Episode Transcript
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Chase Stratton (00:00):
Welcome to the
Deep Dive.
Today, we're really gettinginto something fascinating, the
unique, often unexpectedchallenges of hiring talent in
Japan.
If you've tried recruitingthere, or maybe you're thinking
about it, you've likely foundthat, well, the usual global
strategies just don't quite cutit.
They often fall completelyshort.
So our mission today is prettyclear.
(00:21):
Figure out why those standardWestern approaches tend to fail
in Japan.
And more importantly, whatactually does work for fine top
talent in this very specificmarket.
We've looked at quite a bit ofresearch and real world stuff to
guide us.
Tessa Sourceley (00:36):
Yeah.
And it throws up some reallyinteresting, almost paradoxical
situations, like how can youhave a severe labor shortage,
which Japan absolutely does, butat the same time have this
incredibly skilled workforcethat's just so hard to reach
using the methods we normallyrely on.
And it's really not aboutrecruiters not trying hard
enough.
It's much deeper.
It's about understanding thesefundamental cultural and
(00:57):
operational barriers that demanda totally different game plan.
Chase Stratton (00:59):
OK, let's unpack
that.
We hear about labor shortageseverywhere, but Japan's
situation sounds, well,particularly unique.
What's the basic context weneed here before we really dive
into the recruiting side?
Tessa Sourceley (01:11):
Well, what's
really striking is how deeply
intertwined the talent issuesare with Japan's demographics
and its culture.
Firstly, you've got one of theworld's oldest populations.
So more people are leaving theworkforce than entering it year
after year.
This creates a reallypersistent, significant labor
shortage.
Just as one example, by 2020,projections show a gap of
(01:32):
something like 450,000 ITprofessionals alone.
Now, that definitely creates acandidate-driven market, you'd
think, but
Chase Stratton (01:41):
There's a twist.
A twist.
Okay.
I'm intrigued.
What's the twist?
Tessa Sourceley (01:44):
The twist is
the enduring idea of lifetime
employment.
It's still a very powerfulconcept, especially in the big
traditional companies.
It basically meansprofessionals often expect to
stay with just one or maybe twocompanies for their entire
career.
So changing jobs isn't common.
It's seen as a really highstakes move.
Chase Stratton (02:01):
High stakes.
How so?
Potentially damaging.
Tessa Sourceley (02:04):
Yeah,
potentially.
It could even be viewed as,well, disloyal to the company
you're leaving.
It's a serious decision.
Chase Stratton (02:09):
Right.
That whole lifetime employmentthing really changes the
dynamic, doesn't it?
It must make things tricky forforeign companies trying to
attract people.
Tessa Sourceley (02:18):
Exactly.
It raises a really keyquestion.
If changing jobs is such a bigdeal, such a risk, how do you
possibly convince someone tojump ship?
especially to a foreign companythat might seem less stable or
less known compared to a bigJapanese corporation.
For the candidate, it meansthey need to be absolutely
(02:38):
thoroughly convinced.
They need to feel secure thatthis move is worth the potential
risk to their reputation andtheir future.
Chase Stratton (02:45):
And beyond that
structure, what about just how
people talk, how they presentthemselves?
We're often used to a lot ofself-promotion in the West, but
that's different in Japan,right?
Tessa Sourceley (02:54):
Oh, absolutely
different.
Japanese professionalcommunication really values
modesty, humility.
It's a stark contrast to theWestern emphasis on, well,
selling yourself.
The tendency is very much tounder-promise and over-deliver.
So imagine you have someoneincredibly qualified, genuinely
a level 10 talent, out of...
(03:14):
cultural habit out of modesty,they might describe their skills
as maybe a five or a six.
Chase Stratton (03:19):
Okay, I can see
where this is going.
Tessa Sourceley (03:21):
Right.
A Western recruiter who isn'ttuned into this could easily
hear that five and think, okay,not qualified enough and screen
them out.
They'd completely miss thisamazing potential simply by
misreading humility as a lack ofcompetence.
And this isn't just anoccasional thing.
It's a systemic issue, a realbarrier.
Chase Stratton (03:38):
Okay, that
context is crucial.
So with that in mind, let'stalk about a tool many global
firms lean on heavily, LinkedIn.
The data we found on its use inJapan was, well, pretty
eye-opening.
Tessa Sourceley (03:48):
Yeah, the
numbers really tell a story.
LinkedIn's market share inJapan, it's tiny.
We're talking maybe around2.19%, something like that.
