Negotiation and Decision Making in Japan
Introduction
Many aspects of the economy have changed during the lost decade, like marketing,
accounting or management. However negotiation and decision making are more or less the same.
It didn’t really know a huge evolution because these processes take their roots in the Japanese
psychology and it is really hard to improve our own way of thinking or way of living. However
these both processes are very time consuming for Japanese corporations, but also for Westerners
who try to do business with them. In order to understand how Japanese make decisions it is
important to understand the environment of Japan. Japan’s insular and mountainous geography,
the dense population, and the importance of rice as the basic food crop made it possible a country
where the society values obedience and corporation (Hodgson, Sano, Graham 2000, p.33).
Individuality is not favored while the idea of a group is important.
To succeed during an intercultural negotiation we have to understand the other party,
what they are thinking, why they react like that, what is the most important aspect for them. We
have to become a “chameleon”, not by losing our personality or our culture, but by
understanding and imitating the other team’s behaviors to create a relation of trust. However
when the other culture is very different from our own background, it is really useful to get some
information before the meeting to avoid mistakes.
In the first part the main concepts used during negotiation and decision making are
presented then some specific Japanese processes are explained. In the third part strategies of
Japanese decision making and negotiation are described. In the last parts intercultural
negotiations are outlined and current developments in negotiations styles and decision making
styles are studied.
I°) Main concepts used during negotiations and decision making
Negotiation and decision making are based on strong cultural aspects of the Japanese
culture (Hall 1983). We have to understand them and their implications before speak about
strategy of negotiation and their particularities because these concepts are fundamental in the
Japanese mind.
JAPAN : THE COUNTRY OF HARMONY
1
One of the most important concepts in Japan is the respect of harmony between two
people, inside a group or within the society, to avoid open conflicts (Doi, 1973). However
negotiation is a rupture of this harmony. Indeed negotiation is a confrontation between the two,
or more, people. Each team tries to put into effect its own strategy to reach its objective. They
have to bargain, to show how good or reliable is their company and to get the best deal. It’s a
long and difficult process.
As Robert M. March writes in his book The Japanese Negotiator the word “negotiation”
and its usual translation “kosho” have significantly different meanings. Kosho has nuances in
Japanese of fighting, conflict, strategy (senryaku), and verbal debate (iiau), whereas
“negotiation” lacks these overtones and usually suggests discussion, concession and conference.
But this is not just an academic point because businessmen who think of negotiation as kosho or
iiau will, not surprisingly, enter the meeting with a more aggressive intent than those who view it
as “negotiation”.
THE CONCEPT OF SEMPAI-KOHAI
Another strong concept in Japanese culture is Sempai-kohai. A Sempai is an older person
who has some experience and power during decision making. A kohai is a younger employee.
The concept is true during all their lives, at school, in an association, or in a company. The
Japanese society is very hierarchical and patriarchal oriented. Social norms are important and
pressures to conform are strong (Noriyuki, 1985).
It is very important to understand this concept during a meeting because western
negotiators have to locate who is the leader –generally the older man, near the window, far from
the door, who could sleep during discussions- because this person has a strong power during the
decision making process. Sometimes he could miss the first meetings because he knows that any
important decisions would not be taken without his agreement.
THE CONCEPT OF INSIDE /OUTSIDE THE GROUP
Trust is the first step if you want to establish a business in Japan. This trust is very
important because if Japanese decide to do some business with a foreign company, this company
has to respect all the criteria to become a member of the group. The only way to overcome the
suspicion is to create an atmosphere of trust. One of the ways to do it is by keeping more or less
even with the pace set by the Japanese, and strive to reassure them as often as necessary
(Zimmerman 1985, p 97). And Japanese people have to trust this company to accept it inside the
group.
Indeed this concept of “inside/outside” the group is one of the main points for Japanese
because if you are inside, you are a member of this group and relationships are very strong in
Japan. They will help you, give some advice, many benefits and you have to do the same. Japan
is a collectivist society that emphasizes being a member of a group and preserving the welfare of
the group (Hofstede, 1983; Sours 1982).
However it is more difficult for a foreigner to earn the trust of Japanese people. Even the
2
word in Japanese gaijin, which means foreigner, is composed of the kanji Soto which means
outside. Historically Japanese did not have good relations with other countries, they did not
really trust them, and were afraid to lose their independence. During the Edo period, foreigners
were killed if they arrived in Japan, the country was living in autarky. Even today, foreigners are
accepted, tolerated but never totally integrated and Japanese products are preferred rather than
foreign products (Bernadette Lanciaux 1991)
Now that we have defined some important Japanese concepts, we can explain and analyze
the basic tools and processes used by Japanese negotiators during a meeting or a decision making
process.
