You'll never achieve truly great success or deliver on big projects if you can't effectively move your organization. Learn how to develop teams and get your organization moving.

41 Numbers give clarity, so set KPIs

Key performance indicators (KPIs) are just a way of expressing goals in detail with numbers. To achieve our major objectives, we set goals for the steps along the way, and KPI is simply the term we use to refer to those concrete numerical goals.

Major objectives are crucial to influencing the direction of an organization. But to achieve those major objectives, the goals that represent steps along the way to their achievement must also be clearly laid out and visible. Unless all members of the organization understand the progress they have made against those goals, there's a possibility they will lose sight of the path. KPIs are simply the markers along that path.

In sales, for example, you can set KPIs for numbers of new contracts or new clients, expressing detailed KPIs in numbers for each of the actions that are key to achieving your major objectives.

As an organization grows, it's quite common for individual members of the team to come to feel that their role in achieving major objectives is relatively unimportant. This is when it can become almost inevitable for some members to feel that it won't make a big difference to the whole organization if they take it easy for a day. But this is the sort of thinking that, if left unchecked, will slow down the entire organization.

KPIs are the vital links between not only the major initiatives of an organization and the individual tasks of each employee but also between the major objectives that will take years to achieve and the smaller goals to be achieved today.

By setting specific numerical targets, hard numbers bolted to reality, each individual team member can track his or her own progress on a daily basis. It might be unglamorous work, but it fuels the engine of every dynamic organization.

Ultimately, the work of any company, no matter how large, is only the sum of the work done by every individual employee. If every employee in a company of 5,000 takes one step forward in one day, the organization will take 5,000 steps forward that day. Maintaining that pace over a whole year adds up to more than 1.5 million steps. To be sure you achieve those 1.5 million steps, however, every single employee must take that one step forward every day.

Some say that the success of a startup all comes down to the ideas they're able to generate. That thinking probably also means that, even if the organization is not yet developed, startups can succeed as long as their ideas are good. On the other hand, that's like saying that even successful startups with great ideas don't have great people.

That is not the kind of startup I set out to establish.

My goal wasn't to win based on ideas alone but to develop the abilities of every individual team member to a level that means we're able to disrupt and beat even the most established firms. That's another reason that I believe objective numerical goals, in the form of KPIs, are crucial. The data are clear; KPIs can drive innovation in organizations and push them to higher levels of efficiency and execution. Never take your eye off the numbers.

42 Pay close attention to resource allocation

Whether you're budgeting your time or your money, be concrete, not conceptual.

Resource allocation is all about deciding how to allocate resources to individual businesses. Paying close attention to this is vital for all companies, large or small.

Company resources will vary according to the industry, but the most important resources and what all companies have in common are human resources and capital. How should you allocate people and money? While we should all be aware of these as top priorities, surprisingly enough, many of us don't pay enough attention to the details. Allocation is often guided by vague concepts like management know‐how—in other words, simple intuition.

Resource allocation is crucial not just for managers but for all of us. It's a question of how to best allocate and use resources with defined limits.

On an individual level, would you logically consider how to allocate your own resources, such as your time and money? You may actually need to budget both. To do this effectively, you need to take into account the total amount of resources and the needs of individual businesses. In practice, however, allocation decisions are often made on an ad hoc basis.

There was a time when I used to wake up an hour early every morning to study English before work. I don't think I'd have been able to keep it up if I'd decided to do it for an hour between getting home and going to bed. Sometimes you work late or are invited out for a drink. I was a “salaryman” and had to get up at a certain time every day anyway. Getting up an hour earlier wasn't as hard as you'd imagine, as you'll learn once you try it. It's actually easy to wake up two or even three hours earlier than you need to. Among high‐performance workers in the United States and Europe, it's not unusual to show up for work at four or five in the morning. At such an early hour, no one calls, there are no meetings, and no one bothers you for anything. You can be incredibly efficient at this time of the day. If you can get your day's deskwork done before everyone else even turns up, you can use the rest of your day much more effectively. In central Tokyo, there's also the added bonus of missing the morning rush hour. It may be a small thing, but it's these things that can revitalize your everyday life and open up great new possibilities.

The same recommendation applies when you look at resource allocation for organizations. Always questioning common sense and being consistently rational are indispensable. For example, don't assign lots of top people to a particular department just because it's an important part of the company. Sometimes assigning a smaller number of enthusiastic young people with less experience to a task can yield better results. This can happen because abilities are not static, and, depending on the environment and circumstances, you can sometimes see unrealized talent bloom. The right mix of veterans and newcomers can be a catalyst for major change. Human resources should always be on the lookout for this human chemistry. It's a process a computer can't duplicate.

