Every Japanese company enters the US market place implementing different strategies, however the trend has seemed to lean toward implementing a centralized structure in their foreign location. This entails relocating Japanese managers abroad for a few years at a time to run their companies in the US, resulting in a “two-track system.” Under this form of management, there is a team that is loyal to the domestic company (trained and originating from Japan) that compose the higher portion of the company hierarchy, and a local team that is specialized for the US location (effectively stationary).
This system has proved successful because the firm can embrace the loyalty and values of their domestic representative while utilizing the knowledge of the foreign market and preferences of the local representative. For example, when a firm is opened abroad, a company needs someone who can train the workers to meet the standards and comply with the company philosophies but also needs someone who is continuously in the area to check on production and logistics. Local representatives are also necessary because they are familiar with the laws and norms of their area. The knowledge and experience of both these sources are crucial to prosper in foreign markets. (Trevor)
However, having these counterparts, and trying to instill non-American business practices in America have proven a major obstacle that face Japanese companies. Every year thousands of Japanese businessmen come to America to explore business opportunities and expansions. They come to learn the language, the customs, the manners, to build relationships, and to develop insight, but it is only a short time before the culture barrier becomes apparent in many realms of the business sphere.
First and foremost, the everyday lifestyles and social norms of America can be very shocking and intimidating to Japanese companies that want to expand. Japan has always been a very homogeneous community. Though foreigners are slowly starting to compose a larger portion of the Japan, it is far behind in diversity when compared to America. The idea that the workplace would be composed of such a diverse group of people raise many concerns to the more sheltered Japanese. Further, the Japanese have long criticized the liberal nature of the US education system, as it is starkly different from the Japanese system. Ultimately, companies would have to hire people who are a product the US education system – a concern for many managers.
The American market can also be an intimidating place for the Japanese to expand a business because of the resentment that lags from the large acquisitions by the Japanese in the 1980s. The expansion of many Japanese companies is often seen as imposing on US superiority. The idea that this economic takeover is putting the “real America” at risk fosters hostility that can hinder the growth of incoming Japanese companies.Further, one of the biggest decisions incoming companies have to make is whether to preserve the business tactics traditionally practiced or to follow in American footsteps. The process of switching could prove risky or fatal if attempted incorrectly. Further, business models in the US in large tend to be considered frustratingly shortsighted by the Japanese. Japanese companies focus more on a long-term reputation where as many American companies focus on immediate profits. There are however, practices on both sides that prove risky. America has long been infamous for the culture of suing and lawyering up – making the Japanese very nervous about deal making processes in the US. Likewise, the Japanese workplace does not place much value on the needs on the employee. Japan has infamously long hours and prioritizes the needs of the company over the needs of the individuals or their family. They also more openly practice questionable tactics such as bribery and price fixing within the company.
The hierarchy and philosophies of the workplace also exhibit polarizing qualities. Japanese workplaces place a lot of value on the vision of a harmonious community and working for the collective betterment of the company. However, the American workplace is very driven by personal profit and independence. In fact, this is often highly encouraged. In the American workplace, employees strive to stand out and pursue new challenges. In Japan, obedience is expected and difference is punished. The combination of these two starkly different attitudes in a work atmosphere often lead to a lack of respect and thus inefficiency in a work setting.Finally, beyond the organizational structure or the business practices of a company, the personal values and social norms that the Japanese have been raised with are starkly different from those of Americans. Japanese people are taught since early childhood that expressing their opinions harshly is inappropriate. As a result, their form of communication is indirect and vague. Contrast this with the more blunt and direct form of communication among Americans and it leads to frustrating outcomes for both sides of the spectrum. Further, the Japanese tend to function off of strict hierarchies that Americans are not accustomed to and thus disregard. The Japanese as a result view the Americans as rude and confrontational while the Americans see the Japanese and overly sensitive. These differences in interpersonal relations do not only lend themselves to misunderstandings, but cause offensive or frustrating situations. (Linowes)
Though Japanese companies have been in the US market for decades, the cultural barriers are still very much alive. Attempting to meet the expectations of both the nature of the Japanese and US business market is challenging to say the least. Ultimately though, both countries have something to gain from cooperating and making efforts to better understand each other. Currently there are so many benefits that are being denied because of an inability to overcome those differences. In the long run, the unique dynamic of a Japanese and American workplace will help both economies grow.