Japanese Business Disruption

Change the System by Embracing it!

It’s often assumed that change agents and disruptors need to go against the established system to alter or reform it–or change it altogether.  

In Japan, however, change tends to happen through evolution rather than revolution. This means working with the existing system, then gently steering it in a new direction while keeping everyone’s interest in mind.

Take for example the ubiquitous ride-sharing phenomenon of Uber and Lyft launched in 2011 and 2012 respectively.

Hailo, an app that matches passengers with taxis based on their mutual GPS locations and the taxi’s availability, was founded in London the same year as Uber.  Together, Uber and Lyft effectively smothered Hailo worldwide–except in Japan.

Uber’s market approach was to try to revolutionize the transportation system by challenging industry and government norms.  Unlike much of the rest of the world, this didn’t go over well in Japan. Even if it had, Japan has a way of making sure that, if you discount other stakeholders, you may win the battle, but in the end you will lose the war.

Hailo, by contrast, is a platform that benefits all the stakeholders. A major challenge, however, was the lack of smartphone use by cabdrivers. So Ryo Umezawa, president and CEO of Hailo Japan, partnered with Hikari Tsushin, a telecommunications company, to sell discounted smartphone packages to Hailo drivers.

A famous example of the reverse approach is Narita Airport. Although the opening was planned for the early 1970's, the stakeholders in the area (local farmers) were not consulted, only hearing about it when they read it in the newspaper.  

Irate, the farmers succeeded in delaying the opening until 1978 when it could still only open with one runway rather than the planned three, and drew a protest rally of around 22,000 people. Many of the farmers still refuse to sell or leave their land. Protests and vandalism continue to this day and the third runway remains in limbo.

Being a team player is imperative to getting things done in Japan. One aspect of being a team player is including others, not leaving anyone out. This is the function of nemawashi, the relationship-intensive, time consuming process of looping everyone in and bringing them onboard for a consensus-based decision.

Being a team player also means being in sync with everyone else, joining and harmonizing with the group. Insiders can have influence in Japan.  But if you don’t join, if you are perceived as an outsider, your power to change things is miniscule!

A third aspect of being a team player is taking everyone’s feelings into consideration. As if in a big family, if you must disrupt, you want to try to keep everyone as happy as you can.

For example, many years ago, one of my American clients was promoted to president of a subsidiary of a major Japanese company. His superior in Japan said to him, “Ronn-san, we want you to change everything in the next two years, but don’t make anyone uncomfortable.”

Diana Rowland

Author

 

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