March 16, 2013 Why 80% of Japanese returning to Japan HQ quit

I attended the “rebel” 15th anniversary reunion of my business school class recently. It was a rebel reunion because as veterans of the 1997 Asian financial crisis, the 2001 dotcom bust and the 2008 Lehman shock, we are quite a frugal, prudent bunch (although there was talk of one or two modest millionaires being in our midst) and didn’t fancy forking out the thousands of dollars in travel, accommodation and class donations being requested to attend the official reunion on campus. Instead, a few of our class arranged an alternative, cheaper party in a club in London.

Of the 90 or so alumni that came to the rebel reunion, I estimate less than ten percent are with their original employer of fifteen years’ ago. Many were, like me, sponsored by their company, with some conditions attached, such as staying for two or more years after graduation. My classmates have set up their own companies, gone to work for competitors or even changed profession entirely.

There were very few who, like me, were sponsored by a Japanese company. And I’m afraid I joined the vast majority of those at business schools who were sponsored by a Japanese company, in becoming frustrated with my employer’s lack of understanding of how best to make use of me when I returned, and quitting.

I have heard similar frustrations recently from young Japanese people, around the same age as an MBA candidate, who have been sent to work abroad by their Japanese employer. They learn and experience a huge amount, enjoy some autonomy and responsibility, but on returning, are plunked back down in the same domestic oriented, junior level jobs they were doing before they left, with very little interest shown in the insights and skills they gained abroad. One company told me around 80% of young returnees quit within a few years of coming back to Japan headquarters.

Japanese companies cannot view this as sanguinely as Western companies. In the West we think it is partly the dues you pay to your industry, to invest in training up future senior managers for the industry to benefit from. Some MBA grads may stay, some may join client companies and be a useful contact, others may return at a more senior level after gaining experience elsewhere.

Most of the Japanese returnees, however, are leaving their Japanese employer for a foreign company based in Japan, so in effect the very reason that they were sent overseas – to help Japanese companies globalize – has been undermined.

Maybe Japanese employers need to view those employees departing for foreign companies as “alumni”; by keeping in touch and keeping the door open should they wish to return a few years later, with experience of another corporate culture. Only then can Japanese companies become truly diverse and global. When there are more people with diverse experience at senior management level, it becomes easier to attract and retain other high fliers whose genders, nationalities and career backgrounds may differ from the traditional mainstream – including those juniors who are sent overseas.

This article by Pernille Rudlin originally appeared in the 26th November 2013 edition of the Nikkei Weekly