Japan has a wonderful year end tradition where the entire house is given a massive clean up. Dust is dispatched, junk is devolved and everything is made shipshape. We need to do the same with our business and I don’t mean cleaning up your desk. We have two types of people working for us. There are those who receive a salary of some dimension, be they full time or part-time and then there are those who get paid for their services. Some of these services are delivered regularly throughout the year. Others are intermittent, on a needs basis. Regardless, we need to take a good look at these every year to make sure they are still fit for purpose.

As a training company, we have some regular suppliers. Our landlord charges us rent for the space we use and that lease pops up every two years. Regardless of the economy, the office space vacancy rate, the consumer price index or any other intergalactic factors, the numbers always go up at renewal time. It is no good finding ourselves at renewal time and thinking “maybe I should have investigated if there were more appropriately priced alternatives”.

Too late by that time, because it takes quite a while to find the size of space you need, in the location and configuration you require, at a number that makes sense. Better to engage a real estate broker early to start telling you what the alternatives are so that when the time comes you can have some choices available. That data is also a potential bargaining chip in the arm wrestle for the next two years of tenant penal servitude.

Another key player is your accountant. If you outsource your accounting to a firm, they will receive the data from your people and then get into a P&L and Balance Sheet format that you can come to terms with. It also enables someone externally to see what are the patterns of spending and spot any anomalies. Japanese staff are very honest. However, like staff in other countries, they can find themselves in the newspaper for embezzling vast sums from their employers, sustained over breathtaking amounts of time.

If you need an English speaking accountant, we are now fishing in a very small pond. This tends to mean that we lock someone in to do the books and we just keep them forever. We all seek an equilibrium comfort point. We get the service, we are happy with it and we are generally too busy to investigate if we can better it. Once a year, list up some accounting service delivery alternatives and have a conversation about what they offer. Existing suppliers can become robotic in their delivery of their services and they have pruned their services down to the minimum necessary to maximise their return. It might be a good time to see if you can maximise your return instead.

In our case, we need things designed and printed, because we distribute flyers to clients and training manuals to class participants. I am using the same printing company now which I have used for over ten years. I know there are other companies who are slightly cheaper, but I need high quality service, delivered at speed. Being able to get things designed very quickly is something I value highly and will pay more for that service. If that service was diminished then there would be a reason to change. The point here though is, I need to keep track of the size of the disparity between what I pay and what they deliver. I can’t just go to sleep at the wheel and keep using the same folk because I am too busy to know the relative price, quality and scope of the service I am receiving.

Labor lawyers do well here in Japan. The regulations are changing, there is government pressure to not have unpaid overtime and numerous arcane labor rules abound. Our labor lawyer is a pretty good businessman and signed my firm up on a monthly retainer. I took my COO’s advice on this retainer, though I had my doubts. I reviewed that service need and that retainer and guess what? After I cut it, there has been no difference in what we needed as a service. Instead, we are saving that money every month now.

Maybe at one point there was a point. My point though is, don’t let these things just drift along, without making a conscious decision to decide if the service is really what you still need or not. End of the year clean up time is a good time to survey new potential providers and clean up unneeded service expenses too.

I met the owner of a successful business recently. He had bought the company twenty years ago and then pivoted it to a new and more successful direction. So successful, that he employs over 230 staff and was recently listed on the local stock exchange. It was a business meeting to discuss collaboration and I was expecting an entrepreneurial leader, charismatic and personally powerful. Why was that my expectation? Being raised in Australia, that is what successful entrepreneurs in the West are like, so I expected a Japanese equivalent. He was totally different to what I expected.

He had no personal power at all from what I could see. One reason may be that we were speaking in Japanese. It is a subtle, circular language that masks and obfuscates like few others. He had two senior staff members with him, his direct reports and they too were rather underwhelming. It got me thinking about what does it take in Japan to become a successful leader? Here were three of them in front of me and I wouldn’t have crossed the road to meet any of them.

