Inside the Japanese Company

Fiona Graham

• Publisher: Routledge
• Year: 2015
• eBook ISBN: 9781134400362
• Edition: 1
• Topic: Política y relaciones internacionales
• Subtopic: Política

Graham explores the attitudes of Japanese employees towards their work, their company and on related issues. Based on extensive original research inside a Japanese insurance company (C-Life), which subsequently went bankrupt, the book shows that attitudes towards lifetime employment, company loyalty and the other characteristics of Japanese working life, which are often portrayed in stereotype form in the West, are in fact more complicated than is at first apparent.

1 Introduction

In early Japan literature, the stereotype of the Japanese company was a large, white-collar organisation with hundreds or even thousands of employees. It is only over the past decade that this picture has been balanced by studies of other types of Japanese companies and employees – blue-collar companies, small companies, female workers and so on. In fact, the backlash has been so great that the large white-collar company has now become somewhat neglected. This book seeks to redress the balance by providing an in-depth view of employee life inside a rather typical, large, white-collar traditional company. It looks at what everyday life is like for the very many Japanese employees who work in such companies, and investigates the dynamics of the social relations inside the company.

Before introducing C-Life, the company which is the subject of this book, it is necessary to describe briefly its economic context. My purpose is not to give an exhaustive account of the Japanese economy; this book is not intended as a detailed description of the company’s economic situation or the nature of its business. Rather, my intention is to describe the everyday life and social relations of its employees, and what I present here is offered merely to set the context for the fieldwork which follows.

The economic background

In 1945 Japan was in ruins, with up to 80 per cent of some of its cities destroyed. No-one could have predicted the amazing turnaround that would be achieved by 1950. In five short years, Japan had achieved financial stability, rebuilt large parts of its cities and industries and recommenced trading. In fact, the country had been so successful that its income per capita was higher than the pre-war level, and its industrial output had actually doubled. In the following decades, Japan continued to defy economic analysis by expanding at an unprecedented pace for a non-Western nation.

But by 1986 and 1987 economic growth had slowed down as the yen rose. The central bank lowered the official discount rate from 5 per cent to 2.5 per cent to boost the economy. This sparked a massive economic boom: money was poured into the stock market and the property market. These investments were financed by using land and stocks as collateral for the credit, which meant that both land and stock prices were pushed through the roof in a seemingly endless upward spiral: the ‘bubble’.

The benchmark Nikkei index reached its highest point on 31 December 1989. And then it collapsed; the Tōkyō stock market crashed, and the ‘bubble’ burst, with devastating results. By the end of 1990 the Nikkei had dropped 50 per cent. It kept on falling over the next ten years, dropping into the 12,000s in 1999, a 70 per cent decline from its peak. As stock prices plummeted, the price of the land supporting the borrowed credit also tumbled. The banks were suddenly facing enormous bad loans, and became increasingly reluctant to lend further – especially on the basis of property. So there was no support for companies struggling in the aftermath of the stock market crash, and they began to go bankrupt at record rates.

The banks themselves began to fail. This in turn sent stock prices crashing even lower. Japanese companies are mostly tied together in a complicated system of cross share-holding, begun as an attempt to fend off corporate raiders. At the height of this system, more than 60 per cent of shares were held in cross shareholding arrangements and were never traded, thus aggravating fluctuations in an illiquid market. With the bursting of the bubble, many companies decided to start unwinding these cross share-holdings, exacerbating the negative spiral.

With the collapse of the bubble, it now became evident that Japanese companies were far from uniformly successful. In fact the financial industry was astonishingly backwards compared to the manufacturing sector. The Japanese were rather badly prepared for the ten-year economic downturn that followed the crash, a downturn that was exacerbated by the effects of deregulation and increased competition from foreign companies. Rather than reacting aggressively to the changed environment, many companies still seem at a loss to know what to do.

The slump has now lasted for over a decade. With the passing of the old economic climate, change has come to the corporate culture that once seemed immutable and monolithic. As companies flounder, their employees are forced to re-examine the old ideals of life-time employment and self-sacrificing loyalty.

The literature

The topic of Japanese management has been of more than academic interest to many people. As Fuse (1990: 24) aptly puts it: ‘Faced with the startling economic progress of Japan, the world was first stunned into amazement; the amazement was eventually turned into admiration and envy, and finally in the 1970s the admiration was transmuted into open fear and covert hostility.’

During this period, economists were understandably eager to explain the reasons for the Japanese ‘economic miracle’, and if possible to replicate it. Different theories were devised to explain Japan’s economic success. Some were purely economic, attempting to explain the success in terms of manufacturing systems or Japan’s late development compared to the West; others tried to explain the success by use of cultural factors. Japan at the time stood out as the sole counter-example to Western economic theory, which basically contended that non-Western nations would develop into Western-style capitalist economies as they matured. Japan’s success was unprecedented for a non-Western nation, and this raised, for the first time, the possibility that successful non-Western styles of capitalism would be possible in the modern world. Was this due to clever economics? Or was it something deeper, within Japan’s national identity and culture?

