A WINNING STRATEGY FOR AMERICAN HIGH-TECH FIRMS IN JAPAN Succeeding in Japanese high-technology markets largely depends on having the right product at the right time. Yet for U.S. firms, gaining market share in Japan also results from traveling to Japan to establish contacts and deliver the hands-on customer service the Japanese expect. We don't use the Pacific Ocean as an excuse for not visiting Japan," says Don Faria, Director of Applications and Product Planning at Altera, a California-based manufacturer of programmable logic devices. Although the company has an office and distributors in Japan, representatives from the U. S. travel overseas regularly. "If a customer needs us, we go to Japan as readily as we go to Texas," says Faria. Altera's business strategy has paid off handsomely. In 1991, the companies sales in Japan exceeded $21 million- a full 20 percent of their worldwide revenues. Though the slowdown in Japan's electronics industry made this figure tough to match in 1992, Faria considers this a very lucrative market. EXCEPTIONAL SERVICE SETS COMPANIES APART Altera's quick response to Japanese customers needs differentiates the company from the competition and displays the attentiveness that the Japanese expect of their domestic suppliers. "Japanese customers respect the American organization that will send high-level representatives to Japan right away to solve a problem," notes Faria. Cognex, a Massachusetts-based manufacturer of sophisticated machine vision systems, also recognizes the value of traveling to Japan. Frequent visits helped Cognex derive about half of its $32 million revenue from the Japanese market in 1991. "Conducting business in Tokyo is the best way to provide the level of service our Japanese customers demand," says Cynthia Selby, Marketing Communications Manager at Cognex. "Even though Cognex has a subsidiary in Tokyo, constant travel to Japan by representatives from our U.S. headquarters often makes the difference in the Japanese market," she says. "Our investment of time and customer service, coupled with high-quality products, will prove key to Cognex's long-term success in Japan." COMMUNICATION ENHANCES PRODUCT RESEARCH At Teradyne, a $530 million firm that sells automated test equipment to customers such as Sony, Mitsubishi, and Sharp, firsthand interviews with Japanese customers and prospects yield valuable Market research. "To maintain our share of Japan's commercial electronics' market, we could conduct extensive surveys in Japan before we design our products," says Joe Wrinn, Engineering Manager in the companies Assembly Test Group in Boston, "As a result, we learn exactly what our Japanese customers want." When Teradyne's market research team began the interview process, they quickly realized the importance of clear communication. On their first visit to Japan, they delivered their presentation in English. The technical and often subjective topics- ranging from product features to price tradeoffs- proved difficult to convey. For the second round of customer interviews, Teradyne accompanied the presentation with text slides printed in Japanese. "The slides helped us explain details, and the audiences appreciated our efforts to communicate in their language," says Wrinn. "Most important, the Japanese slides increased our credibility." PUBLICATIONS DRIVE HOME COMPANIES' COMMITMENT Travel is essential to good working relationships with Japanese customers, but it comprises only part of a successful strategy. To ensure that their message stays with their customers long after they return to the U.S. companies increasingly rely on sophisticated Japanese language publications. Japanese Language Services has produced a range of documents for leading corporations. These materials include Japanese language versions of new product information for Teradyne customers and salespeople in Japan, the translation of a lengthy technical paper discussing the Cognex's machine vision of technology, and the translation of a manual and several data sheets for Altera products. Altera, Cognex, and Teradyne visit Japan frequently and prepare documents in Japanese as a matter of course. Their reward is a share of the large Japanese market and affirmation of their status as world-class technology leaders. Fax International Fax International While international facsimiles offer a fast and convenient way to reach business associates in Japan, the giant communication companies that provide fax service in the United States can not necessarily provide the greatest value, reliability, or security. Enter Fax International, a company that provides an appealing alternative to the higher-priced Japan-bound fax services of AT&T, MCI or Sprint. Fax International customers save from 25 to 60 percent on faxes to Japan. "Our customers typically enjoy savings of $1.50 or more for the first minute of each fax call," says Douglas Ranalli, the company's president. "We use an advanced network that allows us to increase our transmission speed to six times the standard," Ranalli explains. "As a result, we can serve high-volume international communications routes more efficiently." At any time of the day or night, if a document encounters a delivery problem, a fax International document manager immediately intervenes to ensure delivery. Clients also benefit from 24-hour bilingual customer service and customized delivery instructions. In addition, Fax International provides unsurpassed security. Each piece of data that enters the companies network is automatically encrypted to protect against unauthorized access- a measure that major U.S. carriers cannot provide due to Federal Communications Commission mandates. Anyone can try Fax International for two weeks free of charge and without obligation. For more information, call Lauren Sitrin at 617-221-0444, extension 308 An Added Dimension in Japanese Customer Relations: Feelings Uniquely positioned between the United States and Japan, Japanese Language Services bridges the culture and business practices of both countries. In this column, we offer the Japanese perspective. Each issue will offer interviews, observations, or opinions on topics to help you sharpen your business skills and enhance your success in Japan. Much of this information cannot be read on the surface of Japanese culture and proves stubbornly elusive to newcomers. A perfect example is the high value the Japanese place on feelings. One of our Japanese clients recently noted: "When we buy from Americans, we're often frustrated that the salesperson disappears after closing the sale. This particularly upsets us when difficulties arise. Even if we learn to