Doing Business with Japan, part 3.

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Japan's global role for the environment

Although the Japanese have attained a high standard of living, many don't realize that the crowdedness of the country and the lack of natural resources has forced the Japanese to do without many luxuries we take for granted in the West. Good examples might be central heating or running sewers. Most Japanese homes, even in the big cities do not have central heating. Instead they rely on kerosene or electric heaters (often disguised by all sorts of high tech features like alarms and timers) or low kotatsu tables fitted with heating coils on the underside and heavy blankets. As a result, Japan's energy consumption is lower than that of similarly developed countries and Japan makes an excellent example of a "slim" country.

Unfortunately, this is quickly changing as Japan continues to try to "catch up." Since Japan and the US in particular tend to set the example for developing countries, it becomes all the more important to send the right message. The world's known natural resources can probably not long sustain billions of people should they all develop central heating and become as wasteful as the United States. Japan and the US both have an Achilles' heel in the sense of not thinking from the very beginning about the social and environmental consequences of the technology we develop. We should make these difficult decisions quickly in order to provide good examples to countries like China as to why they should as well.

Japan and the world: an important partnership

The US-Japan partnership is critical to the success and stability of the world economy. Japan plays a quiet but important role in all sorts of events around the world. For example, the president of a midsize Japanese manufacturing company in Nagano, enjoys watching CNN coverage of bombs hitting their targets in various arenas where the US uses certain technology (including recent forays in Iraq and former Yugoslavia). The reason is that he claims that he can count the amount of money that he is making which each strike. Each of the missiles used contains a gyroscope in it and his company provides the only machinery that can be used to manufacture those gyroscopes.

The point here is not to condone a cavalier attitude towards war and global conflict, but to demonstrate how his situation says a lot about how much we rely on Japanese technology in so many aspects of what's going on in the world today. In business, manufacturing, and even the military, if Japan wasn't here, the world would certainly be a different place. The world relies on this partnership.

Even with very promising technology, a small company in the US needs a Japanese partner in order to achieve maximum potential. If one's partners are well-chosen and one has the finesse and sophistication to deal with large Japanese companies that have a very different corporate culture and society as well, then there truly are limitless possibilities for your technology. These possibilities span well beyond the Japanese market because the input and advice you receive from the Japanese can help in American markets and around the world.

When weighing the difficulty of accessing the Japanese market, one should consider how much potential there is in expanding beyond Japan as well. What kind of access to the world's markets will be available once Japanese partnerships are in place?

The sun always rises again tomorrow

Given the recent boom in the US economy and downturn in many Asian economies, including Japan, many American high-tech firms have begun to neglect Japan. Journalists will have us believe that the sun has already set on Japan, the land of the rising sun, but perhaps they are forgetting that the sun always rises again tomorrow.

The American media has made much out of the recent financial problems on many of the keiretsu, claiming that the entire system is about to collapse. An typical article would be Mitsubishi: Fall of a Keiretsu in Business Week. But the keiretsu are not disappearing. They are an essential part of Japanese society -- the keiretsu system has historical roots leading back to Japan's feudal period. They will continue to transform themselves, but they will certainly not disappear any time soon. The considerable power they still hold makes them critical when devising a market entry strategy for Japan.

In considering the future potential of Asian markets, one should consider the circumstances of their historical development. China, with its massive population and recent overtures toward constructing institutions of democracy and capitalism, may at present seem the most promising Asian market. On the other hand, considering the sheer size of China in terms of geography and population, is it safe to assume that institutions of communism and differences in regard for human rights can be so quickly transformed?

Likewise the boom in many Asian economies in the last decade seems to have been economic development in its early stages. Japan is among the most mature economies in the world. The industrial momentum that Japan has achieved during the twentieth century is not easily arrested. Surely, Japan must undergo some difficult structural changes, but it will emerge from its present situation in a stronger position than it was before.

Now is an excellent opportunity to begin to forge strategic relationships with Japanese partners in order to take advantage of opportunities to supply next generation technologies in the world economy of the twenty-first century.