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Friday, July 16, 2010

Rakuten's all-English edict a bold move, but risky too


Staff writer

Internet shopping mall operator Rakuten Inc. surprised the public by announcing early this year it will make English its official language by 2012.

News photo
"Eigo hanashimasu": Hiroshi Mikitani, president of Rakuten Inc., speaks in English at a news conference at its headquarters in Tokyo on June 30. At Rakuten, cafeteria menus are now in English, which will be the firm's official language by 2012. RAKUTEN INC.
News photo

All internal meetings will be in English whether foreigners are present or not. Board meetings and weekly all-company meetings have been in English since March, and President Hiroshi Mikitani has said board members who can't speak English in two years will be fired. Cafeteria menus are now in English.

The Rakuten group has 6,000 employees globally, of whom about 400 are non-Japanese, spokesman Naoki Mizushima said. The firm doesn't keep track of how many non-Japanese it has in Japan, while the 16 board members at its headquarters in Tokyo are all Japanese, he said.

Japanese companies looking to expand their overseas sales don't deny the merit of having employees proficient in English, but none has gone as far as to require their Japanese employees to speak English to other Japanese employees. Experts are unsure if Rakuten's ploy will succeed, saying it depends entirely on employee commitment.

"Of course, Japanese is the best language for Japanese to communicate with each other, and of course other companies should also try to improve their employees' English skills," said Minoru Ohki, the business development supervisor at Temple University Japan's Corporate Education. "The significance of Rakuten's announcement was that Mikitani forced the employees to make the commitment."

Rakuten is one of a very small number of Japanese companies able to push English as its official language because Mikitani, who has an MBA from Harvard, is fluent in English and is very charismatic, analysts say, though making such a decision and getting positive results are two separate things.

"Rakuten has a culture of uniting under Mikitani's top-down decisions," UBS Securities Japan Ltd. analyst Sumito Takeda said. "For Mikitani, Rakuten is doing something normal at a normal speed, but the speed is very fast for other firms."

Rakuten employees are under a lot of pressure to learn English. Spokesman Mizushima said 200 employees out of 3,000 working at the headquarters take lessons from Berlitz Japan Inc., a language school chain that has an exclusive contract to send English teachers to Rakuten.

"A lot more people applied for the lessons, but we had a capacity of only 200 due to space limitations," Mizushima said, adding that other employees are taking English lessons elsewhere. "Everybody spends their own money for lessons and is committed to learning English."

Rakuten is not providing financial support for lessons, but Berlitz offers a discount, Mizushima said.

For its part, Berlitz believes success at Rakuten would give it an enormous business boost, while it also feels the pressure to produce. "Our responsibility is huge. Our mission to improve Rakuten employees' English skills has just begun," Berlitz Japan Sales Manager Gan Yaguchi said.

In a similar move, Fast Retailing Co., operator of the Uniqlo inexpensive clothing chain, said last month it will make English an official language starting in March 2012, but meetings among Japanese employees and e-mail exchanges with Japanese won't have to be in English, spokeswoman Naoe Tsunashima said.

Now, some meetings are in Japanese and foreign participants later ask Japanese who speak English about what was discussed. But mixed meetings after March 2012 will be conducted in English, she said.

Other major firms have long focused on improving the English proficiency of their employees as they look to expand overseas amid the declining labor pool at home.

However, few have made it a rule to adopt English as their official language.

For example, Nissan Motor Co., which is headed by Carlos Ghosn, who is not fluent in Japanese, "has no rules on languages," a spokesman said.

"If non-Japanese are in a meeting, Japanese need to speak English."

Nomura Holdings Inc., which acquired U.S. securities firm Lehman Brothers' Asian and European businesses, also has no rules, but many Japanese now have to communicate in English with foreign colleagues, a spokesman said.

Rakuten has also acquired foreign companies, including Buy.com Inc. in the United States, and it has a major stake in a joint venture with Baidu Inc. in China. But the degree to which English is necessary at Rakuten is far lower than companies like Nissan and Nomura, and thus critics say it is questionable whether Rakuten employees' commitment will last.

"Even people who absolutely have to learn English give up learning. Many Rakuten employees don't need to speak English. I don't think Rakuten will succeed," said Giri Suzuki, who teaches Japanese linguistics at Taisho University in Tokyo and edited "Ronso: Eigo ga Koyogo ni naru Hi" ("Dispute: The Day English Becomes an Official Language").

Mikitani insists English is a must for all the employees, saying in a recent magazine interview, "English is like 'soroban' (abacus, meaning math) in 'yomi kaki soroban' (reading, writing and arithmetic). Employees who can't speak English are out of the question."

Achieving certain scores in the TOEIC, or the Test of English for International Communication, will be required for promotion, Rakuten spokesman Megumu Tanefusa said. The range of required TOEIC scores is from 600 to 750 depending on job title, but workers in the lowest two levels don't need TOEIC scores, he said.

The Japan Times spoke with several Rakuten employees. All but one declined comment when asked what they think of adopting English. One said, "If it's a company order, I will do it."



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