Position rather than personal power counts for lot in Japan. You meet a lot of people here with big titles and pretty much no personal firepower. That is not to say there aren’t charismatic, powerful leaders here. Mr. Nambu who founded the massive Persona organisation is a very charismatic person, who has tons of personal power. He has nearly 20,000 employees spread across his 67 subsidiaries and 11 affiliates. I know him personally and he is very good at dealing with people, both high and low. He started the company while he was still at university, so he is a rare bird in Japan, to take a start-up to serious stardom and himself to billionaire status.

What is the difference between some of the successful Japanese I have met and the nobodies leading many firms. When we teach leadership, we make a point of differentiating it from management. Managers make sure the processes are running on time, cost and at the required quality. Leaders do all of that, plus they set the direction and build the people. By this definition most Japanese leaders we meet in business would be classified as “managers”. Japan is a country of detail, long term planning, caution and perseverance. You can go a long way on the back of that line-up and many do.

My new acquaintance is a manager I would say. I am guessing that he fell into the business he is in, rather than it being the product of strategic planning. What a contrast with Jordan Wang. Jordan is the Dale Carnegie franchisee in Sydney and took the business over two years ago from basically nothing growing it very quickly to a substantial size. I was attending his talk to the Franchisee Association on how he runs his business.

His planning frameworks were very sophisticated. Because they started with basically nothing, he said, he had to come up with a road map. He spent some serious time studying the various frameworks out there and then adjusted them to his reality. Over the next two years he shaped and crafted those frameworks into a formidable machine, to help run his business. One of the very experienced and successful American franchisees commented that “I am feeing less smart” after listening to Jordan. I know exactly what he means, because I too was blown away by Jordan regarding his thinking, energy and that word – charisma.

In Japan, trust is a key requirement for retaining staff, gaining clients and remaining successful. This is the same everywhere, but somehow Japan just brings a much great intensity to the word. If you can gain trust with others, you can build a business here. Over time you can build it, if you happen to have chosen a niche or a sector that is growing and profitable. Being high on trust and low on charisma is no impediment to success here in Japan.

So when you meet a Japanese leader and they are a fizzer in the charisma stakes, don’t necessarily write them off. Look at their numbers, particularly staff numbers as an indicator of how much credence you should attach to them. In my experience, few Japanese excel individually, but put them together in a group and they are most formidable. To keep the group together, their leaders need to have been able to build the trust. The other question you need to ask is have they been able to sustain this over decades? If they have, then you may have a business partner in front of you, even if they seem grey, dull and boring.

Time is the enemy of good leadership. It takes time to develop a team of individuals. A common metaphor is the orchestra conductor. Each instrument player has a specific role and it is the job of the leader to meld them together to work harmoniously and effectively. The conductor takes a significant amount of time to get this working correctly. That is their sole purpose. They make the best of the talent in the team, get them working well together and develop the individual talents of those involved. In business, we have to do all of these things and worry about the P&L, the Balance Sheet, the competition, quarterly earnings, changes in Government regulations, the media, shareholders, where the market is heading and the latest developments in technology. We are kept pretty busy.

Consequently we are time poor from the moment our eyes open until we drift off to into slumber at night. There is a tension between the time needed to work with our team members to work effectively together and the time we have available to do just that. So we cut corners. We start to lead from a macro perspective. We are prone to broadcast emails to the whole team, mass Town Halls where we download what is going on, Zoom calls to the whole team where we pontificate on how things should be. It is terribly efficient but is it particularly effective?

We know from sports that all the modern coaches coach each individual based on who they are and what they are capable of doing. The old style game half-time coach thunderous moments of inspired oratory are the thing of Hollywood movie celluloid relics of a past long passed. Leaders need to focus on each person, one by one.

Some players are easy going, amazingly talented athletes who can perform the most unexpected feats of spontaneous physical dexterity, that a coach can never teach. They are Amiables who like people and are understated. They don’t speak in a loud voice, in fact they are laconic to the extreme. Loud incandescent outbursts about the requirement for getting the numbers are lost on them. We have people like that on our business teams. They are the solid quiet performers, often the social glue inside the team, holding all the superstructure together.