Academics tried to identify the elements of Japanese culture that might be at the root of it all. Was it due to the way in which Japanese workers are trained, or to their unique decision-making systems? Was it because Japanese are inherently hard-working, or was it more to do with Japanese values, which have traditionally stressed loyalty, harmonious relations and diligence? Was the miracle a nation-wide phenomenon, happening in all companies, or was it in fact only a small percentage of companies that were successful while the rest of the country rode on their coat-tails? And crucially, could the factors which brought about the miracle be imported into other countries?

Many theories went along the lines that the Japanese are ‘different’, which was why they had created an unprecedented new style of capitalism on a Japanese model. The so-called ‘nihonjinron literature’ – or theories of Japaneseness – were touted by a range of academics from anthropologists to psychologists to brain specialists. Although long debunked by the spectacular demise of the bubble economy, this literature is particularly interesting as an example of a native people making cultural interpretations of their own economy. This genre of literature has now largely disappeared, and the rational economic theory versus cultural debate is largely subsided. Yet the literature remains of interest because it describes the ideal that many Japanese held of themselves and of their country. This is why this genre of literature was overwhelmingly popular with a mass audience.

The collapse of the bubble, and the realisation that the Japanese were subject to the same economic laws as everyone else after all, provoked an immediate backlash to the ‘theories of Japaneseness’ literature. Books with titles like Japan as-anything-but-number one (Woronoff 1991), which had already begun to appear even during the 1970s and 1980s, multiplied. It was realised that the first genre had attempted to explain Japan’s success in terms of Japanese traits, but mainly described an ideology, mistaking it for reality. So now, the new literature rejected this blind idealism in favour of rather negative descriptions of the ‘reality’. Authors aimed to describe what they saw in the workplace rather than what people there believed. In other words, the idealistic portrayal of Japanese society in the nihonjinron literature was replaced by accounts covering common negative elements: gross inefficiencies of many companies, cruel training, ruthless competition, bullying, forced dismissal and so on.

Neither the old literature nor the new provided a balanced account of both the ideology and the practice. Anthropologies of large white-collar Japanese companies have been rather sparse in the following years, or they have looked at issues other than that of ideology and practice. This book aims to redress the balance. In it, I look at both the ideology and the practice of working life in a large company, and at how the employees trod their everyday working lives between the two extremes.

C-Life

C-Life was founded in 1904 by Ikunoshin Kadono as a mutual insurance company – the first in Japan with an Anglo-American structure. In 1999, the total value of life insurance in force was 54 trillion yen. The company had traditionally been the smallest of the so-called ‘big eight’ life insurers, but in 1999 it was struggling to maintain position as a major, having had a series of bad results as Japan’s economic downturn in the 1990s worsened.

The central C-Life building is in an unusually suburban location for a major Japanese insurer. It is at NM station, two stations from Shibuya, in a thoroughly suburban area of Tōkyō. Go down the steps outside the station and you will find yourself on the busy thoroughfare Yamate Dōri. Walk to the right for a minute or two; turning right again one enters NM Ginza, a small shopping street gaily decorated with coloured lanterns and plastic flowers celebrating the season. This is the main artery of the suburb, and home to C-Life. Among the mainly residential area of two-storey shops, houses and small business, the huge C-Life building towers, dominating the surrounding landscape. The main buildings fill two sides of the block of land and the rest is sculpted Japanese garden, unusually large and beautiful for a corporate headquarters in Japan.

The 1999 annual report says of the company:

C-Life has grown into one of the leading life insurers in Japan. This steady progress is rooted in our alertness to emerging trends, the skills of our financial professionals and the confidence of policy-holders.

However, C-Life was, at this stage, generally recognised by analysts to be the weakest of the life insurance majors. All eight of the industry leaders showed a decline in income from insurance premiums for the fiscal year ending March 1999. But C-Life fell the most, by 23 per cent. And over the same year, the company’s investment income dropped 23.1 per cent, premiums were down 42.1 per cent, and total assets fell 13.3 per cent.

The fieldwork

My experiences during several extended periods of fieldwork at C-Life form the basis of this book. I was at the company in several different capacities, over a total period of 15 years. The first and most substantial period of fieldwork was the two years I spent employed at C-Life as a fresh graduate. I worked there as a regular employee in the International Department for a two-year period from 1985 to 1987. As a trainee I was assigned to help Mr Y, who was in charge of buying and selling international shares. My work involved analysing foreign companies, buying and selling, doing the paperwork for the transactions, keeping track of the daily share prices, and producing the profit and loss statements of our portfolios every week. Although the responsibility for my portfolios rested, of course, with my seniors, I did all of the day-to-day investments for a two billion yen stock portfolio. I also taught English to members of the International Department for one hour a day during lunch hour, and did occasional English-related work such as producing the English-language annual report.

