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My Japanology / Japanese market important for its human capital, innovation

Akira Anzai/The Yomiuri Shimbun

Peter Jennings speaks to The Japan News at his office in Shinagawa Ward, Tokyo.

The Japan NewsPeter Jennings, president of Dow Chemical Japan Ltd. (see below), was involved in the Pyeongchang Olympic Games with his company. The experience has convinced him that success will come for the 2020 Tokyo Olympics. The American lawyer recently spoke to The Japan News about the Olympics and other topics, including Japanese culture.

Q: Dow Chemical is a top partner of the Olympics. You participated in the Pyeongchang Olympics in February with your customers. What were you most impressed by?

Jennings: My number one takeaway is it made me even more enthusiastic and excited about Tokyo, because I think first of all, the Summer Olympics are much, much bigger and more pronounced in participation and exposure. I think Tokyo is going to be a great host, and I’m very excited about that opportunity for Tokyo.

Q: Can you elaborate on your experience in Korea?

A: When I saw the Korean athletes participating in the speed skating the stadium was loud and enthusiastic, and you appreciate the fact that these young people, men and women, have spent their whole lives training for this. The other part I liked is the fact that you give your best, which is part of the Olympic creed, right? The people who finish in last place are still respected and cheered by the crowd. It doesn’t matter what country you’re [going] for.

You could see it was a very emotional time, and I said, “What else but the Olympics could bring that type of experience together?”

And I really hope that maybe like the ’64 Olympics, when I was too young, the world will see Tokyo as a beautiful city, with great people and blue skies.

Q: The company has a long history in Japan. How important is the Japanese market for your company?

A: There’s two parts to that question. One is, it is important. I’ll use a couple of examples that I think will hopefully demonstrate the importance of Japan. I’ve been in Japan six years and our CEO Mr. [Andrew] Liveris has visited Japan eight times in those six years. Then in September of this year we’re having our second Dow Japan Innovation Day — we had one in November 2015. We will have 500 customers and maybe the top 50 people at Dow — leaders — will come to Tokyo.

So why is Japan important? There’s great innovation here, there’re great customers here, there’s great potential here. When you talk about how big Japan is as a market for Dow, if you just look at gross revenue, it’s a very good business — but it’s never going to be China, it’s never going to be the U.S. But that’s OK, because there are other things that Japan has — human capital, innovation-related growth opportunities, and a significant customer base.

Q: But our market is shrinking.

A: I see us going in the opposite way. I’m kind of paraphrasing what our CEO has talked about. We’re not going to build an ethylene cracker in Japan, whether [because of] energy costs, feedstock costs, labor costs — and the market is not here. But that doesn’t mean that we can’t import some of our specialty plastics, add value to them in Japan and solve our customers’ issues.

Maybe we bring the plastics in from Thailand, maybe it’s from Saudi Arabia, but Japan is still an extremely innovative country. It’s still the third-largest economy in the world, and many of our Japanese customers are in China already. So how do we help the Japanese OEMs [original equipment manufacturers] solve their problems in Thailand and Indonesia, in Southeast Asia and China?

Q: Is it tough for you to do business in Japan with Japanese customers?

A: I think that’s a bit of a stereotype because as globalization has occurred Japanese customers now for the most part have the same pressures. Maybe [it was different] in the old days when it was Japan Inc. I think if you can provide the Japanese customers with a quality product that’s innovation-technology driven, that they will be [happy].

Japanese customers can be difficult if you can’t deliver the product on time and have that quality. But if you can provide them with innovative solutions to their problems, I don’t think that they’re as interested in buying from a Japanese as they are in helping [themselves] — that’s just basic business.

Q: What is your management style?

A: I’ve been very fortunate to work with the top people [at the company] in my career. I’ve been with Dow now 33 years. What I’ve tried to do is watch and emulate [them], and try to pull out the best characteristics of each individual — each one is a remarkably successful person, much more than I will ever be.

So what is determinative of your success at Dow? It’s not based on your family name or your gender or your race or your nationality. What I really ask people is if you are passionate about what you do, if you’re energetic, enthusiastic about what you do, if you continue to try and improve every day, and ask questions. Today you’re going to make mistakes, but are you always continuously learning, trying to improve, trying to understand how you do better every day?

What I tell the young people here is don’t be discouraged, do not give up. Dust yourself off, acknowledge the good things you did. But get back up and keep trying. We want you to have a long career. If you make mistakes, that’s fine, but persevere. If you do those things, then you can have a good career at Dow.

‘I will remain bullish’

Q: You have spent six years in Japan. Have you learned something from Japanese culture? Does it influence your business?