The opposite stye are the Drivers. They are highly numbers and outcome oriented. They want the big bucks which comes with producing results. They don’t need external motivation, because the fire burns deep inside them and it is permanently self-igniting. They don’t need public acclaim or affirmation, because they march to the beat of their own drummer. They don’t listen to any praise because they are sceptical and they don’t feel any need of it. They can handle extreme pressure from above to perform. They have no problem with straight talk about getting the numbers or getting out of Dodge. They need to be strongly corralled to play as a team member, because they are oriented as an individual player and believe they rise or fall on their own efforts. They have severe outcome focus, rather than people focus, so often they can be limited in application as the leader. That doesn’t stop organisations putting them in charge though, because they produce results.

Analyticals are data freaks. They only react to proof and evidence. They suspect any opinions which cannot be backed up with the statistics, expert testimonials, key numbers or facts. They are very well organised and thorough in their approach to everything. You have to persuade them with the data. They are not stirred by emotional calls to action. “Do it for the Gipper” doesn't do anything for them. Whether in sport or in the office, they need to be convinced by proof of the right course of action and once on board, they then knuckle down and get right behind the effort.

The opposite style is the Expressive. They are outgoing, like being with people and are very confident, often too confident. They are usually the pranksters inside the team, making the jokes, geeing everyone up. They are flamboyant and enjoy the accolades, public acclaim and attention. Titles, prizes, trophies, incentives – bring them on they say. Inside the company they are the “hail fellow well met” crew, who work hard and play harder. Pumping up their ego has no bounds. The less fizzy, more sensible variety are often the most attractive leaders inside the organisation.

As leaders we need to know which style we are and what are our own strengths and weaknesses. We need to know the same detail about our team members. We should spend time with them individually. Time constraints push us away from doing this, but we have to fight against the unrelenting drive to harmonised mediocrity. There is no point in being a macro leader in a modern micro world.

I remember reading once about a President reflecting on the cost controls he had instituted inside his organisation. The industry had emerged from a recession and even though the economy and the company had recovered, he had forgotten to ease the strict controls he had instituted to protect the company. Covid-19 has forced many of us to institute strict controls in order to survive the business disruption caused by the virus. When should we release some of those stringent controls?

This is a tricky subject at any time, but it becomes more pungent when you are coming out of a long tunnel. As Winston Churchill once remarked ,“If you are going through hell, keep going”. Very clever and witty, but when we have come out the other side of Covid-19 hell exactly at what point do we need to ease off the vice like pressure we have been applying to expenses and investment?

In any business there is always tension around a couple of staples. Control and innovation can be in contradiction. Compliance, regulations, controls are there to protect the business. Systems have to work at scale, regardless of who is employed in the business. There has to be consistency and production sequences need to work to make deadlines or to ensure the required quality. When I worked in retail banking, there were so many regulations and audits, regarding what we were doing. Every process had to be documented and followed according to the letter of the specified designation.

People didn’t get into trouble for varying from the procedures. It was hiding the variation that proved to be career ending. They were too scared to admit they had not followed the procedures and so tried to hide the fact away. Unfortunately, that doesn’t work and at some point it all comes rolling out and rolls right over the top of the individual and they are summarily fired for hiding the offence.

On the other hand, we want people to be innovative. We know the danger of groupthink and also of being left behind by more creative rivals. Staff witnessing the career ending variances from the established tried and true methods, are not much induced to try new stuff. How do we get innovation, when we have the system tied down so tight there is no room for mistakes?

There has to be a different mentality around mistakes. Japan is a mistake free zone. There have been decades of bosses very publicly screaming abuse at staff for screwing up. This curtailed people’s interest in doing anything new or better. The boss has to now take the lead here. The staff need to be told clearly what can’t be played around with for compliance or regulatory purposes, but also what is up for grabs. Mistakes can be said to be tolerated but if the talk isn’t matched by the walk, the experiment in a “hundred flowers” blooming, dies on the spot.

Sounds easy, but just where is the line? How big a mistake are you personally, as the boss, prepared to tolerate? When Lee Iacocca called in one of his marketing executives at Chrysler following a major failure on a new model launch, that executive was expecting to be fired. To his amazement Iacocca said, “Fire you! We just spent million educating you”. Can you be like that?

