1. The Japanese Way Michelle Tan, Associate Professor of Law, Tezukayama University,Nara SOCAP AUSTRALIA 2004 INTERNATIONAL SYMPOSIUM 27-29 October 2004

2. What I will talk about 1.Extremely brief overview of consumer law in Japan 2.Complaints (including enquiries) management by: Consumer centers administered by local governments A consumer group on behalf of a local government Large manufacturing companies (some recent trends/ data, information obtained thru recent interviews)

3. Consumer Law in Japan Public Law (based on Fundamental Act on Consumer Protection 1968) (sector specific ） Self- regulation Private Law ・ Specific Trade Practices Act ・ Anti-Monopoly Act ・ Civil Code ・ Consumer Contracts Act ・ PL Act ・ Unfair Competition Act

4. Factors Affecting Complaints Handling 1.Increasing number of complaints 2.Increase in scams 3.Increase in scandals involving well-known companies ( since 2000)

5. Complaints handling by consumer centres 1.Administration comes under local government ( over 400 nationwide) 2.Handled over 1300000 enquiries/complaints last year (contract 82%, services 74%) 3.Managed by local government officers, front-line inquiries/ complaints handling done by consumer advisers employed by the centres 4.Initial contact with the consumer is usually by telephone 5.Role of the consumer advisers: information, mediation, policy-making

6. Outsourcing of enquiry/ complaint handling by local government 1.New role for consumer groups 2.Kansai Consumers Association is first example (since 2002) 3.How does it work (handled almost 10,000 complaints in 2003)

7. “ Complaints handling ” in companies 1.CS 、 CD 、 CSR 2.Social/ Economic Factors Driving CS Promotion Scandals → greater awareness of need for CS (scandals→ distrustful customers→ makes customer contact more difficult) Long recession Aging population

8. Trends in enquiry/ complaints handling (Surveys by the Cabinet Office in 1999 and 2004) 1.large increase in companies with CS Division (up from 1.1% to 14.6%) 2.advances in ＩＴ /OA 3.interaction with top level management

9. 1.Kao Corporation ’ s Echo System 2.Suntory ’ s profit center 3.National/Panasonic and Toshiba ’ s Customer Care Centres Some examples

10. Top manufacturers improving CS through enquiry/ complaint handling 1.High status within the company 2.Consumer-oriented Communication with customers is key Use of knowledge management systems Effective use of information --feedback into all areas of the organization e.g. development, planning, design, manufacturing, sales, marketing 3. Complaint Handling ” Complaints ” are treated as valuable free information Speedy, sincere Several levels of complaint management

11. Product, Advert, Info Response to enquiries Consumer Information Centre “Accurate, Quick 、 Kind” Information Exchange Search Enquiry Support Function Product information Lifestyle information Enquiry input Send replacement product Write letters Follow-up ongoing enquiries E-Mail enquiries Kao Echo System Enquiry Analysis Function Free search Typical enquiry analysis Enquiry trends Daily enquiry bulletin Enquiry input search information Research Marketing Sales Production Consumer Opinion Reflected in “Good Product Production” Consumer Two Way Communication Source: Translated from Japanese original with permission of Kao Consumer Information Center, see “Outline of the Kao Consumer Information Centre."

12. Some examples 1. Kao Corporation ’ s Echo System 2. Suntory ’ s profit center 3. National/Panasonic and Toshiba ’ s Customer Care Centres

13. Central centre General contact point for customers and overall management 1.General contact point for customers, overall management 2.Planning and promotion of new management systems for enquiries 3.Enquiry information available in-house, monitor for trends 4.Support staff training Customer Business domain companies forward Customer Value Enhancement Planning Publicity Design Reflected in Quality control Technical Sales Advertising Company centreBusiness unit Free-dial Ｃｅｎｔｒａｌ ｃｕｓｔｏ m e r care centre/ Business domain company centers Source: Translated from Japanese original by Michelle Tan, with permission of Panasonic's Customer Care Centre.

14. Customer Enquiry Information Retrieval System ＰＡＣＳ System Data for all companies Available in- house next day Company ＬＡＮ Customer advisor Company centre ＰＡＣＳ = Panasonic Customer Support & Satisfaction ＣＴＩ system ＰＡＣＳ server Data sent that night Central centre Server Customer Enquiry Information Retrieval System Source: Translated from Japanese original by Michelle Tan, with permission of Panasonic's Customer Care Centre.

15. Stages in evolution of the internal function of Customer care ① Complaint/Inquiry Management ② Information collection/analysis ③ Information to consumers ④ Internal distribution of information from consumers ⑤ Utilization of information for marketing ⑥ Participation in/ Support for management Customer perspective is basis Source: Presentation by Sumio Shibata of Yoku Moku Corporation, ACAP Kansai Chapter meeting, July 27 2004.

16. Source: National Consumer Affairs Center of Japan, The Annual Report on Consumer Affairs 2004