About Me

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SME, RISK AND TRADING SYSTEMS, PhD [Operations Research]. I had interesting journey from small pahadi town in Uttrakhand to today (probably inspired by Phanisher Nath “Renu”’s Atho Ghumkaddo zigyasa), both in space and in time. The journey has made me a queer mix of contradictory extremes (points). I am caught up between and swing from one extreme to other, striking balance between Small town values and Big City Values, between experiences of bought up in socialistic environment and working in capitalistic environment (reaping benefits of!!), between Hindi medium schooling and English medium higher studies, between ease in connecting to small town values and issues and big city mores and list goes on…

Saturday, November 8, 2008


Last year or so I have been working with a Japanese banking giant. The bank is moving to new trading and risk management system and I did consulting work to help them in the transition. It has been a great learning experience, more so as I have worked mostly with American clients (with few European clients thrown in). As I have earned a higher degree in USA, I am more attuned to American way of doing things. As in culture so in business America and Japan are poles apart [book by one of the founders of Sony; “Business the Sony Way” gives great insight into the differences between American and Japanese way of doing business and psyche (rather philosophies)]. Japan has been a great exporter of products over the years, so it surprises one to see its insulation from importing high end product and services [though they import raw material heavily]. To get a background of Japanese capitalism we will have to go back to era of the Japanese noble families. Noble families were pretty much like English aristocracy, they ruled a precinct and maintained an army independently, were faithful to King (at the time of war they came together and fought for the King). As the modern age downed in they adapted well and became business conglomerates. This is a reason why the credit defaults in Japanese financial system were at a very low level, as one could borrow only if one belonged to one of the noble families. After world war two Japan’s rise to prominence has been nothing like but the phoenix rising from ashes. The great Quality pioneer Deming was behind the birth of made in Japan brand. So, what I have learned? And what are helpful insights into doing business with Japanese? First I discuss the opportunity (particularly for the Indian software companies), then the learnings, and finally I discuss way forward.

The Opportunity

Unlike America, most of Japanese companies do their IT work in house. Of late due to lack of highly qualified human resource (add higher cost of the human capital to it), Japanese companies had been forced to think about outsourcing. They are new to this game and as I have discussed earlier they are little insulated from outsourcing wave. So naturally one can see the discomfort of Japanese businessmen with the idea of outsourcing. Also culturally they don’t trust foreigners too quickly to do critical job for them. But law of economics leaves them with no choice but to experiment with the outsourcing. Two important things about Japanese culture and their way of doing business are, first they don’t think in term of short-term relationships, second they take their time in trusting vendors (any outsider). For Indian software companies, here lies an opportunity for long-term business engagement. Also in current business scenario, Japanese market provides an opportunity to diversify companies’ portfolio (only bet against the risk).


In following bullet points I have summarized my learnings
§ First learn their culture and their psyche. Its great opportunity to unlearn to learn; particularly if one is too influenced by American way of doing business
§ Be patient
§ Japanese like to discuss and debate. Be prepared for the meetings that go on for hours and hours, and at the end, most of the times you wont see any take-aways (conclusions). Japanese like to analyze a problem from many angles (making sure all bases have been covered), their focus is on efficiency not on effectiveness. Decision-making is very slow; they might take days to what you believe can be decided in a day. Don’t rely on verbal commitment or clarification; get everything in written. If confused see the second point.
§ Biggest challenge one would face (bigger than the business problem itself) is language barrier. One will always be working with an interpreter in one’s business communications, and lot of information will get lost in the translation. Here is what has worked for me; I used, what I call white board method, where during the meeting I noted down key points of the discussions we had since the start of meeting on the white board. If we realized that we are going nowhere or loosing context, we could go back to the board and refocus.
§ Some thing about their psyche, they expected one to be skillful in one’s area of expertise. Unlike America, where no question is stupid question, Japanese expect you to display your expertise in your communication. So it’s better to not speak for the sake of keeping the ball rolling. Speak when you have an intelligent observation, or a good point that helps them in seeing the situation from different angle. They will appreciate a lot if you add a point that opens an avenue for their internal debate.
§ Japanese like to discuss a lot while in meetings, so don’t feel lost if in the middle of a meeting they start discussing among themselves for a long period of time. If confused see the second point.
§ Be ready for the long cycle time for their responses to any of your written documents. It gets translated into the Japanese first, they answer in Japanese, which is then translated into the English before coming to you. If confused see the second point.
§ Be ready for lot of localization effort. For example Japanese accounting system is different than that of other countries, so seemingly simple P&L calculation can be very messy.
§ Try learning few words in Japanese, its really difficult otherwise. Start using San after an entity and person’s name.
§ If confused, baffled, frustrated always recall the second point.

The Way Forward
I think Japanese market provides a great opportunity for us (Indians). The good news is we have a good image as we are perceived as good in mathematics and computers. It’s a difficult market to crack, but rewards are big and long term. It’s like a clean slate so we will get freedom to showcase our creative talents. One needs to go with lot of patience and perseverance but then life wont be fun if it is easy and predictable!!