UNDERSTANDING JAPANESE CULTURE:
A PRE-REQUISITE FOR DOING BUSINESS WITH JAPANbyN. Krishnaswami

PREFACE
There is a great awareness about Japan in India and about India inJapan in recent times and the two want to work together in all fields educational, cultural and economic for the betterment of both. But there
is a need to fill the gap in information, in knowledge about each other. It isto fill this void that the Indo-Japan Chamber of Commerce & Industry hasplanned to bring out a series of Background Papers with the help ofpeople who have known Japan and India, interacted with the two peoples
and would like to share their knowledge with others. This effort on ourpart is a prelude to greater and more intellectual interaction throughdiscussion, seminars and research on Indo Japan bilateral cooperation in
the coming days. I am sure the Background Papers will create moreinterest among all readers to further strengthen our bilateral relations.

15-05-2015

N. KumarPresidentJapan is an island nation in the Pacific Ocean, off thecoast of East Asia. More than 6,800 islands together makeup the nation of Japan, most of them are very small. Only
four islands

Hokkaido, Honshu, Shikoku and Kyushu

make up for more than 98% of the country. The countries
nearest to Japan are Russia, China and the Republic ofKorea and each one of them has its own geographic,
political, economic and social problems with Japan which
erupts from time to time.
Japan is a fascinating country. This is partly becauseof the country's phenomenal economic development after
its total devastation in the Second World War and partly
5because of the various consumer products, especiallyelectrical and electronic good from Japan that have floodedthe world. But in spite of all its modernism, Japan is a very
old society, sometimes old in its thinking even today. In spiteof over half a century of ultra-modernism and its superpower stature today, Japan in a sense continues to be an
enigma to many.
Many people including the Japanese think of Japan asa small country. But what is more important than Japan's
geographical size is its setting, its relative isolation from therest of the world till about 150 years ago. During that period
they had known of only two countries, China and India; theformer because of its close proximity leading to frequent
clash of arms, and the latter because of Lord Buddha, whose
message of non-violence and humanism had reached theshores of Japan by the 6th century.
This isolation has probably forced the Japanese tocreate a set of characteristics in their culture anddevelopment, quite distinct from the rest of the world.
Majority of the Japanese even today believe there are only
two groups of people in the world - one, “We Japanese”(Nihonjinron), who look Japanese, speak Japanese and think
Japanese, and the other, “The Rest”. They considered
6themselves superior to what the rest of the world had to offer
and they had even come out with a “scientific proof” ofJapanese uniqueness. A famous Japanese scientist, Dr.
Tadanobu Tsunoda, claimed to have discovered that Japanese
brains were essentially different from and superior to thebrains of other peoples of the world! And, we have to interact
with them and deal with them in different situations, indifferent walks of life, social, political, economic, etc.
What is it that has gone to make Japan what it is today?
Only a proper understanding and appreciation of the socialand cultural mores of a nation, will pave the way for interpersonal contacts in economic and commercial cooperation.
So then, what is the basis of Japanese culture? Japan is ahomogenous society, free of internal conflicts. This has madethe country a major industrial power. True, Japan too hadsocial stratification in the earlier days but with the progress ofmodern materialistic civilization, all the social groupings haveby and large disappeared though every Japanese is proud tolook back on his ancestry even today.
Education has played a very important part in making
Japan a great nation. Formal education and examinations
have taken the place of class and birth in determining one'sfunction and status. Since Meiji restoration in 1868 a highly7centralized and uniform school system,

even making

education the first charge on the budget, has come to stay.
The whole system is highly egalitarian, open to merit; but it
has become highly competitive, a rat race, resulting in an
increasing number of suicides of bright children. But thewhole Japanese educational system today is so regimented
that all Japanese children, boys and girls, the young and thegrown ups, will think alike and there is no scope for any
original thinking. No wonder the Japanese society at alllevels and in any spectrum, is a highly regimented,
disciplined society all in a free democratic country.
Japan is a land of non-religion. The Japanese will
declare they are not religious but in the next breath willproclaim Shintoism is in their blood, and in yet anotherbreath, will say Japan is a Buddhist nation. Besides, Japan
has about 1 million Christians too, of different
denominations. It is humorously remarked that a Japanese isbaptized in the Christian faith, married according to Shinto
rituals, and arranges to have a Buddhist burial. Very cleverpeople, they are keeping all options open for after-life! Thenon-religious Japanese are after all religious. The Japaneseconsider religion as more concerned with this life rather with
the next, answerable to society rather than to God.

