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  • Jun Fujita

Common mistakes I've seen on managing the Japan business

Updated: Dec 17, 2020

I've spent over 20 years in software industry in Japan and worked for a large multi-national enterprise such as Microsoft or SAP and a smaller startup such as GitHub or Auth0. If I can recall correctly, I've reported to over 20 managers who don't live in Japan and managed over 200 people in Japan as total. Through my experience, I've observed common patterns that I consider as mistakes to manage the Japan business.

Overly assume Japan as a unique or different market

I would say that there are 90% or more similarity between your market and the Japan market. Pains your product is solving will be same. Values your company provides will be same. You will provide same subscription model. Customer demands same things as customers in your country such as a reliable, scalable, easy to use, secure, reasonable priced, useful, and novel product from you. Uniquenesses or differences of the Japan market I can think of on top of my head are lower maturity on technology at senior management level, language (of course), and unclear (and long!) decision making process.

I've seen so many companies assume Japan as a totally different market and give too much autonomy to the local team or conduct too much micro-management to the team. So, my two cents will be to make sure to be absolutely sure if it is mandate to do something special to the Japan business. Otherwise, work with the Japan team as same as you work with your team in other regions. Make sure that the Japan team is included and visible in the circle where people learn from each other to grow their business in their regions.

Expect something magical will happen

May be this is the most common one I've seen. I cannot emphasize enough that it will fail if you expect that your business will take off once you hire a hunter type strong sales/a gray-hair-well-connected veteran, or sign a reseller contract with a national software reseller in Japan. Why? - Because you are trying to sell to one of the most conservative and un-educated (in terms of technology) people on the planet. It will be a too heavy lifting work for single person and/or outsiders such as resellers. Your sales person's contact list will dry up soon and the reseller won't be ready to sell your product for months.

You need to have a person who is excited to tell stories on what kind of good things your product can do to the customers and why they need to care about you. As that person gather more attention from customers and partners, s/he will build an autonomous lead-gen engine before you hire a sales person. A strong sales can close a deal but they won't be good at making people to be excited about your product at large scale. A national reseller may have 1,000 existing customers, but they won't be excited enough about your product to have 50 sales calls without a sales. There is no silver bullet on market entry but first thing you need to do is make people excited about your product. Then revenue will follow you.

Ignore the fact your brand is not as strong as in your home country for hiring

Hiring has been the worst headache for me. I know (more accurately, believe), I'm good at growing the business from scratch in the Japan market. And often time, hiring is one of the most tricky one among other GTM activities because the brand is not strong enough to attract A-players in Japan.

It's very frustrating to spend 6 months speaking with candidates to fill a role and never find a person who is above the bar for hiring. Even if I work with one of top recruiting agency in Tokyo area, it's common that I don't find the one I want to hire for months. You need to have strong brand visibility in the market before you make 1st hire if you want to attack A-players.

In Japan, letting people go is very difficult and delicate thing because employees are protected local labor law that is extremely favorable for employees. My recommendation is to wait until you are comfortable that your brand is strong enough to attract A-players and work on things to warm up the market instead.

I hope this was helpful for you. I'm not saying the Japanese market is a bad market. In fact, customers will be very loyal to you once they start to working with you. But, I must admit that initial phase of your business in Japan will be a tough one.

Please let me know if you'd like to make it easier. I believe we can help you to warm up the market for you.

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