Thursday, January 21, 2010

Can Japanese organizations embrace diverse people as members?

As I mentioned in my previous post, the recruiting process for new employees have stayed the same in the last 40 years in Japan. Basically, big Japanese companies hire permanent employees only from among new graduates just once a year. They do not only avoid to employ old workers who used to work for other companies, but also stay away from young people who graduated just a year ago and have not found a job yet. Some people sarcastically say that it is because Japanese companies seek only "work experience virgins".

This unique recruiting practice in Japan has a specific name "shinsotsu ikkatsu saiyo" or "concentrated hiring of new graduates" in English. The Japanese version of wikipedia on this term tells us an interesting fact. According to a governmental study in 2006, the top 2 reasons why Japanese companies continue this recruiting practice is (1) to maintain the age structure of employees (balance in numbers between the young and the old) (2) to acquire human resources who have not been (adversely) affected by other companies' corporate culture. Japanese companies expect these new employees to hold a solid loyalty to them and work for them until the time of retirement. It helped Japanese economy grow fast and steadily until the 1980s.

In the age of globalization and the flattening world, however, this Japan-specific hiring practice most likely will not work any more. The fundamental defect of this method is that it miserably fails to embrace different kinds of people in an organization. Japanese organizations assume homogenious members and if not, they make desperate efforts to uniform the members' ideas by "brainwashing" them. In another word, Japanese people do not know how to organize people other than by gathering people with the same thoughts and background.

In a Japanese organization, members are expected to look the same, think the same, and behave the same. Exotic attitudes are not publicly criticized but privately finger-pointed. Unwritten rules govern the organization. Real power often resides in the people who have no position on the organizational chart, even out of the organization. It is very hard for outsiders to understand. Sometimes it is confusing even to insiders.

This is the time when companies place an appropriate person to a position only on the ground that the person has suitable skills and talent. Other elements (sex, age, ethnic background, etc) are not essential. Only Japanese companies go to the opposite way. Are they stupid? I used to think so. But now my thought has changed slightly. Probably, Japanese companies simply don't know how to deal with diverse people. The management executives have never worked in an environment where different kinds of people work in harmony. It is not that they are willing to keep the traditional recruiting process; they just have no choice but to keep doing it. Maybe, we should feel a little pity for them, instead of despising them.

8 comments:

Andy M. said...

Thanks for shedding light on the issue of Japanese labor practices.
I agree with your analysis (since many of Japanese managers cannot manage diverse work force, they simply cling on to homogenous working environment). I can see the management side of the problem.
On the other hand, I don’t know if job applicants have been taking initiatives to resolve the issue. For example, if a job applicant was turned down simply because of his/her age, gender, ethnicity, etc. in America he/she will sue the company. Without taking an initiative, we may put ourselves at mercy of others and also limit ourselves to a passive position (e.g., wising the other side spontaneously resolve the issue).
In the time of intense global competitions, Japanese managers and job applicants are so ill equipped to survive in the new environment. They are essentially doing business in the same way as 20 years ago. Their demands are by and large based on the old reality. The managers need talented foreigners badly, but they cannot manage them nor compensate them enough. Realistically, Japanese firms will be split into two groups. One group will move their vital functions (including HQ) to abroad to bypass Japan’s outdated and dysfunctional system. Another group will merge and slim down (hire as little number of full time employees as possible) to coup with the ever shrinking domestic market.


Andy M.

HAL said...

If new companies which don’t follow old rules appear in Japan, and then they make new rules and achieve remarkable success, many old companies have to follow the new rules. I think this is the easiest way to change the Japanese companies. I think many Japanese companies still don’t know “how to place an appropriate person to a position only on the ground that the person has suitable skills and talent.” At the same time, they seem too old to change theirselves.

Ei "Ray" Murakami said...
This comment has been removed by the author.
Ei "Ray" Murakami said...

A story in the article below illustrates why Japanese companies and universities keep failing in the global economy of the 21st century and how they should coped with it as they seems to be facing the same problems as the Girl Scouts did in 1970s,

"Why Peter Drucker hailed Francis Hesselbein as the world’s best leader?"

Hesselbein however took up the gauntlet with characteristic courage. First up she took apart the curriculum that had remained unchanged for twelve years and made it more contemporary.

She roped in four renowned artists to re-design the official handbook; her brief to them was: “any young girl who opens the handbook must be able to see herself in it” (the Girl Scouts organisation of 1976 was predominately white). “Any?” asked the overwhelmed artists. “No, I should’ve said every,” was her answer.

Hesselbein made the Girl Scouts handbook relevant to every young girl from “a Navajo girl on a reservation to a blue-eyed girl in a New England home with picket fences”. And the results came. By the time Hesselbein retired in 1990 she left the organisation with not just the highest membership numbers in history but more importantly had tripled its minority membership.

Eiji Sakai a.k.a. elm200 said...

Hi Andy,

>For example, if a job applicant was turned down simply because of his/her age, gender, ethnicity, etc. in America he/she will sue the company. Without taking an initiative, we may put ourselves at mercy of others and also limit ourselves to a passive position (e.g., wising the other side spontaneously resolve the issue).

You have a very good point. Many Japanese people do nothing and just whine within families and friends. In my last post, I talked about the coming-soon demostration organized by the students who were seeking a job. It turned out that only about15 people showed up in the demonstration even though they tried their best to distribute the notice in the Internet. It seems that the general people's energy level for activity is going down in Japan. How deplorable.

Andy M. said...

Hi Eiji,
>It turned out that only about15 people showed up in the demonstration even though they tried their best to distribute the notice in the Internet. It seems that the general people's energy level for activity is going down in Japan. How deplorable.

Humm, it doesn’t even sound like the same country that I grew up in 70s. Back then students who shunned political activities (staging protests, etc.) were called as “Non poli (non political)”.
It seems that young Japanese people today are not challenging the status quo, nor standing for what is right. They are merely watching others as bystanders and hoping the other side (whatever that is) will take actions for them while they are privately whining. The trouble is that apathy is contagious.
I totally understand now why you urged young Japanese people to go abroad. I hope that some of them who read your comments will take actions to save them at least.

Andy M.

Shyamsundar said...

The idea of this organisation is extra ordinary.In a Japanese organization, members are expected to look the same, think the same, and behave the same. Exotic attitudes are not publicly criticized but privately finger-pointed. Unwritten rules govern the organization.yeast infection

ahojanen said...

The post gives some great awareness. I agree with you upon "unique" employment practice in Japan. Being overseas for long and now over mid-30s, I often find myself extremely hesitant to come back home seeking a position at any Japanese organization. It is virtually impossible for (relatively) older guys, though they are high-skilled, experienced, as well as industrious, to start anew out there. In my view the Japanese labor market has still remain highly structured according to age and seniority, exclusive, culturally homogeneous, and perhaps stuck to virginity

In a practical sense, ageism in employment does exist in other countries, but that in Japan is far more extreme and persisting. I’ve stopped complaining about it since long, waiting to see (so far in vain) that a change and reform would soon come in their recruitment policy.

Let's be aware of brain drain. Talented Japanese who for some reason "derail" from a singular career path at a organization may have few choice but fly overseas. Or they are willing to do so, no? I think it is one of implicit yet urgent issues.