We set the temperature for innovation, by how much we celebrate the learnings from failures. We might not be as big minded about losing millions like Lee baby was, but still there will be opportunities to demonstrate that we never fail, because we always learn. We are going to come out of Covid-19 in 2021, so although we can’t set a specific date to loosen the controls, we still need to set a date to remind ourselves that we need to reevaluate where we are in the business cycle. Now is also the time to look for innovations which can be implemented, once the cash flow has been stabilised. Plan now and pour in the investment when the time is right, rather than waiting for the cash to be there first and then start the planning.

We need systems and rules to protect the company and we need innovation to take the company forward. It cannot be “either”, it has to be “and”. Striking that balance has no road map and is difficult to get right, but if we can be directionally right and at the right scale, then we are going to be on the right track.

Harvard Business School, Stanford Business School and INSEAD Business School are all awesome institutions. My previous employer shelled our serious cash to send me there for Executive education courses. Classes of one hundred people from all around the world engaging in debate, idea and experience exchange. One of my Indian classmates even wrote and performed a song at the final team dinner at Stanford, which was amazing and amazingly funny, as it captured many of the experiences of the two weeks we all shared together there.

When you get off the plane and head back to work, you realise that the plane wasn’t the only thing flying at 30,000 feet. The content of the course was just like that. We were permanently at a very macro level. The day to day didn’t really get covered and the tactical pieces didn’t really feature much. This isn’t a criticism because you need that big picture, but the things on your desk waiting for you are a million miles from where you have just been.

Fortunately, there are some leadership principles which can cover off the day to day needs. Principle #22 is “begin with praise and honest appreciation”. Such an obvious thing, how could this even be mentioned as a principle? It may be obvious, but are you a master of this principle? We talk about providing psychological safety for our teams. Well that is great and just how do you do that, when you have pressure to produce results from above and are feeling the stress of the current business disruption? It is too easy to begin with an interrogation about the current state of play, the numbers, the revenues, the cash flows. How about if you started every interaction off with finding something real to praise about the team members. Not fakery but something real, that shows you are paying close attention to what they are doing well.

Mistakes happen. Except in Japan. In Japan mistakes are not allowed and the penalties to career advancement are large. “Fail faster” might make you a legend in Silicon Valley but would see you cast out in Japan. That is why the entire population here are all ninjas at concealing any errors, so that the boss never finds out. How do we get innovation going if we can’t tolerate mistakes? That is one big reason why there is so little white collar work innovation in Japan.

Principle #23 says “call attention to people’s mistakes indirectly”. Rubbing in it some one’s face that they screwed up is a pretty dumb, but universally adopted, idea by bosses. Principle #26, “let the other person save face” isn’t an “oriental idea”. It is a human idea and no one likes losing face in front of others and it doesn’t increase people’s engagement levels. In fact, is has them thinking about leaving for greener pastures. Principle #24 also helps, “talk about your own mistakes before criticising the other person”. We want our team members to feel empowered to take responsibility, to step up and try stuff. That is how we create an innovation hub inside the organisation. If you have a hotbed of ideas from your team and the competition is still canning people who make mistakes, then you will win.

Principle #25 is so powerful. “Ask questions instead of giving direct orders”. Bosses are staff super-visors, because we have super-vision. Probably true once upon a time in the olde days, but no longer the case. Business is too complex today, so we need to grow our people and to be able to rely on their ideas. If I spend all my time telling you what I think, I haven’t learnt anything. Bosses need to think of questions which will push the team’s thinking muscle hard and get people really engaged. Instead of laying our your thoughts, chapter and verse and falling in love with the sound of your own voice, try asking questions instead. After asking the question, shut up and let your people answer without interruption. It may be killing you, but do it. Being asked for your opinion and ideas is empowering. Maybe the boss has all the answers, great, but what if the staff have questions the boss hasn’t even thought about. In Japanese business, asking the right question is more valued, that having the right answer.

All of these principles have things in common. They are common sense, but not common practice. They are super easy to understand, but devilish to execute consistently. They are game changers in our relationship with our staff. Having some leadership principles to live by just takes the action of thinking out of the equation. These become the reflex actions we take because they have become a habit. These are the types of habits we need to cultivate.