II°) Japanese Decision Making Tools
If some Japanese processes are worldwide known and taught, like the toyotism, many
ways of doing negotiation or during decision making, a cognitive process of reaching a decision,
are less famous and studied in Western countries. However they are still in the center of actual
negotiations and even if some Japanese do not know the name of these processes, they
unconsciously use them everyday.
NANIWABUSHI : HOW TO TOUCH THE FEELING OF JAPANESE PEOPLE
As Robert M. March writes in his book –The Japanese Negotiator- many Japanese use a
strategy called naniwabushi during negotiation. Naniwabushi “are popular Japanese ballads
dating back to the Edo period (1600-1868) whose performers chant tales of chivalrous robbers
and rise and fall of great families.”(p22). They keep the same structure during negotiation. First
they describe how the relationships between the two companies during these last years were,
how they were good customers and how meticulous they have been about making payment on
time etc… This is the Kikkake.
In the seme, they speak about how the last events were difficult for their company, e.g.
the recession during the last decade, the price of petroleum, which sacrifice they did to honored
the contract. It is a narrative of critical events.
In the last part, called urei, it is quite melodramatical. It expresses pathos and sorrow at
what has happened. However the more tragic is the story, the easier it is for Japanese listeners to
show some compassion and to change some conditions in the contract. Sometimes we could
convince Japanese by the heart, whereas the reason could not change anything.
As M. March says “Naniwabushi is artful, premeditated, calculated – and in Japan it
works”. (p23)
NEMAWASHII :
HOW TO INVOLVED EVERYONE IN A DECISION MAKING TO REACH
ONE ’S OBJECTIVES
The nemawashii is one of the main concepts of negotiation and decision making in Japan.
Literally nemawashii means the digging around the roots of a tree in preparation for
3
transplanting (MacColl, 1995).
As the group decision is very important, Japanese people have to involve everyone in
this process. One’s speaks with each member of the team, or manager of different section, by an
informally way. One’s presents his idea, try to show advantages and ask for advices. Once one’s
has spoken with every main executive, and has obtained some support, he organizes a formal
meeting. This time one’s formally presents his idea and asks of suggestions. This method avoids
confrontation and achieves consensus easier than formal negotiations (Watabe, Holsapple &
Whinston 1992).
The main strength of this method is to involve everyone before the meeting to get their
support. If they organize a meeting without doing nemawashii, the new proposition could be
rejected. However this process is very time-consuming and many ideas could be dropped before
a meeting. They have to adjust their viewpoints among members of a group trough mutual
concession in order to coordinate and unify the opinion of the group as a whole (Mitsibushi,
1986). This way of doing is also called suri-awase in Japanese.
The Japanese decision making process is said to be slower then in the West. The reasons
that have been contributed to this are the following:
1. the Japanese involve and inform more people
2. demarcation of responsibility is less clear in Japanese firms
3. the Japanese are preoccupied with detail and have greater difficulty in taking an
overview; and
4. the Japanese seek to take linger-term view.
The classic Japanese practice of consensus management is not democratic participation in
decision making. The ideas and views of all people involved in the issue, including junior and
shopfloor workers, are gathered, then the most senior person takes a decision (Japan
Management Today).
Path of inclusion during Nemawashi
Source : MacColl 1995
4
Each square symbolizes a section of the company. When Japanese people do nemawashii,
they evolve each section. Usually they start with the same level section, get advice, information
or agreement, and then they ask to their manager and to their top manager.
HARAGEI: AN EMPATHIC WAY OF COMMUNICATING
Haragei is a strategy used by the Japanese when they are communicating with themselves.
It is a technique used by two individuals without the use of direct words in a problem solving
negotiation. One party doesn’t reveal what is in his hara or guts, but he communicates his
purpose and intention through his haragei (McCreary 1986, p45).
To succeed in using the haragei strategy one has to know the other party’s personality,
background, and other personal matters. High positioned Japanese use haragei effectively
through their early experiences (Mitsubishi 1983a, p 58-60). Indeed haragei is a form of sensing
and serves as a starting point in the establishment of a work relationship (Maccoll 2001, p 379).
