The Trust Building Process in Japanese Society

Build Trusting Relationships

The Japanese believe that once the initial contact and introductions are completed, the next stage of the process involves developing trust through deeper knowledge of what the Westerners have to offer. This includes:

• How we handle ourselves as businesspeople and managers.
• Our efficiency, manufacturing methods, and the standard of quality of our products.
• Whether or not we are people they can do business with.

There are times when the seller wonders: “What else does it take?” For some the answer is:

• “It will take ‘two years of eating and drinking’ before you will get an order.”
• “Attitude. Consider yourself not on business, but on a personal visit. There is no such thing as ‘outside business hours.’ You have to be friends to do business here. And you are always on the job, 24 hours a day.”

The friendship dimension often involves extended social contacts. It’s not just drinking at bars, but karaoke (where the visitor is expected to sing however poor his voice), as well as golf, fishing, going to the track, perhaps tennis. In some ways, the Japanese are better at this than Westerners, and treat it as more a part of their professional life.

Business competence aside, friendship and maintaining a harmonious and pleasant atmosphere are not the only important factors from the viewpoint of Japanese managers. Most hope Westerners will show interest in Japan and that they will ask questions about the country and its culture. Many Japanese anticipate their guests as having done research into Japan. Most Western managers who are successful in Japan believe in and practice this. Generally, they warn against companies sending managers to Japan who are ignorant of, or show no interest in, Japan or the Japanese.

Test of Sincerity

How we handle tests of trustworthiness and our patience and endurance are noted carefully by the Japanese. How we handle objections, complaints, response to their discovery of mistakes our side has made and our honesty, are all contributing factors to their evaluation of us.

When asked how they would:

1. Respond to a demand from the Japanese to meet a business contract provision, even though he had already explained why his side could not meet the demand;
2. Handle a situation where the foreigner had inadvertently caused a loss of face to a Japanese.

Senior managers have stated:

1. “In this case, you have to play the sincerity game. Be sincere, explain why you cannot comply, and that there would be advantages for them. Treat their threat about losing the contract seriously, and be sure all your comments spring from sincerity.”
2. “I would formally apologize, make a special visit to them, explain that it was a misunderstanding or an error, or whatever. Even if they did not believe me, it does not matter as long as I restore the relationship, and show them proper respect.” “It’s a different world, and things happen,” another manager said. He was talking about inadvertent mistakes. “Take responsibility for whatever happens.”

Consistently, the respondents state that from experience they have learnt that honesty is the only policy.

Some go further, arguing that they have found it best to be unstinting in their praise of the Japanese business and its expertise. This, if sincere, even if overdone, does no harm, these managers say. Indeed, others say that the strongest position to take with the Japanese is that of the student, wanting to learn, asking questions, and presenting any proposals with modesty and a little hesitation – for this is how the Japanese would themselves do it.

Negotiation Success is in the Details

Keeping on top of the paperwork is clearly important for maintaining effective relationships with Japanese customers. Also, much communication is indirect, so you are expected to pick up the nuances, the underlying meaning – the infamous “yes” that really means “no.”

The early stages of the trust building process can be difficult for inexperienced managers to know whether or not the Japanese are really interested in their business proposals. Commenting on this “will they/won’t they?” stages of waiting, experienced hands have observed:

• “If they don’t call and you have to call them, something is probably wrong.”
• “If they haven’t said anything positive, such as ‘we are interested’, then their attitude is probably negative.”
• “Expect nothing, and then you will not be disappointed. Walk away, and get on with your life. If they come back to you, think of it as a surprise bonus” – words of wisdom particularly useful for smaller companies.

Many managers in the early stages of their dealings with the Japanese employ, and learn to effectively use, bilingual consultants and interpreters. Such professionals provide cultural and linguistic interpretation in situations where exactly what the Japanese are thinking or saying is unclear. Interpreters are important because they style your language into polished, sophisticated Japanese. This can greatly enhance the Japanese’s perception of you.

Consider Who You’re Negotiating With

One of the surprise twists of the early trust building, pre-agreement or pre-alliance process, is that the people with whom you have meetings can change in status. In the beginning, it may have been the business’s urbane senior manager, but soon you are handed on to a younger, operations-level Japanese person. Probably someone at section manager level.

As the age of the Japanese team gets younger, so their orientation becomes more factual, detailed, and bottom-line oriented. Their human relations skills are less polished. It’s not until the negotiations are well advanced that senior managers re-appear. Indeed, when it’s smaller Western firms, key Japanese people may not appear at all until negotiations have advanced substantially.

When larger Western companies are involved, one experienced negotiator explained that he has learnt from his experience that senior Japanese managers are very busy people, involved in many projects at the same time. They will not appear, and cannot justify appearing, until a project is close to agreement. So, he advises Westerners to remain aware of the composition of the Japanese teams they face. When a senior manager or director appears, he says, you are very close to a deal. They wouldn’t be there otherwise. In short, while it’s the only sign you may get, it indicates that your trust building has been successful.

Trust and Expectations

An Australian telecommunications company withdrew from a negotiation with a Japanese negotiator before it was concluded. The manager’s story was:

“I was working for AWA in the 1980’s and we were looking at a major component for color monitors from the Japanese. I was the project manager, and we had to source a fairly sizeable order. We made enquiries of three or four suppliers of the component, got samples, and trialed them. One Japanese company’s product was particularly good, and their price was competitive. We had them make some modifications, send us further samples, and provide more detailed price data. At the eleventh hour, however, our internal politics stepped in, and we had to go with another supplier. When I told the first supplier that we had decided to give the business to another company, they spat the dummy. They fumed – ‘what a terrible way to do business! You have no ethics! We’ll never do business with you again.’

“Their view was that they had the contract in their pocket because of the amount of work they had done. Privately I sympathised with them. And ever since then I have been very careful about how to ask questions of Japanese suppliers.”

The “Getting to Know You” Process

So what should the Western executive bear in mind when preparing to meet a Japanese business client, supplier, or associate? Think of the process as a reciprocal, universal, getting to know and trust each other. It need have no connection to business. You meet someone for the first time, and warm to each other immediately. So you meet again, in the process you will choose to exchange information on families, pastimes, interests.

You will probably decide to do something together socially. Perhaps your families will meet. Perhaps you will go take in some form of recreational activity together: a movie, concert, etc. As the relationship warms further, you both think about what you can do together of a more serious nature – go into business, for instance. When you have got to that point, you will have established the requisite foundation of mutual trust. Keeping a business relationship personal is often the not so hidden secret to successful human relationships across many other cultures as well.

Dr Bob March is one of Australia’s leading specialists on Japanese business and culture. He is the author of six books on Japan, including: The Japanese Negotiator (Kodansha International 1989, available in paperback.) He has been a consultant on Japanese negotiation and business relationships for the past 20 years.