Sandisk issued a statement saying that their “current assessment is that there has been minimal immediate impact on wafer output due to the earthquake. SanDisk continues to assess the situation for any potential future impact that may arise from issues related to Japanese infrastructure and the supply chain.”

Is the earthquake/tsunami/nuclear meltdown triple-whammy that happened in Japan an apocalyptic crisis? Or is it a slight interruption in business as usual? Who do you believe?

Well, as a procurement guy schooled in understanding cultural differences between countries, I came to my own conclusions. But I wanted to tap my colleague, international procurement guru, and primary author of the online courses “Basics of Smart International Procurement” and “Executing A Global Sourcing Strategy,” Dick Locke, for a response to a question I had.

Dick was more than gracious in giving me a response that can help frame the Japan situation – and all of the seemingly conflicting accounts of the impact – in a way that can help procurement professionals understand and work through the risks that lie ahead. Here’s Dick’s response to my request…

I’ve been watching and reading the various information coming out of Japan and trying to interpret it after filtering it through the cultural differences that can impede communication and sometimes action. I see one apparent difference and am concerned about another potential difference.
One consistent complaint is that the various spokespeople in Japan seem to be
understating the seriousness of the radiation hazards. It’s very likely that this is due to a cultural difference that strongly affects communication. The difference goes by various names, and I call it a “need for harmony.” It could also be called a “low score on a frankness scale.” A strong cultural need for harmony can make it difficult for people in that culture to deliver bad news directly. They will often resort to various expressions such as the Japanese “honto ni muzukashii” which literally means “truly difficult” in English. However, people in Japan will correctly take it to be a very frank statement that something will not happen.
A classic example is in the Japanese Emperor’s speech to the nation announcing the surrender at the end of World War II. It included “the war situation has developed not necessarily to Japan’s advantage.” This was after two nuclear bombs and a total collapse of manufacturing and logistics.
While Japan is especially strong in this need for harmony, it’s a fairly widespread characteristic among Asian and some Latin American cultures. Keep in mind that Japanese may be perceiving the messages differently than Westerners.
The second difference is just a concern at this point. There’s a well known cultural difference called “Uncertainty Avoidance.” It influences the willingness of people to make decisions without being sure of the outcome. It makes people much more comfortable with routine situations and incremental improvements than they are with dealing with the unexpected. While Japan is extremely high on the “Uncertainty Avoidance” scale, I really haven’t seen any indication of lack of creativity in solving the problems.
Let me also add that while the radiation hazard is getting so much attention, both the earthquake and tsunami are terrible tragedies that shouldn’t be overlooked.
Now, to bring this around to Charles’ question: “What cultural considerations should supply chain leaders take into account when receiving Japanese suppliers’ feedback on the expected impact of the natural disaster on future supply?” Be sure to probe assurances of continuing supply more deeply than you would with people from a frank culture such as Germany or the US. It’s best to ask open ended questions such as “how are the roads to the airport” or “how are your suppliers in the affected area” than questions that can be answered with a simple yes or no. You should also keep in mind that Japanese communicators are usually not being
dishonest when they seem overly reassuring. It’s just that their culture makes
it difficult to say some things too directly.

I’d like to thank Dick for sharing his insights. I highly recommend heeding his advice as the world works to recover from this terrible disaster.