In March 2010, CEO Hiroshi Mikitani (HBS MBA '93) stood in front of his employees at online retail giant Rakuten's Tokyo headquarters and dropped a bomb: all 7,100 workers would have two years to become proficient in English—the "language of business"—or risk demotion.
"I was simply astonished," said an engineer interviewed after the announcement. "Many Rakuten employees are allergic to English."
“If they don't have a language strategy, they'll regret it”
In a company where just 10 percent of all workers at the time spoke English, Mikitani's move was radical and divisive. He even coined a term for the conversion: "Englishnization."
"This issue is explosive," says Assistant Professor Tsedal Neeley, who tracks Rakuten's journey in her case Language and Global "Englishnization" at Rakuten. "Students have strong reactions to this. Some insist that this is a poison pill that you have to swallow—there's no other choice. Others say: 'This is impossible, the CEO is crazy. How can you do that?' "
Neeley argues that chief executives of global companies will have no choice but to confront the language issue as they extend their global reach.
"If they don't have a language strategy, they'll regret it," she says. "Even American-based companies with operations overseas need a language strategy. One of the most powerful ways to globally compete today is to make your company an English-speaking company. This takes years to achieve."
The problem is that teaching non-English speakers a new language risks drops in productivity, causes some employees to lose status, and can engender belief that they aren't as effective in their second tongue—all significant hurdles employers must overcome to make a program successful.
Neeley, who has studied this unmined subject for nearly 10 years, worked closely on the case with Mikitani, described by some as Japan's Bill Gates.
Mikitani expected that the initial global English-only conversion would be difficult for his company. "This is going to be a long-term effort for us," he said. "Starting this month, my own speech will simply be in English."
All workers were required to take a two-hour 200-question test to assess their reading and listening comprehension of business English, and continue to take the test until they passed. A second phase involved bringing in lecturers to discuss with employees how to study and manage learning the language. The last phase was encouraging workers to use English in meetings.
In line with a do-it-yourself culture, one early problem was that Rakuten offered little initial training or support to workers, who were expected to pay for their own English classes and learn during off-hours.
Neeley, who drafted some best practices that the company began to implement, says Rakuten has quickly moved to make substantial changes, including paying for language classes.
While workers in their 40s and older typically resist language mandates more than do 20-somethings, Neeley says the older workers at Rakuten also shared advantages: they often had more education and money to pay for additional private or small-group classes. "Higher education is correlated with stronger language education," she says. "If you have a second language already it is so much easier, and people in their 40s can make inroads."
While it's challenging for workers to start from scratch it is "absolutely doable," she says.
English In A French Firm
In a separate, forthcoming Organization Science article titled "Language Matters: Status Lost and Achieved Status Distinctions in Global Organizations," Neeley interviewed workers at a $25 billion Paris-based high-tech company about its two-year-old English-only language mandate. (She uses the pseudonym Frenchco for the company in the case.)
With about 40 percent of Frenchco's 210,000 employees based outside France, pressure had mounted to change to English-only. The company's customers, partners, suppliers, and competitors were using English exclusively; its operations were becoming increasingly global; and it had made recent acquisitions in Poland and the UK and opened a subsidiary in China.
“In English I am not myself. My personality is much smaller in this context.”
Neeley, who speaks five languages, conducted in-depth interviews in English and French with workers at all levels of Frenchco, in particular studying status loss among workers learning a new language. She searched for key words in her interviews with workers such as "diminished," "devalued," "reduced," disqualified," and "less sophisticated."
All employees whose native language was not English experienced a status loss under the mandate, she found, regardless of their level of English fluency.
"There's this universal experience of status diminution when people compare their native/formally trained language to this new language," Neeley says. "So no matter how fluent some people are in English, they believe they'll never be as sophisticated, as influential, or as articulate as they are in their native language."
Interestingly, Neeley found the French-to-English-only transition was most difficult for workers with midlevel fluency. They shared the most anxiety about their language abilities, which were neither stellar nor poor.
One low-fluency worker painfully summarized his experience: "If you cannot express your ideas because you lack language skills, the collaboration becomes a nightmare. You lose interest to continue, and you feel you are being devalued."
Most of these language-anxiety issues remained under the surface at Frenchco, Neeley says. These workers often suffered silently, worrying about disclosing a deficit, being passed over for promotions, being left out of conversations that they couldn't understand, or simply not being able to show their true selves through humor and discussions in English at the same level they were able to in French.
Neeley's forthcoming Organizational Dynamics article, "The (Un)Hidden Turmoil of Language in Global Organizations," written with Pamela J. Hinds and Catherine D. Cramton, addresses the hidden nature of language struggles.
These problems created an "us and them" class of native and nonnative English speakers, which sometimes led to resentment and distrust among nonnative speakers toward the native speakers.
Working with English speakers from the UK or America was more difficult for the Frenchco workers than working with English-speaking colleagues in Poland, the Netherlands, or Spain, Neeley found. In one interview a Frenchco worker said: "A real English person is in a stronger position, and I find myself justifying myself much more in those interactions."
Native speakers can also dominate conversations, workers said in Neeley's interviews. "Sometimes it's hard to get our American colleagues to be quiet but we manage," a high-fluency speaker reported in an interview. "I say, 'If you don't stop we're going to talk in French.' "
While many Frenchco workers were angry about the English-language mandate, Neeley says a small number of highly fluent workers viewed the change as a chance to perfect their English by asking for feedback from native speakers, participating in meetings as often as possible, repeating key phrases, and seeking out English speakers in their groups.
Helping Employees Learn
There's a number of techniques companies can employ to reassure and help workers with this transition. First, it's crucial for CEOs and managers to be firm that nonnative speakers don't have a problem. All workers have to be invested in working and speaking together, Neeley says.
Managers should also be aware that workers often underestimate their language capabilities. In many cases, testing and offering benchmarks helps calm anxieties, as can limiting meetings for low-confidence English speakers until their language skills improve.
Future research, Neeley says, includes exploring the role of language as the mechanism by which companies transform from a domestic to a global player-the fulcrum of language.
When teaching the Rakuten case at HBS, where 35 percent of her students are international, Neeley says, students were passionately engaged. There is no topic that is more personal than language. You just need human experience to "get it."
"I had an American student who couldn't stop thinking about what a nonnative classmate said in class: 'In English I am not myself. My personality is much smaller in this context.' So many people have said the case taught them about themselves."
Aside from the deep personal connection, the case is also powerful for students because they have such an intense interest in globalization. "Language is emblematic of that," she says.