Japanese airlines also have unions and FAs do have a right to speak up. But it’s in Japan. Like most of the other Japanese companies, ANA established the union just for formality and it doesn’t function as it does in the US and Europe. Informal pressure from the management and unsuccessful track record of these unions have inhibited employees’ willingness to speak up and raise the pressing issues surrounding them. That must be a part of the reasons that the working condition has persisted for so long.
Alfonso, you spot on. The retention rate is actually low at ANA and this is a growing concern for them. I think they really reconsider the treatment of its employees. The reason why ANA has been so successful, I think, is that the protectionism in the Japanese airline industry have done a favor for established Japanese airlines such as ANA and its only rival, Japan Airlines, went bankrupt and was delisted about 10 years ago. Since the competition is getting more and more intense now and customers are getting more and more familiar with other option such as LLC, I think that the competitive edge that ANA has had is now at risk.
Thank you very much for the comment, professor! I believe ANA’s performance have not been strongly impacted by the misalignment. However, I think it’s because the protectionism the government poses on Japanese airline industry has limited the competition for them and Japanese customers tend to choose their domestic airplanes over their cheaper foreign counterparts. This environment can change anytime.
Thanks for the comment, Boris. I believe that the management’s ignorance about on the ground operation is pretty prevalent among traditional companies in Japan. I hope newer companies such as Rakuten would change the entire landscape of Japanese business world.
For the 2nd question, I still believe Japanese airlines align Omotenashi with their business objective better than the other airlines and have better service and hospitality on the flight deck. However, I think they have to improve the working condition to be sustainable because actually the retention rate of FAs is not high for Japanese airlines.
Great post, Manny. Actually, my previous employer, Mitsubishi, just acquired salmon wholesale company. Although its headquarters are based in Norway, it has a large operation in Chile. This means Japan imports a lot of salmon from Chile!! My question would be upon its scalability. Although the business model is very compelling, it seems to be difficult for the company to duplicate its business model in other regions because the effectiveness of aquaculture must be affected by surrounding environment. Can these obstacles be overcame by adjusting its operational model?
Very interesting topic. Agriculture and foods are absolutely important for our future growth. I know some Japanese companies started buying agricultural fields in Brazil because of the business potential these lands would have in the near future. On the other hand, I wonder if famers in emerging markets such as Sub-Saharan Africa can afford these fertilizer when they still live with income below the poverty line ($2/day).
Great post. I still remember the dramatic change of the landscape in Tokyo after the Softbank’s acquisition of Vodafone. Every single Vodafone shop in town became Softbank’s in a very short period of time. The impact Softbank’s LBO made on the Japanese society was actually the very reason I became interested in the field of finance. And then introducing iPhone was surely a major turning point for Softbank, making them one of the most popular mobile companies in Japan. I just wonder if all these successes were attributed to Mr. Son and his business acumen. Or Softbank as a company is capable of doing something innovative?