An update from Sam Puri, who is participating in the Global Leadership Program in Japan and China:
To start Day 3 of the Global Leadership Program, we had to take an early bus the next morning for our company visit to Nishimura & Asahi and Hitachi. The purpose of company visits during the GLP program at SMU is to learn about work culture and operations for internationally-based companies.
During our first visit to Nishimura & Asahi, we had the pleasure of first hearing from Megumi Kiyozuka, CLSA at Nishimura & Asahi. He spoke mainly about the macroeconomy, private equity in Japan, and career paths to private equity in Japan.
These were some key points that Kiyozuka mentioned:
- Unemployment in Japan is increasing yet is just under 4%
- Japan is the largest country with net foreign assets at 2.903 Billion
- The oldest private equity firm in Japan was established in 1999
- It is difficult to raise money in the United States for Japanese investments
- Japanese private equity firms are looking for people with analytical skills for entry-level positions; however, soft skills are more important for subsequent managerial positions
The next speaker was Jiro Abe, who spoke about competition law and antitrust laws. His main key points were:
- In the mergers and acquisitions (M&A) space, competition lawyers are everywhere
- The Japan Fair Trade Commission (JFTC) conducts “Dawn Raids,” where they show up at a company’s office to conduct audits on competition and antitrust law compliance
- Generally speaking, to be a dominant company in an industry, the organization must have more than 50% of market share
After our visit to Nishimura & Asuri, we visited Hitachi. The speaker was Yoshitaka Komiya, and his insights about Hitachi included:
- Growth in current domestic markets cannot always be expected, so it is important to expand reach
- Hitachi plans to expand its high-voltage facilities into global markets
- Saudi Arabia is a potential global market that can be a hard market to break into
- Natural disasters may slow growth as technologies may need to be replaced
I found it interesting that similar to companies in the United States, Hitachi was also looking to expand its reach into global markets to boost growth. Also, according to Nishimura & Asuri, it appears that many of the Japanese private equity firms are looking for candidates similar to private equity firms in the United States.
Although some similarities were present between countries, there were also some main differences that I noticed between the United States and Japan. The first is how young the private equity market is in Japan relative to the States, as Japan’s oldest firm was established only 15 years ago. Another difference is that Japan has to still recover from its tsunami natural disaster, which may slow growth and inhibit technological capabilities.
After the company visits, I visited Disneyland Tokyo with seven other MBA students. It was a fun experience, and is quite similar to the Disneyland in United States with theme-park rides, games, and tours. Even if you have visited Disneyland in the U.S., I would highly recommend visiting the Disneyland in Tokyo, as it will provide a unique experience with rides, games, and tours that cannot be found anywhere else in the world.
Tomorrow we will visit PriceWaterHouse Coopers (PWC) and Kirin. Be sure to continue checking the blog as I will have an updated post on those visits soon!