I fully understand that individual observations in team creation become difficult to put into practice as company scale grows. It's when organizations become large that their ability to resolve personnel issues and high performance teams within the organization becomes even more crucial to future growth.

Resource allocation can never become a routine or rote process. It must always be viewed as dynamic and rooted in human insight, yet grounded by rationality.

43 Lead by teaching

A leader is a commander and strategist, but also a teacher. This is true for every leader, no matter how small the group.

Particularly when you're young, you tend to think of leaders only as commanders. But a true leader does more than just command a team. Leaders are strategists and must be aware of the greater context of their team's role: They must always plan out the overarching strategy, not just work out tactically on the immediate issues at hand—just as skiers on the slopes must look both at what lies ahead and the terrain beneath them. If you lose sight of where you're going and why, you can't lead your team in the right direction. What's more, if you don't think strategically, you won't be able to formulate an appropriate response when an unexpected situation arises, when mistakes are inevitably made and trouble presents itself.

We all know that cutting our losses is the best way to cope with failure. But not all failures are the same. If there were only one type of loss, it would probably not be too difficult to respond to it. However, complex businesses generate various kinds of losses: impacting earnings, customer trust, and team spirit, among other things. So the question is—which losses should you strive to minimize right now? You must think strategically to make the correct decision. That's why it's often said that the best commanders are those who excel at fighting from a losing position, like the Duke of Wellington in the early 1800s.

Another leadership mandate we shouldn't forget is that great leaders must also be teachers. Natural leaders are confident in their actions and judgment. What takes a leader from good to great is the ability to pass on these skills.

It's the same in sport: Great athletes don't necessarily make great coaches. It's difficult to teach others things that you can do intuitively. And it's extremely hard if there's a difference in natural talent between you and the individual you're teaching.

When asked about how to be a good batter in baseball, the Japanese baseball icon Shigeo Nagashima once said, “You just hit the ball when it comes toward you.” This is something that only a genius would say. These 10 words express the very essence of batting, but this is difficult for an ordinary ballplayer or fan to understand. The natural talent of a genius must be broken down into parts so that an average person can understand it.

Your intuition as a leader can't be widely understood until you can articulate it in a teachable way. Teaching can come in actions or words (which is one of my reasons for writing this book).

You can't create a good company simply by bringing lots of talented people together. Because when one leaves, your company will suffer in proportion. You need to construct a framework to transfer abilities. This isn't simply a question of passing on knowledge. I don't think a company can claim to be educating its employees until the ability of all employees as a whole are enhanced. A company won't last long without a system that continually educates its employees.

What drives your successes? Conduct a thorough analysis, and once you understand that, be a teacher and communicate this to your team members. Develop your team and achieve your goals. Then aim higher.

The ability to set a positive cycle in motion like this is the hallmark of a true leader. It all starts with a commitment to educate others.

44 Leverage the organization to move faster

There are many complaints out there about organizations. People say they become rigid, that they stop working. Criticism of bureaucracy is similar. But it's pathetic when colleagues within organizations resort to these complaints. I want to remind them that getting their organization moving is their own job.

Organizations exist to enable us to achieve things we can't accomplish alone. Members of organizations should view their organizations as their foundational tools. I want to say to them, you should be able to use that tool! Drivers keep their cars maintained and filled with gasoline. Chefs sharpen their knives daily to ensure precision. You'll never hear professional chefs say they can't cook because their knives are dull. Professionals know it's their job to be prepared. An organization is a tool a million times more complicated than a knife or a car, so it's obvious that if we don't continue to innovate and make an effort to get an organization moving, it will stop functioning effectively.

We must constantly be innovating and making an effort to drive our organizations forward. Sometimes drastic steps are needed to revive a stagnant organization. If an organization is too idle or inefficient, the first step is to eliminate waste to reclaim speed. It's my observation that most organizations could move 10 times faster simply by identifying and cutting waste.

Make this your personal aim. Reduce the time spent in meetings, or whatever, by 90 percent. Cut a two‐hour meeting to 12 minutes. You'll probably say that this is impossible, but really make the effort to achieve it. You may surprise yourself.

Everyone's attitude will change when they realize their organization is working 10 times faster. And they'll start to feel motivated, because, if you're going to run, running faster is even more fun. Work is boring if you're dawdling. And once you realize how fast you can run, you will start to feel an intense craving to run even more. It's when people feel this urge that the whole organization will move.