However, as you need to be quite experienced in using the strategy of haragei the tactic
seems to be familiar with the older generation. Almost everyone living in Tokyo knows the word
haragei as a strategy that is used by business men and politicians as a well thought strategy when
negotiating.
STUDY CASE
Robert Sievers, the chief executive of a U.S. chemical company in Tokyo, said of
negotiation sessions: “You get some strange answer or just silence. If there’s silence, just sit.
Don’t try to fill the space with noise. Just sit and sit.” Sievers doodles to fill the time and reduce
the temptation to talk. The silence can last as long as five minutes. Then Sievers sometimes
adjourns the meeting because of a deadlock. “It takes a lot of patience to do business here”
(Sharpe 1983, p.1).
In fact it is not an empty silence, but it is an intended silence or ma, where one has to
feel the empathy between the people involved. The above mentioning of Mr. Sievers was to show
how he wasn’t able to feel the empathy toward the other party. Had Mr. Sievers understood the
Japanese haragei he may have used his own haragei as a strategy to end the deadlock by asking
follow-up questions or make comments not related to the business (McCreary 1986, p. 47).
RINGI: THE CIRCLE DISCUSSIONS, CENTRAL POINT OF JAPANESE DECISION MAKING
In Japanese companies there are ringi or ‘circle discussions,’ which is the system of
circulating an intra-office document in order to obtain the approval of the people involved for a
purpose of action (Lincoln and Kalleberg, 1990). Ringi is indeed the most widely known
decision making stage in Japanese corporations.
Once the document is circulated among the participants, the document is sent to higher
level authorities for approval or information purposes. Ringi is an information tool that
symbolizes positions, where the circulation of the information on decisions that has already been
5
made (Craig 1975; Ruch, 1982).
Besides ringi systems there are other ways where Japanese employees interact with each
other. For example, if a Japanese person uses the word chotto ippai it means to go for a drink
where they discuss serious or non serious talks with each other. Hanashiai or talking means
involving a few members of a company meeting in an informal meeting and explore ideas. Kaigi
in Japanese corporations means a meeting where the employees discuss a problem and try to
reach a consensus.
Finally the decision making processes in Japanese companies is finalized by the ringi.
The idea that was mentioned in the chotto ippai session or in the drinking session goes to the
hanashiai or the place where employees talk and discuss about the idea goes on to the kaigi
where more authorities are present. The ideas or proposals that have survived until the kaigi and
have made it into the ringi are certain to be approved by the chairman.
6
Source : the International of Organizational Analysis, 1995
The decision making process of Japanese corporation is explained by the above model
that ideas can occur in any part of the organization but it is introduced in informal settings. Ideas
which has gained acceptance can enlarge the coalition of consensus surrounding the idea. The
larger the consensus, the more formal is the setting for the presentation and discussion of the idea
(MacColl 2001, p.383).
However flexibility among the ideas is necessary because the ideas that have been
presented can be dropped or new ideas can come up from the informal settings of chotto ippai,
hanashiai, and kaigi. As an example of decision making in Japan below is the example of DaiIchi Suisan Kaisha Ltd.
STUDY CASE
The Tokyo sales branch of the mentioned sea food products firm was to decide on adding
a new product. In order to add a new product the decision took four months and included
everyone in the branch office, from the branch head to all of the sales representatives (MacColl
2001, p.383). Through the four months that took to make a decision of adding a new product
there were many chotto ippais and hanashiais where everyone took part in the discussions. It is
because of all these chotto ippais and hanashiais that take Japanese corporations so much time to
decide or make a new decision comparing to other countries.
Japanese try to involve everyone to increase the cohesion inside the group. If they are not
in a dominant position to propose a new idea or a suggestion to improve something they ask to
their sempai to support them during the meeting. However any important decision could not be
taken without everyone’s agreement.
These interactions inside their group are maybe time-consuming but improve the
cohesion inside the teams.
KEIGO AND KOGO
Keigo, the polite language, and kogo, the colloquial language, are used by the Japanese in
different situations according to the person addressed. When speaking to an inferior, a Japanese
person will switch to the colloquial language. Most nouns, pronouns, suffixes attached to the
verb root, and the syntax of the utterance can be modified (McCreary 1986, p.42). For the
foreign side negotiation team’s interpreter the switching language of the Japanese side when
doing negotiation might be difficult even though he or she is supposedly bilingual. By artfully
switching from polite to colloquial language and back, Japanese negotiators can partially conceal
their meaning and carry on a private conversation in front of supposedly bilingual foreigners
( McCreary 1986, p.43).