A: Every day. I have absolutely the highest respect and admiration for Japan. No matter what the demographic situation, no matter what the economic situation, the aging population, I will remain bullish on Japan.

I would like to see more start-ups in Japan with a mentality of not worrying about failing. You know, if you go to Silicon Valley, most of those guys have gone bankrupt two or three times before they became billionaires, right? But they have no advantage over Japan in terms of their ideas, their ingenuity, their innovation, all those things. And they certainly don’t have any advantage in terms of their work ethic, loyalty and dedication.

Q: Some say that Japan has been too concerned with a team-oriented approach.

A: Everything to a degree. I think it’s far more a strength than a weakness. And, again, all I’m really talking about is, maybe changing some things around the edges but not changing the DNA and the Japanese culture.

Maybe as the millennials move more toward management they will bring more of that entrepreneurial-type spirit to it. That’s why I’m so very optimistic about Japan.

The other thing I’ll say is that Japan just needs to be a little more confident about its place in the world. Sometimes Americans have too much confidence about their place in the world, whereas Japan has too little. Sometimes it really needs to be a little bit of a blend between the two.

Regarding diversity and inclusion, we work very hard here. You know, I say we work very hard, but it’s just a natural progression to me. One of my passions here has been to make sure that female Japanese that join Dow are given the same opportunities, exposure and experiences as in any other part of Dow. I’m very proud of our women scientists that have spoken at the ACCJ [American Chamber of Commerce in Japan] women in business summit.

U.S. relationship will survive

Q: You are also vice president of the ACCJ. What do you think of the future business relationship between Japan and the United States?

A: Last year I went to Washington, D.C., and met with 45 members of Congress, and the message is Japan should not worry. Yes, President [Donald] Trump is different, but Japan should not worry because every single business leader in the United States and every single congressman understands that Japan is our strongest economic partner, our strongest trading partner, our strongest military ally. President Trump and Prime Minister [Shinzo] Abe have a great relationship, but that relationship will survive to the next president.

I think 90 percent of it is positive. I just worry that sometimes the U.S. and Japanese media want to focus on the 10 percent that’s bad, so people on the street don’t realize the 90 percent of the good things that are happening.

There’s a lot of successful U.S. companies here like Dow, Boeing and others, and there’s a tremendous number of Japanese companies that are doing great business in the United States and other parts of the world as well. I say over and over again — yes, President Trump is different, but he’s also a businessman and I don’t think he wants to ruin that relationship. No way.

Q: What do you think of Japanese society and culture? What are the pros and cons for you?

A: My perspective on Japan has changed a lot. I moved to Hong Kong in 1998 and spent almost seven years there, and I used to come to Japan on business. But I didn’t really like coming here. It was a long flight, a long bus ride, everyone smoked in the hotel, I didn’t like the food, everything took time. I was very impatient and immature back then.

But I’ll answer the question like this — just look around Tokyo. People in Tokyo should be so proud of what they have achieved. I’m just talking about this city alone. I’m sure it’s true in other areas, but I can’t speak to Osaka or Sapporo. This city is wonderfully safe. Look at what we have in the United States now. I’ve encouraged my kids to move from the United States to live. It’s a sad tragedy that you send your kids to school now in the United States and you don’t know whether they’re going to come home at night. How terrible is that?

Q: What are your favorite things to do when you have time off? Golf?

A: Of course, I like to play golf. My wife and I like to walk around the areas that we live in and go to restaurants. My one regret is that I wish I had been more diligent about learning Japanese, because I do miss out a lot on not speaking the language. At the same time, maybe if I spoke the language I would be less interested in learning more, because I think as a foreigner people are always so nice or willing to help us, right?

This interview was conducted by Japan News Assistant Editor Takeshi Nagata.

■Peter Jennings

Jennings joined Dow in 1985 as an attorney at Michigan Operations in the United States. In 1998, he was named counsel for Dow Pacific, based in Hong Kong. In 2004, he relocated to Michigan as the senior managing counsel for performance chemicals and thermoset materials. He assumed the presidency of Dow Chemical Japan in 2012 and also became president of Dow Korea in 2014. He is a vice president of the ACCJ.
Born in 1960 in Michigan, Jennings graduated in 1982 from Albion College in the state, and later earned a juris doctor degree from Wake Forest University.

■Dow Chemical Japan Ltd.

Its parent firm, the Dow Chemical Company, is one of the world's largest integrated chemical product suppliers. The U.S.-based company founded a joint venture firm with a Japanese partner company and launched full-scale operations in 1952. Dow was the very first foreign company to be listed on the Tokyo Stock Exchange in 1973. The Japanese subsidiary has dealt with basic chemical, plastic and other products.Speech

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