Aruna Basnayake, CEO and Partner, Japan Cloud

The second of three posts on Japan market entry.

If anything keeps enterprise cloud CEOs up at night in Japan, it’s not a lack of opportunity. Japan is fertile ground for cloud services that can help businesses succeed in a data-driven, hybrid world. If CEOs lose sleep at night in Tokyo, it’s because they struggle to find top talent.

A Costly Conundrum

The average tenure of Japan country managers over the past 10 years at firms listed in Bessemer’s Emerging Cloud Index is 22.6 months, according to Japan Cloud research. Companies often fall into a vicious cycle of hiring and firing. The cost in terms of time, money and reputation is incalculable.

But there’s a way out of this costly conundrum. Global cloud leadership must escape their corporate comfort zone. They need to think twice about candidates who seem the obvious choice. Seasoned sales people whose resumes include familiar global cloud brands and who impress HQ with their English skills may be a great corporate fit, but they’re not always the best fit for growing and managing a business in Japan.

Corporate leaders need to put themselves in the market--the second largest enterprise software market in the world--and ask themselves: which candidates have the growth mindset and passion to keep developing their leadership and management skills, as well as their sales prowess, to grow the Japan business to a thousand employees and 10 percent of global company revenue?

This is the executive they want running their business in Japan.

Stuck in Mainframe Days

It’s not hyperbole to say that the recruitment process for country managers in Japan has changed little since the days of the mainframe. While meetings with search firms and candidates may now be virtual, the candidate profile usually includes country manager or sales management experience, preferably with a reputable global software firm, as well as proficiency in English.

In most cases, the management team decides who will lead their Japan business based on feedback from corporate colleagues, a recommendation from the recruiter, endorsements from candidate-nominated references and perhaps the advice of a trusted, local advisor. The new country manager is then “empowered” to hire a team and start closing deals.

There has got to be a better way. The intent isn’t to denigrate the efforts of companies or their partners or consultants. The language barrier and time constraints leave corporate leadership few options but to rely on local experts. But given the challenges software firms have had with their Japan leadership over the decades, it behooves them to do things differently.

They should begin by rethinking their candidate profile.

In Pursuit of “Learn-it-alls”

In addition to evaluating experienced country managers and salespeople, companies should shortlist executives who have limited experience but show potential for growth.

Candidates who have 10 to 15 years of solid sales and management experience in the IT industry and who have a growth mindset are often preferable to English-speaking country managers who talk a good game and boast that they know everyone in the industry.

While English skills are desirable, they’re not as important as local credentials--a degree from a reputable university, for example--and the ability to engage with senior executives at Japan’s leading companies. Companies can always rely on a local partner or consultant to bridge communication gaps with HQ.

Candidates with a strong network are also welcome. But people who have the mindset to continuously grow their network are even more attractive. Executives who can learn to network across industries and keep improving their value-selling skills are exceptional.

If they have the humility and EQ to build trust with customers and employees, they are truly golden. Recruiting and management skills are absolutely critical for the country manager job.

To quote Satya Nadella, “The learn-it-all does better than the know-it-all.” Candidates who are coachable, collaborative and constantly try to improve themselves often trump proverbial “rock stars” who rely heavily on past accomplishments to define their future capabilities. This is true in Japan as it is anywhere else in the world.

Hiring for Customer Success

In the go-to-market phase, corporate leadership should also be involved in the recruitment of the core management team, from marketing to pre- and post-sales. In addition to minimizing the country manager’s overreliance on personal relationships, the goal is to build a foundation for scaling the local team over the next three to five years. While the country manager should be the final decision maker on who makes the team, corporate leadership should have a say in the screening of candidates.

Unlike the country manager, the core management team should have solid enterprise cloud experience. They should live and breathe Customer Success. While seemingly counterintuitive, companies should prioritize hiring a post-sales leader. The objective is to embed Customer Success processes and values in the organization early and to build relationships with systems integrators. Again, English proficiency among core management is desirable, but not essential.

In Search of EQ

In addition to reference checks and third-party feedback, companies should include formal aptitude and personality assessments in their screening process, especially if they are considering candidates who are new to a leadership role.

Despite the widespread adoption of personality testing and job-fit data among U.S. corporations, very few, if any, global cloud companies assess their candidates in Japan. This is not good. Along with fundamental cognitive abilities, companies should test for communication, team-building and organizational skills, among other soft skills that are essential for leadership positions. They need to assess the whole person. The cost of not doing so is simply too great, for candidates, as well as for companies and their customers.

Beyond the Comfort Zone

Global cloud companies need to rethink their approach to talent acquisition in Japan, especially at market entry. Expanding their search while spending more time on screening candidates is the surest way to avoid the hire and fire cycle and to get their business on track.

They shouldn’t be enamored by candidates who fit the corporate bill. They need to escape their corporate comfort zone. Their goal should be to hire leaders who can sell on value as well as achieve operational excellence and Customer Success-driven growth longer term.

How cloud companies can develop their team in Japan and build a company culture anchored in local Customer Success will be the subject of my next post. Stay tuned.