At that time in Japan, it was very unusual for a Westerner to be employed as a regular employee, as it was normally only possible for graduates of the Japanese school system. The linguistic and cultural difficulties normally prevented foreigners from working with the same status as normal Japanese employees. However, I had already lived in Japan for a period of nearly ten years by the time I was hired by C-Life. I graduated from both high school and university in Japan in the same manner as a Japanese student, and lived for some years as part of a Japanese family. This experience offered me the opportunity to be integrated into Japanese life and society to an unusual degree.

C-Life originally decided to hire me because they thought that my unusual background would enable me to fit in with the totally Japanese world of the company, and with Japanese-style management. I was the first Western woman to graduate from Keiō, a university that provides 30 per cent of regular C-Life employees. Although I originally had no intention of being employed in a Japanese company, this opportunity was too good to resist.

A number of factors persuaded me to stay at the company. First, when I graduated, C-Life was one of the most prestigious and coveted employers. In Japan, all of the industries and companies in Japan are ranked by the media in order of preference for entry each year. As employment is generally long term in Japan, the criteria for being highly-ranked on these lists include future growth of the industry, its present state, personnel policies and numerous other factors. The life insurance industry was the top-ranked industry in Japan that year, and C-Life was the seventh company within the industry. At the time, joining such a high-ranking organisation was considered very important by most fresh graduates.

Moreover, the position I was offered was very unusual. By accepting the job at C-Life I became the first Westerner ever to work as a normal employee in the Japanese life insurance industry, the largest in the world.

At the same time, I recognised a unique opportunity to do fieldwork. Although the nihonjinron literature dominated at the time, I knew that the reality of working in a Japanese company was quite different from the rosy picture painted by the literature. I wanted to document a Japanese company as an insider would experience it.

My second period of fieldwork took place during a summer some five years after I left the company. I revisited my colleagues and wrote copious notes on the company structure and organisation in preparation for my master’s thesis. I also distributed a comprehensive survey to those employees who had been members of the international section during the period under study in 1985–7. The responses I received shed considerable light on the employees’ feelings about job satisfaction and motivation.

I carried out the third stint of fieldwork in late 1999 and 2000, whilst making two anthropological documentaries, one of which was to be shown on NHK. I was lucky to have access to the company at that time. Because of the precarious financial state that C-Life was in by this stage, not even the Japanese media had access to interviews with top officials. Yet I was able to film C-Life’s employees with relative freedom.

During the months that I spent filming in the company, I interviewed all of the international division employees whom I had worked with and followed over the duration of my involvement with C-Life. I also interviewed a number of high-ranking officials, some retired members of the division, and members of the publicity department and the personnel department. The first documentary focused on the international department; the second focused on the members of my own year-group (my ‘dōki’), including those who had since left the company. It is this period of fieldwork that is most represented in the present work, since I have made extensive use of the transcripts of the interviews that I carried out at this time – although of course my understanding of the issues raised in the interviews dates back to my period of employment in the company.

I have made extensive reference in my descriptions of C-Life to the work of the anthropologist Thomas Rohlen, who studied a Japanese bank for a year, as his work is one of the most complete anthropologies of a Japanese organisation. Rohlen’s work is one of the few studies to focus on the head office of a service industry organisation in Japan, as opposed to the extensively described manufacturing or blue-collar organisations. However, my study differs from Rohlen’s in important respects. First, it is based on fieldwork conducted at three different times over a 15-year period – a period, moreover, of great economic change, during which the company went from great prosperity to imminent bankruptcy. So my study describes the company in transition, whereas Rohlen’s is more like a snapshot of one year in the life of his organisation. Second, as an actual employee of the company, I enjoyed a degree of access and participation unavailable to outsiders.

Note on the advantages and disadvantages of my position in the company

During my first period of fieldwork, I was a participant in C-Life in a way that would have been impossible for an anthropologist coming to study the company from outside. As a new employee in the company I was unable to gain an all-encompassing understanding of the organisation, and I did not try to do this. Instead, I got to know a narrower group of individuals very well who made up one section of the company – the international division. My goal was to explore and fully understand the everyday world of company employees.

Outsiders find it much more difficult to operate in the Japanese company with freedom, even if they are a former employee, as I found in my later follow-up studies. For the subsequent visits for the purposes of my doctoral research, I returned as an observer and an outsider. My status as a documentary producer and co-director of an NHK programme, and as an ex-Reuters financial journalist whose job included reporting on the Japanese economy, gave me a very different perspective on the company and reception. Nevertheless, although I was treated by the company with considerably more respect than when I worked there, I was still treated as an ex-employee. This meant that I was still more of an insider than an anthropologist studying the company would normally have been. It was noticeable that I ...

Table of contents

• Cover
• Halftitle
• Title
• Copyright
• Contents
• 1. Introduction
• 2. Literature review
• 3. The company and structure
• 4. The company and career
• 5. The company and life
• 6. The company and human relations
• 7. Ideology, groupism and individualism
• References
• Index