Thursday, February 21, 2008

As US demand softens, Indian firms eye Japan

Finally...it seems that Japan is getting the attention it
deserves in the mindshare of Indian IT Companies. Lot of data points in this article from Wall Street Journal. Happy reading. Editor
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New Delhi: With a likely softening of demand for their services from buyers in a slowing US economy, Indian tech services vendors such as Tata Consultancy Services Ltd, Wipro Ltd, Satyam Computer Services Ltd and HCL Technologies Ltd are increasing their focus on a market that has until now not believed too much in outsourcing: Japan, the world’s second largest economy.

Traditionally, Japanese corporations have outsourced tech and support units or have relied on services to their information technology or IT relationships built over years with local vendors.

There has been “a lack of competitive element which has not pushed them to think differently,” said Sanjeev Nikore, corporate vice-president and global head of sales and marketing at HCL Technologies. With increasing global competition, “that is changing”, he added.

The Tokyo headquarters of New trend: Shinsei Bank Ltd. The bank, formerly Long Term Credit Bank, has transformed itself into a profitable bank using modern-day banking processes and technologies. (Kaku Kirita / Bloomberg)

According to estimates by India’s largest tech services firm TCS, or Tata Consultancy Services by 2010, spending in Japan will touch $95 billion, or Rs3.82 trillion at today’s IT currency rates, growing at an annual rate of 3.2% from 2005. Currently, work worth around $32 billion is outsourced, a number expected to grow by a quarter to $40 billion by 2010. Around 4%, equivalent to $1.28 billion, of the outsourced work is sent to offshore locations—a market segment that a spokesperson, quoting research compiled internally, said is expected at $5 TCS billion by 2010.

Though it takes time,said Yukihara Yorifuji, IT services group manager at researcher International Data Corp., Japan, some Japanese customers “may delegate even custom development”. Local businesses, Yorifuji said, through a spokesperson, could ship work directly to offshore firms bypassing local vendors.

The top five tech service vendors in Japan are Fujitsu Ltd, NEC Corp., Hitachi Ltd, a local unit of International Business (IBM) Corp., and NTT Data Corp. IBM Japan, set up in 1937, is the only non-Japanese firm with a strong presence.

TCS, which set up its subsidiary in Japan in 2002, today has some 1,800 workers servicing Japanese businesses, including more than 300 based in that country. An offshore delivery centre in Kolkata drives all Japan specific initiatives for the firm. TCS’ revenues from Japan amount to around $100 million (revenues for the company in fiscal 2007 was $4.3 billion), but expectations are high. “We expect this to grow rapidly,” said a company spokesperson adding the focus will remain on embedded systems.

Friday, February 08, 2008

The Japanese way of thinking

Reading this article will tell you a lot about the Japanese mind and the way they approach or would like to approach a business discussion overseas. Look at the extent of preparation that is advocated by the author!. Emphasis is also laid on "human relations" underscoring the Japanese approach that we all know. This article appeared in JETRO newsletter Vol.47 Jan. & Feb. 2008 TTPP NEWS For International Business Matching and is authored by Ms.Yoko Kawaguchi, President, Y's Worth Corp. Editor
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The other day, I took part as a lecturer in seminars in Vietnam for local exporters on how to enter the Japanese market. I also attended business meetings for a buying mission from Japan organized by the Vietnamese Embassy in Japan. I would like to summarize my thoughts, based on those experiences, on how to make effective use of such buying missions and business meetings.

1. Consider in advance the sales channels, prices, and volumes of the products purchased

Beginning buyers in particular tend to end up spending all of their energy on finding and importing the products. They leave questions like how to sell the products at home and how to make a profit from them for later and therefore fail in many cases.

To order to determine if your firm can handle certain products, you have to
think of who you are going to sell the imported products to. And in which way?
Then you have to think at first about profit structure (purchasing prices,
sales prices and volume, and resulting profits). A business which studies and plans for this in advance can make full use of the free time at the country visited to tour factories, uncover more new products, and return successfully.

2. Prepare materials introducing your business in advance to facilitate mutual understanding

When the potential business partner is from a developing country or a small
business, some people take a condescending attitude to them. Do not forget that you can only do business if they supply their products to you. Further, it is not enough to just obtain information on the counterpart. It is important to introduce your own business by preparing corporate brochures in English, photographs and samples so as to accurately describe your business to the future business partner as well.

