow and frustrating, it can, as we have seen in the case of Hitachi Rail, who have committed fully to the UK market and are one of the few Japanese companies to base their Global HQ here, result in a reliable commitment quite rare in an uncertain business world.

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The Added Value of Inward Investment

Posted on 20 August 2015 in News, Published Article -

Japanese firms support education and community links

Look at any region of the UK and you will find Japanese firms’ headquarters and manufacturing facilities, mergers and acquisitions, R&D projects carried out jointly with British firms and many academic links. All these are contributing to unprecedented growth in both the British economy and employment figures.

According to UK Trade & Investment’s Inward Investment Report 2013/14, Japan is the UK’s key investment partner in Asia, having delivered 116 projects across the country in 2013–14 and created 3,040 new jobs. Moreover, half the cars manufactured in the UK in 2014 are by Japanese makers.

Hitachi Rail Europe’s training carriage arrives at the Port of Tyne in North East England.

Recent case studies

The same may well be true of trains soon. Hitachi, Ltd. recently set up their global headquarters of Hitachi Rail in London, and production at their factory in Newton Aycliffe, County Durham—the firm’s European rail manufacturing base—is due to start in 2016.

In the field of M&A, in 2014, Suntory formed Lucozade Ribena Suntory when it acquired two popular British brands. Advertising giant Dentsu Inc. continues its buying spree in the UK after having acquired, in 2013, the Aegis Group PLC, , in one of the industry’s biggest acquisitions ever.

Snack manufacturer Calbee, Inc. recently made its first European investment in Flintshire, Wales, and has just unveiled their first product to be manufactured at the factory.

Some of this activity may have been prompted by Prime Minister Shinzo Abe’s growth strategy and an economic need for Japanese firms to globalise, moving out of a relatively uncompetitive domestic market.

However, there is no doubt that the strategic positioning of the UK, its openness to inward investment, the strength of its workforce and leading expertise were also key considerations when making these decisions.

The benefits of this inward investment are not solely economic; there are also social, cultural and educational ones. Living in the East Midlands myself and working with Japanese firms across the country, I have seen links develop at a grass roots level that have had regenerative effects on local communities.

To continue to read the full article, which was published in the British Chamber of Commerce and Industry’s Acumen Magazine, June 2015, go here.

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BBC Radio 4 Misunderstanding Japan: Contrasts and Complexities

Posted on 20 August 2015 in Cultural Awareness, Inter-Cultural Training, News -
midunderstanding japan

I recently spoke on a Radio 4 programme called “Misunderstanding Japan”, where I wanted to convey that Japan will naturally seem quirky and incomprehensible to people who have no understanding of its cultural context. People wanting to do business or engage with Japan need to understand the complexities of the cultural context to avoid misunderstandings. However, things are not always as they seem. At a recent UKTI seminar on Business Japanese for Beginners that I delivered to local businesses looking at working with Japan, we covered many interesting contrasts in Japan that can sometimes muddy the waters nad indeed revealed some interesting pre-conceptions. Some examples include:

  • The clutter of outdoor advertising and information vs the order and Zen like calm attributed to Japanese lifestyles
  • Hierarchical company structures vs an emphasis on a very Japanese style of consensus within decision making
  • The status and importance of Japanese business leaders vs their fairly anonymous presence in marketing campaigns/PR about the company (although this is changing with entrepreneurs such as Rakuten’s Hiroshi Mikitani and Masayoshi Son)
  • The bureaucracy and seriousness of Japanese government institutions vs the cute mascots they take very seriously to promote them
  • The seemingly submissive role of women within one of the most masculine societies on earth vs the relative dominance of women within the home/ child rearing and control over finances.
  • The infantile behaviour and use of childish, cute objects on TV adverts/reality shows and the drunken fairly inhibition free after karaoke-session vs the conservative behaviour within traditional Japanese corporate life.
  • The immense need for detail contrasted with the indirect vagueness of Japanese oral communication
  • The garish packaging of the “kawaii” culture vs Japanese minimalism
  • Kyary Pamyu Pamyu, J pop idol- a grown woman who dresses and acts like a 10 year old vs kimono -clad, demure enka singers
  • The hidden emotions and public masks vs the immense emotional outpouring at national competitions and the general irony-free sentimentality of the Japanese
  • The sensuality and open acceptance of sexual desires and practices vs the low birth rate and reported lack of interest in sex amongst the younger generation.
  • The peace of a Japanese temple vs the onslaught of noise and announcements within Japanese everyday life.
  • The expectation of convenience and high levels of politeness & hospitality displayed in the service industry vs inefficiencies and a lack of flexibility within this industry
  • The high-tech nature of Japan and their use of the latest gadgets vs the fax machines still used in most Japanese offices and the emphasis on written communication.

The list could go on-do you have any more?

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Working with Japan

Posted on 28 May 2015 in Inter-Cultural Training, News -
Sarah Parsons speaking at the Scottish Parliament with the Cross Party Group Convener, MSP Alex Johnstone.

I recently said a few words about “Working with Japan” at a “Japan Scotland” Networking reception at the Scottish Parliament, co-organised by the Cross Party Group on Japan, the Japan Local Government Centre, London and the Japan Exchange and Teaching Alumni Association (JETAA) Scotland Chapter. It was great to see so many existing links & Japan related interests there. The audience included MSPs, the Japanese Consul General to Scotland, JETAA members, representatives from local councils & universities with links to Japan, local businesses including some who have succesfully entered the Japanese market plus Hitachi Rail Europe, who have just signed a contract with Scotrail.

With such a mixed audience and with such a short time slot, it was quite challenging to encapsulate what “Working with Japan” means. For those looking to break into the Japanese market, naturally a good USP and knowledge of market is needed. For those looking to attract Japanese investment, reliable partners and workforce plus attractive financial incentives are paramount. However, the key to working with Japan in any sense is successful relationship building, nurtured with integrity and patience (frustrations abound in most cross-cultural transactions) and trustworthiness. Some may argue these are out of date values in a fast-paced global world with instant access to information. Structurally, barriers to market entry are falling and Japan is becoming much more open with Abe’s globalisation strategy. I totally agree that now more than ever before, Japan offers so much potential for working with foreign partners. Still within this, relationships, which culturally form a backbone to Japanese society, are key.

There is sometimes a misunderstanding as to what constitutes a successful business relationship with the Japanese and how to maintain it. Although it is not a deep, dark mystery, it can seem significantly different to our more individualised methods and can at times seem impenetrable and a lot of hard work to those preferring a “quick fix” or to those who believe that “business is business” wherever you go. Many Japanese ex-pats who have lived long enough overseas have become very skilled at adapting to Western methods but there is still very much a default position of preferring to deal with Japanese suppliers/clients, mainly because the many facets of Japanese relationships are implicitly understood. Reciprocal obligations, risk aversion, face saving, consensus building and hierarchy still feature heavily in Japanese culture and although Japanese society is changing and becoming less group orientated, these are all still elements that need understanding and navigating within long- term business relationships.

There are many viable options out there to help you work with Japan-Japanese speakers who can connect you up with their language skills and effectively build the relationships for you, researchers who have immense knowledge of the market but in some cases no real connection with their contacts or agencies with business matching capabilities that leave you after the matching has been done. I prefer to help companies and organisations understand how to form successful relationships and give them opportunities to network, using carefully nurtured relationships. If this appeals to you, I would love to work with you.


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