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Why does a Japanese company rarely follow strategies?

JAPAN started a global revolution in operational efficiency in the 1970s  - 1980s. This revolution was a pioneer in quality management practices and continuous improvement in companies. As a result of this practice, Japanese manufacturers have enjoyed competitive cost and quality advantages for many years.

However, how Japanese companies can develop differentiated strategic positions. Of course there are exceptions, such as Sony, Canon and Sega. But most Japanese companies imitate some others and follow others movements without a differentiation strategy.

All rivals used mostly, the same features and services, products; in general, all follow the same parameters of declaration and performance in the market.

The dangers of Japanese-style competition are now easier to perceive.

In the 1980s, all Japanese companies as rivals (or operating in the same market sector) were able to grow in an expanding domestic economy and were slowly penetrating global markets. They seemed invincible. However, as their operating gap narrows, Japanese companies are now increasingly dependent on the trap they themselves have created. This undermines the business performance of Japanese companies, which finally realize what they have learned. It is a cultural issue, which, as we know, in this sense is still very closed. To do this, they have to overcome cultural barriers. For that reason, they started hiring many Europeans.

Strategy means making difficult choices, which is against their culture of consensus.

Strategy requires difficult choices, so it is difficult to take this strategic stance.

The Japanese also have a tradition of service in order to satisfy any need of a customer. The customer is King. The competence of companies in Japan comes back to this question: the customer or client, emitting some others, all become equal, not differentiating themselves, (Michael Porter's survey, Hirotaka Takeuchi, with the help of Mariko Sakakibara).

The Kaizen methodology is one of the secrets of Japanese productivity. But that is for a next article.

We all know that each and every strategy is based on unique and specific activities. Each case is different.

Affirming yourself with competitive strategy is being different.

Southwest Airlines Company, for example, offers short-haul, low- cost, point-to-point service between midsize cities and secondary airports in large cities. Southwest avoids large airports and does not fly great distances. Its customers include business travelers, families, and students. Southwest’s frequent departures and low fares attract price-sensitive customers who otherwise would travel by bus or car, and convenience-oriented travelers who would choose a full-service airline on other routes.” – in HBR’s 10 Must Reads – On Strategy article– by Michael Porter – Harvard Business Review Press – 2011.

Southwest Airlines serves travelers sensitive to price and convenience. But with different strategies and activities from its rivals.

A strategy cannot be "just a marketing slogan", because if it does, it will not stand up to competition.

How are they different? A complete airline company of this type has a hub & spoke system centered at major airports for connecting flight customers. For passengers who demand more comfort, they offer first class or executive services. To accommodate passengers who need to change planes, they coordinate schedules and check, transfer luggage. As some passengers travel for many hours, full-service airlines serve meals.

Competitor Southwest offers a convenient, low-cost service on its specific route type. Through quick rotations at the gate of just 15 minutes, Southwest is able to keep planes flying for more hours than rivals and provides frequent departures with fewer aircraft, does not offer meals, designated seats, baggage check between lines or classes of premium service. Tickets at the gate are automatically issued and they encourage customers to bypass travel agencies, allowing Southwest to avoid these types of commissions, with a standardised fleet of 737 aircraft that increases the efficiency of their maintenance.

Southwest has established a unique and valuable strategic position based on a set of tailor-made activities. It is the cheapest airline in the Southwest, given its strategy.

Another good strategic example is the case with IKEA. The Swedish company, global in the furniture sector, has as its target audience a young clientele that shows preference for purchasing furniture with a more modern, simplified and low-cost design, easy to assemble, without the need for special technical knowledge. It is a Marketing concept that has become a Strategy. The simplicity of this Philosophy has to do with the very name IKEA, which is nothing less than the acronym of its founder, Ingvar Kamprad Elmtaryd Agunnaryd, one of the greatest entrepreneurs of the 20th century, who lived here many years close to where I live , at Suisse Romande in Epalinges (VD-CH), because he himself assumed that he wanted to avoid paying taxes in his country. He was considered one of the 300 richest personalities in Switzerland and the world, according to Bilan Magazine. He lived very simply, no luxuries, and his philosophy of simplicity was thus applied to his IKEA strategy. Its strategy has resulted in the employment of more than 190,000 workers globally. In this case, the strategy of simplifying and targeting a specific audience, was its differentiation and success.

According to friends of the Kamprad Family, when he invited someone, he prepared himself coffee for them. This never shocked his friends. On the contrary, it was consistent with its philosophy, way of being, and strategy. An example to follow ...

In short: having a defined strategy and following it religiously in a planned and conscious way, being different, seems to be the key to success.

Is that what Japan needs? Or is it that in the case of Japan the problem is not success, but a problem of differentiation? They are very good at producing and reproducing. I think it is not the same thing. And you, what do you think?

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