Most large Japanese companies run two ladders at once. The first is the grade, set by the company's qualification or job grading system. Moving up it, shokaku, usually brings a higher base salary band. The second is the post: section chief, department head, division head. Moving into a higher post, shoshin, brings authority over people and budgets and a post allowance. Under traditional ability-based grading, the grade ladder was the main one, and there were often more people at a manager-equivalent grade than there were management posts to give them.
The gap between the two explains several features of Japanese careers. Titles such as deputy manager, or specialist with a manager-level grade, exist to recognise seniority without a line post. An employee can be promoted in grade every few years while staying in the same job. And when a manager reaches the age set for post retirement, they lose the post but often keep much of the grade.
Grade promotion typically follows a process: minimum time in the current grade, a run of good evaluations, a recommendation and, at many companies, a promotion exam, an essay or an assessment centre at the step into management. Promotion to a post depends on there being a vacancy, and in a seniority-based system the timing of both was predictable. At many companies it still is, though high performers are now often promoted faster.
What it means for a foreign employer
- Ask for the grade, not just the title. A candidate's title alone can understate or overstate their level. Grade and number of direct reports are better guides.
- Managers without teams are common. A manager-level title with no direct reports does not necessarily signal a weak candidate. Probe what they actually led.
- Pace matters to candidates. Someone who has just missed a promotion round, or sees the next one years away, is often open to an external move.
- Your title can be part of the offer. For candidates leaving a slow ladder, a clear step up in title and scope may matter as much as pay.
Sources
- Ministry of Health, Labour and Welfare, Basic Survey on Wage Structure (management-level data by post).
- Employer practice; the grading background is set out under shokuno shikaku seido.