Some may think wrapping up a two‐hour meeting in 12 minutes is impossible. But I did it at Rakuten. The actual decision‐making part of a meeting only takes five minutes or less. The remaining time is taken up by explanations. In such cases, the explanations could be written down. I made those who wanted to speak at meetings submit what they wanted to say in writing a day before the meeting—something they would have had to present anyway. This added to their workload (although only slightly), as they had to submit a clean copy in advance. Those attending meetings read all the submissions before the meeting starts. They can easily do this when they have a spare moment. So at the actual meeting we have five minutes to clear up any questions, five minutes to make decisions, and two minutes to spare.

Some colleagues of mine had trouble with this in the beginning, but the system is now working very smoothly. Writing something down rather than saying it clarifies the weaknesses and vague points in any argument. The system has also made everyone skilled at clearly summarizing the key points. A byproduct of the system is that the content of meetings is far more significant.

An organization will move 10 times faster if you really want it to. And the faster it moves, the more effective it will be.

45 Harness the power of competition

Darwin's theory of evolution posits natural selection as a law of the natural world, but introducing this law into your enterprise will also make it evolve. In other words, leverage the power of constructive competition within your organization. Many companies already do this, although whether they are doing it correctly is open to debate. After all, two colleagues trying to pull each other down is one form of competition. One may lose, the other may win, but in the end, the company is no better off. So I believe it's important to create not just a competitive environment but also an environment in which competition is net positive for company growth.

You must therefore create an environment in which harnessing the power of competition draws out those abilities and drives motivation. At Rakuten's headquarters, for the use of all employees, I've created a library as a self‐study space, with educational programs, and a fitness gym. Exercise is a good way of relieving stress, but it's also a way to grow. In order to be effective at work, you need more than just your brain working.

Of course, everyone is free to choose to use, or not to use, the facilities. Sadly, many employees are too busy to use them, but I think this also shows that the competitive principle is working naturally at Rakuten—no matter how busy things are, there's always someone who manages to find the time to lift weights in the gym or read an educational book in the library. Of course, they don't have to do these things at work. What's important for us as a company is that we express to every employee that we are keen to see them grow. The facilities are a physical expression of this mindset.

There's a stark difference between someone who's always strived to grow and someone who hasn't. If the environment is conducive to growth, employees will realize that improving their abilities is an effective way of boosting their results. Those who don't will be left behind in the process of natural selection. Once that kind of environment exists, it's important to build a framework for competition.

The Rakuten corporate culture is intensely competitive. We reward those who achieve outstanding results, recognizing their performance, and conversely we give negative evaluations to those who don't perform. A system of demerit, however, is not part of our culture. Taking on a challenge and failing is not a sign of weakness and we don't play the blame game when that happens.

Doing nothing, on the other hand, is not something that will garner praise. Always doing the same thing is simply not good enough. Whatever your position in the company, every individual should be setting and testing hypotheses in order to achieve even better results. You will get marked down for not continuing to make this effort.

Getting marked down doesn't just mean a pay cut. There have been times when executives have been demoted to the status of regular employees. However, it's possible to make a comeback at any time. Rack up enough positive evaluations in your new position and there is no limit to how far you can advance.

This is not an easy environment to work in for those used to handling only the tasks they are served. In my company, employees are expected to seek out and solve new problems.

Those who realize that being in this kind of environment will improve their own abilities are the ones who excel and thrive. Professional growth and promotion become a major motivation driving their work. Indeed, there's no greater joy in life than knowing you have improved.

46 Share the sense of accomplishment

A “sense of accomplishment” is not an empty expression but a feeling much more profound than the one you experience in response to a financial reward. It's even deeper when we achieve something together with our colleagues.

I'm not discounting the importance of financial rewards. It's the source of the energy that drives and builds companies. If a company can't make a profit, it will eventually wither away. I started Rakuten because I wanted to achieve something big, but I certainly needed money to do it. Obviously, the pursuit of profit is at the core of why companies exist.

It's the same for every individual employee. We work to earn an income. However, a purely financial reward is not enough to bring out our true strengths. This may be a little idealistic, but I believe human beings are essentially creatures who feel even greater joy when we accomplish something as a team. I don't know how many tens of thousands of years it's been since our ancestors came out of the jungles and began to hunt in tribes, but that's how we've been living ever since. We've spent our lives in tribes, in groups, in teams. There's no doubt that we've always experienced that special joy of achieving things as a group. If you consider the context of humankind's staggeringly long history, currency as a means of exchange for value is something that only came into existence very recently. So it's understandable that the joy of monetary gain doesn't connect with our primal roots.

