In general, softer German steel is "tougher" and less prone to chipping. Harder steel can be more brittle and can be more prone to chipping. Now these are generalizations and there are modern harder steels that are still plenty tough enough for regular use in the kitchen. And because they are harder, they can be made thinner and still hold an edge for a long while. Thinness is a good thing when it comes to cutting/slicing performance, particularly thinness in proximity to the blade edge.
German-style knives tend to be thicker, more hefty, tougher, more chip-resistant. But their softer-steel edges roll and deform more easily, so will require frequent steeling to say in good shape between sharpenings. But steeling is very easy to do and not a major burden... so it's not a huge drawback... except perhaps in fast-paced high volume professional kitchens. Because they use thicker steel in the blade they will not typically take as keen an edge as a harder and thinner (i.e. Japanese-style) blade. The milder steel can be easier to sharpen than harder steels, but it will need sharpening more often.
Japanese-style knives with newer steels tend to be thinner, lighter, harder, somewhat more prone to chipping. They can hold a keener edge and will generally hold the edge longer. Chipping is usually not a major problem if proper cutting technique is used (e.g. use a good board, straight cuts, no twisting/torsion on the blade during cutting, avoid bones, etc), but somewhat more caution is called for with thinner harder blades.
I use a Japanese gyuto for most kitchen tasks most of the time, but keep some German-style knives on hand for a few tasks that seem tougher. But I probably baby the gyutos more than I need to.