Contracts

One of my students works for a major computer company and discussed a bidding war for a contract with a chain of convenience stores (no, it's not the one you're thinking of). During our talk about her situation at work, we talked about the differences between the way Japanese business deals with and regards contracts and American business.

On a layman's level, I've been aware of these differences for quite some time. In general, it has been my understanding that the Japanese do not view contracts as absolutes, but rather as a starting point for business. Customers may ask for services outside of what is stipulated in a contract, for instance, and the company providing the service will comply without feeling put upon in many cases. In the U.S., companies use contracts as a way of limiting demands outside of what is stipulated in writing.

This differing view of contracts and how closely one can be expected to adhere to the terms of one can cause a lot of problems in international business deals, joint ventures, and the Japanese offices of western-based businesses. In the case of the latter, the expectations of the home office abroad can be very different than those of the branch office in Japan. The home office in a western country may have very rigid notions of how a deal should be carried out in terms of goods, services, and payment while the Japanese take a more flexible approach in accord with the expectations of Japanese customers.

For those who come over from western countries and work in Japan under contract, this flexibility can be a big headache because we expect only to do as we are asked under the terms of our contracts. The Japanese will often freely ask all employees (not only the foreign ones) to do tasks which are far outside of any reasonable description of the job you are coming over to do. Helen has mentioned in comments that she was asked to answer the phone like a receptionist while she was a teacher. Turner said he was asked to clean white boards at the end of the day (more in line with a janitor's tasks) when he was a teacher. At my old workplace, office girls had to vacuum the floors and clean the kitchen once a week. Most of the time employees are asked to regularly do things which are outside their job description as a way of saving the cost of hiring someone with the proper job title to do it. Though foreigners often feel they are being asked to work outside their stipulated contractual duties because they're foreigners, the truth is that it's because they are employees and contracts are not seen as iron-clad or limiting in the same way they are in the U.S.

That being said, my discussion with my student this morning showed that the times are changing. More and more businesses are getting serious about following U.S. business practices and laws like SOX. Part of the reason for this is that following these practices clarifies expectations and simplifies transactions, but another reason is that companies can be removed from the stock exchange in the U.S. if they don't follow these guidelines and regulations. Of course, this sort of thing only affects the really big guns. The little guys can still be as wishy-washy as they want.

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Anyone who is interested in learning more about the business practices of various countries can check out Kiss, Bow, or Shake Hands. It provides a good overview of the thought process and general ways of doing business in a good many countries.