Unlocking the Mystery of Japan?s Long-Term Economic Slump
To those who find it strange that Japan cannot seem to emerge from its
economic slump:
Shinya Okamoto
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Why is the Japanese economy, with all the human resources and capital
available to it, languishing in recession, seemingly unable to perform
to its full potential? The most significant reason is not the failure
of policies, but values commonly held among Japanese and fundamentally
different from those of Europeans or Americans. This Japanese mindset
is characterized by fear of change, acute risk aversion, and rejection
of all things new.
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Kyu Nihonjin (The "Old Guard") Kyu Nihonjin, or the ?Old Guard,? are hangers-on at their companies, lack a sense of purpose and have ceased to think. They put the preservation of internal order at their companies ahead of customers and focus on protecting their own personal interests. They have no interest in strategy, productivity or cost consciousness. And they prefer to have their worlds defined by connections and a traditional sense of obligation; they despise market competition. |
It may seem unbelievable, but this attitude is common among most Japanese
businessmen. It is, therefore, very difficult for Japanese companies to
generate profits, and returns on equity are, consequently, weak. Left
to the private sector, capital has failed to circulate adequately, so
the government has come to play a huge role as guarantor and rescuer.
The Old Guard reject free economies and their tendency to be organizationally
dependent is the cause of Japan?s prolonged recession.
There is, however, hope.
I am convinced that a transformation in the thinking of Japanese businessmen
? so significant that it could be called a renaissance -- is currently
underway. This transformation amounts to a change in values that, in terms
of degree, far exceeds that which led to the collapse of socialism in
the former Soviet Union.
People whose values are completely different from that of the Old Guard,
and they can be found in most every organization in Japan. These are the
Shin Nihonjin (literally, new Japanese) and they possess both the willingness
to change and the rational and strategic thinking that are lacking in
the Old Guard.
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Shin Nihonjin As professionals, Shin Nihonjin are self-reliant. They understand that their jobs connect them with society at large. They feel that work is meaningless if it is unprofitable; they act rationally. They respect free markets, where exchanges are based on value, and are constantly working to improve themselves in order to compete successfully. |
I want to highlight the fact that there are now two types of Japanese.
The table below summarizes differences in their attitudes and values.
Japan
is currently undergoing a significant change. This change, however, is
being stymied by the Old Guard, the same people who are responsible for
bringing the country to its current unhappy circumstances. The efforts
of Shin Nihonjin to bring about internal organizational reform are being
thoroughly repressed by the Old Guard, who hold positions of authority.
For them, changing the established order is tantamount to a rejection
of their existence. And as the opposition force, they are engaged in their
final, fiercest bout of resistance.
Presently, an intense, yet invisible, struggle between the Old Guard and
Shin Nihonjin is taking place in company organizations throughout Japan.
I count myself among the Shin Nihonjin who have participated in that struggle.
Having lost in their struggle, not a few Shin Nihonjin have left their
companies. But the end is clear and Shin Nihonjin will prevail over the
Old Guard. This is inevitable as the vast majority of ambitious young
adults are Shin Nihonjin. The critical issue is the speed of change.
I ask that those who want to build mutually beneficial relationships with
Japanese government agencies, companies and other organizations and those
who would like to see an economic recovery in Japan support the efforts
of Shin Nihonjin.
Gai-atsu, or pressure from outside, will not change the attitudes of the
Old Guard. I am asking people who deal with Japanese to scrutinize them
and determine whether they are Shin Nihonjin. I want non-Japanese to study
their Japanese counterparts, ask whether they are self-reliant, capable
of rational thought, considerate of the needs of society, and supporters
of free markets, and if they are, to support them. Identifying Shin Nihonjin
is not easy. Age is not a determinant as many in their 30s are members
of the Old Guard. However, noting whether Japanese counterparts ever mention
that they want to leave their companies because they are poorly managed
may yield a clue as to which side of the line they fall on. The Old Guard
cannot exist outside of their companies and would not make such a comment.
The greater the influence of Shin Nihonjin, the faster will be Japan?s
emergence as a new country and the stronger will be the beneficial relationships
in which it is a participant. Nothing less is dependent on the change
that is underway and the speed with which it occurs.
I perform a detailed structural analysis of the Old Guard and Shin Nihonjin
in a Japanese-language book due to be published in November 2002.
My hope is that communicating this idea to these people will help to strengthen
support for Shin Nihonjin and accelerate the pace of change they will
bring. If you find the model I have constructed to be interesting, I would
deeply appreciate your passing this message on to others.
Profile: Shinya Okamoto
Born in 1965. Worked as an editor for the monthly business magazine President,
published by President Inc., a Japanese subsidiary of TIME Inc. After
leaving this position in 1999, began examining the behavior of Japanese
businessmen, the subject of a book to be published in fall 2002. Other
works include books on IT venture companies, customer orientation, and
policy studies.
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Shin Nihonjin / Old Guard Comparison
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Summary of the Shin Nihonjin / Old Guard Comparison|
Old Guard
|
Shin Nihonjin
|
| Attitude
Group-Dependent |
Attitude
Self-Reliant/Disciplined/True to themselves and others |
| Value
Orientation
Pay Little Attention to Value |
Value
Orientation
Pursue Value
|
|
World View Have a Closed (=Company-Centered) World View Pursue
Selfish Purposes, Capable of only Vague Leadership |
World
View
Have an Open World View
|
|
View of Organizations Favor
the Status Quo, Have no Goals |
View
of Organizations
View Organizations as Places to Work With Others |
|
View of Work
Trivialize Work, Focus on Company |
View
of Work
Professionalism = Desire for Knowledge |
| View
of People
Exclusionist |
View
of People
Have a Reverence for Humanity
|
| Basic
Networking Skills
The Old Guard have no interest in information unrelated to their
work. |
Basic
Networking Skills
Shin Nihonjin have an external orientation. They have a strong interest
in intangible value and seek it out. |
|
Network Management Skills
The Old Guard understand very little about networking. |
Network
Management Skills
Shin Nihonjin have a solid understanding of the unique qualities
of network communities. ? ?
? |
|
Business Mentality
The Old Guard do not sincerely believe that their mission is to
make profits. |
Business
Mentality
Shin Nihonjin understand business to be the addition of value and
the consequent making of profits. Shin
Nihonjin have managerial sense.
|
