Citation
Takeda, Y. (1998), "Inside the
Publisher
:Emerald Group Publishing Limited
Inside the Kaisha is unusual in the category of books that describe Japanese business behaviour. First, it is a collaboration between an American business professor and his Japanese student, whereas most books on this subject are written from either the Western or the Japanese perspective. The authors’ approach also sets them apart from others who have broached this subject; they interviewed selective samples of Japanese salarymen, with the intent to get an inside view of Japanese corporate life. What results is a book that presents a striking contrast to prior literature on Kaisha; it contains no broad generalities about Japanese culture or national character, nor does it linger on details about etiquette observed in Japanese business. This book outlines models that drive the behaviour of Japanese salarymen in the institution known as the Kaisha.
The main purpose of the book is to explain some of the inconsistencies in behaviour shown by Japanese salarymen that frustrate westerners who come into contact with them. For example, westerners find Japanese salarymen to be extremely polite and to act in co‐operation and harmony in some situations, while being rude, competitive, and distrustful in others. The authors’ contend that “the reason why Japanese behavior seems contradictory is that outsiders see Japanese behaving very differently in similar situations, whereas Japanese view the situations as being quite different” (p. 8). Underlying the authors’ explicit intent to explain inconsistent behaviour is their implicit purpose to debunk notions put forth in prior literature about the superiority of Japanese kaisha over western counterparts, and to counter the idea that this “superiority” derives from the innate character of the Japanese people.
The book lays out four themes that are used as models to explain inconsistencies in Japanese business behaviour. All the themes concern how decision making occurs in the kaisha, and how Japanese salarymen determine the appropriate course of action in a given situation. The authors point out that they are not developing a formula to explain all Japanese behaviour. The themes outlined in the book are meant to help westerners understand the kind of Japanese manager they are most likely to encounter in business: a white‐collar male who has graduated from a prestigious university and works for one of Japan’s largest manufacturing or service firms.
The first theme identifies the importance of “context” in decision making for a Japanese salaryman. By context, the authors are referring to the who, what, why, where, and when of a given situation in which a decision must be made. The authors argue that the reason why westerners are puzzled by the seemingly contradictory behaviour of Japanese salarymen is that westerners fail to notice slight changes in context that can completely change behaviour. For example, one‐on‐one meetings and exchange of personal information is inappropriate for Japanese salarymen in a business setting, but an exception is made while playing golf. One of the key concepts connected to this theme is “Soron‐sansei, kakuron‐hantai” ‐ a Japanese saying that allows one to agree with an abstract principle while ignoring it in a specific situation. The authors extend this idea to the Japanese support for free trade while making an exception for rice imports. The point of the first theme is that Japanese business behaviour is not guided by ideologies; instead Japanese salarymen take a more case‐by‐case approach to determine the correct action in a given situation.
In the second theme, the authors anticipate that westerners may throw up their hands, and conclude that decision making in a Japanese kaisha is random. They argue that this is not the case, rather Japanese salarymen learn how to make decisions from models that are provided for them. An important distinction is made here between the western approach to models, which is reductionist, and the Japanese approach, which is holistic. Japanese salarymen are discouraged from dismantling a model and arguing the logic of its parts. They are expected to follow the model exactly and acquire an intuitive understanding of the skill through “learning by doing”. The result, according to the authors, is that “tatamae”, which loosely defined means “doing what the model calls for”, often supersedes “honne”, which is “doing what one really feels”.
The third theme suggests that the primary model of Japanese business behaviour is to avoid social embarrassment. The motivation that drives this model is the fear of being viewed as inferior in a group. Japanese salarymen often make it a point to announce their lack of skill and preparation before presenting to a group. This kind of behaviour may be seen in the West as evidence of a weak self‐image, but the salaryman is attempting to pre‐empt the possibility that he will fail to meet the group’s expectation, and therefore look inferior. Obviously, this model leads to all kinds of organisational games in a kaisha, and creates a dynamic where perceptions are all‐important. The authors’ point is that this model creates the illusion to westerners that the kaisha operates by consensus, even though the dynamic behind the consensus suggests social control.