Without mutual understanding, good human relations cannot be built and good business will not result. A Vietnamese businessman I met the other day started as a craftsman in a small farm town but in a few years time grew to a manager of a business with annual sales of US$10 million. Anyone can succeed in that way, so it is important to be humble when talking with others.

3. Examine not only the products, but also the reliability and flexibility of the manager

I often see Japanese buyers who just look at the products offered by exporters and instantly repeat words such as "Yes, I will buy" or "No, I will not buy". In other cases they say only "Yes, the products would sell in Japan" or "No". How about asking the exporters questions like "Can you make this type of product?" or "Can you change the product in this way?"

This should be the natural consequence if observing the rule of the first point above.When I talk business, I always look at not only the product, but also whether the manager can be relied on and whether he is flexible enough to work positively with me by nature. This helps to avoid risks. Try it by all means.

4. Develop an "eye" for new products on a regular basis

Developing an "eye" for new products is a something that has to be worked on daily. Do not say it is too much trouble or that you will not find anything even if going somewhere. It is important to take every opportunity to go out and carefully examine new products in order to develop an eye for them.

Right before I left for Vietnam this time, I had a meeting in the Vietnamese Embassy in Japan and saw a product which I thought I could sell well in Japan. In Vietnam, I coincidentally found the manufacturer on one of my tours. I learned that he had received a US$5 million order from a large mass merchandiser chain in Europe and that the product was selling well in a branch of that chain in Japan.

The manufacturer told me that when he previously exhibited the products at an international trade fair in Japan, he failed to receive any inquiries from Japanese businesses. This is probably because in general the booths of developing countries lack refinement in display skills and the manufacturers have little information about the Japanese market, so fail to showcase the products suitable for the Japanese market.

5. Use "buying missions" and "business meetings" of official organizations and commerce and industry associations

Joining a "buying mission" organized by a public organization, foreign embassy in Japan and commerce and industry association offers you many merits over going on your own. Since these are package tours, the travel costs are lower and you do not have to arrange for flights or hotels. Reputable local firms are introduced. You can get support from the mission attendants. Highly skilled interpreters are arranged. All of this is convenient for private entrepreneurs and small businesses. The content of the mission will differ with each mission, but the other participants will all be professionals so even if the industry or the products handled differ, there will be much to learn from them.

Even if not traveling overseas, Japan hosts many international trade fairs and business meetings inviting exporters from overseas. Interestingly, you can sometimes learn from exporters about trends in Japanese industry which you cannot see while in Japan. Let's make positive use of buying missions and business meetings as places to meet new companies, find new products, and pick up new information!

Tuesday, February 05, 2008

Opportunities in Japan - A Chat relay

Karthik Tirupathi, Founder President of Nihongo Bashi hosted a live chat on rediff on Februrary 4th 2008. Provided below is the transcript that answers a gamut of questions across a wide spectrum. Editor
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Karthik Tirupathi says, Good Afternoon (Konnichiwa in Japanese). Welcome all and look forward to an interesting afternoon's discussion. Karthik
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vvnaidu asked, Hi I would like to know how is the job market for SAP SD or SAP Business one professionals? How do we go about applying for job ?Is it mandatory to know Japanese?

Karthik Tirupathi answers, As you know the SAP market is red hot in this part of the world. SD or Business one professionals are also in good demand however since most positions in functional consulting require client interaction, it becomes imperative that you know Japanese. A JLPT Level 2 proficiency is the most common requirement. Applying for jobs is fairly easy and most popular job portals have notices for such positions. Leading companies like HCL [Get Quote], Satyam [Get Quote], TCS [Get Quote] all need many functional consultants




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siraj asked, I want to know if there is Indian food and schools are available in Japan.

Karthik Tirupathi answers, Just in Tokyo alone, there are over 150 Indian restaurants not to mention the fact that a popular dish is Curry rice (or Karey rice). However it does use pork or other meat stock for preparations and hence may not be suitable for vegetarians. Be also warned that most of tehse are fine dining restaurants and hence it tends to be an expensive affair. There is one Indian school currently in Tokyo.

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shilpa asked, hi howz it for it professionals and students

Karthik Tirupathi answers, I suppose you mean living in Tokyo. It is fairly easy to get by these days than it was a few years ago. This is due to increasingly wider usage of English and bilingual signages in most places. Travel across Japan is a breeze as always due to a world class subway and bullet train system in addition to traditional airlines
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ram asked, Hazeme mashithe, watashiva ram desu. i speak little Japanese. I worked there for about 2 years. Is there any correspondence course in Japanese?