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Examples can be drawn from Japanese politics,
diplomacy, economic affairs, etc., to show the Japaneseness ofthe Japanese. For example, the Japanese were annoyed withIndia for getting close to Soviet Union in Nehruvian days. But
they did not mind being a satellite of the United States because ofthe military protection received from it to defend the borders.
Likewise, Japan was critical of India's economic policy ofplanned economic development, but Japan's free economy was acase of “managed capitalism” under the benign guidance,direction and dictation of its Ministry of International Trade &Industry. Yet again, Japan expects all the countries of the world tosign the Nuclear non-Proliferation Treaty; and post-Pokhran II
India knows this to its cost. But Japan has allowed it to beprotected by the U.S. nuclear umbrella under a Defence deal
between them since 1950. Of late, there has been growing
protests from the people of the region affected by the deal. They
want the US nuclear deal modified or rescinded. The question ofnuclear power is a highly sensitive issue in Japan today and thenation is not yet ready either to accept it or remain non nuclear.
All these are not to belittle in any way the greatnessof Japan in the comity of nations today. Japan was thesecond biggest economic power till recently after theUSA; it has since been overtaken by China. Having failed9in our attempts to woo Japan in our early postindependence years, there were high hopes that theJapanese would come to India faster and closer,
economically and commercially after the inauguration ofeconomic liberalization in India in 1991. If there was one
country that had spent so much money, so much time andeffort in understanding India's liberalization, it is Japan.
But, the country has been exploring India still while therest of the world sees India as a rich source of investmentand trade. It required Goldman Sachs to remind Japan thatIndia is going to be a major economic power along withBrazil, Russia and China, and will surpass even Japan andChina by 2050.
The historic visit of Mr. Yoshiro Mori, the thenPrime Minister of Japan to India, in 2000 and thesubsequent summit between Mr. Mori and Mr. Vajpayee
the then Prime Minister of India has opened a new era inIndo-Japan relations. Today, the annual summits between
the two Prime Ministers of Japan and India, preceded byForeign Ministers meetings and the Secretary levelmeetings regularly is looked forward to eagerly by boththe countries. Today, the cooperation between the twocountries is not only confined to economic matters but also

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to political, strategic and international diplomacy. Thebilateral relationship is at a historic high. And so theJapanese are here in a big way, at last. It is now for us tounderstand the basics of the business mores and businessculture of the Japanese if we in India are serious about“Doing Business with Japan”.
Doing business with Japan is an art. There are several
apparent contradictions in the behavior of the Japanesepeople. They are a highly disciplined lot, but are also given
to extra indulgence at times. They believe in hierarchicalorder and obedience to authority, yet they also believe insocial equality - decision making by consensus is a Japanese
brainchild. The Japanese are extremely helpful, but they canalso be extremely unconcerned. They are very hospitableand open to foreigners; they are famous for politeness andsincerity; but they can be extremely rude and discourteousalso. All these are nothing special about the Japanese alone.
The Japanese have absorbed strong influences from abroadin the last about 200 years; but even here they absorbed justthat much they required and not the whole. That explains thethJapanese conservatism in the midst of their 20 century
modernism. This explains the apparent contradictions intheir behavior.

