The impact of cultural work differences on Japan Company doing business in Viet Nam Honda Motor Company

Working Paper
Mai Hoang Vu Mai Anh Tu Nguyen Duc Anh Ngo Van Luc Nguyen Tuan Phuc

The Honda motor Company Honda Motor Co., Ltd. is a Japanese public multinational corporation primarily known as a manufacturer of automobiles and motorcycles. Honda has been the world's largest motorcycle manufacturer since 1959 as well as the world's largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year. Honda became the second-largest Japanese automobile manufacturer in 2001. Honda was the eighth largest automobile manufacturer in the world behind General Motors, Volkswagen Group, Toyota, Hyundai Motor Group, Ford, Nissan, and PSA in 2011. As a young man, Honda's founder, Soichiro Honda (Honda Sichir) (17 November 1906 5 August 1991) had an interest in automobiles. He worked as a mechanic at the Art Shokai garage, where he tuned cars and entered them in races. In 1937, with financing from his acquaintance Kato Shichir, Honda founded Tkai Seiki (Eastern Sea Precision Machine Company) to make piston rings working out of the Art Shokai garage.After initial failures, Tkai Seiki won a contract to supply piston rings to Toyota, but lost the contract due to the poor quality of their products. After attending engineering school without graduating, and visiting factories around Japan to better understand Toyota's quality control processes, by 1941 Honda was able to massproduce piston rings acceptable to Toyota, using an automated process that could employ even unskilled wartime laborers. ( Wikipedia , 2012 ) Honda Viet Nam:

Honda entry into Vietnam market in March 1996. March 22, 1996, Honda Company was officially founded. Honda Vietnam is a joint venture between Honda Motor Company of Japan,

Asian Honda motor company in Thailand and corporations movers and Vietnam agricultural machinery. . In March 2005, Honda Vietnam has received the license of Ministry and Planning and Investment Portal of Vietnam to allow Honda produces and assembles cars in Vietnam.

This is an important history of Honda Vietnam; it marked the development of Honda Vietnam in Vietnam market. After one year and five months, Honda Vietnam has successful built factories and construction agency network. The company has completed the training programs, service and safe driving for employees and agents released first car model in August 2006.

Since this time, Honda Vietnam is not only known as motor manufactures with product reputation, but also a manufacturer of automotive prestige in Vietnam market. Manufacture of Automobiles: Established: 2005 Office: Phuc Thang, Phuc Yen, Vinh Phuc province. Capital: Approximately $ 60 million Area: 17.000m2 Labor: 408 People Capacity: 10,000 cars per year Total capital investment of Honda Vietnam is 290 427 084 usd, 62.900.000usd charter capital, number of employees is 4,369 people. Automotive manufacturing plant is equipped with machinery and equipment similar to the Honda plant in other countries with criteria focusing especially on quality, safe and friendly environment. Moreover, the plant also is equipped with engine assembly lines with the desired gradual localization of products Cars.

Abstract: Culture has become an essential factor in understanding different economic and business environments. . The culture has on people and society has been studied and defined by scholars through different models. In the global business environment, it is inevitable that activities are increasingly across cultures. As a major emerging market, Vietnam offers many MNCs great potential in their future growth. This paper explores issues in cross-cultural management area in the setting of joint ventures in Vietnam. This articles also talks about the abilities in adjusting to working and living in Vietnam and its impact on their performance. It further discusses the management style appropriateness and cultural differences in leadership styles and the impact of these issues on effective management in Vietnam for Asia MNCs.

Introduction Business development across continents has become the important problems for

organizations whose activities are expanding internationally. In the 2014, these international businesses must necessarily employ managers with the skills to manage across extremely different cultures. The Japan based businesses, operating in Viet Nam have proved to be a major challenge of cross-cultural expertise. Cultural differences are reasons have led to the research and activities of foreign companies in Viet Nam unsuccessful performance. The increasing parameters of foreign investments in Viet Nam raises the issue culture and the working in the company become the top issue to resolve before we invested to Viet Nam. In this paper, the case of an Japan business in Viet Nam is example to exemplify the impact of cultural difference on international business operations. The challenge for the Japanese managers is how to

understand Vietnamese culture and use this as a basis for conducting business and managing Japanese staff in Viet Nam. This cross-cultural competency directly affects the performance of many MNCs. Relevant research

This paper has constitutes an intersection of two research fields concerning cross-cultural technology transfer and cross-cultural Honda company management practices.