ADVANTAGES AND DISADVANTAGES OF THESE PROCESSES
One of the strongest advantages of Japanese negotiators is the organization of their team.
7
If Westerners spend a long time to put into effect some argumentations or strategy during a
meeting, Japanese spend this time to coordinate their team. Each member has his own role. Some
people will look the nonverbal expressions of westerns during the meeting, some others will ask
specific questions about the agreement. But all members of the Japanese team will lend their
support to the spokesman –who is not necessarily the leader of the team (March, 1991).
Japanese are used to work in team since they are young. It is very natural for them and
they have developed some abilities to create some harmony and efficiency in teamwork. (Eric
Spires, 1999). They have clear leader whose leadership is respected. Japanese team memberships
are also more flexible than many westerners. There is a strong cohesion inside the team.
Moreover the lake of short deadline during the decision making process or during negotiation is
a fact which explains Japanese calm and weighing.
However Robert M. March writes that Japanese teams know some disadvantages,
especially concerning communication skills. “The Japanese people are generally good at
interpersonal communication that deals with information exchange, and the exchange of news,
views, opinions, gossip, and experiences in a friendly, relaxed way. They are, moreover, polite
and well mannered, and it is important to remember that “manners” are themselves a form of
communication. On a scale of human communication that culminates in true intimacy and
openness, however, communications that are concerned only with manners or information
exchange are of a somewhat limited nature.”(p 155)
Moreover many Japanese have some trouble to speak English. So Japanese negotiators
prefer listen and defend their position during a meeting than be aggressive and lead the
discussion.
Besides these processes are extremely time-consuming and it is the main disadvantage in
this period of globalization. The reason for this time-consuming process is because of the
Japanese managers and employees view themselves as all moving in the same direction with
equal effort and the Japanese like to make decisions within a structured organization. The idea
again comes from the social system where harmony is important. Japanese people can show
individualism in your personal life but not at their work.
In fact the seemingly long meetings which might seem like a waste of time are not a
waste of time for most of the Japanese people. Getting everyone’s consensus on a project before
the meeting is time saving because everyone knows where the others stand on the issue. It is also
important for the Japanese employees to get to know each other on a personal basis, and it is
done by the frequent discussions that occur during the day (Bacarr 1994, p 199).
Moreover these negotiations are not “linear”. They do not negotiate linearly the point A,
then the point B and after the point C as Westerners do. Even when an agreement is found for the
point A, Japanese negotiators can come back on it during the negotiation of the point C. That is
why negotiation and decision making are very time consuming in Japan because everyone has to
agree and when an agreement is found, it is never definitive.
8
These processes are maybe unknown in Western countries but daily used in Japan. They
are as essential as the following strategies during negotiations and decision making.
III°) Strategies of Japanese Negotiation
DEFINITION :
Negotiation is an interaction of influences to reach an agreement, which focuses on
material interests or quantitative issues between two or more parties. This interaction involves a
confrontation of many interests that the involved parties or group resolve by holding discussions
and coming to an agreement which can be mutually agreed by them.
Robert M. March writes in his book –the Japanese Negotiator- that Japanese use 3 types
of strategies during a meeting.
NORMATIVE STRATEGY
During a negotiation Japanese try to follow etiquette and customs of their foreigner
customers. They hope their patterns do the same. Politeness is more than a custom, it is a way of
living for Japanese.
Indeed, sellers have to be very polite and use keigo –a polite way of speaking Japanesewith buyers. Indeed, generally in Japan customers do not buy something simply for the product,
but for all extra services and their relationships with sellers. Sellers have to help their customers,
and not simply sell their products. Service is more important than price.
Moreover Japanese do not speak just about product and price during negotiation, but also
about their private life, their family, their hobbies etc… This is maybe strange for some western
negotiators, but this is fundamental in Japan if they want to establish a friendly and trusty
relation with their clients, if they want to become a member of a group. If a Westerner just speaks
about business that could be quite rude from a Japanese point of view. After knowing the other
party’s background and establishing trust Japanese side move on to the details of the negotiation.
