【Global Leader Interview】 Mr. Yoshiharu Hoshino, CEO of Hoshino Resorts

　My working hours fluctuate depending on where I am in the world – when I am in Tokyo, my days are usually spent in meetings and when overseas, I explore new business opportunities on-site while conducting marketing activities, especially in the Asian and North American regions.
　Incidentally, I use English the most in Japan for investor relations rather than on overseas business trips. I’ve worked with Goldman Sachs in Tokyo and I still deal heavily with foreign investors participating in the REIT (Real Estate Investment Trust).

　There are just too many things that I value (I do not know where to begin!), but first and foremost, the future vision and policy of the company and our approach to reach them are my priorities. I believe that the way we approach our goals in taking this company to the future is what attracts individuals to work here. Should we conduct or invest in businesses that divert from our goals, it would cultivate distrust in the workplace. It is thus essential to clarify the company goals and policies and to be in complete focus.
　Another aspect is embracing transparency in the workplace, enabling a culture of flat organization. This is something that we have nurtured and encouraged over the years which has become quite vital in remaining competitive as a company.

　Oddly enough, I learned the most not from taking academic lessons but rather from gaining perspectives of how Japan is seen in the outside world and what foreigners expect of the hospitality industry in Japan. My father ran a traditional Japanese onsen (hot springs) ryokan (accommodation facilities) in Karuizawa; the business was planned to be passed on to me. However, the facilities were worn down and I did not find them appealing – I wanted to destroy and rebuild them to look similar to the Western-style hotels.
　That all changed after I came back from two years at Cornell where I realized that “copying” is not what is anticipated and rather Japanese resorts and culture have been long respected by people from all over the world. In fact, without the elements of Japanese culture in our resorts, people would regard them to be merely a mimic of Western culture. My mission is to make the Japanese ryokan appealing and to create a world-class resort, but this was not to be done by imitation. I’ve speculated on how to modernize the Japanese traditional resorts and as a Japanese resort, HOSHINOYA dwells on business localization. It was an epiphany!
　 Further, there is something that I keep as a secret from my planning and development staff: my ultimate goal in my projects to not be of a laughing stock amongst my fifty fellow graduate school classmates from all over the world. I spent two full years with these classmates and I developed extremely close relations with them to an extent we all share and exchange our opinions freely. They boldly ask questions things like, “Aren’t the Japanese just envious of the Western culture?” and “Why do the Japanese think that way?” This led me to then think of ways for them to admire the Japanese resorts and to regard Hoshino Resorts to have originality. I’d secretly ask myself at the end of every new project, “What would my fellow fifty classmates think?”

　I struggled with English the most. I experienced going through ‘stages’ in improving my English abilities. The first stage was “to keep up in class.” The first term (September to December of 1984) without a doubt was the most challenging phase, where I was only able to get on average two hours of sleep per day. During my undergrad years, I was heavily sports-oriented so I was confident I had the physical strength. It turned out that all the perseverance that I had built over the years drained within the first three months at Cornell. I literally slept for fifteen hours per day during the winter break before commencing the next semester in January. But surprisingly, I felt confident with my English during the second semester. It was my breakthrough moment where my grades were actually good and I felt a load off my mind. Something just clicked after undergoing six months of intensive English studies. The fact that I was the only Japanese student among my fifty fellow classmates perhaps contributed to me being able to keep up in class.
　Another hardship that I faced was the gap I found in my personality when communicating in English and in Japanese. This was my major issue during my time in the United States when studying and working between 1984 and 1989. I noticed that there was a difference in my communications skills when taking part in discussions and debates in English and in Japanese. I was naturally able to articulate my thoughts in Japanese and be more like myself, but when it came to expressing them in English, I felt a sense of discomfort hence a gap in my behavior. I still at times feel this gap and I feel that it is necessary to close it. Communication is not only effective via the contents in writing but also more through face-to-face interaction which is fueled by the existence of the personality factor. My main job is to also gain trust from my investors and a lot can be conveyed when communicating with them directly. I tend to be more persuasive when communicating in Japanese – if only this were also the case when I communicate in English (laughter).

　The sense of values differ among nations and I was really able to feel that through experiencing both the Japanese and U.S. education systems. In your 30’s, 40’s and 50’s, you tend to interact with the people you do business with on a superficial level (at least without much criticism). During my graduate school years, I was able to show my true colors with my classmates which was very special considering it gets harder to foster trustworthy relationships as we get older. As mentioned earlier, my graduate school classmates would deprecate me and my culture occasionally, but that is not to say that I take it as criticism. It was an opportunity to hear honest opinions of what non-Japanese thought of Japan in a non-business capacity.
　In addition, my friends from Cornell’s Master of Management in Hospitality program mostly hold vital positions within the realm of hospitality and having this great global network is something that I am very grateful for.

