Doing Business in Japan
Doing Business in Japan
1. Concept of “nemawashi”.
In order to do successful business in Japan, it is very important to understand the heart of the Japanese decision-making process, known as “nemawashi”. Nemawashi was originally a gardening term, which roughly translates as “to dig around the root of a tree a year or two before transplanting it”. In the terms of business, “nemawashi” is the organized and efficient consensus building procedure by which the approval of a proposed idea or project is sought from every person in a major organizational position. Today, this term is widely used in Japan, particularly in the business sector, trying to avoid discrepancies and gain an agreement from everyone in advance, along with keeping relationships harmonious.
There is a significant difference between Japanese “nemawashi” decision-making procedures from that of western companies. In Western cultures, the “vertical system” implies top-down decision-making where downward communication consists primarily of orders for realization, and upward communications consists of reports on performance and achievement. As a rule, the top manager makes decisions, and part of any employee’s job is to follow the heading set. For “nemawashi” it is typical to have a bottom-up style where information flows from lower levels to higher ones, making managers of the middle position wield the greatest influence on making decisions. Furthermore, in contrast with the western model, a group making-decision is desired. The important thing to remember is that “nemawashi” is used to allow the free flow of ideas between people, who might never have the opportunity to speak publicly about a proposal.
However, as in any system “nemawashi” has its own advantages and disadvantages. Advantages are that there is huge group of people involved into decision-making process. It eliminates any disagreement among people and makes room to amend and revise proposals until everybody in the group agrees comes to a
1. Concept of “nemawashi”.
In order to do successful business in Japan, it is very important to understand the heart of the Japanese decision-making process, known as “nemawashi”. Nemawashi was originally a gardening term, which roughly translates as “to dig around the root of a tree a year or two before transplanting it”. In the terms of business, “nemawashi” is the organized and efficient consensus building procedure by which the approval of a proposed idea or project is sought from every person in a major organizational position. Today, this term is widely used in Japan, particularly in the business sector, trying to avoid discrepancies and gain an agreement from everyone in advance, along with keeping relationships harmonious.
There is a significant difference between Japanese “nemawashi” decision-making procedures from that of western companies. In Western cultures, the “vertical system” implies top-down decision-making where downward communication consists primarily of orders for realization, and upward communications consists of reports on performance and achievement. As a rule, the top manager makes decisions, and part of any employee’s job is to follow the heading set. For “nemawashi” it is typical to have a bottom-up style where information flows from lower levels to higher ones, making managers of the middle position wield the greatest influence on making decisions. Furthermore, in contrast with the western model, a group making-decision is desired. The important thing to remember is that “nemawashi” is used to allow the free flow of ideas between people, who might never have the opportunity to speak publicly about a proposal.
However, as in any system “nemawashi” has its own advantages and disadvantages. Advantages are that there is huge group of people involved into decision-making process. It eliminates any disagreement among people and makes room to amend and revise proposals until everybody in the group agrees comes to a
References: Arin, O. (2005). JAPAN: Traditions and Foreign Policy. Retrieved August 12, 2008, from http://www.alexbattler.com/alexbattler/Japan.html. Koldau, C. (1996). Meanings of Cross-Cultural Differences in Establishing Relationships in Japanese-American Business Negotiations. Retrieved August 12, 2008, from http://www.smeal.psu.edu/isbm/database/documents/wp96/14-1996.pdf. Status to set up a business in Japan. (2006). Retrieved August 12, 2008, from http://dp21244855.lolipop.jp/english/Page001.html.