Enduring or rather seemingly everlasting operations of many Japanese businesses have directed attention of the global business world towards them. Believe it or not in Japan there is an operational construction company named Kongō Gumi, which was founded in 578 AD! Most probably, it is the oldest operational company in the world. Shitennō-ji temple in Osaka, built in the sixth century, is the 1446-year-old firm’s first project.
The world’s oldest functioning hotel, according to the Guinness Book of Records, is in Japan. Its name is Nishiyama Onsen Keiunkan hotel and it was founded in 705 AD! It was opened 1319 years ago in the Yamanashi Prefecture, outside Tokyo and it is still functioning.
It is baffling but true that in Japan, there are more than 50,000 companies, which are over 100 years old and of this 21 are more than thousand years old. This is astonishing to say the least, especially in today’s volatile business climate, where it is impressive if a company survives for more than 50 years.
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Long-term Vision
In Japan, the businesses which have survived for more than a century, while keeping ownership within the same family and continuing to operate in the same industry are known as shinise firms.
The success of so many Japanese companies over such an amazingly long period of time can and should inspire many entrepreneurs operating a business with the aim that it would stand the test of time.
One of the reasons behind the awesomely long operational duration of many Japanese companies is their increased focus on long-term goals than short-term success, coupled with extremely strong business ethics. Japanese businesses also believe in building long-term connections with consumers and employees, which is also a contributing factor behind the long innings of Japanese businesses, on an average. Another reason behind the long operational duration of Japanese business lies in their ability of beautifully merging new ideas with old traditions.
Playing to Strength
From the long and continued life span of many Japanese companies we can imbibe the lesson that we need to evolve with the times but shouldn’t forsake our core competency. Diversification in unknown areas can be a pitfall for an enterprise.
For example, Nintendo (established in 1889) which started with making playing cards, is now in video games.
Japanese businesses generally maintain huge cash reserves to withstand economic and other storms without compromising on their operations, which is another of the reason behind their longevity.
Pursuit of Perfection
Moreover, in Japanese culture there is considerable emphasis on attention to detail, and a desire for perfection, and these values can contribute to longevity of business. Japanese companies generally go the extra mile to ensure high quality products and services, which in turn lead to loyal customers. Entrepreneurs thinking of having a long innings should also, like many Japanese businesses, strive for perfection.
The strong tradition of innovation in Japanese culture may have also been reflected in their businesses’ long-term success. Entrepreneurs should develop a tradition of innovation in their company, for frequent innovation can help a company to remain a step or two ahead of competition.
The Culture of Kaizen
In Japanese management, process has equal or perhaps more importance than the absolute result. Their process-driven operations facilitate consistency and quality, and encourages an enduring culture of excellence. Moreover, Japanese believe in the culture of continuous improvement which in Japanese is termed as kaizen.
The culture of kaizen is an integral part of Japan’s business philosophy and reflected in quality control, the reduction of waste in production process, use of more sophisticated equipment, etc. which has perhaps contributed to the awesomely long operational duration of many Japanese companies. What is more, kaizen encourages suggestion for improvement from all employees of an organisation and not necessarily from only the top and middle management.
In kaizen, there is no concept of absolutely right process or completely right result but always a constant striving for an even better process or even better result. There is no space for complacency or resting on past achievements.
For example, a Japanese company adhering to kaizen philosophy would not just be contended with achieving the goal but may then strive to attain how this goal can attained in lesser time and lesser cost. In the western model of management, people learn from failures, but in Japanese business philosophy infused with kaizen. people are expected to learn from their successes too.
Consensus is the Key
Consensus-based decision making style in Japanese business culture is also a positive factor which may have contributed to the lifespan of many Japanese businesses, and this trait should inspire many of the businesses in India too.
In consensus-based decision making, employees feel more valued and thereby are induced to contribute better to the company, and it also affords the introduction of varied perspectives and insights. Ringi, which refers to the bottom-up decision-making process, is a common feature of Japanese management.
