Aug 02, 2019

Developing business relationships in Japan: Hierarchies and expectations

EHLION Team 0
News Culture

Following our Japanese business tips so far you've built a solid basis of a long-term business relationship. You know how to exchange business cards, what to avoid when dealing with your Japanese partners, and how to behave on your first business dinner.  

We also talked briefly about Japanese negotiation style and rules of nonverbal communication. These themes will be reappearing as you go deep into your business partnership, and deserves a closer look.  

Building a business relationships in Japan is a long process. Whenever you feel stuck, or unsure about the cultural side of your partnership, reach out to our cultural coaches. They will quickly ensure you are on track with your business goals.  


 

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Japanese hierarchy 

Japanese business hierarchy is extremely important in Japanese corporate culture.  

Relative status in an organization determines how people interact with each other and how they expect others to interact with them. To be able to follow the rules of hierarchy in Japanese business culture you will first need to accurately determine: 

  • The status of the people you're working with. 

  • The relationships among them. 

 

It's no easy task, especially in a larger organization. 

Age can often can be used as a proxy for guessing someone's place in the hierarchy. But, it’s not always the case. To be on the safe side verify your assumptions with a Japanese person, or with our cultural experts. They can help you decipher the meaning of job titles, and explain how they map onto the hierarchical structure of the company. 

 

Once you understand the Japanese hierarchy system:  

  • Show respect to people with high status. 

  • Try to bond with individuals on the Japanese side who are at a similar level in the hierarchy. 

 

Japanese business negotiation style 

We highlighted before how negotiations in Japan look different than in the West, mainly in that they require patience. There are, however, many more expectations regarding the negotiation process.  

The first principle to remember, and one that guides the Japanese business negotiation style is: 

While business in Europe, especially Anglo-Saxon countries, tends to be transaction-based, business in Japan tends to be relationship-based. 

What follows is that negotiations occur at a slow pace and are process-oriented. Your Japanese business partners will first want to determine if a relationship can develop to a stage where both parties are comfortable doing business with the other. 

 

How to negotiate with the Japanese?  

Bear in mind these three principles. 

 

1. Non-confrontation 

Japanese are non-confrontational. 

  • They will not overtly say no, even if they don't agree with your terms. They will rather reply they will think about it or will see. 

  • Under no circumstances should you lose your temper. Following your emotions can make you lose face and irrevocably damage your relationship. 

 

If you have doubts about how to interpret the cultural meaning of what happens at the negotiation table, run it past our expert coaches. Clarity on where you stand helps decide how to proceed with your partnership. 

 

2. Hierarchy 

We mentioned this above, but it's important to highlight it again. Japanese business hierarchy is reflected in the negotiation process.

What it means is: 

  • Decisions are unlikely to be made during the meetings you attend.  

  • It will take several rounds of meetings, as your counterparts will need to take time to consult the intermediary progress with their superiors. 

 

3. Patience 

Decisions will often take a long time.  

  • They require careful review and consideration by those higher in the hierarchy. 

  • They may not be final even when they seem to be final. 

 

Formal and informal relationship building 

In Japan, there is a lot of emphasis on making connections and maintaining relationships. Business deals can be influenced by these connections, as long-term relationship nurtures sense of debt, loyalty and responsibility. 

 

Honoring agreements and decisions 

Japanese business culture places less importance on honoring the details of an agreement and more emphasis on building a strong long-term relationship. 

The simplest prerequisite for successful business relationships in Japan is to always be polite, punctual, and respectful of your business partners. As you learned from our article series, there are many rules and cultural differences to bear in mind when building relationships with Japan. Even the most careful and culturally aware business people can make mistakes.  

The key is to remain honest and humble. Always apologize if you are aware of any mistake on your side, your Japanese business partners will appreciate your transparency. You know your business best, and have experience building international partnerships. But, even a minor cultural adjustment is enough to give your strategy a rocket boost.  

The advice of our cultural coaches is known to give business experts an extra edge in their international business relationships. Book your coaching session now

 

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