Sharing a sense of collaborative accomplishment is a fundamental driver of corporate growth. The joy of achieving something together with those close to you fosters development of new talent and enables companies to reach stretch goals. That's why there should always be a sense of sharing the joy of accomplishment in the workplace. And it's beyond doubt that the greater the achievement, the greater the joy.

One year, I challenged 170 new Rakuten employees fresh out of college to reach a quota for signing up new customers for Rakuten credit cards. I gave them one month to sign up 10 new customers each. I assumed that even these young people could achieve this goal.

My corporate training challenge didn't turn out as I anticipated. None of them achieved the goal. I was horrified. They weren't able to do something that should have been possible to do with a small effort because they didn't put in that effort. I decided to test them. I gave them one more week, but also said that in return they had to secure 30 contracts each.

If they hadn't been able to win 10 contracts in a month, why would I challenge them to reach a seemingly ridiculous goal—three times the metric they'd just failed to achieve? But I had my reason. I knew that we can achieve just about anything if we really put our minds to it. Our true strengths come to the fore when we're racing toward that impossible goal.

The 170 new employees returned at the end of the week with 10,000 contracts, or 58.8 per person. I was speechless.

But I was also secretly enjoying imagining the looks on their faces when they realized their achievement. Did they hug and slap each other on the back, the way my generation did? They learned that they can achieve any goal, no matter how difficult, if they put their heads together as a team.

Humanity is where it is today because we have worked toward major goals, encouraging those we work with, being encouraged, and opening up new paths together. In this way, we've made the impossible possible and pushed past our boundaries. There is no greater joy to be experienced at work than this. When I first announced that our company would make English our language of business, I knew it would be a huge challenge to achieve that goal. It was often difficult, it took longer than expected, and many people along the way said I was crazy. But when employees in our company did start achieving successful English test scores, when meetings could be run in English as a matter of course, and when other major companies began to look at our experience as a model for their own English language programs, I felt that sense of achievement—the one that only comes when you've pushed yourself farther than anyone thought you could go.

47 Find the bottlenecks

No division in any company is ever really working at 100 percent efficiency. They all have their own issues and weaknesses. It's important to eliminate weaknesses, but there's something even more important that you must do first. Among all the deficiencies you see, you must find out which of them reduce efficiency of the company. Find the bottlenecks. If you don't address the bottlenecks, other attempts at improving the company may be ineffectual or even meaningless.

Put the other way around, resolving bottlenecks boosts overall efficiency. A relatively small effort has a major impact. It should be your first step.

Constantly examine your overall operation and develop an eye for bottlenecks in workflow. This is useful personally, not just for organizations. For example, thinking about where the bottlenecks are in your own work can be a springboard to drive higher performance.

Sometimes, right when you think everything in your company is going well, you'll encounter a surprise bottleneck. In 2007, Rakuten moved its headquarters to new premises. A large proportion of headquarter functions were consolidated in Rakuten Tower, a building in Shinagawa, Tokyo. Some 5,000 employees worked in the 23‐story building. The building had 10 elevators working around the clock. But at peak hours, the elevators presented a transportation bottleneck. The elevator hall was always crowded during the morning rush and around the regular Tuesday morning company‐wide meeting. It could take up to 30 minutes to get all 5,000 people back to their seats after the meeting. Everyone started the day feeling irritated in the crowded elevator hall, waiting to ride the elevator. While I appreciated that everyone was committed to making efforts to improve their work efficiency, as we were always talking about it, it also looked like everyone had given up on the elevator problem and had resigned themselves to waiting patiently. I bristled with my own impatience, watching everyone shuffling around waiting for the elevator. The 30 minutes it took to get everyone through the elevators was a complete waste of time. Thirty minutes per person meant we were losing 2,500 working hours right there. If we couldn't solve such a simple problem as the elevators, how could we aim to be number one in the world?

We attacked the problem by the numbers. The congested elevators stopped on every floor, and when we did the calculations, we realized it took 20 seconds to let off passengers on each floor. For one elevator to go up to the top floor and back, stopping on every floor took as much as an extra 440 seconds.