In the cross-cultural technology transfer , we have many important problems to facilitating develop knowledge and technology transfer in cross-cultural business contexts, but these works such as the characteristics of the knowledge, the suppliers and recipients, and their relationships (e.g, Le & Evangelista, 2007 ; Sazali, Raduan, Jegak, & Haslinda, 2009). Some studies have indicated the importance of national culture in the cross-cultural knowledge transfer process (e.g., Holden, 2002; Pauleen, Wu, & Dexter, 2007). Others have pointed out that cultural difference and distance are the key obstacles and the roots of cultural conflicts and misunderstandings in inter-firm knowledge and technology transfer (e.g., Lin & Berg, 2001). (Nguyen, T.D.N., & Atsushi Aoyama, 2013)

And In the cross-cultural Japanese management practices, there are few insights into how Japanese manufacturers adjust their successful production methods on the locational, regional, or spatial level (Schlunze, 2002). Some studies have taken culture-based approaches to examine the impact of Japanese-style management on Japanese multinational companies (e.g., Swierczek & Onishi, 2003; Dore, 2011), (Nguyen, T.D.N., & Atsushi Aoyama, 2013) or to analyze the

potential for the international transfer of Japanese production systems. While acknowledging that the Japanese-style production system is difficult to transfer successfully.

Finally, the studies on cross-cultural technology transfer and cross-cultural Japanese management practices have mainly aimed to explain the nature of international culture transfer, and have lacked a synthetic and incorporating both theoretical and empirical approaches. The key issues, which have yet to be conceptualized adequately, are how Japanese managers adjust their management styles to match local cultures, and how they decide which managerial elements should be adjusted. Reason chosen topic

The topic we chose to investigate Honda Company in Vietnam because it was one of the first companies in Vietnam to develop very early. And also the Honda Company improves work culture and advanced manufacturing technology in the latest Vietnam since 1960. That makes our team very interested in Honda Company so after all the Japanese companies in Vietnam, we chosen Honda priority become target group has a studies working papers.

The difference about group consciousness between Japanese and Vietnamese

In this article I will write about cultural studies and cultural groups active in company time Honda. First we will learn about the cultural activities of the group to date. Japanese people have other thoughts to the west on how it's done. The western thinks that they have done in the shortest possible time. However the Japanese people think that they want the job done most

efficiently. Each individual knows his limits and they do not want their work is not completed perfectly. Because they always think like this so personal they feel they need to help their peers. They are always willing to help their colleagues a dedicated and thoughtful way. For reasons similar to those caused by many Japanese workers rarely use their vacation time fully. They feel it is their duty not to abandon others while they are working; regardless of their work has been completed. They stay in the office to share the experience together. From there they can learn from the experience of others. Because of this and to ensure that workers get some time with their families, the traditional Japanese company completely shut down for a week in the spring and summer and also in the New Year. A common practice is the "company trips with everyone going away for a few days of fun with each other, either wholly or partially funded by the company. I will tell you the story of Rene T. Domingo when he was working in Japan. Rene T. Domingo writes When I was in Japan, I worked in the office doing paperwork. One day I heard my boss talking to someone over the phone and he became very excited. It turned out he was negotiating with a manager of one factory who was borrowing workers from his factory. In Japan, it is a very fluid situation. There is no such thing as loyalty to a factory. You are loyal to the company. If one factory needs your workers, then you lend them out. No questions asked. There was this negotiation because demand suddenly picked up or there was a high rate of absenteeism. I thought the problem was over when the phone rang again. Another factory needed more people. But there were no more people to send over from our factory. All the extra workers were already lent out to other factories. But we had to help this particular factory. So my boss started calling up the marketing department, the accounting department, the personnel department borrowing people. There was no resistance, no angry remarks from the different departments. The Chief Accountant said, "Okay, I'll lend you five accountants to assemble cars,