And the next stage of the negotiation would be the technical details of a product if it is
going to be sold in Japan. Japanese people like to know everything in detail so it is not a surprise
to find Japanese people wanting to know everything in details at the negotiation (McCreary 1986,
p 26). Japanese want to “cross every t and dot every i” (Blanchfield 1983).
Indeed another Japanese strength is their persistence during negotiation. They do not
want to sign a contract quickly. They have time and every team member must agree with the
final proposition. As Mr Rigault, negotiator of Dargaud France, explained in an interview in
2006, Japanese negotiators want to be sure and satisfied of all details before sign a contract. They
prefer to spend time to check the final quality of product than quickly make an agreement,
especially with foreign companies. Patience is a good virtue in Japan and they call it “gaman”
But during this negotiation compromise and mutual cooperation are two other strong
9
virtues in Japan. It is not a “take and give” negotiation, as we can assist in Western countries, but
more a consensus (Yoshimura 1997). Indeed, Japanese want to reach an agreement that’s why
they focus negotiation on common goals and objectives.
Besides M. March writes about Japanese rightness that “this sense of rightness is
supported by the widespread conviction that the Japanese are, as a race, decent honorable and
innocent people.” (p129). So when a contract is signed, they will do everything to honor their
agreements, even if some conditions change. Indeed for Japanese this agreement is not
something fixed at an instant. If conditions evolve, e.g. price of raw materials increase, contract
must be improved.
However the final stage of the negotiation which is the signing of a contract may not exist
in Japan, because a sale can be finalized or closed in the initial stage of phatic communication if
a true trusting rapport is formed (McCreary 1986, p 26).
RATIONAL STRATEGIES
Japanese negotiators try to put into effect good relationships with their parterns. In Japan
an important aspect of these relationships is the degree of dependency –amae- which can be
developed. Amae is a sense of community (MacColl 1995). It concerns dependency on the
goodwill of others. It is more or less the kind of relationships within a family, reciprocity is
expected (Takeo Doi, 1991). The naniwabushi is grounded on amae for example. Employees
may amaeru to their employers, and employers should recognize it, feel acceptance of their
dependence by extending their benevolence, and allow employees to receive attention. In the
vertical society of Japan, this phenomenon is widely spread (McCreary 1986, p.31). When the
negotiation processes have just started Japanese loke to seek out details about others to determine
how much amae, as well as trust, can be developed within the future relationship (McCreary
1986, p.31).
One of the main steps during the negotiation process is “bargain”. Indeed there are some
habits in Japan and some unreasonable offers could be a bad form (Nikkei Weekly 2007, October
issue). If Japanese want consensus and could accord a 10% discount quite easily, they would be
very disappointed if Westerners ask for a 40% discount, even in the beginning of the discussion.
Japanese have an expression call “banana no tataki uri” which means the banana-sale approach.
This happens when the Japanese negotiators don’t know what to expect from foreign buyers and
they feel it’s safer to leave room to maneuver. (Graham & Sano, 1984)
Indeed M. March says “one of the commonest Japanese complaints against Americans is
that the latter are insincere and not to be trusted when they make an outrageous offer. This
suspicion is strengthened if the Americans, soon after making such an offer and comprehensively
justifying it, shamelessly change it to one closer to reality.”(p135).
There is another custom in Japan, when a contract is signed buyers get out of habit of
offering a small present to the sellers to celebrate the agreement. It is not really expensive but it
is to show friendly relationships between the both sides (Georges Crasnier, 2006).
10
AVOIDANCE STRATEGIES
“Kuchi ha wasawai no moto” is a Japanese proverb which means “The mouth is the root
of all trouble”. Indeed Japanese respect silence and generally do not take initiative during
discussions. Another interesting point is the respect of silence in Japan also extends to response
time for answering a question which is not so long in the West. Sometimes they also give an
evasive answer like “That’s a good question. Let me get back to you on that”, when in fact the
question has floored him.
Another important aspect in Japan is the notion of Honne and Tatemae. Honne is our
feelings, what we are really thinking. But Japanese rarely show their feelings or thoughts. They
have a poker face, an impassive mask, which is called tatemae and without look their non-verbal
expression it is quite impossible to enter in their mind (Mitsubishi Corporation 1988).
