HR Management Consulting for Japanese Business Abroad
Identifying optimal HR management models for Japanese offshore subsidiaries is critical for successful expansion. Our HR consulting services can deepen your foreign colleges’ understanding of Japanese work culture while simultaneously harmonizing traditional Japanese practices with cultural norms abroad.
How do overseas business cultures differ from Japanese culture?
Japanese companies are accustomed to traditional HR management models, where each batch of new graduates are recruited for the purposes of long-term employment. This recruitment model cannot always be replicated overseas, where values of individual independence and freedom in career development are more prominent. To attract talent and ensure that offshore offices remain staffed, HR management models need to be adapted for different work cultures overseas.
Uniqueness of japanese HR management practice
| Japan | Outside of Japan |
|---|---|
Batch recruitment of fresh graduates
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Position-based recruitment
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Life-time employment mindset
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Employment agreement upon free will
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Value on learning & sharing as a team
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Value on independency & collaboration
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Three guidelines for HR management in Japanese companies
Most Japanese companies have seen success with long-term employment models. However, the business landscape overseas is a lot more heterogeneous. Some companies may favor loyalty while others are accustomed to regular turnovers. This introduces new challenges when developing talent for Japanese subsidiaries.
That said, optimizing HR management strategies of overseas Japanese subsidiaries does not have to be an insurmountable task. The following three points outline key areas that HR teams of Japanese companies may focus on when overseas:
1. Aligning Japanese practices and business culture with strategy objectives
Generally speaking, the HR management’s main objective is to accelerate business growth via organizational and employee development. Organizational structure and employee development plans will vary greatly between companies. Expanding a business globally will require Japanese companies to weigh organizational and human resource issues on a case by case basis that takes into account both present and future needs.
5 stages of business expansion from Japan to overseas
| 1. Export from Japan | 2. Local operation (Production, Sales etc.) | 3. Cross-boarder business management | 4. Global/Regional Integration | 5. Transnational management |
|---|---|---|---|---|
Key features
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Key features
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Key features
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Key features
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Key features
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Business issue Market expansion |
Business issue Localization |
Business issue Value maximization & cost optimization |
Business issue Organization change under shared value |
Business issue Business portfolio management |
Required Organization Collaboration with local partner |
Required Organization Cross-functional collaboration |
Required Organization Value chain optimization |
Required Organization Global/regional governance |
Required Organization Reinventing operation model |
Required Talent Bilingual staff |
Required Talent Capable local staff |
Required Talent Experienced manager/ specialist |
Required Talent Visionary leader |
Required Talent Affluent leadership pipeline |
2. Focusing on key issues in HR management
Two core metrics guide decision making in HR management: Business growth and management resource optimization. Evaluating business according to these metrics will vary depending on each business’ developmental phase. To execute HR management effectively even under resource constraints, key issues must be correctly defined from the outset to so that the appropriate course of action can be identified.
Priority focus for HR management at each stage of business development
| Starting | Expanding | Enhancing | Shrinking |
|---|---|---|---|
Typical business issues
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Typical business issues
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Typical business issues
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Typical business issues
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Initiative to Grow
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Initiative to Grow
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Initiative to Grow
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Initiative to Grow
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Initiative to Optimize
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Initiative to Optimize
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Initiative to Optimize
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Initiative to Optimize
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3. In-depth understanding on cultural diversity
Incentives for recruiting, developing, and retaining talent can vary greatly between countries, regions, or even individuals. Having a proper understanding of each country's culture and social norms will provide solid grounding for introducing performance assessment and rewards criteria.
Finding common ground between different work cultures
In-depth understanding on cultural diversity
Common factors
- Hierarchy
- Respect for the region
- Pragmatist
- Fun priority
- Polite expression
- Followership
- Disciplined
- Strict punctuality
- Humility
- Respect for seniors
- Generosity
- Emotional sensitivity
HR solutions for effective workplace practices in Japanese companies
The following six steps outline how HR management can identify critical issues and formulate solutions accordingly. Rather than adopting these steps wholesale, our HR consultants will help you find a unique solution that incorporates Japanese work culture and practices to cohesive office environments.
| The six step approach to enhancing HR management | |
| 1. Visualize current state |
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|---|---|
| 2. Define future goal |
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| 3. Develop required policy |
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| 4. Develop capability |
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| 5. Manage the change |
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| 6. Foster as culture |
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The right tools for Japanese companies expanding overseas
Receive unique solutions for overseas subsidiaries of Japanese companies. With strong bilingual support and an in-depth understanding of HR practices in multinational Japanese companies, Mercer Asia Japanese Business Advisory team will help your organization transition overseas smoothly using Mercer’s proprietary global methodologies.
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Organization and HR strategy design
Develop mid-term organization and HR strategy complete with specific actionables based on comprehensive diagnosis from Mercer JBA consultants. -
Rewards policy and process design
Design a rewards program that brings employee satisfaction while meeting business needs based on market benchmarks and policy design principles provided by Mercer JBA consultants. -
Talent management policy and practice design
Develop comprehensive talent management policies such as recruitment, development, internal mobility, and retirement by drawing links between organizational structure and workforce planning. -
Organizational design and capability development
Mercer JBA consultants will help bring clarity to the future roles of HR functions as well as plan for long-term organizational structures by developing HR processes based on customized analysis. -
Designing employee health and benefit policies
Identifying employee health risk and understanding how it ties in with business resilience is crucial to designing attractive benefits program that are also cost-effective. Mercer JBA consultants can help you identify the right external partners that provide you and your employees with the best coverage. -
Designing retirement benefit policies
Take care of your employees’ financial wellness long after retirement with the right external partners that Mercer JBA consultants can find. We will help you develop pension plans and deliver models that line up with market benchmarks.
Shaping how you should think about transformation
Our Japanese Business Advisory (JBA) team
Let’s get started
Your journey to integrating Japanese business culture with overseas offices for a seamless global expansion starts here