to run your milling machines." The Marketing Manager said, "I have five salesmen here who are not busy. I'll send them over to you." And for the sake of knowing what Japanese teamwork really is, I also volunteered. In this situation, you can understand that cultural groups in renovation work not only within the company but also in the middle of the company together. It is a culture of team work in Japanese company Honda. This passion for teamwork shows up in endless ways. The easiest way to see how much the Japanese people truly enjoy teamwork is to watch a Mikoshi team at a Japanese festival. A mikoshi is a chariot for a god. They are heavy. Mikoshi can easily weigh 1000 kilograms (2200 pounds). It takes a great deal of teamwork and determination to get a mikoshi through the streets. Just to make things a little more challenging, competing Mikoshi teams might meet at a predetermined spot and bounce the mikoshi wildly in the air. Mikoshi teams are fiercely competitive. In Japan, when one member of a team has to work late, it's common for the entire team to stay (even when half the team isn't directly involved in the task at hand). There's an unwritten rule in Japan, never go home before the boss. Workers who have finished their day's work may wait for the boss to leave before going home. The opposite also happens, if there's a task to be done on the weekend, it's common for the entire team (including management) to show up. Traditionally, Japanese companies hired employees for life. Only in unusual situations such as bankruptcy were people laid off. This is slowly changing. These days, some employees will shop around for a new job every five or ten years. Companies are a little more likely to lay off employees in difficult times. However, compared to the United States layoffs and firings are uncommon in Japan. Workers in Japan take responsibility for mistakes of their company. When the company screws something up, employees apologize. When something goes very wrong, the entire executive team is likely to quit in apology. All workers on Honda's assembly line have the authority to stop the entire

production line if they spot a quality problem. Any mistake is the responsibility of the entire organization (not only the individual who committed the error). When Honda workers call a cab in Tokyo, they request a Honda. Japanese workers not only buy their company's products, they pressure their entire extended family to do the same. This stems from their team loyalty. In Japan, everyone loves uniforms. A uniforms makes you part of the team. But after investing in Vietnam, the culture of teamwork has not been maintained perfectly. Honda Company is the joint venture company, but the all most of company' employees is Vietnamese so there is the inevitable impact of the work culture of the Vietnamese to Honda Company. Write your employees always have negative thoughts when working in groups as they are afraid of losing their own interests. They always have the thought that I am always right, only I do it in the best way. This caused a great impact on the connecting member in the group. Difficulties arise both cognitive problems and offering solutions, because everyone is claiming to be the center stand, is "valuable asset" of the group. Besides, they had looked at the strengths and weaknesses of themselves. Understanding their role in interacting with other colleagues is very important. To create credibility for the rest of the team members, they must be made aware and proactive about their role in the collective. This is beneficial when the head of the work group assigned to members. If you know about, they will be more accurate decisions, leading to more satisfactory results. That's two crucial issues affecting the working culture of employee groups. However, there are equally important issues such as who wrote frequently on relations and for relations between the emotional views. So there are issues most people are not pro but still passed. It is even affecting the culture of teamwork. It means that people do not have a voice in the group and k be given ideas to help get the job done in a better way. It also affects the creativity and learning of those around them. That is the problem that Honda employees who are

suffering in Vietnam. Honda Vietnam need to find out solutions in order to promote the culture of teamwork as Honda Japan has done. Since then the quality of the new Honda Viet Nam increasingly developed. Working style It can be defined as the way people in the work force absorb and retain new and difficult information, think or concentrate, do their daily work and solve problems. Everyone has a unique style in which they prefer to work and if a person's working style is matched with their work requirements, job satisfaction increases and their work performance improves. Are working styles useful for managers? Yes, particularly when it comes to staff selection or promotion. Knowing an employee's working style will also help with communication, how they need to be instructed and supervised and to which management style they will respond best. Working style in Vietnam Of course, in a company you cannot avoid of bicker with each other because of different ideas. However, try to give some suggestions and open your mind with your colleagues. Talk bad things about a person with others, people will estimate you as a bad component which is try to dividing the company. This is the taboo thing in a company, because it will decrease the rate of progress of the company.

