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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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Cultivating a Culture somewhere Inbetween Individualism and Collectivism

Posted on 9 March 2015 in Cultural Awareness, Inter-Cultural Training, Published Article -
Image for leaflet2

The boom in global expansion by Japanese companies, a need for higher female and foreign labour participation prompted by an ageing and declining population, shifts in attitudes towards work among the younger generation and political pressure to change corporate culture that doesn’t support this “globalization” imperative, all mean that Japanese managers now need to employ different management techniques to motivate and communicate and ultimately retain talent that is not currently being nurtured.

My home culture (U.K.) is fundamentally individualistic.  Putting the needs of the group ahead of our own is not always rewarding, as there is so little importance placed on it. We are generally motivated by individual achievements, although we may play them down, and expect to be rewarded appropriately.

From my experience of traditional Japanese working environments, they are more collectivist. In Japan, the strong group mentality and the paternalistic management techniques employed by Japanese companies have successfully created intense personal identity with, and loyalty to the workplace. Employees are valued not only by the work they do, but for being cooperative, obliging and harmonious in interpersonal relationships. Often, these elements are misinterpreted or at worst ignored by the individualist for whom strong hierarchies, big investments in relationships building and ultraconsensual decision making processes seem confusing and time-consuming.

Motivators used within Japanese organizations do not always translate effectively to other cultures. I know of a small Japanese subsidiary in the U.K. employing socialization techniques among local staff such as morning exercises, reciting company mottos, and encouraging all employees to spend lunch hours together. They also use an apprenticeship style of training for new staff by gradually introducing work under close supervision. The local staff members don’t appreciate its value and cultural context, so they lack motivation and staff turnover is high.

Such Japanese-style management models work well in an environment where they fit a cultural need to derive worth and identity from membership in a viable and successful group. 

An Individualistic Culture
Sir Richard Branson, founder of Virgin Group Ltd., is an unabashed self-promoter, risk-taker and world record breaker. . He is a highly successful and motivating individual whose leadership style has been described as “charismatic and transformational because of its informal style and lack of emphasis on hierarchy within companies. He believes that underlying ‘Virgin-ness’ is a scope for individuality and believes that you should give individuals the tools they need, outline some parameters to work within, and then just let them get on and do their stuff.

Branson’s recently announced “limitless holiday” policy for employees allowing them to control their own working hours with the assumption that it doesn’t affect their work output provides an interesting contrast to Japan, where long working hours are often seen as dedication to the company and where it is common that staff do not take their full entitlement of holiday time. In an individualistic society, this may well hit the right spot, engendering a feeling of autonomy and trust, creating competition while preserving performance output. It would be interesting to see whether this would ever translate into Virgin’s subsidiaries in Japan as planned.

Japan Meets Entrepreneurialism?
Although the risk-averse nature of the Japanese has not been the ideal environment for entrepreneurialism, some interesting entrepreneurs, most notably Hiroshi Mikitani, founder of Rakuten, have appeared, championing a change to traditional Japanese corporate culture. He encourages a risk-taking attitude within his company, often expresses frustration with the pace of change within Japanese organisations, and prefers direct styles of communication.

Like Sir Richard Branson, his use of social media as a promotional tool enables him to engage personally with his customers without hierarchical barriers. He still places emphasis on collaboration as the only way to achieve sustained success; all his staff clean their own desks and he has adopted the Japanese principle of kaizen (continuous improvement) which is driven by teamwork alongside consensual decision-making, rather than through individualism.

Needless to say, change is afoot for Japanese management. Company loyalty is weakening among younger employees, headhunting is more rampant, money and quality of life are becoming stronger motivators. Japanese employment structures and management styles will more resemble Western patterns, hopefully combining a hybrid of the best aspects of both to support Japan on its journey of true globalisation.

For the full article published in the HR Agenda January 2015, click here

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