Publicity May 2014

Respect and fear not

As Intelligence Global Search (IGS) enters its third fiscal year, the recruiting specialist is completely focused on growth and expansion.

Even though IGS is part of the Japan-based Intelligence Group, its 40-plus team members in Tokyo have successfully built their own brand as an independent, foreign-style recruitment firm.

Having the support of Intelligence, while at the same time enjoying the freedom to grow the IGS brand independently, is what separates the firm’s operations from those of its competitors.

How do merger and acquisition (M&A) activities affect your business?
As a whole, M&As affect almost every aspect of recruitment—both in positive and negative ways.
For example, if market rumours suggest a company may be bought out, most job hunters will avoid that firm out of fear that any job there will be unstable.

Likewise, for companies that are openly shopping for an acquisition to, let’s say, bolster one area of their business, a feeling of uneasiness can persist among staff. This is because once the acquisition is complete, there will also be a “merger” of ideas and visions.

Additionally, the purchased company is likely to lose a considerable portion of their workforce—due to redundancy or voluntary resignations reflecting fear of working for the new entity.

Also, once an acquisition has been finalised, the transition may require new hires, such as back office, human resources and finance specialists. However, for the most part, all hiring will be put on hold, which could spell disaster for a recruitment firm that has invested countless hours with respective clients.

Lastly, the investment bank that managed the deal will get a considerable fee and publicity—meaning that if that deal was sufficiently sexy and public, you’ll get quite a few young investment bankers looking to join that bank.

Should a Japanese firm fear being bought out by a foreign company?
I don’t think such a scenario would be any different from that of a Japanese firm buying out a foreign competitor. There are risks in all M&A deals, regardless of borders.

In any merger or acquisition, there will inevitably be unhappy parties, redundancies, and some hardship.

However, there are also endless possibilities in terms of sharing ideas and information, pooling profits and revenue, as well as expanding sales networks—which essentially fuels everything else.

What advice would you give a foreign firm coming to Japan through an M&A?
Respect. Simply put, in Japan you must show and give respect to be successful. Experience, language, motivation and unique products will bring success in most countries, but these things don’t guarantee a win here.

While this country is at the forefront of technology, has a world-leading economy, and boasts top-tier manufacturing firms, there are still a few facets of society that lag behind the rest of the developed world, such as the number of women in senior management positions.

Another traditional aspect of Japanese business culture that remains prevalent is respect. This virtue is valued almost as highly as experience and skills. You are almost always expected to respect the current systems. To attempt to change anything within them takes a lot of time and energy.

You are also expected to respect those people who have been in the industry longer than you; this senpai (senior) versus kouhai (junior) mentality remains prevalent in Japanese business culture.

As a foreign firm with a Japanese parent, what have been your struggles?
IGS has had an amazing two years in terms of growth, challenges and successes. And through everything, we have been blessed with the unwavering support of a management team that completely understands the complexity of the Japanese market and has been incredibly helpful.

I think most of us had fears about entering Japanese firms, given that stereotypically, they were too rigid, structured and hierarchical. However, this simply doesn’t apply to Intelligence. Our management’s understanding and encouragement has been vital to our success here.