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A small digression about Japan's 'Decision-making
by Consensus'. The Westerners and the Japanese meansomething different when they talk of taking a decision. Inthe West, all the emphasis is on the answer to the question.
To the Japanese, the important element in decision making
is defining the question. To put it simply, going to the rootof the question. In the case of starting a business in aforeign country, a Japanese businessman wants to ensure
more than 100 % sure of success and once the businessproposition is decided positively it must go on fromground-breaking to manufacturing and marketing theproduct or service, without any hitch or hurdle. They wantto leave the decision making of every stage to the people
handling it. They send team after team of executives atdifferent levels one by one, study their respective reports
and findings before going to next stage. And this goes on
and on till the Chief Executive of the company visits thetargeted country, meet with his counterpart and makes surethat things will move on. A very highly democratic way
but it is a long and time consuming process. A country in ahurry like India finds this irksome. But they forget oncethe decision is taken by the Japanese to go ahead, thepotential partner, be it India or some other, find it difficult
to cope up with the speed of the Japanese.
12The meteoric rise of Japan after Second World War wassolely due to the attitude of the Japanese people to work. For anaverage Japanese, work precedes everything, including
family; this is from the social and spiritual ethos of the people.
But the new generation Japanese will not want to put work andworkplace ahead of its own individual interests.
The clue to the Japanese success lies in the
country's progress in science and technology. Japan
invested 5% of its GDP in R&D, and in turn, privatecompanies invested nearly 50% of their profits in R&D. In
the early days of industrialization while the Japanese
freely imported the best technology available in the world.
For every dollar of technology imported, it is said, they
invested five dollars in R&D for further improvement,assimilation and absorption as their own. It is humorously
remarked that the Japanese are “imitators” not“innovators”. In a sense, all of us are imitators in one senseor the other. What is more important is what one imitates.
The Japanese have an uncanny sense of identifying“unnoticed potential” in any small thing and exploit it tomake it Japanese.
We, in India, often complain that the Japanese are
reluctant to part with technology. In a sense it is true. But it13

must be mentioned there are some perceptual gaps in thethinking of both of us - Indian and Japanese. An average
Indian businessman thinks that technology transfer is justtransfer of hardware and a bit of training of labour for thishardware. But, in technology transfer the whole system is tobe transplanted into a new environment and it involves theassimilation of that technology in the new soil. It is a process
and the Japanese look at any such transfer as a longterm
investment.
There is a need for radical change in our thinking
about “Doing Business with Japan”. We imagine thatJapanese businessmen are making a fetish of smallthings. We must remember two things; one, if we want
the Japanese to come to India as investors or traders theymust get in return what they will get elsewhere - thetheory ofOpportunity Cost. Two, many Indianbusinessmen say they could sell their wares here, there
and everywhere and wonder why the Japanese refuse.
Reply: the Japanese are not asking you to sell your wares
to them; if we want to sell our products to the Japanese,they should meet Japanese expectations - it is sheer
common sense! As a matter of fact, Japanese considered
India a poor partner for business all there days; now they14

are aware that we are an emerging economic giant,superior to China in terms of quality and cost (real cost)
and that the next few decades are going to be the decades ofIndia and Japan.
On a larger canvas, both Japan and India arefacing the economic challenge of a manufacturing
juggernaut, that is China today. Neither Japan, with its
much smaller and diminishing population, nor India with
its present performance in the overall manufacturingsector, may be equal to this challenge all by itself. By
combining the strengths of the two countries, these twolargely complementary economies can be equal to thischallenge, to the benefit of consumers all over the world.
The warmth towards Japan cuts across party lines inIndia. There is much admiration and affection for theJapanese in our country. A Gallup poll a few years ago
confirmed that Japan was the most popular foreigncountry in India. The essence of India lies in her people,
their aspirations, their beliefs and their feelings andemotions. It would be in the interest of both Japan andIndia to understand that, more than a great economic
opportunity, the bilateral cooperation between the twocountries is definitely entwined for generations to come.

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It is to this aspect that we have to pay the most attention,and history would bear witness to the two great Asianneighbours, the two great democracies of the world,
Japan and India work shoulder to shoulder, to make this21st Century the Century of Asia.