Karthik Tirupathi answers, To the best of my knowledge, presently there are no correspondence courses in India. Language and cultural content require a very high degree of personal contact. Also, it has not proven to be successful in many parts of the world. This may be the main reason too
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jackychang asked, after akio morita, Japan seems to have lost it's charisma. What do u think is japans future? Will it get saturated like US?

Karthik Tirupathi answers, It is unlikely that the 2nd largest economy in the world will come to a grinding halt. It has tremendous momentum and outsourcing to India is just begining. The future promises to be full of excitement across all sectors
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mudassir asked, How are the opportunities for Java professionals?

Karthik Tirupathi answers, Java is quite popular and in demand. Leading IT companies like TCS, HCL,Satyam are constantly looking for specialists in this sector. Embedded technology, ERP, Mainframe are other highly sought after skills. However bilingual expertise is a must here
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kurukan asked, Have u ever seen Japan?

Karthik Tirupathi answers, I visit Japan many times in a year and have numerous friends and professional acquaintances.

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sunil asked, Hello Karthik, I Business Manager with 7 years of work experience in the IT industry. I was wondering if you could share some information on the IT industry and opportunities for marketing manager like me.

Karthik Tirupathi answers, Today the merging Indo-Japan sector calls for business leaders which we lack. This is a major stumbling block in outsourcing to India. Sales, pre-sales, Business Development and Marketing professionals are MOST highly sought due to their "rainmaking" capability. As always people with superior communication skills are needed in all customer interactions
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Aniruddha asked, Hi Good Afternoon.. I am a Human Resources Generalist with a Master's Degree from Mumbai University with about 25 years hands on experience. I am a New Zealand [Images] citizen,currently working with a Japanese company in Mumbai as General manager -- HR. Do I have any opportunities o work in japan based on my background? Thanks & Regards

Karthik Tirupathi answers, I think your skills would be extremely valuable in large organisations that are looking for bi-cultural managers who can effectively handle native and non-native Japanese. However in a sensitive position like this a very high degree of bilingualism is a highly desired
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Cox asked, what about the IT salaries in Japan?

Karthik Tirupathi answers, Salaries in Japan are comparable to salaries in US. Saving potential is also equally high. However like the US Japan does not have a quota for H1B visas!! It is a India friendly visa regime
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itsan asked, what are the chances of small/medium IT companies making a foray in offering offshore services to japanese IT companies in the Small/Medium segment?

Karthik Tirupathi answers, It is a highly relationship oriented market where trust reigns supreme. If the client knows and trusts you at a personal level, limitations due to size can be easily overcome. This is in stark contrast to the US market where SLA's are used to enforce compliance and realtionships are not necessarily the first step needed to start a business transaction. You will find that Japanese seek quality over size and quatity. The first order is usually a small one and slowly progresses in both volume and consequently margins
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Anup asked, HI Karthik, I am Dr Anup Karnik wokig in pharma and CResearch since 7 years, Any opportunities in Pharma, Clinical Research in Japan?

Karthik Tirupathi answers, Bio tech and pharma sector is seeing a lot of M&A activities. Leading Indian companies have made mid sized acquisitions lately. It is a heartening trend to see Japanese comapnies exploring such partnerships.
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Toshi asked, Sir, What are your thoughts on the long Japanese working hours? Sometimes they sit even if there is no work. Do you think Japanese meticulousness appears stupid to Indian brain?

Karthik Tirupathi answers, It is a matter of courtesy to your superiors to stay back until he/she finishes. It is more cultural and a very Asian trait in many ways. Their meticulousness is highly prized world over and is definitely not stupid. In the long run better quality (due to meticulousness) will be prove to be more cost effective as the Japanese experience has shown.
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shefali asked, what major differences in work culture will an Indian manager experience in Japan

Karthik Tirupathi answers, Mainly it will be cultural difference at the work place. The work ethics of Japanese and Indians are quite good (hard working, diligent and so on). In the past few years, due to Americanisation of Indian work culture, we have become very direct and individualistic in our approach. Japanese place more emphasis on team culture and less on individual "visibility". Also punctuality and adherence to timelines is a major problems that Indians face in their cultural adjustment in this environment
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VINIT asked, how the opportunities for ACCOUNTANTS in japan after passing graduate in india

Karthik Tirupathi answers, Recently we trained Indian Chartered Accountants for IT/SOX projects for a Big 3 audit firm who then went to work onsite in Tokyo. There is an estimated demand of about 15000 to 20000 CA's required due in JSOX compliance projects.
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Bhaskar asked, Can you suggest me the best way of learning the Japanese Language?