Indeed in Japanese society you see many people smiling. The smiling faces of Japanese
can affect a negotiation process in many ways In a positive way, when they smooth over ruffled
feelings, or in a negative way, when, combined with silence, they increase the other party’s
frustration (McCreary 1986, p.20). In fact the most agreeable face is the smiling face and to
present the most agreeable face possible to parents, relatives, teachers, friends, well-wishers, is a
rule of life. Japanese smile is the form of the self-control rooted in the culture of the Japanese
(Nippon Steel 1982, p.306). Being able to control yourself in the public is one of the most
important lessons children learn from their parents from an early age in Japan.
Up until the above discussions we have introduced the terms and contexts that are used in
Japanese negotiations and decision making processes. For someone who had never lived in Japan
knowing the terms and contexts that are familiar with the Japanese will help to succeed in a
Japanese environment. In the coming pages we introduce some ways that Japanese act during the
meeting and after the meeting.
IV°) Japanese as International Negotiators
DURING A MEETING
Sometimes some problems can appear during a negotiation. The main difficulty is some
misunderstanding between Western and Japanese negotiators. They have some problems to
understand what they are thinking, if they agreed or not. Georges Crasnier, international sale
director of TBS, explained in an interview some aspects of a Japanese negotiation.
Generally western junior negotiators believe that when Japanese say “hai” –yes- that
means they agreed with the proposition. But in reality Japanese just show they understand the
proposition and they will think about that later. It is not approbation. Moreover Japanese people
never say “iie” –no- because it is very impolite and they do not want to stop the discussion.
There is a joke which says “If Japanese says “yes”, that means “maybe”. If he says “maybe” that
means “no”. And if he says “no”, he is not Japanese.”
11
INTERCULTURAL GAP
However the main difficulty during an intercultural negotiation is the gap to understand
the other party’s priorities. Usually the Japanese negotiators can understand the Western
negotiators’ priorities but the western negotiators do not understand the Japanese negotiators’
priorities (Richard Menger 1999).
Indeed if for the both parties information is viewed as an important source of power, the
Western negotiators prefer share information during a meeting in order to get information, but
Japanese negotiators exercise the power of information by hiding it (Jeanne M. Brett 1998).
Usually Western negotiators communicate more directly than Asian negotiators who prefer
indirect speeches. Indeed low context negotiators (Westerners) rely primarily on explicit verbal
messages whereas high context negotiators (Asian) are better in inferring meaning form context
(Ting-Toomey 1985).
For these reasons it is particularly difficult for low context negotiators in an intercultural
negotiation to understand a high context negotiator’s indirect behavior because information about
priorities is contained not in the words of the offer, but in the way that offers change over time.
The high context negotiator gets information from the context of the actual proposition, which is
the history of prior proposition, but not directly from the words of the proposition (Wendi L.
Adair 2003, Brett and Adair 2005). So during an intercultural negotiation it is easier for a high
context negotiator to understand and get information from a Western negotiator because he
understands direct message, but for Western it is very difficulty and unusually to get information
from context and not from direct proposition.
Moreover objectives are usually quite different during an intercultural negotiation. For
Japanese people the goal is to reach the best agreement for both parties. Their propositions will
be moderated, and they could be offended if Western negotiators propose some inacceptable
price or agreement during the negotiation. Indeed the Japanese culture is more collectivist and
hierarchical (Schwartz 1994). However for American negotiators negotiation is viewed as a
competition dividing winners and losers (Yoshimura 1997) because their culture is more
individualistic and egalitarian.
AFTER A MEETING
At the end of the first meeting, inexperienced negotiators have some troubles to know if
the meeting was a success or a failure. Indeed Japanese are very secretive and it is hard to
understand their goals, their opinions or their objectives (Georges Crasnier 2006). They keep a
poker face and it is really difficult to read their feelings. However some Western negotiators
speak with frankness and honesty but this kind of speech could be quite rude for Japanese.
Generally Japanese show their approbation by some non-verbal expressions. Westerners are not
really familiar with this kind of language and misunderstand the meaning or simply do not notice
it.
Japanese people do not give feedback after a meeting. It is quite difficult to understand
their expectations. Sometimes Japanese can ask many times the same question. Maybe it is
12
because they do not really understand the answer, but it is maybe because they want specific
information that westerners did not said. However there is maybe another explication.
Sometimes between different sections of the firm, Japanese do not really communicate all the
details of meetings and the other section wants same information (March 1991).