navigate through different departments to solve the problem, no one person responds to our feelings." For many Americans, feelings, may seem a rather abstract criterion by which to conduct business. yet the importance of feelings to the Japanese cannot be overstated and should never be taken lightly. If Japanese customers feel uncomfortable, they have reason enough to take their business elsewhere. To the Japanese, business relationships represent more than commercial exchanges. They view their interactions as a series of finely tuned links between people. In business and personal ties, the Japanese place an extremely high value on loyalty, responsiveness, and accountability. Japanese customers must sense that their suppliers will make every effort to follow through on promises and avoid the shame of failing to deliver. To this end, American firms should make customer service their top priority. Americans who work directly with Japanese customers must exhibit excellent character, and businesses should allow these representatives to establish the familiarity and trust that grows from working with a client over a long period of time. Above all, American business people in Japan must do whatever they can to fulfill their promises and go beyond merely satisfying the contract. To compete in the Japanese market, Americans must extend their customer relations efforts and establish comfortable, trusting affiliations. BARGAIN AIRFARES: While frequent visits with Japanese customers can help Americans succeed in Japan, travel costs make many customers think twice. Fortunately consolidators such as I.A.C.E. Travel offer fares well below published rates. Fall 1992 fares averaged $800 RT between the East Coast and Tokyo, and $700 RT between the West Coach and Tokyo. All seats are in the coach class, availability is limited, and schedule changes incur large penalties. Yet the savings might allow for the occasional extra trip that wins your customers trust. I.A.C.E. can be reached at 800-526-4223. In Washington D.C. dial 233-9400. While travel agents will answer in Japanese, they are bilingual. LEARNING JAPANESE: It takes years to reach business-level fluency in Japanese; however, a basic knowledge of the language helps build relationships and makes doing business in Japan more fun. Beginners can reach conversational level in two to three months with the Pimsleur Tapes, a self-instructional language cassette program. To order, contact the Cassette Learning Center at the Harvard Cooperative Society in Cambridge, Massachusetts at 800-222-5860. "Japanese 1" (30 units) costs $249.95. To learn to read Japanese, we recommend using Easy Access to Reading Japanese after completing approximately 30 hours of study with the Pimsleur Japanese 1 cassettes. The two volumes cost $48 each. Phone orders are welcomed from the Kinokuniya bookstore in New York City at 212-765-1461 or in San Francisco at 415-567-7625. Students of all levels will enjoy Mangajin, a magazine that teaches Japanese language and culture using excerpts from comic books read by millions of Japanese adults as well as teens. Call 800-552-3206 to subscribe. Mention Japan Insider to receive a ten percent discount off the regular $30 subscription price. The Japanese Business Calendar WINTER/FUYU YEAR OF THE ROOSTER 1993 The influence of the seasons is felt in all aspects of life in Japan, even in business. Thus, we will use the cycle of four seasons as our framework to highlight important events on the Japanese business and social calendars. January 1st (Ganjitsu) is a sacred holiday, part of the Shogatsu period (late December through early January) of rest and renewal. Business shuts down and Tokyo empties as people spend time with their families. Employees visit their bosses' homes during this time to offer New Year's greetings. On the day work resumes (usually January 4th), women wear traditional kimonos, and special ceremonies mark the first product shipment of the year. Some of these customs are observed only by the large traditional firms such as banks and trading companies, yet everyone feels a sense of renewal and purification, and the special significance of the "first" of each activity in the new year. Most companies hold departmental New Year's Parties (Shinnenkai) in early January. Some companies also hold larger parties to which people throughout the company, as well as suppliers, customers, and affiliates, are invited. While business is not directly discussed, contacts made at such events hold a lasting importance throughout the year. Another New Year's custom observed by some traditional firms is to mark business cards passed out early in the year with a special red stamp (Gasho). This reminds recipients that the meeting occurred during a particularly auspicious time of the year. February 14th brings Valentine's Day, an occasion when women give chocolate to men in the office. If you choose to participate, remember that every man in the office must be given at least one chocolate. Men return the favor on March 14th, or White Day, and the same rule applies. Income tax forms must be filed on March 15th. March 31st is the end of the fiscal year in the government and most companies. Most activity in March centers on settling all the year's accounts. though a last-minute order may be snagged from a client using up a budget surplus (which is much rarer these days). New university graduates formally join the company as a group on April 1st after a period of training in late March. Those who have joined large companies will receive raises and promotions in tandem for many years, until some move to the fast track in their 40's. A special bon (and an important network) remains throughout the careers of all members who started on the same day. Cherry blossoms (Sakura) start to appear in Okinawa in January, and by the end of March television coverage of their northward movement heralds the coming of spring. Mark your calendar. No business is conducted in Japan on the following national holidays: January 15 Coming of Age Day February 11 National Founding Day March 21 The first day of spring _________________________________________________________________ JAPAN INSIDER Copyright 1993 Japanese Language Services, Inc. All rights reserved. PUBLISHER: Carl Kay EDITOR: Laura Silverman WRITING AND PUBLISHING SERVICES: Philip Johnson Associates, Inc. Japan InsiderJapanese Language Services, Inc. 186 Lincoln Street, Boston, MA 02111-2403 Phone: 617-338-2211 Toll-free: 800-USA-JAPAN Fax: 617-338-4611 _________________________________________________________________ E-mail: insider@japanese.com World Wide Web: http://www.japanese.com