The Future of HR in Japanese Tech Industry

It is February 2022 and it has been exactly 6 years for me working as an HR specialist in the Japanese tech industry. I can say that the Japanese tech industry has seen a big change in the last 6 years, thanks to the success of tech unicorns like Mercari and Smart News. These companies have successfully expanded their services outside of Japan as well as hired a lot of tech talents from outside Japan. In this blog, I will present my observations of the things happening in the Japanese tech industry as well as how the HR divisions can be future-ready to keep up with these changes.

Tokyo Tower as seen from Mercari office in Roppongi Hills

5 Business Observations in the Japanese tech industry

1. Make for Japan, expand to the world: Japanese startups have been eyeing global expansion at a very early stage. Mercari and Smart News have emerged as pioneers, as both of these companies have expanded to the US successfully.
2. Western tech companies are eyeing expansion in Japan and Korea due to the size of the economies and the lack of innovative solutions.
3. Support for foreign startups to expand in Japan: This is still at a very early stage but the city governments are promoting this actively.
4. Shortage of talent is one of the biggest blockers for the business, accelerated due to the border restrictions caused by covid-19.
5. Remote work, flexible working hours, freelancing, working on side projects getting more common due to the covid-19 onset and subsequent work from home policy by the companies.

Mercari introduced “Your Choice” in 2021 to promote working from anywhere in Japan

Pertaining to these business changes, HR in the tech industry needs to be changed. While some companies like Mercari are actively making these changes, others need to work actively to keep up with the business changes. Here are my 8 points that should be acknowledged by the HR division heads of the Japanese tech companies to be future-ready:

1. Employer Branding is more important than ever: Whether to attract new talent, retain talent, or even attract investors, the employer branding function is becoming indispensable to win the war for best talents. The western companies have already identified this and have built solid teams around Employer Branding, Engineering Branding, Company Advocates, etc. One of the main roles of these teams is to empower line managers and members to promote & brand their teams on various networks & platforms.
2. Invest in systems for skills and internal mobility: With the acute talent shortage, skill gap identification and skill-up programs need to be accompanied by internal mobility systems. This is a win-win for companies and employees since it helps in the development of both parties. It will help in employee retention, engagement as well as succession planning.
3. Promote English and D&I education: This is a unique problem in Japan. As Japanese tech companies aim to expand globally as well as hire top talents to their firms from other parts of the world, I would say it is necessary for the management to be able to convey their vision and ideas in English, which has become a global language in today’s world. Same time, the management should be able to work with a diverse workforce, while including them in relevant discussions.
4. Enable Work-Life Flexibility: Employees can choose where to work from, when to work, how to work (part-time, full-time, full-time with side projects, etc)
5. Invest in data-driven HR: My observation is that Japanese people mostly make decisions based on consensus, rather than data. This process is biased since the consensus is aligned with the most powerful people in the room. This needs to be changed and the use of HR data should be promoted by the management to make any people decisions. For that, there is a need to set up the HR data infrastructure and create tools to help you with that. Feel free to connect me on LinkedIn if you need any help in this.
6. Promote Agile HR: From HR that takes decisions for the company to HR that enables divisions and teams to make their own decisions. This needs to be followed in all aspects of the Employee Experience Journey. Does this mean HR is no longer strategic? No. HR still needs to create strategies on how to provide resources and platforms to enable divisions and teams. For example, L&D team needs to create programs like “Lunch & Learn” and open manuals so that other teams can execute them. If you are interested in reading more about Agile HR, check out Agile People: A Radical Approach for HR & Managers
7. Invest in Knowledge Base: End of the day, employees leave the organization and new employees join. Also, the employees will move around teams and divisions. What makes the transition difficult is the lack of documentation or the difficulty in finding the right resource at the right time. Investing in a knowledge base can go a long way in not only improving the employee experience but also achieving business success.
8. Hire more diverse members in the HR divisions: While many tech companies are in the favor of hiring talents from different cultures and backgrounds in the engineering or product divisions, HR divisions are still largely operated by Japanese employees with experience in the corporate side of things. As the HR responsibility shifts towards empowering employees rather than making decisions for them, it becomes important to hire more diverse members in the HR divisions.

Image Source

Finally, I would like to say that my organization Mercari is moving towards the above-mentioned 8 points. We are currently hiring members for our People & Culture team. Do check the openings here: https://careers.mercari.com/search-jobs/

Feel free to connect with me for any questions or suggestions on this blog.

LinkedIn: https://www.linkedin.com/in/jatinkumarmercari/

Twitter: https://twitter.com/jkroks