You see figures mentioningmaybe 4, 4.1 million users.
But compare that to thedominant local platforms.
They have tens of millions ofusers.
It's just not comparable.
That's small.
Chase Stratton (04:07):
Wow.
Tessa Sourceley (04:07):
And what's
more, our sources point out
something quite frustrating forhiring managers.
A lot of the job applicationscoming through LinkedIn for
roles in Japan aren't even frompeople living there or people
who speak Japanese.
It ends up wasting a lot oftime.
Chase Stratton (04:20):
And a major
factor there is just the
language barrier, presumably.
Tessa Sourceley (04:23):
Exactly.
Estimates vary, but it'sthought only somewhere between
maybe 2% and 8% of the Japanesepopulation speaks English
fluently.
And LinkedIn, well, most of theprofiles, the content, the
interface, it's predominantlyEnglish.
But it's more than justlanguage.
There's a deep culturalmismatch too.
LinkedIn is fundamentally aboutpublic self-promotion, listing
your achievements, connectingvery openly.
(04:44):
That whole model runs counterto core Japanese values like
humility, modesty, andmaintaining group harmony.
It just doesn't feel naturalfor many professionals there.
Chase Stratton (04:53):
So if I'm
piecing this together, The issue
with LinkedIn in Japan isn'tjust low usage.
It's that the people on itaren't representative of the
broader talent pool.
It's like a little bubble.
Tessa Sourceley (05:05):
That's exactly
it.
You've hit the nail on thehead.
The professionals active onLinkedIn in Japan are by
definition already likelybilingual.
They're probably alreadyworking for foreign firms or
international Japanesecompanies.
They're comfortable with thatmore outward facing Western
style of professionalnetworking.
So if you only use LinkedIn,you're essentially And we heard
(05:33):
some companies
Chase Stratton (05:40):
even mandate
using it first.
Tessa Sourceley (05:42):
Yeah, we did
see that.
Some multinationals apparentlyhave policies forcing recruiters
to spend, say, a month just onLinkedIn before trying other
methods, which, given the lowsuccess rate, means losing
incredibly valuable time andlikely missing out on the best
candidates.
So
Chase Stratton (05:57):
if LinkedIn
isn't the answer for reaching
that broader pool, whatplatforms are Japanese
professionals actually using dayto day?
Tessa Sourceley (06:04):
Well, the
digital scene is dominated by
platforms that fit much betterculturally.
Line is huge.
It's not just messaging.
It's a central hub foreverything.
Daily life, communication, evenprofessional interactions.
We're talking over 97 millionmonthly active users.
It dwarfs LinkedIn.
Then you have platforms like X,formerly Twitter, which offers
(06:26):
a level of anonymity that can beappealing.
Chase Stratton (06:28):
Okay, so
mainstream communication happens
elsewhere.
But are there any professionalplatforms that have actually
adapted to the Japanese contextand found success?
Tessa Sourceley (06:37):
Yes.
Wantedly is a reallyinteresting example.
They've pioneered what theycall social recruiting.
The focus isn't just on skillsand salary.
It's about connecting companiesand potential candidates based
on shared values, mission, andcompany culture.
And crucially, they frame theinitial contact very
differently.
It's positioned as a casualchat where a company visit, not
(06:57):
a formal job interview.
Chase Stratton (06:58):
So that lowers
the perceived risk.
Tessa Sourceley (07:00):
Exactly.
It makes it much less dauntingfor candidates who are
culturally risk averse about jobchanges.
It shifts the wholeconversation from what skills do
you have for us to somethingmore like here's our mission.
Here's our culture.
Let's just talk and see ifthere's a connection.
It shows changing thatnarrative is vital.
Chase Stratton (07:19):
OK, this is all
painting a very clear picture.
It sounds like trying to handlerecruitment for Japan with,
say, a remote recruiter basedelsewhere, someone who doesn't
speak Japanese.
That sounds like an uphillbattle from the start.
Why is it so challenging?
Tessa Sourceley (07:34):
Well, yeah,
their difficulties usually
aren't about lack of skill oreffort on their part.
It's more about a fundamentalinability to bridge these
massive gaps.
Cultural, communication, andeven operational.
Take communication.
Japanese interaction is oftenvery indirect.
There's a huge reliance onnonverbal cues, context, and
something called nimowashi.
Chase Stratton (07:53):
Nimowashi.
What's that exactly?
Tessa Sourceley (07:54):
It literally
means root binding.
