Yuji Akabane, formerly of Komatsu and McKinsey, now President of Breakthrough Partners is interviewed in the Japanese Nikkei Business Online about how Japanese companies can get their mojo back.
Akabane says that although there are various external factors such as the high yen, friction with China, the earthquake, world economic slowdown etc, Japan’s problems existed before that. He points to the lack of leaders that can be respected – in business and in politics – in Japan. He traces this back to Japan’s “mura” (village) culture – of working through collaboration and cooperation as a team, without expressing opinions. As a result, strategic thinking, starting with military strategy since the Meiji era, has been “poor”.
There were great business leaders like Soichiro Honda and Konosuke Matsushita, but they were the right leaders for the postwar era – it’s hard to say if they would really be effective in this day and age. Akabane concludes that it is not the case that Japanese management ability has worsened, but that Japanese companies always were bad at product planning and management, compared to foreign companies.
His remedies are for Japanese executives to be very clinical about what businesses they are good at and what businesses they are not, and to radically restructure, removing as much bureaucracy as possible, to ensure their vision really fits the 21st century, and then build a three year plan with targets for each year, and properly develop a global product planning and marketing capability.
He also recommends setting up teams to start new businesses, but acknowledges that such teams are often not very effective, as they are made up entirely of internal “left overs” who are not bothered if the new business fails. Turning such teams into subsidiaries also often ends in failure.
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