So I decided the elevator in a building of 23 stories would only make 10 stops: on 1, 2, 3, 5, 7, 10, 13, 14, 17, and 21. Those who worked on a floor at which the elevator didn't stop were to get off at a nearby floor and use the stairs. (Of course, the stop buttons were still accessible for people with disabilities.)

This system reduced the time it took to transport everyone back to their desks to less than five minutes. This small gain boosted workforce productivity by 5 percent. Also, we didn't just reduce the amount of time lost. Without a doubt, we also eliminated the stress and frustration of our elevator rush hour.

Don't ignore bottlenecks, no matter how trivial they may seem. Resolving them can lead to improvements that ripple throughout the organization.

48 Create your own turning point

The nodes in a bamboo stalk are the secret to its powerful growth. There are times when companies also need to create such nodes, or turning points. There are times when even though you're working as hard as ever, growth slows and indicators seem to stop rising altogether. This is the nature of growth. Growth doesn't happen in a straight line but actually ratchets upward, like steps. As there will be plateaus, you should make good use of those times when growth flattens out. Slow growth periods can be used for reflection and planning next steps.

Say you teach a group of children how to add and subtract, then get them to practice what they've learned. At first, the more they practice, the more skilled they become. But at some point they stop improving no matter how much they practice. That's when it's time to move up a step and teach them how to multiply and divide.

In education, you know what to teach at what stage. But it is difficult when it comes to corporate growth, because every company is entirely different from every other company. It's not as simple a remedy as moving on from addition to multiplication. It's more common for companies to tread water during plateau periods while they search for a breakthrough. In many cases, they can even start going backward when they can't find a way of getting past the plateau. Even if you want to try something new, you have little access to capital and human resources and few options because your rate of growth has slowed.

When I say create the turning point, I mean create an artificial plateau when you're one or even two steps short of the natural plateau—in other words, while you're still growing. Stop for a second, rethink the state and direction of your company, and prepare for the next stage. For example, cut costs or personnel before it becomes absolutely necessary. Or switch to completely new ways of doing things.

Companies usually only do this when earnings have peaked and have started to deteriorate. But I recommend doing it while they're still growing. You need courage to do this when things are going well. You might face a torrent of competitive opposition. However, if you plan your strategy when you're growing, when you have ample financial and human resources, your new iterations and ideas will progress far more efficiently. As you grow, you can make internal changes and move smoothly on to the next growth stage.

Aim for further substantial growth by creating these reflective turning points, rather than waiting for the crisis of the real plateau.

49 Meet and revive in the morning

Every department at Rakuten has a daily morning meeting. Team members share information to understand current conditions within the department. At the beginning of the day, we clarify the theme and objectives of the day's work. Departments that do this well are without exception tremendously successful.

Generally speaking, failures in business usually occur when people get sloppy. They stop planning and using themes and objectives and as a result, their work lacks clarity. To regain clarity, think: “What should I do today?” and “What should I do tomorrow?” Organize your work into a sequence of events.

However, if you don't prioritize and establish a clear plan of action, you are setting yourself up for failure. Essentially, you are wandering without a compass. You work for 8 hours, from 9 to 5. If you work without some sense of direction, you can waste the whole day without doing anything meaningful. Do it every day and you may go years without accomplishing anything.

Morning meetings create milestones that give clarity to your everyday work. Whether we like to admit it or not, all of us can lapse into laziness. If there's an opportunity, we take it easy. I know this because I'm like that, too. To ensure such opportunities don't arise, it's important to stimulate your motivation with a daily agenda at the start of each day.

If you have clear goals for action, not only will you be building up that motivation, you will have to focus on your work, whether you like it or not. If you focus, you'll accomplish more than you even thought possible. What's more, as you continue to experience this, you'll find work will become enjoyable.

You might find setting specific goals at the start of every day troublesome to begin with. But if you persevere, you'll probably realize it makes your work even more rewarding and meaningful. I recommend it to anyone and everyone. If you're not in a position to call morning meetings, you can “meet” with yourself and take a few minutes to establish your priorities and goals for the day. At the start of the day, clearly organize your goals for that day, and take steps to achieve those goals. You'll be astounded at what this disciplined approach will produce over weeks, months, even a full career.

50 Think like a manager

In Japan, there is an expression that refers to “the salaryman mindset.” As described in Chapter 3, it is used to describe people who think of themselves as nothing more than workers for hire who only need to do what they're paid for. The salaryman never volunteers for an assignment or pushes himself to excel beyond stated expectations. He never thinks about his role in the company and how he could do better. He never does more or less than absolutely necessary. I have a hard time believing anyone can be happy with a salaryman mindset. It's my belief that a manager mindset—no matter what your actual title may be—is far more fulfilling.

