Tokyo - Each April, hundreds of new graduates report for
work in Japan's corporate world, all on the same day, all dressed in standard
business black, and all ready to be moulded into staunch company loyalists.
Across the country, companies select and groom new staff
under a decades-old formula that puts an emphasis on loyalty, diligence and
conformity, not the visionary or out-of-box thinking that experts say corporate
Japan badly needs to halt its decline.
The current heads of Japan's companies are often criticised
for failing to keep pace with fleet-footed foreign rivals, but most are a
product of that system and there is nothing to suggest it will change any time
"Companies were assessing your personality and looking
whether you would fit," says Erina Seki, 23, one of the students Reuters
followed through the annual five-month ritual of dozens of job fairs, workshops
"At one insurance firm, I was told that I wouldn't fit
because I was too vocal about my opinions," said the fourth-year
accounting major from Tokyo's Rikkyo University, who finally landed a job with
an outplacement service company.
"I thought companies were looking for perfect matches
with the corporate culture."
Unlike in many other parts of the world where the ability to
deal with the unexpected or devise new solutions to problems are prized, the
top concern for Japanese employers seems to be how well a recruit would blend
in and get along with others, the students said.
They recounted being asked same generic questions over and
over again in what could be up to a dozen interviews for a single prospective
The outcome? A culture where even outsiders brought in to
shake things up struggle to challenge the status quo.
The six-year reign of Welsh-born Howard Stringer at the helm
of Sony Corp, which ended after a dismal run of losses, and the ouster of
another Briton, Michael Woodford, as head of camera and endoscope maker
Olympus, are cases in point.
Both were replaced by company veterans.
A shortage of strong leaders and risk-takers, which the
present recruitment and training system seems unable to produce, is seen as a
major cause of the woes of Japanese companies, from its once-famed electronics
industry to auto giants.
Toyota Motor, once the world's biggest automaker, has seen
its market share slip to General Motors and Volkswagen and has South Korea's
Hyundai in its rear-view mirror.
Electronics giants Sony, Panasonic and Sharp, slow to revamp
loss-making TV businesses, suffered a combined $20bn loss in the past fiscal
year, hammered by competition from South Korea's Samsung Electronics.
Squeezed by nimbler foreign rivals overseas, Japanese
companies also face a shrinking market at home. The population peaked in 2008
at just over 128 million and the government forecasts it will keep falling over
coming decades to about 90 million in 2060, when 40% of Japanese will be 65 or
Almost every major Japanese company participates in the
annual mass-hiring ritual that dates back to the country's post-war economic
miracle, when skilled workers were in short supply and companies began hiring
graduates in bulk, trained them for months and secured their loyalty by
guaranteeing a job for life.
That guarantee is no longer there, but the ritual continues.
Stamina not flair
With just over nine jobs awaiting every 10 of the 381 000
students graduating and looking for work this year, and the most coveted with
the likes of Toyota or Nomura even more scarce, job-hunting has become fiercely
Between early December when big companies start advertising
entry-level positions and April when they make offers to fourth-year students,
each student will typically send up to a hundred or more applications, attend
dozens of presentations and endure multiple interviews with 20-30 prospective
"At the peak, I attended two to three seminars a day; I
almost had no time to attend school," said Yuki Yamamoto, a law graduate
from Keio University.
"School was in an exam period in January but
irrespective of this, job seminars continued. Some students even gave up taking
The system has also led to a flourishing industry in cram schools.
Chihiro Obata, a senior official at Vein Carry Japan that
offers courses to candidates, says the number of such private schools has
quadrupled over the past three years in Tokyo to about 80.
Her company charges ¥105 000 (about $1 300) for courses that
teach students how to write CVs and job applications, how to bow and exchange
cards and simply look good in interviews. It offers to refund the fee if
students do not land a job.
Last year, a Tokyo department store even organised a
workshop for students of both sexes on how to use skin lotions to look fresh in
Under a voluntary pact, the country's leading 840 or so
companies - grouped in its top business lobby Keidanren - recruit during the
same five-month window.
Uniform entry salaries, today at around ¥200 000 per month,
are also common.
Rehearsed and scripted, the process leaves little room for
spontaneity and frustrated students talk of a mad scramble of job fairs held in
vast convention halls.
"Skills seem to carry little importance," says
Shunsaku Funaki, a 21-year-old politics major from Tokyo Kokushikan University
who so far has not found a job.
"Companies want to train and educate students from
scratch and that hasn't changed over the years. I want the culture of uniform
job-hunting activity to be destroyed and want companies to seek students with
Followers or leaders?
Not only the students are fed up. Management experts and
recruitment professionals say that if Japanese companies are serious about
change, the system that defines their DNA has to change first.
"If you bring somebody in when they just graduate, they
practically have no business experience, so how are they going to come up with
new ideas?" says Christine Wright, Asia operations director with Hays
"They would just think the way the company
Hiring managers however say the old formula has its merits.
"We are able to secure a certain number of students who
meet certain criteria relatively easily, and it helps reduce costs of employee
education because that is done simultaneously," says Hiroshi Ishihara,
recruiting group manager at infrastructure and IT supplier Hitachi.
Takashi Shinohara, human resources manager with office
equipment maker Ricoh, says the system allows his company, which hires 200-300
graduates each year, to plan and maintain a steady age profile of its
Although mid-career hiring is on the rise, at most big firms
the track to top management still involves joining the company fresh out of
Ricoh's Shinohara acknowledges the need for changes but says
it is hard to envisage a radical overhaul.
"Companies do hiring and students do the job-hunting
simultaneously. This system is entrenched."
Online retailer Rakuten, which uses English as its main
language and has been recruiting engineering graduates from China, has modified
rather than ditched the system even though it is not part of the Keidanren
Yoshinori Kondo, head of its global talent development
office, says it is important for newcomers to stick together, so Rakuten still
hires them in batches.
But it does so twice a year to accommodate foreign students
who graduate in the autumn rather than in spring like their Japanese peers.
Other companies also focus on foreign graduates as a source
of new ideas. Hitachi, for example, wants to double the number of graduate
positions filled by foreigners to 10%.
Hiring Japanese educated overseas is also an option to bring
in some diversity. However, the number of Japanese studying abroad has been
declining since 2004 as they are reluctant to leave for fear of missing the
Experts also warn firms that hire foreigners will not
succeed in getting diversity and new thinking if they try to squeeze them into
the old seniority-based system and predetermined career path.
For now, signs are that even an exponent of a new, more
dynamic Japan, such as Rakuten, is not quite ready to let go.
While its employees are expected to show initiative and
"venture spirit", they should do so in the vein of The 5 Concepts of
Success laid down by company founder and CEO Hiroshi Mikitani, it says.