Uniqueness—being genuinely different to the competition—is the greatest strength that any company can have.
Harvard professor Michael Porter famously compared old-fashioned Japanese companies to lemmings—all running in the same direction until they plunge off a cliff into the sea!
Porter was right. Just think of the once-great Japanese electronics firms: Because they all focused on producing the same things as their competitors, rather than on producing one or two things that were different, they completely lost their global dominance.
But being different is not about being different just for the sake of it. Being different is about finding the things which you can do and no one else can. Being different is about establishing the core principles of your business and sticking to them until you evolve the business model that makes you unique. Being different requires guts.
Significantly, when Steve Jobs returned to Apple in 1997, one of the first things he did was to commission the “Think Different” advertising campaign. Apple had lost its way by trying to be all things to all people—just another Compaq or HP. Jobs quickly eliminated 70% of the products that Apple made, including printers, servers and the Newton PDA. In future, he announced, the company would focus on just four business areas: two kinds of desktop computers, and two kinds of laptop computers.
Apple has continued to make itself “different” by focusing on producing a handful of simple, intuitive and elegant devices. This laser-like specialization was a key factor in propelling Apple past Exxon to become the world’s largest company by market capitalization in 2011. (Since February this year, Apple’s market cap is twice that of Exxon!)
But as a company gets bigger, retaining this uniqueness gets harder and harder. These are my tips for how to keep thinking and being different.
1. Stay physically close to your roots
Warren Buffett, the 84-year-old billionaire investor has spent almost his entire life based in his home town of Omaha, Nebraska. Buffett claims that being at a distance from Wall Street helps him keep a sense of perspective. In his business, “thinking different” from everyone else—“being fearful when others are greedy and greedy when others are fearful,” as he puts it—is a major advantage.
The same thing holds true in Japanese industry. There is a cluster of electronics components companies based in Kyoto, all of which are globally dominant in their respective niches. Atsushi Horiba, CEO of Horiba, one such Kyoto-based manufacturer of precision measuring instruments, is on record saying that moving the company HQ to Tokyo would be harmful. Moving to the capital, where most of Horiba’s competitors are based, would only make his firm “mediocre,” he says, because it would end up doing the same thing as the competition instead of sticking to its own unique path.
2. Stay mentally close to your roots
Wines have a terroir, a characteristic taste they get from the specific environment where they are produced. Companies have something similar. Ingvar Kamprad, the founder of furniture giant IKEA, was born in the Swedish countryside and founded the firm on the kitchen table of the family farmhouse. Although IKEA now has a presence in around fifty countries, it still retains the frugal and down-to-earth values of a Swedish farming community. And despite the firm’s global footprint, the majority of the board members still come from that same small region of Sweden.
The same is true of Toyota in Japan. The company still retains the culture of Mikawa (near Nagoya), where the company was born. Applied to the business of making cars, the local values of hard work, frugality and persistence resulted in the concept of kaizen—continuous improvement—widely identified as the key driver of the car giant’s success.
3. Establish your own business model—and stick to it
Japanese electronics manufacturer Sony, once famous for hit products like the Walkman and the Handycam, is now better known for endless corporate restructurings as it tries to stop losing money.
Many Japanese commentators believe that Sony lost touch with the founding principles underpinning its business model in its eagerness to become a global company. One of the company’s two co-founders, Masaru Ibuka, described Sony’s mission in the company’s founding prospectus in 1946. The company’s purpose, he said, was “to establish an ideal factory that stresses a spirit of freedom and open-mindedness, and where engineers … can exercise their technological skills to the highest level.”
When Sony, in the face of problems, started to sell off its factories and outsource its manufacturing, the firm was turning away from its original purpose and spirit. It was throwing away the one thing that made it different from the competition. (Interestingly, other Japanese firms, like factory robot maker Fanuc and camera company Canon learned from Sony’s missteps and consciously decided not to outsource their core competence of manufacturing.)
I have done my best to make the business I founded unique too. With GLOBIS, the business school I set up in 1992, entrepreneurship is the key to everything we do. I set up the school at the age of thirty with only $8,000 in capital. And ever since, we have worked to keep this entrepreneurial edge, moving aggressively into new geographic markets (5 campuses in Japan), different languages (an English MBA as well as a Japanese one) and educational formats (online education, apps, etc.). That helped make us the No. 1 B-school in Japan in terms of both scale and reputation.*
At the same time, we have tried to codify the things that make us different. We have something called The Principle of the 4 Uniquenesses. These are:
- A service guarantee (If you don’t like our courses, we will give you a refund. I know of no other business school that does this.)
- Creation/Innovation (We are the only business school in Japan to have been started from scratch, rather than as an adjunct to an existing university.)
- Practical (One hundred percent of our faculty comes from a business background.)
- Focus on mindset (In addition to academic skills, we encourage our students to develop a personal mission.)
When I set up my business school, I was determined that we should be a “different animal” to the traditional Harvard model. It’s easy to copy what your competitors are doing, but copying is never a strategy. Leaders should avoid taking a “me too” approach; instead they should find what is unique in their company’s DNA and develop it.
The secret to success for corporates—just as for individuals—is to “find yourself and be yourself.” In the end, unique businesses always stand the best chance of enjoying unique success.
Author: Yoshito Hori
Founder and President of GLOBIS, No.1 MBA Program & No.1 VC in Japan. Founded G1 Summit & KIBOW.