Too messy: It can be shown through your appearance or your desk. Vietnamese have a bad habit in the company; they think that their job need a lot of documents and papers, therefore a messy table is not important for them. But this habit will show your personality. People will

estimate you as a messy person in the company also. So, you need to take care your appearance and redecorate your desk.

Go to work late always happen in Vietnamese business. It is very common that people are always having a reason for being late in Vietnam like: traffic jam; bad weather; car or bike broke which only a small part in these reasons is truth. Some business man in Vietnam after finish their job in the company, they hang out with their colleagues to drink alcohol or beer, some stay at home and watch a late soccer match, some get in trouble with the traffic jam everyday but not try to wake up and go to work sooner They think there are a lot of people are always late like them, or if they late for 5 minutes not thing going to happen with them.

Vietnamese businessman sometimes very selfish, they carry things, which is value for themselves. They know how to deal with this job but they never teach and tell with anybody in the company. Then in the future, they might get in trouble with other jobs but nobody tell them how to solve these problems. Furthermore, these problems can affect to the whole company and directly affect to their job. Vietnamese businessman should learn how to prevent from this problem by share their knowledge and information with others staffs in a company.

One more problem is people in Vietnam are very subjective, they gather their job to finish it quickly and spend their free time in the company to talking, chatting However working like this is very dangerous and illogically because it will brings a lot of stressful to them with a pressure how to deal with all of these things. It is so shame that a lot of people still remain this kind of work. Whenever they have a new project or take part in a meeting, they do not have any concrete idea, also not spend time to invest the plan and looking for necessary information.

Working style in Japan: In general, most Japanese "salary men" employed with a Japanese corporate environment work much longer hours than their western counterparts in a western environment, as do their managers and female assistants. Although the law states a maximum number of hours per working week and most companies officially work from around 9 am to 6 pm. In fact, the majority of people will be in their office at least 30 minutes earlier. Working in time is very important in Japan, which is a necessary manner for a businessman. Japanese believe that a person who cannot work in time is an untrusted person. Therefore, they had prepared everything for the job in the night before they sleep. In the morning, they go to office by bike, bus or subway that is exactly in minute. In Japan most of the works are done by group, therefore to make the job smoothly, the staffs need to stay focus and catch the rate of progress of others job in the company to acting harmoniously. This mean you need to report your rate of progress to others, and keep contact with people and your higher authority for your difficulty. Japaneses desks are always clean, well ordered and perform logically to safe time when looking for stuffs and necessary documents. They do that to prevent plenty of problems appear from careless. A recently enacted law restricting the amount of overtime an individual could work has unfortunately just resulted in employees not reporting the extra hours they do. Japanese work spontaneously and too much that Japan had a word karoshi which psychologically unsound work processes are allowed to continue in a way that disrupts the worker's normal work and life rhythms, leading to a buildup of fatigue in the body and a chronic condition of overwork

accompanied by a worsening of pre-existent high blood pressure and a hardening of the arteries and finally resulting in a fatal breakdown, or shortly: the death caused by working too hard.

Table: The Honda company management style with respect to Vietnamese culture

Critical managerial elements

Seniority system

Original Japanese management style The person who has worked longer with the company will have the higher wage. Promoted by age; the younger person with stronger abilities will not be promoted to a position higher than one held by an older person. Reward group success rather than individual success.

