Discovering Business in Japan

By Brian Wallheimer | Fall 2016

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Two weeks in Tokyo show students a different view of capitalism

The 15-hour flight to Tokyo couldn’t pass fast enough for Sandra Yu, a Notre Dame science-business senior. She had always been fascinated by Japanese culture, fashion and tradition. And this spring, she was headed to Japan for a two-week pilot course called Japan Business and Culture through the Mendoza College of Business and Notre Dame International.

One of her first experiences in Tokyo was meeting Japanese college students and coming to the stunning realization that she didn’t know much about their lives.

But two weeks in Tokyo changed that.

“I was able to get a feel for what it’s actually like there. It’s so important to at least try to see how other people live,” Yu says. “It was eye-opening.”

In every way. The 19 students who participated in the trip toured sites including the Tokyo Stock Exchange, the largest fish market in the world and the Edo-Tokyo Museum to learn the history of commerce and culture in Japan. They also attended seminars and met with students at Keio University, one of Japan’s oldest institutions for higher education.

The trip was led by Jessica McManus Warnell, an associate teaching professor in the Department of Management & Organization, who studies business ethics and researches with a Japanese counterpart.

“The students could meet and talk with their peers on the other side of the world, and they were really struck by the commonality of their experiences, but also the differences,” says McManus Warnell.

Understanding similarities and differences may have been the theme of the trip. Parallels between the U.S. and Japan are easily drawn, but there are also stark differences in business ethics and operations between the two countries.

A COMPLEX BUSINESS ENVIRONMENT

Before and during the trip, Notre Dame alumni who currently or have recently lived and worked in Japan offered students insights on the country. One of them was Sean King, senior vice president at Park Strategies, a business consulting firm based in New York.

King calls Japan an interesting case study because of its standing in the world. Even though Japan has the third-largest economy, it faces unique complexities going forward.

“It’s still America’s No. 1 Asian ally and the second-largest economy in Asia. But people in Japan are very insecure about Japan’s role in Asia with a rising China,” King says.

After World War II, Japan’s economy surged, aided in no small part by the United States. Japan developed a major focus on automobiles and technology, and became a major exporter of those goods. The government stimulated private-sector growth.

Excessive loan growth, as well as rampant real estate speculation, contributed to Japan’s economic bubble bursting in the early 1990s. In an effort to slow inflation, interbank lending rates were raised sharply in 1989, which led to a stock market crash. The government bailed out banks, which pumped money into businesses deemed too big to fail, though many were surviving only on those loans. The economy is still in recovery. Additionally, Japan’s population is shrinking, which has implications for expanding its workforce.

“Japan, sooner or later, needs to make some tough decisions and make some real structural reforms if it wants to recapture anything close to its past levels of explosive economic growth,” King says. “Immigration can help address Japan’s declining population. Japan’s still very well off but can always do better, especially as it faces nearby competitors South Korea and mainland China.”

McManus Warnell adds, “Efforts to capitalize on the strengths of Japanese traditions and culture including quality in production and service will be critical. In addition, willingness to innovate and inspire entrepreneurship, and attempts to increase the numbers of women in the workplace are also keys to Japan’s future.” 

Students can learn much of that from textbooks and watching current events from afar, but experiencing the environment first hand makes Japan’s situation more understandable.

“It’s always important to know any country’s history when doing business there, as you want to know how people view their own strengths and limitations, as well as, perhaps, more importantly, how they might view you,” King says. “It’s important to understand their own good and bad experiences with other foreign businesses. They’ll naturally, albeit perhaps, unfairly, keep that in mind when dealing with you.”

LEARNING FROM EACH OTHER’S STRENGTHS

McManus Warnell became fascinated with the nuances between Japan and the United States when she began business ethics research with a Japanese cohort in 2013.

“They’re one of the U.S.’s largest trade and political allies in the world. They’re a democracy like us. They’re a capitalist economy like us, and unlike many of their Asian counterparts,” she explains. “But while we’re both egalitarian, free-market economies, they have more direct and active government involvement in the way the economy works. They have a strong collective identity that is different than our more individualistic approach in the U.S. They have a historical tradition of ‘sanpoyoshi,’ or explicit three-way satisfaction in economic transactions — the buyer, seller and society should benefit.”

Her research centers around these traditional approaches to business in Japan, including the concepts of “omotenashi,” which loosely means the art of selfless hospitality, and “mottainai,” the responsible use of resources, and specifically how these approaches may help guide a global definition of the role of business in society.

“These concepts are clearly in line with what we describe in the U.S. as ethical leadership, virtues-based decision making in business, and environmental and social sustainability in business,” McManus Warnell explained. “So it is incredibly valuable for our students to see these concepts in action, and, by extension, see how Japan and the United States can learn from the strengths of each other’s approaches.”

Yu was especially moved by seeing “omotenashi” in action. “It was impressive,” she says. “‘Omotenashi’ was one of my favorite parts of Japanese culture. This word simply means treating guests with the utmost respect in a genuine manner without expecting or seeking anything in return.”

A REVIVAL

The Japan Business and Culture class is a revival of sorts. Late marketing professor Yusaku Furuhashi established a study abroad program during his tenure as associate dean, acting dean and dean of the business school from 1975 to 1989.

McManus Warnell is busy preparing for the May 2017 course, including efforts to secure scholarships for business students. “Students today know that a natural part of learning about business is studying abroad,” she says. “They want a more complete picture of global business. This trip changed and expanded their understanding of what business means.”

Nineteen students participated in the 2016 trip. Noriko Hanabusa, a Notre Dame Japanese language professor, also traveled with the group and taught an introduction to Japanese language before and during the trip.

McManus Warnell said the program will continue to foster teaching and research partnerships in Japan, as well as building and strengthening relationships with Notre Dame alumni working in Japan, Japanese universities and businesses to provide student opportunities.

That is already happening. Four students double majoring in business and Japanese took part in summer 2015 internships at Oracle Japan through a collaboration with the Notre Dame Liu Institute for Asia and Asian Studies and the Notre Dame Japanese language program. The company invited nine Notre Dame students for internships in summer 2016.

Yu says she learned a lot about business during the trip, but she also learned something important about herself. Despite not knowing the language and being thousands of miles from home, she was able to adapt quickly and build confidence in her ability to become comfortable in a different culture.

“I learned more about myself, had the chance to form new friendships and connections with fellow students and administration,” says Yu. “I developed a deep love and respect for another country.”