　I feel that many people interact with the Japanese people with great respect towards our culture: our samurai spirit, craftsmanship, rich history, mannerism, tea ceremony, sushi, and hospitality. These Japanese characteristics have become so familiar and widespread overseas that they have come to be our nation’s forte.
　This however becomes a double-edged sword as I now have to live up to this expectation. When I was in the U.S., people expected me to have mastered all pieces of the Japanese culture. But during my undergrad years, all I did was immerse myself in sports so I did not know anything about the Japanese tea ceremony, the ceremony’s feasts or other traditions. There was no way I could meet their expectation and I was heavily disappointed; ashamed really. I felt this way particularly when I attended a formal event where many participants were renowned in their fields and the attire was ‘formal,’ so I assumed that a black suit and tie would be sensible. But it turned out that many of my fifty classmates came in their traditional costumes. One of them would come up to me and say, “Why are you dressed like an English man?” They were expecting that I would wear a kimono – I was just flabbergasted!
　That moment was every eye-opening for me that I decided to acquire knowledge in my own culture during my studies at Cornell. To this day, I still cherish learning about my own culture when I have the chance.

　There have been times when my foreign counterpart and I just could not understand each other no matter how often we communicated due to differences in our cultural backgrounds. Through many years dealing in business, I have come to realize that what the Japanese perceive as universal may not necessarily be common globally. When you grow up in a certain culture, you tend to have a perception that your culture is superior to others. However, there is no ‘good’ or ‘bad’ culture; having diversity is a natural thing. This mindset is crucial when dealing business internationally.

　The United States may seem to be the center when we hear the word ‘global.’ What many people fail to realize is that America is quite domestic in a sense that many Americans do not know much about the world exemplified by the fact that America has one of the lowest percentages of passport holders among economically advanced nations. This is because just about everything is available within the country so perhaps there is no need for international travels. On the other hand, Europe is the exact opposite: most countries in Europe share their borders with many other countries and are prone to accepting diversity and advancing equality. When it comes to Japan, our nation has had difficulties interacting closely with neighboring countries due to our insularity so it is vital that we evaluate the notion of globalization more than ever.
　I would define ‘globalization’ as ‘opportunity’ as the moment we step into a global zone, it is a world where we could grasp a wide range of opportunities and challenges. Thus far, when pretty much everything revolved around Japan, we emphasized distributing domestic products and services to foreign markets from the Japanese perspective. This however is not the case anymore as the economy is deteriorating due to our declining population. It is time that we get out of Japan and really explore the world, start business overseas and become more independent, away from the domestic market.
　Again, back when the Japanese products dominated the world market, it depended on whether the Japanese consumers accepted them or not. With the dawn of the global era, market acceptability is contingent on whether an individual has the capacity to create ideas and things commonly accepted in a global capacity. With the world at your feet, imagine the endless opportunities that lie ahead!

　We’ve covered business expansion domestically to an extent that it is no longer a challenge: our next aim is to expand our hotel and hospitality business outside of Japan. Overseas expansion may not be profitable on a short-term basis, but foreign market penetration is our long-term goal. The outlook of the Japanese market is not exactly optimistic and the consequences of depending on it are dire. In order to survive in today’s market, it is inevitable for Hoshino Resorts to evolve into a global company despite the hardships and tough competition we may face.

　In my generation, I believe Professor Michael Porter (economist and professor at Harvard Business School) is extremely influential to our business. I had the privilege of meeting him when I received the Porter Prize* in 2014, and have long been adopting his theories and strategies into my business. Professor Porter’s latest theory, the CSV (Creating Shared Value) is something that I keep a close eye on as well as other concepts he continues to advocate in the realm of business. *”The Porter Prize was established to recognize outstanding Japanese companies and to enhance the competitiveness of Japanese industries.” The Porter Prize website: http://www.porterprize.org/english/

　I believe in stepping out of this country at the earliest age possible as well as sustaining close friendships with people who speak to you honestly and opening yourself up to all criticisms. As mentioned earlier, not many people deal with you on a deeper level when dealing business. Thus, being a global leader entails having comrades from all over the world who know you at your worst. Going overseas can be for studying abroad or exploring the world for even just a year; it can be in any way, but my advice to young people is to start getting out there as soon as you could.

　The Japanese people tend to dwell on perfection when it comes to speaking English: it’s either they speak or they don’t. They have knowledge in the language, but are afraid to speak out hence why we cannot speak collectively as a nation. When watching Japanese reporters on television, I often notice that they are not necessarily good English speakers, but they do try and get their point across. I think speaking in broken English actually provides opportunity for the speakers to enjoy communicating with other English speakers and with this positive experience, they would be motivated to speak English ‘correctly.’

　I again say this with emphasis: get out and explore the world. Getting a worldly education in Japan is not a difficult thing to do: you can educate yourself, use the Internet, read books, and even earn an MBA at your fingertips. You can earn any degree you want domestically. What you can’t learn without being abroad is knowing what the world expects of Japan. I have learned the uniqueness of my country and how Japan is seen through the eyes of others. I have accepted their criticisms and values. I know what to say and what not to say when dealing with other cultures. All this is possible because I had the opportunity to get out of my country and see things from a different angle.