But in business, it refers tothe crucial...
informal consensus buildingthat happens behind the scenes
before any formal decision ismade.
It's about laying thegroundwork subtly.
And even things like silence.
In a Western context, a longpause might feel awkward or
negative.
In Japan, silence often meansthoughtful consideration.
(08:17):
It's an active part of theconversation.
Chase Stratton (08:19):
Okay, so a
remote recruiter, probably
trained for directness?
Tessa Sourceley (08:22):
Exactly.
They might misinterpret thatpause as indecision or perhaps
take an indirect yes as a maybe.
They miss the subtle signals.
They can't read the atmosphereeffectively from afar.
Chase Stratton (08:32):
And it goes
beyond just conversation style,
right?
There are specific businessrituals, too.
Tessa Sourceley (08:36):
Oh, definitely.
Business etiquette is quiteformalized.
Think about the simple act ofexchanging business cards,
meishikokan.
There's a whole ritual aroundhow you present it, receive it,
where you place it on the table.
These aren't just, you know,quaint customs.
They're fundamental signals ofrespect and the beginning of
building trust.
A remote recruiter simply can'tparticipate in that.
(08:57):
Then there's the hierarchicalnature of many workplaces.
workplaces.
Voicing a strong, directopinion, especially upwards, can
be seen as inappropriate.
A remote recruiter, unaware,might push too hard or phrase
things in a way thatunintentionally causes offense
or makes someone lose face.
Chase Stratton (09:13):
So deep cultural
and communication barriers.
But you mentioned operationalhurdles, too.
What does that mean in practicefor a remote team?
Tessa Sourceley (09:21):
Well, it means
lacking the physical presence
needed for so much of Japanesebusiness life.
Think about nomunication, thatblend of nomu, to drink, and
communication.
Those informal after workdrinks or dinners are incredibly
important for building personalrelationships and trust.
Business in Japan often reliesheavily on that personal
rapport, which you just can'tbuild effectively over Zoom from
(09:42):
Singapore or London.
Chase Stratton (09:43):
Right.
The trust factor.
Tessa Sourceley (09:44):
Absolutely.
And for foreign companies,especially ones that aren't big
global names, there's often zerolocal brand recognition.
A remote team struggles toconvincingly sell the company,
its stability, its culture.
Why should a candidate trustthis unknown entity?
Even practical things likenavigating Japan's often complex
visa procedures for foreignhires can be really challenging
(10:07):
without on the ground expertise.
Our sources really highlightedhow recruiters living in Turkey
who speak the language are justdramatically more effective
because they can actually do allthese things.
Chase Stratton (10:17):
So putting it
all together, it feels like
there's this huge communicationchasm on one side and on the
other, this massive risk versusreward calculation for the
candidate that a remoterecruiter just can't adequately
address.
Is that about right?
Tessa Sourceley (10:31):
That sums it up
perfectly.
The Western recruiter gearedfor directness misses the
nuances, misreads the signalslike modesty and fails to build
that essential rapport.
Meanwhile, the Japanesecandidate is weighing up a
potentially career alteringdecision.
Is this move worth risking myreputation, my stability, my
place in my professionalnetwork?
A remote recruiter lacking thatdeep local insight, the
(10:54):
cultural fluency and thepersonal connection simply can't
build enough trust orarticulate the value of Okay, so
if the
Chase Stratton (11:07):
standard ways
relying on LinkedIn using remote
non-Japanese speakingrecruiters, those fall so short,
what actually does work?
Our sources seem to point quitestrongly towards one particular
solution.
Tessa Sourceley (11:19):
Yes, the
consistently effective strategic
solution is to partner with alocal specialized executive
search firm, a headhunter,basically.
These firms operate verydifferently.
They're generally not postingjobs on public boards or just
searching through databases ofpeople actively looking for
work.
Their core method is proactiveheadhunting.
They directly and discreetlyreach out to passive candidates,
(11:42):
talented people who arecurrently employed, likely doing
well and not actively lookingfor a new job, but who are a
potential fit.
Chase Stratton (11:50):
So they're
accessing a hidden market,
essentially.
Tessa Sourceley (11:52):
Exactly.
They tap into this unseentalent pool and they do it
through deep, established, oftenprivate networks of referrals
built up over years, that accessis the absolute key advantage.
That's how you find those highcaliber, loyal professionals in
traditional companies who wouldsimply never respond to a job ad
or show up on LinkedIn.
Chase Stratton (12:10):
It sounds like
their role goes way beyond just
finding names.
They're acting as more of abridge or even an ambassador.
