I am curious to know whether you believe Japanese business should push to get less government involvement in these business deals.
NAGAMORI: These government restrictions and regulations you refer to -- you shouldn't assume that they are directed only at American companies. We Japanese are also shackled. The Japanese government, I believe, is in some ways like the government of a developing country. A venture business, when it grows to a certain level, is faced with a lot of interference from the government. For example, once we have what the government calls a "sufficient capital foundation," we are required to pay whatever bills we owe to outsiders quickly. Then, too, regulations get changed by the whim of bureaucrats; they can construe the regulations in whatever way they want to. I have had a lot of quarrels with government people. I'm known as "Quarreling Nagamori." Normally, we don't want to quarrel with them, because they could put us at a disadvantage, but unless we do, the system won't improve. In contemporary Japanese society, however, all younger entrepreneurs have to fact this difficulty.
Now, changing the subjects a little bit -- Japanese companies may be difficult to deal with, but I would say that there is no one in the world with whom it is more difficult to deal than Americans. Let me cite one example.Six years ago, we established a joint venture, a 50/50 joint venture in the United States. One Friday, we faced a fairly big problem in terms of corporate management. Now in Japan, we can work over the weekend as well; we don't care whether it is Saturday or Sunday. But that Friday afternoon our American counterpart said, "Oh, have a nice weekend," and left the negotiating table. We were told that the guy went off on a date with a girl. After this, I began thinking that we were in for some serious with these Americans. The cultural differences were just too much. So, instead of 50/50, we purchased 100% of the company. Of course, we left management to the Americans, and we now completely trust our Americans; but we still feel very much irritated. Americans leave at five o'clock, whatever serious problems may be left hanging. I wish I could learn to do that. We cannot fall asleep at night, we can't even enjoy weekends. But Americans enjoy tennis, enjoy the weekend. Saying, "Have a nice weekend," they leave easily. I wish I could learn that for once in my life.
One other thing: We are not a really big company; we have only about 1,000 workers. But we have people who can speak all languages. I think that's something that American businessmen have been neglecting. American businessmen still tend to believe that English can be spoken everywhere.
CORTESE: Well, if you want to do business with a company that doesn't go home on Friday at five o'clock, call Alpha Micro. But seriously, I would be very concerned, if I were you, about your joint venture with someone who goes home on Friday at five o'clock. And I certainly would recommend buying them out immediately or dumping them.
As to the American's continual litany of complaints about government interference, be comforted by the fact that we also complain about our own government interference, and that our bureaucrats' languages are not that dissimilar to the ones you described. They also say things and do nothing. And they are equally as vexing.
About the language problem, it is just a fact of life. There has always been enough leverage in American money, technology, or muscle to have people acquiesce to our language. Now, I would totally agree that this is neither fair nor just, but I am not sure that it's material.
We are a small company -- 450 employees with more than $50 million in U.S. sales. We have to be very, very careful with our assets, and where and how we invest them. At the same time, we are eager to participate in the world market, and we do participate in almost all parts of the world except Japan. But as the difficulty quotient rises in foreign markets, the incentive to invest decreases; and it is significantly less expensive for an American company to pursue business in the United States than in foreign locations. This doesn't mean we are not interested. It means that we must make a business decision as to the cost of developing the marketplace.
It is now a world market. And it is important to compete in multiple markets, not just because of return on investment and sales value, but for knowledge. I still want to do business in Japan, and I still want to understand better the way you do business, your culture and economic environment.And I don't believe that language is truly an insurmountable problem. You just have to recognize it.
MAKINO: We are going into the American market next month. I am one of the younger generation, born after World War II. We are interested in creating something. That's the wish of the younger generation. We are not interested in manufacturing personal computers or any other products that have reached the stage of maturity. We want to create a new market, a new field. Many American companies have approached us with offers of an alliance, but what they say is that the Japanese are good at manufacturing, producing high-quality goods cheaply. We say no to those offers. We tell them that we would be interested in something in the R&D field, the creative field; not merely producing something on behalf of others. This is the key to my decision to go to the American market: to see if we can add something creative.
And I have found some Americans who are interested. Some Americans have noticed that the Japanese have creativity, too. That's the way to internationalize our business, I feel. There may be barriers and obstacles, like languages and so forth, but I am not concerned with that, perhaps because I am young.
CORTESE: You should know that there is another great concern among many American businessmen about joint-venture arrangements with foreign countries, especially Japan. You are seen as very fierce competitors, and the concern is that the joint venture would be a short-term relationship, in which the Japanese partner will acquire the American technology, then sell it back to America, competing against American companies. When we first met in California to discuss coming to this roundtable, some of my colleagues advised me to be very careful about what I said, what I revealed. it wasn't clear to me why I needed to be any more careful in dealing with Japanese businessmen than I am with American businessmen, but the fact is that this suspicion is prevalent in the United States, particularly in high-tech companies, particularly with respect to large Japanese companies. Are you aware of this stereotype? How accurate do you think it is?