The fourth theme is a further development of the second theme, and states that correct process is more important than results. In following a model, Japanese salarymen are taught to pay greater attention to the way in which the model is applied and followed, as opposed to the result that is achieved. This process emphasis results in a business environment that encourages the establishment of strong and cordial working relationships, but often at the expense of economic efficiency. A kaisha will often choose to continue a business relationship over disrupting it to pursue temporary economic benefits. Low‐cost and economically‐efficient operations do not necessarily win in a market that emphasises the way in which business is done.
After having delineated these four themes, the book tackles six major puzzles regarding Japanese business behaviour. The puzzles reveal organisational games that are played by Japanese salarymen, which understandably leave westerners, who do not know the rules, befuddled and frustrated. By unlocking the mystery of the puzzles, the authors demystify the kaisha and destroy myths about Japanese business that have been perpetuated in the West.
The first puzzle is that Japanese salarymen are extremely polite and sensitive in some situations, but positively rude and even discriminatory in others. Foreign businessmen often have idealistic notions about Japanese politeness and about kaisha treating their employees as family, only to find themselves treated differently, being left out of decision‐making processes and spoken to in condescending ways. The authors argue that this inconsistency is not a prejudice against foreigners; it indicates a deeper mechanism governing business behaviour. Japanese salarymen are trained to identify their “reference group”, to know who are the insiders and outsiders. The reference group changes depending upon the context of an encounter. A salaryman might treat a fellow employee harshly, if their reference groups were in competition. Therefore, the fact that foreigners might be treated as outsiders is not duplicity in the mind of a Japanese salaryman, because the game of insiders and outsiders is played among Japanese the same way that it is applied to foreigners.
The second puzzle has to do with the notion that Japanese kaisha are beacons of harmony. However, many observers have pointed out that despite the prevailing harmony, there seems to be little trust in a kaisha. Even the word that salarymen usually use for trust, “shinrai”, has more to do with reliability than an emotional bond between people. The authors argue that harmony is a product of organisational control mechanisms. Salarymen feel pressure to adhere to group norms and to get along with others. Conflicts and disagreement are to be kept within the reference group. Meeting expectations is a cardinal rule; the penalty may be loss of group membership and social embarrassment. Therefore, harmony exists on the surface, and trust depends more on whether a person can be relied on to carry out organisational processes.
Yokonarabi, a benchmarking game that Japanese kaisha play with each other to measure progress, helps to explain both the third and the fourth puzzles. Western experts often contrast the long‐term approach and the spirit of co‐operation that seem to typify Japanese kaisha with western individualism and short‐term thinking. However, competition in the Japanese market is fierce, and kaisha often engage in short‐term profit‐taking, as revealed by recent financial scandals. The authors suggest that this can be explained by the way in which kaisha engage each other. Yokonarabi literally means “lining up side by side”. The concept describes how rival kaisha in a market often mirror each other, matching their every move and trying to do the same thing. Yokonarabi exists because not losing is more important than winning. This idea generates a process whereby losing market share in Japan is a much more urgent issue than growth or innovation. However, yokonarabi can create the impression that Japanese kaisha are forward thinking and work together towards long‐term goals, when many firms in an industry jump into untested waters together and patiently await results in a difficult market. But the authors suggest that this is usually an illusion; kaisha are competing to keep up with each other, and often engage in short‐term profit‐taking to keep their bottom‐line from looking inferior to others in the industry.
Many westerners employed by a Japanese kaisha complain that they do not know what is expected of them ‐ that goals and objectives are ambiguous. Japanese managers often respond by wondering why westerners do not know the right thing to do as a matter of course. The authors suggest that westerners look at what they should do to help the firm reach its goals, while the Japanese manager looks at how employees do their jobs. Therefore, in a kaisha, attitude is more important than competencies or results. Salaryman survive by playing an attitude game with their superiors, where they try to prove that they have the right spirit for the job. This involves over‐preparing by anticipating every contingency, staying late hours simply to be on hand if a superior needs something, and following models to a T without thinking about results. The fact that this game is taken for granted gives the impression that salarymen are well‐aligned to the goals of their kaisha, while western employees are left disoriented and unsure what to do.