With the ever increasing international connectivity in the global world Japanese
negotiation styles and decision making styles certainly have to go under a change if Japan wants
to stay as a major economic power in the world. With the ever growing China and other Asian
countries whose negotiation styles are more like the Western style, it is important for the
Japanese corporations to rethink of their own ways of doing business. In an internationally linked
world the traditional ways of Japanese business may face difficulty because some people are not
willing to be patient in the business world nowadays. In fact, Japanese way of negotiating has
been going under changes in recent years.
Challenges of Japanese Decision Making and Negotiation Style
Japan’s bubble economy collapsed at the start of the 1990s. The government of Japan and
the BOJ (Bank of Japan) caused the collapse by trying to cool the bubble down. After the bubble,
the Japanese economy entered a long period of stagnation. The economy recovered several times
during the 1990s, but a full recovery never happened. Financial institutions ended up with large
levels of non-performing loans as a result of the collapse in share prices and land values.
Corporations suffered from the “three excesses”: excess capital investment, excess employment,
and excessive debt (Kobayashi 2005, p.13). Many corporations suffered during the lost decade
because of their decision making styles. The traditional way of including everyone in the
decision making processes and getting a consensus of almost 70 percent was not only time
consuming but also a damage in an economic situation where rapid change and decision making
style was needed.
V°) Current developments in negotiations styles and decision
making styles
Japanese are known as difficult to do negotiation with because of their ambiguous way of
giving answers. However, this trend will not continue so long anymore. Up until now, the
Japanese reluctance to give a clear, definitive no has confused countless other foreigners and
snarled international interactions, from casual chats to trade talks. Indeed there has been an
incident where President Clinton advised to the former Russian President Boris N.Yeltsin that if
the Japanese say yes, it means no.
However, times are changing. When the once Prime Minister Morihiro Hosokawa of
Japan had a meeting with President Clinton he used no hemming or hawing in the negotiation of
rejecting U.S. demands for measurable trade targets. According to the translator Mariko Nagai
who was present at the negotiation process at that time it was a bit scary to interpret because of
13
the clear language. Nagai says that she has seen a trend toward a sharper language among
Japanese negotiators in recent years. Hosokawa’s definitive no to Clinton, is a sign of Japan’s
coming of age, symbolizes a shift away from the soft, indirect expressions that Japanese have
long used to maintain harmony and save face with one another.
As contact with foreigners increases and the tradition that frowns on direct expression
weakens, more Japanese are learning to speak more clearly and daring to disagree-in daily life as
well as in the international stage (Hodgson, Sano, and Graham 2000, p40).
The traditional systems of Japanese corporations have been going under change since the
economic stagnation that followed the collapse of the bubble. To solve the “three excess” many
companies took bold corporate restructuring and reorganized their businesses, cut staff, and sold
off assets. Cutting off employees has created new problems because traditionally Japanese
corporations are known to have the lifetime employment system. Workers had a sense of security
and therefore made it possible for them to devote themselves for the company. With the cutting
off of employees the trust between the company and employee had broken. Pay structures based
on ability and performance are being introduced, making employees weaker team players
(Kobayashi 2005, p.59). Japanese decision making style and negotiation style have been strongly
related to the concept of group or in other words team work. With the trust disappearing between
the company and the employee the decision making style will change in the future because the
team members will not be certain if the person in the group will stay at the same company until
he or she retires.
Conclusion
Negotiation strategies did not really change during the last decade. Indeed negotiation in
Japan is based on teamwork and relationships between two different companies or teams. Of
course there are news informatics tools, the time during decision making is shorter –but always
longer than in the West- and Japanese executives have improved their English. However the
roots of negotiation and decision making are always the same. Indeed these processes are based
on the Japanese personality, their relations and behaviors inside a group or with their superior –
sempai- still depend of their high context culture.
Mentalities spend time to really evolve. However the next generation is more aware to the
globalization than their parents. Many Japanese are bilingual, have studied 1 or 2 years in
western countries and want to change some aspects of the Japanese society. Negotiation and
decision making processes could be improved in 20 or 30 years when this generation will have
some responsibilities in the company, when they will be executives because their mentalities has
14
evolved.
Bibliography
Robert M.March, The Japanese Negotiator, 1990
Naotsuka 1980, p. 201-202 in Davis and Ikeno 2002
Interview by phone with Georges Crasnier, international sale director of TBS France.
