ABSTRACT
Japanese companies face challenges when doing business in global markets. There is no right or wrong definition of how to be successful in business – different cultures have different perspectives, and this impacts how business in conducted. US capital markets, for example, emphasize shareholder primacy, whereas the Japanese market has traditionally placed a higher emphasis on serving stakeholders. The mechanisms of Japan’s elevation of shareholder interests in business governance are complex, and changes within companies are often very slow when there is not an immediate crisis or other external influences. This chapter looks at the challenges faced by Japan’s largest businesses when competing in global markets. It will also examine how Hitachi’s leaders have steadily driven the global transformation of Hitachi since the Lehman shock of 2008, thus putting the company in a stronger position to respond to the challenges of the COVID-19 pandemic. Leadership is a key element to driving profitability, and Hitachi’s last two Presidents have successfully demonstrated two approaches to strengthening Hitachi’s profitability and global competitiveness, including (1) adoption of hybrid global and Japanese management styles and (2) business portfolio reform. These approaches may provide a template for a more rigorous response to challenges even in the absence of shocks. The case study of Hitachi presented here illustrates this point.