The last puzzle involves the notion that a Japanese kaisha is egalitarian. In a Japanese corporation, class distinctions are rare ‐ special privileges based on status do not exist. At the same time, a kaisha is a rigidly structured hierarchy, and is designed so that everyone knows their exact status within the corporation. This is because the primary role of status is not to determine material rewards, rather to guide behaviour and relationships. Status derives its power from group membership; belonging to a prestigious firm or graduating from a top university says more in Japan than any individual skill or feat. In a kaisha, there are intricate behavioural models that determine which group one belongs to, and how to relate to others inside and outside the group. Because there are rules and formalities that guide behaviour, westerners may get the impression that everyone in a kaisha is treated equally; yet a salaryman may spend his whole life in a kaisha without ever having met the CEO.
Although I have never even been inside a kaisha, being Japanese, I felt that most of the observations made in the book were credible and accurate. As a micro‐analysis, it is extremely useful; it gives us a good model to understand the behaviour of salarymen. The book exposes the problems in prior literature about Japanese business behaviour, showing clearly that in order to understand the kaisha, you must be a kaisha insider. It simply does not make sense to explain the day‐to‐day behaviour of salarymen by giving details about Japanese Buddhism or the tea ceremony. Salarymen may know little about Buddhism or the tea ceremony, but they were unquestionably weaned on the models provided by kaisha to learn proper business behaviour. Without the models that only a kaisha insider knows, one is hopelessly lost as to why a salaryman took a particular course of action.
Having praised the micro‐analytical approach, it must be said that the book does often run into the problem of scope. The authors interviewed a selective sample of salarymen who graduated from top universities and work at large kaisha. Yet, the authors hardly ever make distinctions as to whether they are referring to large kaisha or all kaisha, and whether behavioural models apply to a small set of salarymen, all salarymen, or even to the Japanese people as a whole! One example is the authors’ claim that the exception of rice to the Japanese support of free trade can be explained by the “soron‐sansei, kakuron‐hantei” concept (see previously, in paragraph four). This may be true, but it seems quite a stretch to make such a general conclusion from a small, selective sample.
Within the problem of scope, there is also an issue that is not addressed about how much a salaryman acts according to the models taught to him by the kaisha, and how much he acts according to models taught to him by the culture. The authors seem almost to imply that this is an “either … or” issue; a clean dividing line can be drawn between books that look at business behaviour through a cultural lens, and this book which analyses business behaviour strictly from the kaisha standpoint. This is probably not the case ‐ many of the ideas in this book come from learned cultural models. I would submit that any book that analyses Japanese business behaviour should try to merge the cultural and institutional viewpoints. In this sense, Buddhism, Shinto, or the arts of Japan are not irrelevant in looking at business behaviour. To their detriment, the authors brush over this point. Their suggestion that eastern religion and philosophy accept duality and contradiction, while Japanese business behaviour is consistent, is wrong and insensitive (pp. 7,8).
The book also encounters the problem of perspective. The authors stress the point that they are writing about the viewpoint of the Japanese salaryman. Yet I could not help thinking that the book tells us as much about the authors’ viewpoint, and the models that western culture uses to generate meaning. The authors make several major assumptions that affect the way they interpret Japanese business behaviour.
The first assumption is that business activity should be measured from an economic standpoint. The book often cites cases where an economic disaster results from a kaisha’s behavioural model. This is especially noticeable when the theme of “process over results” is described. The authors emphasise that:
(1) economic efficiency is sacrificed for the sake of maintaining a business process; and
(2) innovative thinking is discouraged by a preference for models.
But if one inquires more deeply into why Japanese business operates this way, one might find that the kaisha sees a greater responsibility towards Japanese society than just economic output ‐ as a caretaker of human relationships. But it is hard to see this viewpoint because it would reveal what is lacking in our own models. In our culture, innovative thinking and initiative are rewarded, but we often sacrifice co‐operation, courtesy, and responsibility in the process. Our corporations are good at maximising profit for shareholders, but often fail to see the interests of a greater community of stakeholders.
