192: Staff Shortages Change The Business Dynamic Entirely

<p>We are running out of young people in Japan.  Covid has slowed down some major structural changes which must happen.  The implications of staff shortages are dynamic for Japan.  Let’s explore some of these in today’s show.</p> <p> </p> <p>There is a great Simon Sinek video floating around about how companies say employees are important, but don’t really act like it.  He lines up the typical CEO hit list of growth, shareholder value, customers and in fourth place, employees.  He notes that even if you elevate customers to number one, employees still come in second in importance.  Richard Branson is also a powerful advocate for putting employees first before all else.  It makes sense.  We want motivated, enthusiastic staff engaging with our customers and going the extra mile.</p> <p> </p> <p>In many ways, Japan has long had a different order to Anglo-Saxon corporate philosophy.  Workers first, then customers and shareholders last.  Can we learn anything from Japan’s corporate traditions on how to put workers first?</p> <p> </p> <p>This system worked fine in an environment of lifetime employment, low growth protected by interlocking shareholdings and price fixing through the dango or cartel system.  The foreign ownership of Japanese company shares and the expansion of so many businesses outside of japan has changed things and put more pressure on showing revenue returns.  The customer has remained a constant in all of this change though, because culturally, the buyers have very high expectations that must be met.</p> <p>We can’t rely on importing the Japanese nenkojoretsu system of steady escalator career advancement based on seniority and age.  Many Japanese companies still have this system, but today talent is in short supply.  In a global economy, awash with disruptive and competitive technologies, waiting for the best and brightest to become older in order to be given their leadership shot is an opportunity cost you don’t want to pay. </p> <p> </p> <p>These old style Japanese companies often still focus on OJ