Tessa Sourceley (12:16):
Very much so.
They become this trusted thirdparty.
They're fluent in Japanesebusiness culture, obviously, but
they also deeply understand theclient company's goals and
needs.
They can effectively translatethe company's value proposition
into the indirect, nuancedcommunication style that
resonates in Japan.
They build that bridge ofunderstanding.
And crucially, for a foreigncompany that doesn't have a
(12:39):
strong local brand, thereputation of the executive
search firm itself providesinstant credibility.
The recruiter effectivelybecomes the local face of the
company, significantly loweringthat perceived risk for the
candidate.
They answer the why trust youquestion.
Chase Stratton (12:55):
And I imagine
the results reflect this
effectiveness.
What kind of success rates arewe talking about?
Tessa Sourceley (12:59):
They really do.
The retained executive searchmodel in Japan has a remarkably
strong track record.
Some top firms boast successrates around 97% for filling
roles.
Chase Stratton (13:08):
97%.
That's incredible compared tothe average.
Tessa Sourceley (13:12):
It really is,
especially when you compare it
to a typical industry averagethat might be closer to, say,
64%.
And their screening process isincredibly thorough.
It goes way beyond justmatching keywords on a resume.
They're assessing leadershippotential.
mindset, adaptability, andcritically cultural fit, which,
given the importance of groupharmony, is absolutely essential
(13:34):
for long-term success andretention in a Japanese context.
Chase Stratton (13:37):
Now this level
of specialized service, this
kind of access, It doesn't comecheap, I assume.
Our sources mentioned a typicalcost structure.
Tessa Sourceley (13:45):
No, it's
definitely a significant
investment.
You're typically looking at afee structure ranging from 30%
to maybe 35% of the candidate'stotal first-year guaranteed
compensation, their on-targetearning.
Chase Stratton (13:55):
That sounds
high, but I suppose you have to
weigh it against thealternative.
Tessa Sourceley (13:59):
Precisely.
It might seem like a bigexpense up front, but you
absolutely have to view it as astrategic investment, not just a
cost.
Think about the opportunitycost.
What's the cost to the businessof having a critical senior
leadership role sit empty forsix, nine, 12 months while you
struggle with ineffectivemethods?
That cost usually far outweighsthe recruiter's fee.
(14:20):
Essentially, you're paying foraccess to a network you simply
cannot build yourself overnight.
You're paying for deep culturalexpertise you don't have
internally.
and you're paying for a provenmethodology that bypasses all
those systemic failures we'vediscussed.
Plus, our sources were veryclear.
For senior roles in Japan, theretained search model, where you
pay a portion upfront, is farsuperior to contingency search.
(14:43):
It ensures commitment andfocuses everyone on finding the
right long-term fit, not justfilling a slot quickly.
Chase Stratton (14:49):
So bringing this
all together, what are the key
takeaways for you, our listener,especially if you're involved
in global hiring or maybethinking about expanding into
Japan?
Tessa Sourceley (14:57):
Well, I think
this deep dive makes it pretty
clear, doesn't it?
Success in hiring top talent inJapan really hinges on adopting
a localized,relationship-driven approach.
Those standard Westernrecruitment playbooks,
especially ones heavily relianton remote teams or platforms
like LinkedIn, are largelyineffective, if not obsolete,
given Japan's unique mix ofdemographics, deep cultural
(15:19):
norms, and its distinct digitallandscape.
Chase Stratton (15:22):
Right.
So the strategicrecommendations seem pretty
straightforward, even if theyrequire a shift in thinking.
First, really embrace thatretained executive search model.
See the fee not as a cost, butas a vital investment to access
that hidden high value talentpool.
Second, look at your owninternal processes.
Be ready to adapt.
You need to shift the focusfrom why should we hire you to
(15:43):
more of a how can we convinceyou that this is the right,
secure and valuable opportunityfor you.
And finally, think long-termabout building your brand in
Japan.
Your recruiter is often justthe very first step.
You need a sustained commitmentto localization and
establishing genuine trust andpresence in the market.
Tessa Sourceley (16:00):
Absolutely.
And perhaps this leaves youwith a final thought to
consider.
In our interconnected world, weoften assume strategies can be
universal.
But where else, maybe in othermarkets you operate in or are
considering, might deeplyembedded cultural norms be
quietly undermining yoursupposedly global approaches?
How can you start to uncoverthose hidden barriers before
(16:20):
they turn into significantobstacles.
That's something worthreflecting on.