4. On Management: "Enhance your Strength"
Itoi Do you remember the time I asked you the definition of management? It was around when I just started up Hobonichi, when you were president of HAL Laboratory.
Iwata Of course.
Itoi I would never have guessed you'd become president of Nintendo at that time.
Iwata Neither had I.
All (laugh)
Itoi I remember the reason why I asked you that question. Having putting back together HAL Laboratory, I wanted to hear your opinion, thinking of the difficulties you went through, and partly because I didn't want to go through the same situation.
Iwata I remember answering "You have to know your strength and your weakness. You need to lead your organization where you can enhance your strength, not where your weakness becomes exposed."
Itoi You then sounded as if there could possibly be no other answers at all.
Iwata You just have to stick to that until the end. I also remember talking about priorities.
Itoi Yes.
Iwata You have to set your priorities being aware of what you're good at. There are always so many things that you ought to do, but what you "can" do is limited. If you try to do everything you ought to do, you end up falling over. That's what I told you then as my own definition of management when I was wet behind the ears, but I still believe in this idea today.
Itoi Yes, I still see it in you.
Iwata It's a theory that works.
Itoi Those are probably the two things you taught me directly. I always kept them in mind when I discussed management with other people. I've been going over it again recently. I know vaguely our strength and weakness, but not so clearly. Actually, our employees are discussing our strength through e-mail right now. We've got like 150 opinions, but it's still not completely clear to us. I feel we're missing something.
Iwata I see.
Itoi I think most of it has been said, but I feel we're still missing a whole lot. One of the strengths of HAL Laboratory was that it had a fantastic view, right?
Iwata "HAL Laboratory, Inc., the software vendor where you can view Mt.Fuji"
Itoi Ha ha ha. That's a phrase I wrote on a sign in "MOTHER 2" (EarthBound).
Iwata (laugh)
Itoi HAL Laboratory was definitely specialized in programming.
Iwata At the time, yes.
Itoi It was partly because you were there. HAL Laboratory was definitely good at programming, not art. A company like ours, on the other hand, has difficulties when it comes to defining our strengths.
Iwata I can assume that.
Itoi We can come up with many abstract concepts, but it becomes unclear when you try to break it down into concrete concepts. To be extreme, you call something your strength when you want to nurture it even at the expense of investment. We haven't completely found that yet. I think it's an important task for us to find it, thus we've been searching for a long time. It would be nice if you can share some hints on how to search such strength, including how it was at HAL Laboratory.
Iwata Let's see... First, it is ourselves that takes action. Then, the customers or our business acquaintances receive it and respond to it. This is the basic set of action. HAL Laboratory used to receive orders from Nintendo. In a way, the person in charge at Nintendo was our customer. Sometimes they were satisfied with our output, but sometimes not. The interesting thing is that this wasn't related to the amount of effort we put in. With the same amount of effort, sometimes we got 5 times the satisfaction than other times.
Itoi Interesting.
Iwata I found out a pattern, observing this. To put it in short, when you are doing your job, there are times when you feel extremely exhausted and times when you feel it not so hard. Businesses are always accompanied by hardships and difficulties, needless to say. When you have completed a challenging job, if the customer's satisfaction level is not more than the level of the hard works you've been through, you feel even more exhausted. On the other hand, when the customer evaluates us highly, higher than what our hardship deserves in our analysis, employees become more encouraged and motivated to grow further. However, in bad cycles, the employees wear out, and the necessity of having to sit down and listen to their thoughts starts popping up. In summary, if they can feel that they were rewarded more than they deserve in the form of the customer's appraisal, it's the good cycle in which employees can voluntarily grow without the need of the management to intervene. That is something they are good at. If things cannot work out that way, these are not the things they are good at. I think that is how I have been distinguishing the two.
Itoi Ah, I get it.
Iwata It's the same at Nintendo too.
Itoi I think that's something I'm already doing.
Iwata Yes, I think so.
Itoi I don't want my people to go through meaningless agony.
Iwata If it's too painful, just drop it. It's not what you're good at.
Itoi Drop the painful stuff, quit the things you don't find interesting.
Iwata You can say that again.
