Wednesday, May 12, 2010

Why are Japanese white-collar workers inefficient?

"Why are Japanese companies so slow in decision-making?"
"I never know who is responsible for what in Japanese companies."

These are common complaints made by foreigners who conduct business with Japanese companies. Even Japanese people including me often feel frustrated in the same way.

Japanese companies can be very different from those in the West. A Japanese company does have a organizational chart that is very similar to one in a western company. However, the way they actually operate is very different. In a Japanese company, its formal hierarchical organizational chart is less relevant than its informal power structure. In Japan, power is much more spread toward the lower rank than in the West. More than often, a Japanese boss can be a mere symbol that integrates his or her section rather than an active leader who command his or her employees. You can recall the position that the Japanese emperor occupies in the constitution. Probably, this implies something more than only a coincidence.

Even if you are a businessperson in negotiation and have reached an agreement with a person who is supposed to have authority in a Japanese company, therefore, you can never feel relieved. His or her promise will not fulfilled unless his or her boss, coworkers and even subordinates in the company also agree with it. People have to go through a prolonged process of soliciting supports from other "interested parties" in the same company. This process is called "nemawashi" in Japanese, and one of the most important techniques you have to be proficient in to get work done in a Japanese company.

Cumbersome as it might look, the lengthy solicitation process or nemawashi has a positive aspect. Unlike an imperative working environment in the West, Japanese employees are encouraged to participate in decision making processes even if they are low-ranking. Japanese employees can have a high morale and feel that "we are supporting our own company". This mechanism seems to have worked very well until 1990 when Japanese economy enjoyed a rapid development.

However, the serious pitfall of this "all-participatory management" is that it is very obscure who has real authority and responsibility. When a company has to embrace a drastic change, it suddenly becomes paralyzed. Since nobody seems to take a responsibility, it is extremely hard for the company to make a risky but potentially profitable decision. Nobody takes initiative. Every single employee becomes quite conservative and sticks to status quo as much as possible, even if they are subconsciously aware that things won't last forever.

In a nutshell, this is where we Japanese are. These phenomena are quite pervasive and can be observed in every single aspect of Japanese society now. Probably, many people outside of Japan have already realized how ineffective Japanese politics are. This is only one example of the wide spread "indecisiveness syndrome" that inflicts Japanese society.

As a Japanese national, I long for the solution that addresses to this problem. However, I am also aware, with a little resignation, that it will take a long time before Japan gets rejuvenated by overcoming this issue because the problem runs deep in the very Japanese culture itself.

Tuesday, May 11, 2010

Japanese society resisting change

My Japanese blog is getting even more popular these days. However, it doesn't make me so happy. The more I think about Japanese society, the more despair I feel.

Many Japanese companies still force employees to work for long hours and are even reluctant to pay for their overtime. This is obviously an illegal act but the Japanese society is somehow lenient with it.

Today I discovered a surprising fact. According to this paper, working hours of Japanese workers have not changed at all during the period between 1986 and 2006. This report's conclusion apparently contradicts Japanese government's official statistics, which show a significant decrease(more than 15%) in working hours in Japan. This mystery stems from the existence of unpaid overtime work, also known as "complimentary overtime work(sabisu zangyo)". Employers report their employees' working hours based on the amount they have actually paid to them. However, it is an open secret that employees are "not allowed to ask" their employers for overtime payment to the full extent. Therefore, the governmental statistics inevitably show a lower number than the actual one in working hours. How unfair.

Now we know that the working hours are about the same between 20 years ago and now. Here, we need to pay attention to the fact that Japanese economy was enjoying such a prosperity so called "bubble economy" 20 years ago. People were much better off then than now. Yet Japanese people work as long hours now as 20 years ago. It is puzzling.

The conclusion is rather simple: after all, Japanese companies have failed to improve labor productivity miserably. Or maybe they even have not tried to do so in the first place. For many Japanese people, labor is supposed to be cheap or even free just as the name "sabisu zangyo(complimentary overtime work)". They never really made an serious effort to save labor cost by restructuring the workflow. Employers simply chose not to pay overtime time payment.

You might wonder why Japanese employees are still as obedient as sheep after this kind of unfair treatments. The answer can be found by looking at a unique feature of Japanese labor market. It's very difficult for Japanese workers to switch workplace. It is still considered a social stigma. Working long hours is thought to be a sign of diligence. Innovating a new way to save labor time is not really encouraged and it is sometimes labeled as a form of laziness.

Japan's economic stagnation is blamed on Japanese companies' own behavior. Japan has been defeated by itself. But they are yet aware of it.

It's alright. That's THEIR way. They go their way, while I go my way. It's them who are ultimately responsible for their own acts. I will go my own way on my own risk. Nobody can prevent me from doing so.