Japanese giant pharma Takeda recently announced its first non-Japanese CEO, Frenchman Christophe Weber, to take the helm from April 1st. Yasuchika Hasegawa, the current Takeda CEO, made his announcement amidst much dissent from a group of more than 100 shareholders and former employees, defending his decision as imperative in keeping up with global competition.
The Japanese work and management culture is seen by many as extremely hierachical and impenetrable by foreigners. The main cultural differences that make it difficult for foreigners in Japan applies as well to other asian cultures such as Chinese where many business deals are based on relationships. The state of business deals are often difficult to perceive due to the Japanese innate politeness and unwillingness to say no. One can often spend months courting a Japanese client, the latter of which has no intention at all of accepting the deal and is only patiently waiting for the foreigner to lose interest. Japanese business relationships once established however are extremely loyal and productive to both sides. But often the time taken to achieve this proves too frustrating for many foreigners to bear. Japanese need to be 100% sure they can trust you before entering any kind of business deal. And because of their collective culture, this establishment of trust has to be agreed on by a board of members as opposed to a single person. Something I am sure Mr Weber will be aware of.
Mr Weber did however spend a few years in Singapore heading the GSK Vaccines unit, so he is not a stranger to doing business in Asia. There have been many a story of non-Japanese CEO disasters. Olympus being the stand-out case where British CEO Michael Woodford blew the whistle on several Japanese executives on accounting irregularities. He’s probably never getting a job in Japan again for sure. In 2013, American Craig Naylor quit as CEO from Nippon Sheet Glass only a short while after his predecessor Stuart Chambers left, the former citing differences with the board while the latter deciding he is not Japanese, putting family as no.1 instead of work. Yet French-Lebanese CEO of Nissan and Renault, Carlos Ghosn, has done well for the business. I attribute this to his Lebanese side, which share some similarities with Asia in building business relationships.
The spirit of entrepreneurism is also often looked at with disdain in Japan and societal standing is very much based upon the reputation of the large corporation you work for. All this is now changing as prime minister Shinzo Abe rolled out certain reforms named “Abenomics” over the years to loosen bank lending to small businesses and encourage foreign investment with the use of tax breaks and incentives. The Japanese seem to come up with amazing and crazy ideas (recall banana-shaped tupperware and selfie stick) though so it was disappointing to see that only 7.6% of the population felt they have an opportunity to start a business in Japan with 12.8% feeling they had the capabilities to do so, from the Global Entrepreneurship Monitor 2013. This is in stark contrast to other Asian countries such as Indonesia for example, where 46.6% perceived opportunities and an optimistic 62% felt they had the capabilities. Singapore by the way is not far off from Japan, 22.2% in perceived opportunities and 24.7% in perceived capabilities.
One thing’s for sure, with increasing globalization, one needs to be adaptable to different cultures and business customs in order to progress and succeed. Both as a CEO, and as a country.