Karthik Tirupathi answers, In my experience, any foreign language usually requires about 500 to 600 hours of study including Japanese. Any shortcut would usually result in reduced proficiency.
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phil asked, hi, how do we apply for a job in japan and are there any education requirement like in US

Karthik Tirupathi answers, Yes, to get a visa you must have done 12+4 years of education and a degree is usually required.
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DG asked, Hi Karthik! Any investment banking operation opportunities? Especially if I want a lateral shift in project financing and infrastructure advisory services? Shall expect to hear from you. Thank you!

Karthik Tirupathi answers, There is a great demand for investment banking professionals in this part of the world including Singapore, HK and other leading financial centres. Tokyo being the largest has also therefore the greatest demand. We also see a rise in NRI relationship and India related advisory services requirement. Best of all, I have not seen a mandatory requirement to speak Japanese in this sector. I actually have known a banker who lived in Japan for 3 years without learning much Japanese. This may not have yet become a rule but it does indicate a possibility.
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Aravind asked, Will there be any language problems we face there. Wat abt cost of living. Is it too costly like London [Images]. wat abt life style. Are there any gud pubs n discos

Karthik Tirupathi answers, It may amaze people to know that the Japanese language has the same subject-object-verb ordering like Indian languages. This poses a problem for for people "thinking" in English but I believe most Indians would find it easier than other nationalities to learn Japanese as a result. Cost of living mirrors that of any comparable city in US or Europe. Night life and entertainment options are the hallmark of Tokyo as also other large cities :)
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dilshan asked, How about a chance for a CA there & what salary should 1 expect

Karthik Tirupathi answers, In my personal experience a CA with 3 to 5 years experience can expect to earn JPY 7 to 9 Million in JSOX projects.
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BABU asked, Is there any Limit for the number of professionals recruited in a year like the one for H1B in Japan..? Also what is the minimum requirement for getting a job in Japan? Is there any migration program available for Japan like HSMP for UK?

Karthik Tirupathi answers, NO. Japan does not have an official annual quota and practices a visa friendly regime towards Indian professionals. In addition to being a specialist in your field, it would help if you possess 12 + 4 years of formal education.
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Maggi asked, My daughter is 9 Yrs. old, which language do you suggest for her to learn right from this age, is Japanese language can be learnt easily or any other which you like to suggest

Karthik Tirupathi answers, At this age, kids can pretty much learn many languages simultaneously. Japanese being closer to structure of Indian languages would be an easier choice. Also, opportunities in this sector are just starting to explode and hence it would be a "sunrise" choice!
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boom_ram asked, WHAT IS THE AVERAGE SALARY/MONTH ONE NEED IN JAPAN TO RUN A SMOOTH LIFE?

Karthik Tirupathi answers, For a single person typically reasonable rental would be about USD 750 - 1,000 per month and living expense another USD 1,000 to USD 1,500. Hence any additional income could potentially be saved.
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Harpreet kaur asked, Hi, I have done a degree course in Japanese language and have been working as Japanese Interpreter and translater in automobile companies since last 12years. Any scope to work in Japan with this qualifications & experience? Kindly let me know. Please do reply this also. ONEGAI DESU.

Karthik Tirupathi answers, Kaur san, With this experience you should be easily able to work in Japan! Bridge SE positions or customer facing project coordinator positions would easily be possible. I am assuming you are Level 2 proficient currently.
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shilpagoody asked, hello karthik .. i am a graduate along with lots of diplomas in field of finance. I have experience of 4 years in this field.. I am getting married and as my husband is in tokyo ill be shifting there . So what to now about the job market over there in finance field and want a job

Karthik Tirupathi answers, I am sure you would have access to many openings in your field with such qualifications and experience. Try the field of internal audit and risk assessment with Big 3 firms if it interests you. They would be keen to talk to you. Whilst you are there, please sign up to learn Japanese as you will learn it very quickly being in the "environment" there. Good luck

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Karthik Tirupathi says, Thank you for your active participation. I would like to wish you all the best in your careers' ahead and exploring opportunities in Japan