Actual Japanese management style Adjust the wage system each year according to Vietnamese material labor laws and labor unions. Increase about 10-20% depending on the business situation Performance-based rewards according to personal performance evaluation. Rewards for individuals are recognized in a positive wayopenly, frankly, and fairly. The bonuses are paid one per year, about 1 to 3 months' salary. The promotion is done by the immediate superior and is based on work experience, seniority

Dimension of Vietnamese culture Individual initiative. Working to receive personal rewards or incentives worth the effort spent. Differentiation according to power distance.

Job classification

Job classification is not related to wages or promotion.

(usually up one level per 3 years). Flexible Japanese-style system and local-style system. Not much adjustment. Apply multiple work for one employee, e.g., accountant cum office administration, technical staff cum production management, quality control.

Adventurousness, eager to take new chance, less care about risk. To demonstrate individual ability in organizations success.

On-the-job-training

The best way to secure production is on-the-job-training

Train the key Vietnamese technician in Japan from 3 to 6 months, who will train Vietnamese workers under the supervision of Japanese experts in the early stage. Group for quality control and group for quality improvement Supervisors for each production area.

The differentiation in individual ability. The differentiation in managerial role leading company.

Quality control

Require high sense of responsibility for the efficient production of high quality products.

subordinates tolerate inspection and distribution of power at work. Adventurousness, pay less attention to quality practices. Value balance in the process of working and a balance between personal and work life.

Hiring policy

Lifetime employment

Long-term contract: the working experience and skills. Short-term contract: workers who are less education, good health, diligence.

Emphasis on autonomy, separation between management group and worker, professional and Skilled education.

(http://dx.doi.org/101.5539/ass.v8n11p26)

Conclusion

Suggestions for a better working environment:

+ Vietnamese should learn Japanese in how they work and their working altitude. When Japanese working, they really stay focus on their duty and try their best to finish it perfectly even they could stay in the office overnight.

+ People in a company should help each other with their problem, share your knowledge and information with your colleagues, you will get their respect and if you have a trouble in the future, you will get their help too.

+ Try to keep an orderly working environment. By having a good place to work, you will work perfectly and it will safe your time when you are looking for your items and documents. Therefore, your pressure in the company will noticeably reduce.

+ Vietnamese should prepare everything they need for the next day before they go to sleep. This will prevent them from being late for work. Although, they should leave the house as soon as

possible if they do not like the traffic jam. Besides, going to work late gradually can make them dismiss from the company.

References

Bhagat, R. S., Kedia, B. L., Harveston, P. D., & Triandis, H. C. (2002). Cultural variations in the cross-border transfer of organizational knowledge: An integrative framework. The Academy of Management Review, 27(2), 204-221. Chen, J., Sun, P., & McQueen, R. (2010). The impact of national cultures on structured knowledge transfer. Journal of Knowledge Management, 14(2), 228-242. Creswell, J. W. (2009). Research design: Qualitative, quantitative and mixed methods approaches (3rd ed.). Los Angeles: Sage Publications. Dore, R. (2011). British factoryJapanese factory: The origins of national diversity in industrial relations (1st ed.). Abingdon: Routledge. Goulding, C. (2002). Grounded theory: A practical guide for management, business and market researchers. London: Sage Publications Ltd. Holden, N. (2002). Cross-cultural management: A knowledge management perspective. Harlow: Financial Times Prentice Hall. Lin, B. W., & Berg, D. (2001). Effects of cultural difference on technology transfer projects: An empirical study of Taiwanese manufacturing companies. International Journal of Project Management, 19(5), 287-293. Lucas, L. M. (2006). The role of culture on knowledge transfer: The case of the multinational corporation. The Learning Organization, 13(3), 257-275.
https://en.wikipedia.org/wiki/Honda

Le, N. H., & Evangelista, F. (2007). Acquiring tacit and explicit marketing knowledge from foreign partners in IJVs. Journal of Business Research, 60(11), 1152-1165. http://dx.doi.org/10.1016/j.jbusres.2007.04.006
Nguyen , T.D.N., & Atsushi Aoyama (2013). Does the hybridizing of intercultural potential facilitate efficient technology transfer? An empirical study on Japanese manufacturing subsidiaries in Vietnam. 1105-1162