As a company dealing specifically in international HR search, ChapmanCG and its consultants are very well accustomed to complex global assignments. We have often found in these searches that expectations of stakeholders ‘on the ground’ in a market can differ from those overseas at corporate or regional headquarters. But perhaps the single most controversial area that we cover is in hiring Talent Acquisition Leaders in Japan. For anyone who has experience in this realm, this may come as no surprise; but for those who don’t, this might seem like a strangely exaggerated claim. So let’s break it down in this quick article.

1) Costs

The first peculiarity about staffing in Japan is that it has historically been a very expensive market for using agency recruitment to hire internationally-minded talent. The key reason behind this is because Japan has been, and in some cases still is, a high-risk/high-reward market for international companies. Get it right, and a multinational can make huge profits in the lucrative domestic market. But if a company’s entry or subsequent management is badly handled, it can prove to be a very costly mistake. In this market, reputation is important and memories are long, so there isn’t always the luxury of a second chance.

In addition to these high expectations, the market for international multilingual talent in Japan is comparatively scarce, because the large majority of workers are still employed at Japanese companies where only Japanese is spoken, and only Japan-specific working practices are learned. Therefore, high demand coupled with a tight market for the right kind of talent has led to this anomaly in agency recruitment costs. With this background, the pressure to reduce costs by improving direct sourcing has increased massively in recent years, which leads us to the next point.

2) Privacy and Social Media

If the world was split into developed markets and emerging markets, Japan would be found at the top of the list of countries described as ‘developed’. However, it is quite unique among other developed markets in its attitude towards openness, and its willingness to embrace social media, with only neighbouring Korea providing a close comparison. In most developed markets, people are used to being contacted directly by competitor companies, and even if they are not looking to change jobs, they are at least flattered to have been approached and to be a ‘known quantity’ in their field. Japan is slowly getting accustomed to this approach too, but it is a big cultural change for a market that traditionally takes pride in privacy and in loyalty to employers. Many people are still offended to receive this kind of direct approach, and many Talent Acquisition professionals are subsequently wary of initiating this type of contact.

Parallel to this has been the historical unwillingness of Japanese employees to upload their details onto online social media platforms, and in particular websites liked LinkedIn. The uptake has been steadily growing in recent times, particularly among people employed by international companies, and especially in the technology industry. So it would be wildly inaccurate to say that these practices are shunned overall in Japan. But the percentage of the general population who are active is still extremely small compared to other markets, which in turn hampers the ability to create a direct sourcing model in Japan.

So far, this introduction about the Talent Acquisition environment in Japan is fairly easy to understand. So where’s the controversy?

3) The Disconnect Between Recruiters in Japan and Overseas

The controversial issue lies purely in the disconnect between recruitment leaders in Japan and their functional bosses overseas. On the one side, global recruitment leaders are successfully implementing direct sourcing staffing models across the world to improve efficiency and ownership of the Talent Acquisition function. Some are even opting for regional centres of excellence, where staffing is not only being brought in-house, but it is also being offshored to lower-cost locations. Japan, with its huge recruitment costs, is always the number one target for cost reduction, so it’s in the immediate line of fire for any new global TA leader out to make improvements. But due to language issues, it’s not always practical or even possible to offshore the TA function to another country, so this is one ‘easy win’ opportunity window closed.

As a developed nation, Japan falls within the same group of countries that have completely overhauled their recruitment modes. In addition, there are some successful examples, particularly in the technology industry, where companies have implemented a direct sourcing model in Tokyo. So a Global TA Head might think, No more excuses Japan TA leaders, let’s stop farming out so many roles to agencies and start sourcing the candidates yourselves. You’ve had it easy for too long - you may think that you’re a good TA leader, but I manage 30 other TA leaders in other markets who are much more successful.

Many Japan TA leaders have been hearing this and are feeling the pressure to conform to this ‘brave new world’ of recruitment. In contrast to the global perspective, a local TA leader knows that, even at the best of times, it can be hard to attract people into a multinational company whose brand name is unheard of, in relation to a strong domestic competitor. Attempting to do this directly just increases the frustration, because it’s simply not as easy to find people’s contact details as it is in other markets. Even if I do track potential employees down, an approach must be done very sensitively in order for them to be receptive, and very few approaches do convert into tangible results. My English may be in the top 10% in terms of ability among workers in Japan, but compared to the other TA leaders who are managed by my boss, I have more difficulty in eloquently arguing my case. How can I make them understand that their direct sourcing expectations are unrealistic, without simply adding to their preconceptions that I’m using this as an excuse? International TA leaders just don’t listen enough when the market in Japan is explained to them.

4) Conclusion

I have used these two extreme viewpoints in order to illustrate the point, and in reality there are very few organisations where the relationship between TA leaders in Japan and outside is quite so dysfunctional. However, it is still helpful to discuss ‘the elephant in the room’ so that TA leaders on both sides of the fence can use these standpoints as a yardstick, by which to assess their levels of understanding for each other’s positions.

Our own assessment is that both sides are correct in what they say, but both still need to be open to compromise. There are indeed some TA leaders in Japan who have an over-inflated opinion of their capabilities, and are measuring themselves against an anachronistic yardstick that no longer has any value in the modern world of recruitment. There are also still some global or regional TA leaders who steadfastly refuse to listen to the valid reasons why direct sourcing hasn’t yet been as successful in Japan as they would have liked. Our advice to both sides is that they need to recognise that the landscape in Japan TA is indeed moving in the right direction. With open communication, both sides should agree, perhaps on an annual basis, what stage in development can be expected at any one time, as related to their company’s status in Japan. This is true in terms of what skills the Japan TA leader should bring to the role, as well as what expectations they should set, and how successfully new sourcing strategies can be implemented.