Our company was acquired almost five years ago by Canon of Japan. We are still a company that is deeply anchored in our original Scandinavian values, but we have learned much from them. And the hope is that we can teach the Japanese something as well.
The first time I met Canon’s CEO, he was sitting and enjoying a cup of green tea with his CFO. I inquired politely how long the two had worked together. ‘53 years’ was the reply. I was speechless for a moment!
The gentleman I’m describing is Fujio Mitarai, chairman of the board and CEO of Canon Inc. It is almost five years since that meeting and today Mr. Mitarai is a vigorous 83 years old. He’s been an employee in Canon since 1961.
Japanese organizations are acquiring companies like never before. In the first nine months of 2018 Japanese firms were globally involved in no fewer than 2,950 business transactions for a value of $290 billion.
In 2014, we decided to sell Milestone Systems to Canon, and today we are a successful stand-alone company in the Canon family. The time since that day I first met Mr. Mitarai has been – and is still – an exciting and very complex learning process on how two so apparently different cultures like the Danish and the Japanese can interact, and how much we can learn from each other.
One of the things that weighed most on my mind leading up to the acquisition, but also in the time after, was wondering how we could maintain our culture and identity. Milestone Systems was born as a Danish startup company 21 years ago, and although today we count almost 1,000 employees on a global scale, we are still deeply tethered to our original culture with openness, innovation power, flat hierarchy and a strong Scandinavian management style.
How could we maintain this and not become just one-among-many companies in the huge Canon family?
Many Ways to Reach Consensus
First and foremost, one must of course understand the culture, in my case the Japanese corporate culture. And it starts with something so basic as to be introduced to a Japanese colleague or business person, with the exchange of business cards. It must happen for the Japanese in a tactful and intelligent way that reflects who you are and where in the hierarchy. Then there is the meeting itself where hosts and guests have special seating. Nothing is left to chance.
But the real challenge – and test – is the decision-making process. Despite the fact that the Danish and Japanese company cultures are among the most consensual in the world, there are great differences in how to navigate the two different approaches to consensus.
In Denmark and the Nordic region in general, we create a classical flat organizational structure, including active involvement during meetings with direct discussion to brainstorm the basis of what we perceive as a consensus decision. In Japanese companies they cover matters at meetings just as much – but it happens in a completely different way.
Closed Meetings but Open Decision-making
In general, the Japanese need a clear framework defined before the business meeting, and to stick sharply to this structure throughout the meeting. The first rule is that you do not discuss or make any decisions during the actual meeting, much less introduce new ideas. The topic review has already happened in advance as a document in which the initiator has put down his ideas. The document is circulated to relevant stakeholders, thereby contributing ahead of time to the meeting’s input as well as confirming or disproving the ideas.
Through this process, the ideas are actually pre-approved, and the meeting simply confirms the decision.
This is in contrast to the Danes who consider a meeting more like a ceremony, where one repeats, confirms and goes deeper into the things being decided. If you want to influence decision making in a Japanese context, you must understand that the decisions are really made before the meeting. If one starts to brainstorm during the meeting, as is quite common in our part of the world, it is perceived as lack of preparation, and creates confusion around roles.
A good example is from one of our first meetings with Canon where both my colleagues and I had prepared a lot; of course, we had read up on things and had lessons in how we were expected to behave. But as the conversational pleasantries moved along, one of my colleagues stood up with enthusiasm to explain his part of the task at hand, and as was natural to him, invited discussion for feedback. There was no mistaking the result of this: our Japanese Canon counterparts sat completely silent with absolutely no response in any way. There was obviously not going to be any brainstorm that day!
Sometimes I’ve been a bit frustrated with this extremely different approach to communication in general, and to taking decisions in particular. In our part of world one of the rules of good communication is to be ‘said, heard, understood, accepted’. For example when a manager delivers a message and a task, it must be first heard, then understood, then accepted and finally accomplished. It’s a linear model, where the sender is in focus, and the time frame from ‘task explained’ to the expected end performance is relatively short.
In Japan the focus is not on the sender, but on the content of what is communicated about the task or the decision, which is based on mutual and dynamic reflection where you create a knowledge base in common. Here it is not always about getting your own opinion through, but about taking decisions together.
The Company in Focus
From this I have learned something interesting – and relevant – about Japanese leadership culture. The Japanese are collectivists, opposite from Scandinavians who are pronounced individualists. Where for us it’s about ourselves, our own careers, our own performance, our own job satisfaction. In Japan it’s about the company, and the company is bigger than an individual.
A good example of this is Canon and their 200-year vision. 200 years? Yes, because it’s not about the individuals in the company but where it is going and its objectives. Should my business have visions that reach hundreds of years out in the future, and should my staff does no longer focus on their own career goals? No, we’re won’t have a 200-year plan, and we maintain what we believe in: a culture where we are participatory in our jobs, and where it’s ok to have a focus on our own goals.
But we can use Japan’s way of doing it to learn something about ourselves and challenge us on our way of doing business and how it can be more effective. And we can learn to work far more tactically with the Japanese as we begin to understand their way of thinking. In my eyes there’s no doubt that the Japanese can also be inspired by our more linear approach to decision-making and thereby cultivate doing it more effectively.
We must not just copy the manner in which corporate culture is run in Japan, as Japan should not copy us. Instead, we must respect and understand the different ways we do things. And just as we learn from our Japanese counterparts, I’m sure that that they also learn from us.
I know that Fujio Mitarai throughout his long career has practiced a unique management style with inspiration from both the East and West. It is inspiring. And I continue to lead my business with my feet solidly planted in Scandinavian soil.
By Lars Thinggaard, President & CEO, Milestone Systems
This Commentary was originally published in Danish by Mandag Morgen.