Interview with Mister Rigault, negotiator of Dargaud France
Le jeu de l'indulgence : Etude de psychologie fondée sur le concept japonais d'amae par Takeo
Doi, Yves Pélicier, et Dale Saunders (1991)
Tatemae and Honne: Distinguishing Between Good Form and Real Intention in Japanese
15
Business Culture par Mitsubishi Corporation (1988)
INFORMATION SHARING AND COLLECTIVE BARGAINING IN JAPAN: EFFECTS ON
WAGE NEGOTIATION. Par : Morishima, Motohiro, Industrial & Labor Relations Review,
00197939, Apr91, Vol. 44, Edition 3
INTEGRATIVE SEQUENCES AND NEGOTIATION OUTCOME IN SAME- AND MIXEDCULTURE NEGOTIATIONS. By: Adair, Wendi L.. International Journal of Conflict
Management (2003), 2003, Vol. 14 Issue 3/4, p273-296, 24p, 9 charts, 3 graphs; (AN 14402567)
The Negotiation Dance: Time, Culture, and Behavioral Sequences in Negotiation. By: Adair,
Wendi L.; Brett, Jeanne M.. Organization Science, Jan/Feb2005, Vol. 16 Issue 1, p33-51, 19p, 4
charts, 7 graphs; DOI: 10.1287/orsc.1040.0102; (AN 16285252)
INTER- AND INTRACULTURAL NEGOTIATION: U.S. AND JAPANESE NEGOTIATORS.
By: Brett, Jeanne M.; Okumura, Tetsushi. Academy of Management Journal, Oct98, Vol. 41
Issue 5, p495-510, 16p, 5 charts; (AN 1220434)
Ethnocentrism in U.S./Japanese Trade Policy Negotiations. By: Lanciaux, Bernadette. Journal of
Economic Issues, Jun91, Vol. 25 Issue 2, p569, 12p; (AN 9603276185)
Cultural differences affect decision-making. IIE Solutions, Jun99, Vol. 31 Issue 6, p8, 1/3p, 2c;
(AN 2014789)
Sony's Yoshihide Nakamura on structure and decision making. By: Beamish, Paul W.. Academy
of Management Executive, Nov99, Vol. 13 Issue 4, p12-16, 5p; (AN 2570550)
A MODEL OF JAPANESE CORPORATE DECISION MAKING. By: MacColl, Michael D..
International Journal of Organizational Analysis (1993 - 2002), Oct95, Vol. 3 Issue 4, p375, 19p,
3 charts; (AN 4451866)
Japanese and American negotiators: Overcoming cultural barriers to understanding. By: Menger,
Richard. Academy of Management Executive, Nov99, Vol. 13 Issue 4, p100-101, 2p; (AN
2570558)
Jina Bacarr, How to succeed in a Japanese company, Carol Publishing group, 1994
Don R.McCreary, Japanese-U.S. Business Negotiations, Praeger Publishers Don R.McCreary,
Japanese-U.S. Business Negotiations, Praeger Publishers, 1986
16
Mitsubishi Corp. 1983a.Japanese Business Glossary. Tokyo: Tokyokeizaishinposha
Michael D. MacColl, A model of Japanese corporate decision making, 1995
Mark Zimmerman, How to do business with the Japanese, Charles E.Turtle company, 1985
Christalyn Brannen and Tracey Wilen, Doing business with Japanese men, Stone Bridge Press,
1993
The Nikkei Weekly, October 22, 2007 Monday edition, Negotiating business deals in Japan
requires bit of finesse by Pernille Rudlin
James Day Hodgson, Yoshihiro Sano, John L. Graham, Doing business with the new Japan,
Rowman and Littlefield publishers,INC., 2000
Robert A.Blanchfield, 1983, To Japan? Your first (Good) trip,. Wilmington, Del.:DuPont.
Rochelle Sharpe, 1983, Business in Japan: Learning experience.” Wilmington News Journal,
October 9, p.1
Linincoln, J.R., and Kalleberg, A.L. (1990), Culture, control and commitment, New York:
Cambridge University Press.
Craig, A.M. (1975) Functional and dysfunctional aspects of bureaucracy. In E.F. Vogel (Ed.),
Modern Japanese organization and decision maki9ng (p 185-209). Berkeley: University of
California Press
Japanese
management
today,
Should
Japanese
giants
cut
the
apron
strings?,http://www.apmforum.com/japan/jmr-art1.html
Nippon Steel Corp. Personnel Development Office, 1982.Nippon: The Land and Its People.
Tokyo: Gakuseisha.
Kobayashi Kayo, The Japanese Economy, 2005, IBC Publishing Company
17