Global Leadership through Business Innovation and Integration (November 9)

The following is a summary of the panel discussion “Global Leadership through Business Innovation and Integration” at the 2015 U.S.-Japan Council Annual Conference in November 2015. 

Ms. Linda Taira opened the session by introducing the speakers, noting that the word Womenomics had been coined by the panel moderator, Ms. Kathy Matsui, Vice-Chair, Goldman Sachs Japan Co., Ltd.

Ms. Matsui’s first question was on what the panelists wanted to be when they were young. Mr. Paul Yonamine, Country General Manager and President, IBM Japan, Ltd., the son of athlete Wally Yonamine, answered that he was interested in becoming a baseball player. Mr. Takeshi Niinami, President, CEO, and Representative Director, Suntory Holdings Limited, stated that he wanted to be a pilot and a shinkansen conductor.

Ms. Matsui then noted that the panel would look at the integration of U.S. and Japanese business practices and innovation for global expansion. Her first question was for Mr. Niinami, asking about Suntory’s selection of Mr. Niinami for president despite being a tightly-controlled family business and the keys for transforming such a Japanese company into a globally competitive one. Mr. Niinami answered by describing Suntory’s acquisition of the American company Beam Inc. There is a large culture gap between the companies, and Mr. Niinami stressed frequent discussion, especially face-to-face conversation, finding shared values, a long-term vision, and mutual respect as the keys to communication and success. He also mentioned Suntory University and noted that he stresses learning English to the company’s Japanese senior management. He emphasized learning about other cultures to drive collaboration, because culture forms the basis for all decisions.

Mr. Yonamine stated that integrating diverse cultures is a long process, and said that the pressure lies on managers and CEOs to be multicultural to drive the results. Mr. Niinami agreed that leadership is important, and noted that Japanese leaders must overcome the Japanese cultural trait of avoiding conflict to be able to argue their points in front of people from other countries.

Ms. Matsui asked Mr. Yonamine about his experience in running a “glocal” company in Japan. Mr. Yonamine said it was an honor to run the largest American business in Japan. IBM Japan is in a unique position because it has been in Japan for 78 years and many of its customers consider it a Japanese company. However, IBM Japan makes a concerted effort to be in sync with its headquarters and global developments.

Ms. Matsui asked about specific global efforts that IBM Japan makes. Mr. Yonamine mentioned the company’s innovation, including its partnership with SoftBank in robotics for the Pepper robot. He also mentioned IBM Japan’s alliance with Apple and investment in iPad infrastructure, including the provision of meaningful iPad services for the elderly. He noted the importance of robotics in care for the elderly, and said Japan is positioned to be a global leader in this area.

Ms. Matsui asked about past experiences that have shaped their success. Mr. Niinami said that when he was at another company earlier in his career, he became disappointed with the heavy drinking culture. He instead joined a study group that ended up producing great leaders. He created a joint venture with a French company that provided meals to the elderly, in which he fixed flawed meal times. He emphasized that he tried to be different from others and continuously challenged himself. His next challenge is to find how Suntory can differentiate itself from other companies.

Ms. Matsui noted that Mr. Yonamine is fluent in Japanese and asked if he sometimes pretends to be more Japanese in his mannerisms and behavior. Mr. Yonamine said that when he was at KPMG in Los Angeles, his customers came to him because he spoke Japanese and understood Japanese business culture. His customers would also ask him to help them in many other tasks, which led him to realize that helping others was very rewarding for him personally. He then said that many times he needs to be quite provocative, aggressive and creative. Although his Japanese sales staff sometimes finds this challenging, he takes this approach for the benefit of the customers.

Mr. Niinami stressed the value of diversity for innovation, noting that it is hard for Japanese companies to appreciate different values. This is the reason he founded Suntory University, which brings together people from all over the world to discuss innovation. He emphasized that it was important for CEOs to have a strong commitment to diversity. Mr. Niinami then described the differences in employment conditions and compensation in Japan and the United States, noting the existence of lifetime employment in Japan and higher salaries in the United States.

Mr. Yonamine said that people often have negative perceptions of the Japanese workforce. He said that he nonetheless admires Japanese workers and their great motivation. However, times are changing and foreign companies are entering Japan with disruptive technology, which will require Japanese companies to accelerate their efforts. He stressed the importance of programs like the U.S.-Japan Council’s Silicon Valley-Japan Platform. He also discussed IBM incubation centers, which provide people with opportunities to fail and learn from their experience. In terms of hiring, IBM Japan has shifted to individual compensation systems to reward success and to take into account diversity among employees.

Ms. Matsui then asked what the panelists would do if they were prime minister of Japan. Mr. Yonamine said that Prime Minister Abe is doing an excellent job with efforts to spur innovation, but noted that there needs to be further innovation in corporate Japan. Mr. Niinami said he agreed with Mr. Yonamine on Prime Minister Abe, but stressed the need for job mobility and a willingness to fire people in Japan. He stated that mobility is good for society, but also noted the need for laws on severance pay. He said laws should change to support foreign workers, citing the example of foreign people who come to Japan for training programs and then must return home.

Click here to learn more about the 2015 Annual Conference