Another assumption is that logic and numbers are the best ways to generate meaning. The authors show convincingly that Japanese managers distrust numbers, and have a predilection for qualitative analysis and intuition in making forecasts. A stunning observation is made about Japanese students who come to study at US business schools; they learn quantitative methods but promptly discard them when returning to Japan! Instead of looking for cases to understand and validate this approach, the authors give examples of how the distrust for numbers leads to economic disaster. I would argue that this is a fascinating topic to explore more deeply. Yet, our cultural model, which favours rationalism, tends to get in the way.
The last assumption that I find troubling in this book is that individual liberties are more important than collective rights. The authors state repeatedly that the organisational models that operate in a kaisha are forms of social control. They argue that harmony in a Japanese corporation is more enforced than generative. But how much are the behavioural models in a kaisha an effort at social control, and how much are they a predisposition among salarymen towards group thinking? No worker likes being prevented from doing something he/she wants by organisational norms and rules. But I would suggest that in a kaisha most salarymen favour collective rights over individual freedom. This hints at a problem in the authors’ interview sample: the fact that a salaryman would talk to someone about the problems of their kaisha makes him an “oddball”. By pointing this out, I am not implying that the observations resulting from the interview sample are invalid; I am quite convinced that organisational mechanisms in a kaisha often lead to dysfunctional responses. However, because a concern for individual freedom fits our cultural model, I feel that the authors are validating the feelings of a minority of salarymen without providing the bigger picture. We are less sensitive than the Japanese to the instances when an individual lords over a group or when a person is rewarded for results while using any means necessary and leaving a wake of broken relationships.
From a group dynamics standpoint, I found this book interesting because it shows that organisational games and limiting behavioural models are universal phenomena. Each culture and each organisation is susceptible to certain types of games. In that sense, it may be helpful before doing organisational analysis to think about the kinds of games and models to which a particular organisational culture is inclined. From the book, we can discern that there are many contrasts between the Japanese and the US corporate cultures that warrant closer examination. It is obvious that a group‐oriented culture tends to exert controls which limit individual initiative, while an individuated culture exerts controls which make groupwork more difficult. But this line of inquiry can be further explored by asking questions such as: “What does the contrast between the two cultures on the matter of ‘winning and losing’ suggest?” and “Why do group cultures emphasise process while individuated cultures focus on results?” I think that if the inquiry goes beyond dichotomies and categorisations, we might reveal more about the ways different cultures generate meaning, and how to analyse issues by applying multiple ways of seeing.
This book also tells us a lot about decision‐making methods. I must admit that I found the “easy” way in which Japanese salarymen make decisions through shared models very attractive. Of course, the authors’ implication that the Japanese way hints at groupthink and quells feedback is well taken. But instead of looking for a “superior” way of decision making, perhaps organisational practitioners should find ways to help a company cover for the weaknesses of a preferred method of decision making. A company might be shown how to build an organisational mechanism to study its decision making, similar to sports teams watching tapes of games to improve their performance. Of course, I would emphasise that the learning which takes place in such sessions should focus not only on improving the efficiency of decision making, but also on making decisions that were once impossible for the organisation to imagine.
I also learned about the importance of aligning organisational goals in this book. The authors observe perceptively that most kaisha have different sets of goals that do not match; a set of vision goals that are vague and ambiguous, a set of performance goals that are explicit but not the basis for evaluation, and a set of attitudinal goals that are implicit and determine a salaryman’s performance. This does not make sense, and it is easy to see how the performance of a kaisha might suffer when a salaryman is evaluated only on attitude, while company vision and performance goals are not met. Conversely, I would say that in this culture, it is easy to forget attitudinal goals, and measure workers only on fulfilling vision and achieving performance goals. All of these must go hand‐in‐hand, and the goals of a company must make sense as a whole.
In summary, I would suggest that there is a lot to be learned from comparative analysis of different business cultures, especially those in different societies. Ironically, this book is a comparative study, without realising it. It reveals the danger of all comparative studies; it is easy to impose one’s own cultural values on to someone else’s system. But I feel that there is a great need for further study in this regard, because we are being forced to deal with the different ways in which people do business in a rapidly globalising world.