RPO & StaffingTalent Acquisition

Understanding the Japanese Mindset

As Japan’s talent pool grows older, understanding the motivations of today’s workforce is a necessity in ensuring the most effective recruitment strategy.

by Luping Liu

Economically speaking, Japan remains a powerhouse on the global stage, though more recently the focus has shifted to the alarming demographic trends threatening to shrink its workforce significantly in the years ahead. Already, multinationals’ hiring needs are becoming critical as the pool of potential candidates narrows down to almost non-existent levels, especially for English speakers who can meet the requirements of management back at their headquarters in the U.S. or even Europe.

Recently, a client from a major internet service provider left to begin his own start-up and turned to Futurestep in Tokyo looking for help filling five positions for the new venture. After interviewing almost 50 people on his own, he was at a loss: none were willing to take the risk and lacked any passion for the idea of building something from scratch. This follows what we have seen for a while now: by and large, Japanese talent—even the “next generation” of
talent—are more concerned with salary and stability than they are pursuing a dream or building a fulfilling and challenging career.

We thus are helping to manage clients’ expectations and educate them on how to attract or develop people who are fluent in both the Japanese business culture as well as a “global” working environment by first fostering a company culture that becomes renowned as a great place to work for the long haul and secures employee loyalty.

While 20 to 30 percent of younger, up-and-coming middle management professionals in Japan are looking to change jobs along their career path every five to six years, the majority still have a more “traditional” mindset and seek positions in companies where they can stay for the long term. Here is a snapshot of where and why this is the case and the factors that have made it so:

• Family involvement and importance of brand image: Changing jobs in many Asian countries involves the entire family; career decisions and moves are made based on input from relatives and not solely by the individual. In Japan, the company’s reputation is key to the decision-making process, and there is a hierarchy of companies known to afford a certain level of status and security: large Japanese conglomerates, smaller local companies, and foreign capital firms (i.e., local outfits that are partly owned by foreign firms) rank in that order of perceived prestige.

Since the dot-com bubble burst have resulted in highly publicized scandals, Japanese workers are wary of foreign companies in that they might pull out of the country. With a few exceptions, these companies are not the “employers of choice” for most Japanese families.

• Foreign-owned versus Japanese companies: Foreign firms such as IBM and Cisco that have had the most success in Japan have managed to secure employee loyalty due to their size and staying power. Even within foreign firms in the IT and financial services sectors where we find the most movement among Japanese talent today, local firms are still preferred. In pharmaceuticals, manufacturing, and investment banking, there remains a strong preference to work for the well-known Japanese companies that have dominated those industries for years.

• Japanese interpretation of Confucianism: My counterparts in China are very aware of the influence that Confucianism has made on employee retention. In that environment, where the market is so “hot” that the best talents are job hopping every one or two years, whole teams can be lost when a manager moves, as loyalty to the boss is paramount in the China context where there is a heavy reliance on familial and friendship links for career and business success.

In Japan, however, the interpretation of Confucian principles is squarely focused on the group more than any one person and, thus, loyalty to the boss is not as great as to the company at large. This is ultimately the philosophy behind the legacy of “lifetime employment” and employer loyalty and fosters a strong team environment with little competition among individuals.

HR practitioners building teams in Japan must be mindful of the deep-seated attitudes of professionals at all levels today in order to proactively devise strategies to appeal to them.

Luping Liu is the service delivery leader for Futurestep Japan and can be reached at luping.liu@futurestep.com. For additional information, please visit www.futurestep.com.

Tags: RPO & Staffing, Talent Acquisition

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