[Although, for all its colorfulnes, does this contrast even hold water? The non-Yakuza Japanese may arguably be leaving a lot of stones unturned. But mega-merging (at least of banks) and expanding overseas networks don't seem to be two of them.]
[Of course they probably can't match the Yakuzi when it comes to putting the "brutal" back in "brutal cuts." But who can? Such heroes.]
Financial Times; Jan 26, 2002
ASIA-PACIFIC: Gangsters steal march on legit business: Corporate Japan could learn a thing or two about how to downsize - from crime bosses, reports David Ibison
By DAVID IBISON
On a back street in the Meguro suburb of Tokyo is a company called the New Body Institute, which is doing a booming - if unusual - business. For Y380,000, (Pounds 2,000) out-of-work gangsters can get a silicon replacement for their severed little fingers.
Maria Niino, the owner, says business has rarely been better. "It's tough being a gangster right now," she says. "Business is down, as companies are going bankrupt and can't pay protection."
Japan's economic downturn has hit gangland just as hard as the legitimate economy and criminal organisations are responding to the new economic environment with the underworld equivalent of downsizing.
A growing number of out-of-work gang members are seeking employment in normal businesses and want to improve their chances by disguising their missing finger - the universally recognised badge of gang membership in Japan.
But Ms Niino's profitable sideline also highlights an uncomfortable fact. Japan's criminal gangs have responded to the challenges of economic hardship with a speed and thoroughness that has put the corporate sector to shame.
"The yakuza have led the way in reform and restructuring in Japan," says Shigenori Okazaki, political analyst at UBS Warburg. "The wider corporate sector would do well to learn from their example."
While Japanese companies struggle to come to terms with the need for reform, Japan's boryokudan or yakuza (gangsters) have embraced the benefits of job cuts, mergers, acquisitions, economies of scale and international alliances.
The three largest criminal groups - the Yamaguchi-gumi, Inagawa-gumi and Sumiyoshi-gumi - have consolidated their operations by taking over smaller rivals, reduced their head-count and offloaded duplicated operations.
Furthermore, as domestic consolidation has accelerated, the gangs' long- standing but relatively loose affiliations with criminal counterparts in China and Russia are being firmed up and areas of international co- operation broadened.
The restructuring of the nether-economy stands in stark contrast to the piecemeal reform of the corporate sector, where mergers and acquisitions and international diversification have been adopted only reluctantly and have yet to permeate the marketplace fully.
According to the National Centre for the Elimination of Boryokudan, a national anti-yakuza organisation, the number of members or associate members of crime syndicates has dropped from 182,000 in 1963 to around 81,300 today.
Significantly, power has been concentrated into the big three as they take over smaller, regional rivals. In 1995, for example, the three largest groups accounted for just 24.8 per cent of total members, compared with around 77 per cent today.
Further proof of this consolidation comes from the sharp reduction in the number of gang wars. These dropped from more than 150 in 1989 to just 25, while the number of gang members arrested has dropped from nearly 20,000 in 1989 to around 10,000 today.
While part of this reduction in the number of gang members is attributable to the 1992 Anti-Boryokudan Act, it is also to a large degree a reaction to economic necessity.
The boom years of the 1980s resulted in the creation of "economic yakuza", whose interests diversified away from gambling, drugs and prostitution towards property and stock market investment as well as other legitimate businesses.
As a result, the collapse of the bubble economy affected the yakuza in much the same way as their corporate colleagues. A decade ago any self- respecting gang boss would not be seen driving anything other than a Mercedes. Today, he may settle for a Toyota.
The grim acceptance of economic reality in gangland, and its ability to implement tough reforms, stand in stark contrast with the legitimate business sector.
Many Japanese managers remain locked into ideas such as lifelong employment and a reluctance to merge that are inappropriate to the economic situation.
The yakuza also reached out internationally, forging stronger links with Chinese "snakehead" smugglers of illegal immigrants, and joining with the Russian mafia to bring prostitutes to hostess bars and smuggle crabs in Hokkaido.
All of this is good news for Ms Niino and her replacement finger business. She notes that bosses often accompany newly unemployed gangsters and pay for their new digit - a literal as well as figurative form of severance pay.
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