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The Cost Of Doing Business In America And Japan

1388 words - 6 pages

The Cost of Doing Business in America and Japan

A manager or company has many factors to consider when deciding to conduct business internationally. Besides being sensitive and respectful to the foreign country’s culture, one must also be cognizant of how the culture influences the cost of doing business. To illustrate this point, consider the following scenario of countries A and B:
Both countries [A and B] are characterized by low labor costs and good access to world markets. Both countries are of roughly the same size (in terms of population) and both are at a similar stage of economic development. In country A, the education system is undeveloped, the society is characterized by a ...view middle of the document...

In other words, “an understanding of how cultural differences across and within nations can affect the way business is practiced” must be continually taken into account (Hill, 2015). To understand this fact, one must begin by noting the cultural differences between America and Japan.
In America, people celebrate personal accomplishments, and “the value systems of many Western societies . . . emphasize individual achievement. The social standing of individuals is not so much a function of whom they work for as of their individual performance in whatever work setting they choose” (Hill, 2015). On the other hand, citizens of Japan take pride in the team or company they are a part of. In a work entitled Japanese Society, Chie Nakane explains that “when a Japanese faces the outside (confronts another person) and affixes some position to himself socially he is inclined to give precedence to institution over kind of occupation. Rather than saying, ‘I am a typesetter’ or ‘I am a filing clerk,’ he is likely to say, ‘I am from B Publishing Group’ or ‘I belong to S company.’” (Hill, 2015). Thus, people raised in Japanese culture are motivated by the success of the group as opposed to their own individual success. This observation is important to note because “if the worth of an individual is closely linked to the achievements of the group (e.g., firm) . . . this creates a strong incentive for individual members of the group to work together for the common good” (Hill, 2015).
Although the concept of the team’s success being held in much higher regard than the individual’s success can be perceived as a good thing, it is also the reason why the entrepreneurial spirit is more alive in America than in Japan. “In the US and Europe, the success of entrepreneurial economies has to an extent supplanted social casting by employment, but in Japan, entrepreneurs are not accepted so readily and are often seen as eccentrics or misfits” (Japanese business culture, 2009). People raised in Western culture celebrate personal accomplishments and oftentimes feel that their individual success takes precedence over the success of the team. Therefore, within the U.S. is a “lack of loyalty and commitment to an individual company and the tendency to move on for a better offer” (Hill, 2015). Citizens in Japan have a far different perspective, however. “Japanese business culture is still dominated by the concept of 'lifetime employment'. A young man, entering a large corporation such as NEC immediately after graduating from [a] university at age 22, anticipates that he will retire from that same company when he reaches age 65” (Japanese business culture, 2009). Whereas people in America have little remorse in partnering with another company that can provide more benefits, once one has established a good rapport with Japanese business partners, he has a partnership on which he can truly rely. Understanding Japanese customs and business practices will enable a...

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