The Art of Doing Business with the Japanese, by Toru Takahashi

Veteran global executive and GLOBIS Europe CEO Toru Takahashi shares his tips for thriving in Japanese business culture without getting lost in translation.  

Toru started his career crisscrossing the globe to expand overseas markets for Japanese companies. His journey took him from infrastructure projects in Iran to business development trips across Europe, the Middle East and Africa during an eight-year assignment with trading giant Marubeni Corporation. From launching foreign sales and service networks to financing cross-border investments, Toru knows how to strengthen international partnerships and drive global growth amid myriad cultural nuances.

Now as Japan rebounds on the world stage, companies everywhere are exploring tie-ups with its brands – renowned for quality, diligence, and corporate responsibility. As President of the European branch of Japan’s leading business school, one of Toru’s specialties is to navigate cross-cultural interactions. He shares his insights on thriving in Japanese business engagements and going beyond the stereotype.

Avoid broad brushstrokes, observe nuances

Stereotypes can pervade one’s assumptions about doing business with a Japanese firm. European business leaders planning an interaction with Japanese companies may find themselves researching aspects such as dress code, seating arrangements, bowing and business card exchanges. Toru, however, says this shouldn’t be one’s main concern.

“It’s much more important to show respect in your own way, allowing your genuine intentions to naturally resonate with your counterparts. Be genuine,” he says.

At the same time, he recommends showing respect “from the bottom of your heart” for Japanese culture, business norms and the unique accomplishments of each company’s business model and social contributions.

Such respect need not stem from lingual formalities. Rather, it can come from thoughtful research. “From my experience, when someone includes keywords into their conversation that require prior research, it conveys a deep sense of respect. It shows that the person took the time to learn about me before we met. I consider this a thoughtful gesture.”

Make friends, and look for the ones who matter

While aspects like consensus-based decision-making and indirect communication prevail in Japan, it’s risky to assume all Japanese companies share the exact same traits. “Observe each company’s culture with fresh eyes,” Toru says.

It is a risk to assume that all Japanese companies approach hierarchical structures the same way. “For instance, try to determine whether their approach is top-down or bottom-up,” he says.

Many Japanese companies increasingly value bottom-up decision-making, according to Toru. Recognizing this can better inform your approach to healthy communication. “In such cases, following their preferred procedures is crucial, and it’s important to identify a key person in the lower hierarchy.”

Don’t miss the subtext

Every country has its own nuances around work expectations, and Japan is no different. Although Toru acknowledges that Japanese business communications have increasingly aligned with global standards, he believes that they still maintain some unique characteristics. One of these is Japan’s high-context culture that requires understanding of implicit nuances. 

“Japanese people frequently omit mentioning preconditions that are considered obvious within Japanese society. For example, people often don’t dare to speak out – especially when it comes to hierarchical dynamics and power imbalances. Instead of openly acknowledging power structures and asserting the importance of their own wishes – individuals often choose to seek understanding without explicit explanations. They may also hesitate to prioritize the preferences of entities in stronger positions.

Navigating this requires communicating such “unspoken expectations” clearly in advance and obtaining consensus.

The desire for clarity and making sure that everyone is on the same page can sometimes result in information overflow. Verbosity and excessive detail pervade Japanese business communications, Toru says, noting that Japanese presentation slides and meeting handouts can often be dense with words and overly lengthy explanations.

“I believe the reason is that Japanese people often adopt a mindset of including all available information ’for safety’s sake’ aiming to prevent omissions and cover every conceivable point related to the subject. The downside of this tendency is that, at times, Japanese may find themselves losing focus amid the flood of information.”

When a “yes” can be a “no”

Since directly denying requests is avoided in Japan to not disappoint others, the word “yes” can in fact sometimes mean “no.” This subtlety is something that some European leaders who made the long trip to Japan may have experienced first-hand. 

There are cultural reasons for this aversion. “This attitude might be part of the ‘omotenashi’ mindset (Japanese hospitality). It is also a sign of respect and social sensitivity to not directly turn someone down,” says Toru.

His advice is to be upfront about your expectations.

He suggests saying “Please give us an honest answer – we really would like to hear your frank opinions.” If you express this sentiment, it may very well become easier for Japanese individuals to say “no” directly, he adds.

Understand the Japanese decision-making process

While every Japanese company can have a different culture, business model and industry setup, Toru says if he had to highlight one common trait, it would be how they approach consensus.

“The number of stakeholders who need to be informed about the details of decision-making is usually larger than you think, and might be larger than the global average. This means that all people involved need to be aware and reach a consensus on the course of action before any steps can be implemented,” he says.

To smoothly facilitate collaboration, he recommends identifying and collaborating closely with the people driving the consensus. “Decision-making may take time, so incorporating a longer lead time into your business plan from the beginning is advisable.”

Bridging the gap

The Japanese approach to business can sometimes be overly serious. “You could say it is a national characteristic of Japanese people,” Toru notes.

Counter-intuitively, for European leaders looking to navigate Japan’s indirect communication style, this can mean making an effort to keep things light. “Try to lighten the mood with easy questions, small talk and perhaps even share some of your own experiences and failures,” Toru advises.

It is effective to help Japanese individuals relax and create a sense of psychological safety for them, he adds, noting that many Japanese find it a hurdle to communicate with foreigners in what is their second or third language.

Having a coordinator intimately acquainted with Japanese business culture who can mediate interactions can be an invaluable strategy. As Toru advises, find someone to connect you with Japanese players and act as a “translator”.

Make friends – and keep your word

Lasting business relationships with Japan business partners are cemented by genuine bonds, not transactions. To put it simply: make friends.

“This involves caring for them, keeping promises, sharing significant life events, and enjoying fun experiences together, among other things. One thing to keep in mind is that being on time and delivering on promises tend to be very important for Japanese people. Therefore, I recommend being mindful of this as you do business with Japanese counterparts,” he says.

Closing thoughts

In closing, while aspects of Japanese business culture can pose hurdles for foreign leaders, Toru urges patience. For European leaders, he suggests remembering that Japanese people are “genuinely eager to contribute to the global marketplace and society, given the right opportunities”.

The key takeaways are to avoid stereotypes, communicate clearly, identify key decision-makers, and build trust through authentic camaraderie. With patient commitment to understand human nature beyond the cultural façade, Toru bets win-wins await those who tune into the nuances.