NEW YORK (Kyodo) Japanese companies that want to go global must have good risk management and tap into the strengths of the cultures in which they operate, according to the former president of Komatsu America Corp.
Kenichi Nakamura said a company aiming to globalize its operations must have a proper risk management policy. Believing there is “no problem is a problem,” he said, as issues always arise and a company must be prepared for them.
To make his point, Nakamura began his talk, “What is Real Globalization for Japanese Companies?” at the Japanese Chamber of Commerce and Industry of New York Inc. by giving an analysis of the Hanshin Tigers’ loss in last year’s Japan Series.
Most pundits said Hanshin lost to the Lotte Marines because there was a three-week gap between the team’s first-place finish in the regular season and the Japan Series that sapped its momentum going into the finals, and others said the Murakami Fund upping its stake in team owner Hanshin Electric Railway Co. lowered morale.
Nakamura, born in Hanshin’s hometown of Osaka in 1942, said all the reasons the analysts gave were secondary factors. He believes Hanshin lost because they did not have a strategy to win the series and had poor risk management.
“Why did they use (Kei) Igawa, who continued to betray (the fans) since last year, as a starting pitcher?” Nakamura asked. “And did they have a Plan B once Igawa started to get hit? I think the answer was no.”
Nakamura said if Hanshin had proper risk management, they would have used the so-called JFK relief combination — Jeff Williams, Kyuji Fujikawa and Tomoyuki Kubota — because a team cannot afford to lose a single game in the Japan Series.
Businesspeople should not attribute poor performance to external or secondary factors, be it a difference in culture, language or environment, he said.
“I’ve never liked attributing the company’s poor performance to others. You will begin to see the essence of a problem by soul-searching,” Nakamura said.
Japanese in a foreign country must learn from its good qualities, respect them and make the most of them, he said, adding the approach is even more necessary in this age of globalization.
Nakamura said he “rediscovered” Americans in 1990 when he was assigned as vice president in charge of marketing administration of Komatsu Dresser Co., a 50-50 joint venture based in Chicago.
The job was not his first in the United States — he spent 11 years at Komatsu Ltd.’s subsidiary in San Francisco.
However, when he returned to the U.S. after a four-year stint in Tokyo, he found his Chicago office was startlingly different. Unlike at his last job, where American employees “spoke slowly” for the non-English speakers, the American employees at Komatsu Dresser pulled no punches, expressing their opinions in fast, direct English.
“I was shocked when my American subordinate first said to me, straight in the face, ‘You are wrong,’ ” Nakamura said.
Soon the Japanese manager became acutely aware of the need to find common ground between the American and Japanese employees as they constantly feuded with each while the slow economy sent revenue spiraling.
Nakamura’s new book, “Business ni Nihon-ryu, America-ryu wa nai” (“There is neither a Japanese way nor an American way in business”) outlines his struggles to turn Komatsu’s joint venture into a “hybrid operation.”
Nakamura said he did not claim to know the Americans, but for the sake of clarification he made some generalizations to show the differences in the two countries’ business cultures.
For example, Americans are friendly — they will be nice to everyone regardless of title. They are also assertive and clear about what is fair and unfair. They make excellent presentations but are weak in planning and cross-functional activities.
In contrast, Japanese are often bound by company hierarchy and job titles. They do not speak much at meetings. They are efficient and strong in details and planning, but tend to focus on marginal issues and fail to look at the big picture.
These generalizations are not intended to say one group is superior to the other, Nakamura said, but to show how a firm should combine the good qualities of each, the heart of his “hybrid operation” concept.
Nakamura also listed some peculiarities of Japanese managers, which he said are obstacles to globalization. They rarely say “thank you” to their subordinates. They are meticulous and persistent, and they expect their subordinates to read their minds.
It is not only that these attitudes do not work outside Japan, Nakamura said, they are not reasonable ways of behaving.
In contrast to transplanted managers who hold onto their Japanese work habits, there are also those who “instantly turn American” once they arrive, something Nakamura also frowns on.
“It’s not good to forget your identity as a Japanese,” he said. “You must maintain a solid set of values as a Japanese and must have your feet on the ground.”
And don’t be arrogant, he said. In recent years, the Japanese have developed a tendency to devalue other nations, while their own morals and manners have deteriorated.
“When in Rome, learn from the Romans,” Nakamura said.