Akio Morita On Management

For the past few weeks, I’ve been reading Made In Japan, a story about Akio Morita‘s life and the first three decades since the founding of Sony Corporation.

I haven’t finished this book, but the last chapter titled ‘On Management’ was very interesting and it struck a chord with me. I’ve seen enough management decisions that were short sighted and proven to be wrong in the long run, throughout the 12 years I’ve been in the industry, and some of them could’ve been avoided or at least improved had the people behind them had better insights. I think everyone can learn a thing or two from these quotes…

I

pg 144

The most important mission for a Japanese manager is to develop a healthy relationship within the corporation, a feeling that employees and managers share the same fate.

pg 153

What we in industry learned in dealing with people is that people do not work just for money and that if you’re trying to motivate, money is not the most effective tool. To motivate people, you must bring them into the family and treat them like respected members of it.

pg 158

In the Japanese case, the business does not start out with the entrepreneur organizing his company using the worker as a tool. He starts a company and he hires personnel to realize his idea, but once he hires employees he must regard them as colleagues or helpers, not as tools for making profits.

pg 158

The investor and the employee are in the same position, but sometimes the employee is more important, because he will be there a long time whereas an investor will often get in and out on a whim in order to make a profit.

pg 162

At our company we are challenged to bring our ideas out into the open. If they clash with others, so much the better, because out of it may come something good at a higher level.

pg 163

If you and I had exactly the same ideas on all subjects, it would not be necessary for both of us to be in this company and receive a salary. Either you or I should resign in that case. It is precisely because you and I have different ideas that this company will run a smaller risk of making mistakes.

II

pg 165

Who could tell us better how to structure the work more than the people who are doing it?

pg 167

Go ahead and do what you think is right. If you make a mistake, you will learn from it. Just don’t make the same mistake twice.

pg 168

In Western countries, management lays off workers when a recession sets in. In Japan we just do not do that unless we have been brought to the direst point.

pg 170

And when a company is in trouble, it is the top management who take salary cuts before the lower-level employees.

pg 171

Despite the work of the Harvard Business School and others, and the increasing number of holders of advanced degrees in business administration, management is an elusive thing that cannot always be judged by next quarter’s bottom line. Management can look good on the bottom line but at the same time may be destroying the company by failing to invest in the future.

pg 171

To my mind, the performance of a manager is measured by how well that manager can organize a large number of people and how effectively he or she can get the highest performance from each of the individuals and blend them into a coordinated performance.

pg 173

In my view, profit doesn’t have to be so high, because in Japanese companies our shareholders do not clamor for immediate returns; rather they prefer long-term growth and appreciation. Of course we have to make a profit, but we have to make a profit over the long haul, not just the short term, and that means we must keep investing in research and development.

pg 174

I learned that an enemy of this innovation could be your own sales organization, if it has too much power, because very often these organizations discourage innovation.

pg 174

If you are nothing but profit-conscious, you cannot see the opportunities ahead. And where compensation is tied to profits, very often management will say, “Why should I sacrifice my own profits today for the guy who is going to follow me a few years from now?” Too often management will abandon work on a promising product because development costs seem to high. That can be short-sighted and can lead to the inability of a company to compete.

III

pg 186

People who are running a business ought to know their business very well. If the accountant had been in charge of our little company in 1946, our company would be a small operation making parts for the giants. Likewise, someone who is only a scientist is not always the best person to have at the helm.

pg 187

Whether the design, the technology, the merchandising, or the promotion was bad, the failure was a failure of management.

pg 187

Managers who do not have the capability to judge from a technical standpoint whether a product is feasible or not are at a tremendous disadvantage. I have always felt that the idea that professional managers can move from one industry to another is dangerous. Even being in the business and being knowledgeable about it is no guarantee that all the possible opportunities will be exploited and that mistakes will not be made.

pg 188

It is possible to have a good idea, a fine invention, but still miss the boat, so product planning, which means deciding how to use technology in a given product, demands creativity. Only with these three kinds of creativity — technology, product planning, and marketing — can the public receive the benefit of a new technology. And without an organization that can work together, sometimes over a very long period, it is difficult to see new projects to fruition.

The above came only from one chapter of the book, the rest of it was even more fascinating, the story of his childhood, the second World War, the people behind Sony, the technical and business sides of their product development, and the comparison between Japanese and Western philosophies.

I picked up this book after learning from Steve Jobs biography that both Akio Morita and Sony were inspirations to Steve and many people at Apple, I was curious, and now I understand why the legend is such an inspiration.

Note: If you’re a geek interested in reading the book, please also note that it contains lots of chapters on business and management.