Md.

Tasnimul Hasan
2014171630
Serial no. 26
Group 3

What should HSBC have done before they considered a full scale penetration into
Japan’s retail banking market?

Answer:
Through an extensive and intensive PEST analysis (political, economic, social, technological
analysis), HSBC should have discovered the following problems in Japan before they entered
the market:

 Social problems
Language barrier impedes communication as English is not commonly used in Japan.
There are difficulties of English communication in Japan. Therefore, high costs are
incurred to employ bilingual employees.

 Political and social problems

It expatriates and local employment policy. Japanese are known to be polite and this
has been incorporated in their business culture. This has affected decision making
process as they are slow in decision making.

 Social and economic problems

Due to slow and decentralized decision making in Japan the specialists invests
expanded time of energy in talking about, clarifying various issues and contends until
their totally convinced.

 Technological problems
Local standard for ATMs and lack of Internet Banking is a prominent technological
incompatibility of Japan.

If HSBC cannot identify and formulate possible and effective solutions to these
PEST problems, they should not enter the Japanese market.