On June 7th I had the great pleasure of attending a presentation by Masaki Okuno at the American Chamber of Commerce in Japan. Okuno san is the CEO of Internap Japan, a US-based Internet Service Provider that established a joint venture in Japan about a decade ago. The presentation was entitled, “The Wall of Wa,” and it provided rare insights into the B2B sales process in Japan.
Okuno san has been highly successful in not only gaining customers in Japan but also in mediating between the sales approach of an American company and the sales process required with Japanese customers. He has distilled this experience into a very practical model of how to pursue B2B sales with Japanese companies.
Wa, or the Japanese principle of harmony, is often cited as a dominant influence in Japanese culture as well as corporate culture. The associated principle of Kuuki, or air, is often referenced as well, usually in the context of “reading between the lines.” Okuno san has shed new light on the way consensus-based decision-making actually works in Japanese companies, utilizing the principles of Wa and Kuuki but also much more.
Before getting into the details, I want to make clear that there is an existing body of literature around how foreigners can be more successful pursuing business in Japan. A good example is, How to Do Business with the Japanese, by Mark Zimmerman. Chapter 14 of that book, “Playing the Harp,” is an excellent foundation in basic principles and is well worth studying. For someone new to Japan, that book is a good prerequisite to understanding the approach formulated by Okuno san, and clearly illustrates how advanced Okuno san’s thoughts really are.
It is also worth mentioning that the following insights are very much from a native Japanese perspective but would potentially be controversial or unconsciously understood among Japanese. It is because Okuno san spent time in the US and has dealt with the frustrations of an American company trying to impose its sales methods on Japanese companies that he has made the effort to formalize his observations.
So let’s get started.
Decisions in Japanese companies follow a process of bottom-up consensus-making, and the overall goal is to maintain Wa throughout the organization. However, there are different players or roles within an organization and when an external vendor is seeking to introduce a new product or service, it is extremely important to identify these roles and follow an approach that will be effective.
Here are the key roles:
Let’s describe these in some detail.
The Arsonist is a change agent, who believes he is “the trend.” The trend would be whatever new approach/concept/product he is passionate about and of course should overlap with what the vendor is offering. Like any good fire-starter, he wants immediate change and will impulsively attempt to introduce the trend to his organization. As Okuno says, the Arsonist thinks he is a god. There are relatively few Arsonists in most Japanese companies – perhaps 7% of the staff.
Intellectuals are much more numerous. They attended top universities and take a research-based, analytical approach to issues. What they do when an Arsonist starts a fire is put it out. Their final word to the Arsonist is always: Will you take responsibility for this? The fire gets put out 80-90% of the time. If that happens, the vendor’s approach is futile, though it may make sense to try again later when staff changes bring a new Arsonist and ideally a Policeman into the picture.
The Policeman is a rare and unique character. He is self-oriented, with high expertise and very good human relations skills. He is skeptical about the trend, since what everybody is chasing is usually wrong. He is instrumental in defying the Intellectuals and is usually the person who can make an organizational change take hold. However, Policemen are rare and may be as few as 2% of the staff.
Sheep are followers, who may say they want to learn about the trend. But they will only follow the overall direction of the organization. Sheep are often part of the masses, who wait and see.
Here is how a successful engagement might proceed:
An Arsonist takes hold of your product, and gets push-back from Intellectuals, who want to maintain Wa. If a Policeman is available and becomes interested, he could defy the Intellectuals and begin to establish Kuuki around the trend. So clearly a successful sales engagement will require cultivating an Arsonist and a Policeman.
Finding and cultivating an Arsonist and Policeman is no small feat, and would require the ability to discern those types of people. That will be the subject of another post.
One general piece of advice is to avoid promoting the trend with both Arsonists and Policemen. The Arsonist believes he is the trend (remember, he thinks he is a god). The Policeman already knows about the trend and is more interested in stories behind the trend or things they might not know.
To wrap up for now, Okuno san offered some historical perspective on the concept of Wa and also the reason why decision making is not driven from the top in Japan.
The concept of Wa can be traced back to the 6th century when the 17-Article Constitution was established by Shōtoku Taishi. The first Article instructed Japanese to respect Wa and determine everything through neutral consideration (according to Wikipedia: Harmony is to be valued, and the avoidance of wanton opposition to be honoured).
Okuno san speculated about the deep roots of Wa and its effect on the Japanese psyche. It is not consciously taught in schools, and therefore, it is very hard to change. The idea that if something is determined against someone’s will, it will cause a bad feeling, is something that scares Japanese at a fundamental level. It may be related to a belief that violation of Wa will cause natural disasters – which is just a speculation, but it is true that Japan as an island nation is subject to an unusually high degree of natural disasters.
There have been times in Japanese history when leaders who imposed their will on their subjects were assassinated. So there is clearly something in the collective Japanese psyche that drives behavior around the concept of Wa.
In the next post I will dig into some details Okuno san offered about finding and cultivating an Arsonist and a Policeman, and how that contrasts with the typical American and global approach to sales.