Having a manager's mindset means ridding yourself of this salaryman spirit. In other words, it means feeling that the company you work for is your company. You see things differently when you do business with a manager's mindset. You can see the big picture of the business as a whole and you understand your role in the larger success of the firm.

Cultivating this mindset isn't a question of ability. It's a question of perspective. The man who stands on the roof of a building can see farther than the man on the ground. It's not because he has naturally better eyesight; it's because he sought out the vantage point that allowed him the broader view.

Why does a manager mindset give you a wider perspective? To put it simply, it's because when you look at your business as a manager you will see the overall balance between income and expenditure. As a result, you will understand how each specific individual job connects to the overall sales and profits of the company. Connecting the dots this way is empowering. Great companies are able to instill this mindset in virtually every employee. This is what management is all about. If you think like a manager, you will always come back to this perspective. It will give you the benefit of a big‐picture perspective.

For some, the issue is all about money. In Japan, some avoid a direct focus on money, thinking it's somehow not virtuous. People who fuss about money can end up being disliked.

But any CEO must be fussy about money and a manager mindset requires it, too. Business is, at its core, all about money. In the war that is business, money can be compared to weapons and ammunition. It's impossible to consider overall strategy without money taking center stage. Managers think of this first. Most employees don't think about it at all. As a result, their perspective on the company narrows. When this happens, they can't see what lies ahead.

Always think like a manager to achieve a bird's‐eye perspective. This will give your daily work clarity and make it much more interesting and fulfilling. When all employees have this mindset, a company will soar.

51 Create and share a template for success

There are winning patterns to be found everywhere. Success in one field allows you to develop a template for success that can be applied in other fields, based on a thorough understanding of the reasons behind the success.

Rakuten Ichiba was our first success at Rakuten. We tried various things to achieve success. We then identified which of those things were effective. These initiatives included providing different services to merchants opening stores, launching a loyalty points program, sometimes cutting costs to achieve these initiatives, and rolling out marketing tactics. Many of those things were effective. Combined together, we codified them and called it our template for success. This is a template we carry forward as we enter into new businesses.

The effort required to make a business successful is sobering. Some studies say 80 percent of all new businesses fail. If you succeed, you will be among the minority whose efforts are rewarded. But, on its own, this initial success of any new venture means nothing. If you establish a template for success by trying various things and figuring out what works and what doesn't, however, you can apply that template to other projects.

Most well‐established companies do this. However, many start‐ups never reach that point. Perhaps because they're sure their initial success depends on an original idea, one that would be hard to replicate. But, if we leave aside for a moment the surprise hit products and the cyclical boom periods, there will always be a logical reason why success has come to a business. That logical reason is what you want to capture in a template.

If you can organize your pattern for success into a template, it becomes a valuable company asset. You will need to break down your experience and investigate deeply—often, the pattern may not be readily visible on the surface. Why did that go well? Why were we successful? What are the unique factors, what are the universal factors? You must dig deep and analyze the reasons, and find a pattern that can be applied to in other areas.

If you can do this, you'll find the results can also be applied at an individual level. Whenever something goes well, figure out why and draw up a pattern which you can apply in other cases. Your method of studying English (in my case, making regular time to practice) could even improve your golf game. And it did. Applying the template I drew from my English worked in golf. So create templates. It's a method with wide applications.

52 Earn trust within your company

Soccer players must earn their teammates' trust in order to play well themselves. Players who aren't trusted by their teammates never receive a pass. They can't be counted upon to convert to a goal. They are known to break the chain of connection. No matter how good they are, they won't be able to utilize their talent if they never get a chance to kick the ball.

This lesson from the soccer field applies in business. I have heard colleagues say, “No matter what I say, no one listens.” They claim their work doesn't go well because no one listens to them. In other words, it's not their own fault, but the fault of everyone else who apparently refuses to listen.

If you're engaging in this kind of thinking, you're likely misguided. That coworkers and subordinates aren't listening to you is a problem, to be sure. But don't fault the audience; fault the messenger.

If you remove yourself from the situation and think about it from a third‐person perspective, it's immediately obvious. Think of someone you know who can't get others to listen to them. There must be a reason why people are not listening. Now think of someone who people do listen carefully to—what kind of person are they?

Working in a company is a team effort. Just like in soccer, you can't do a good job if your team members don't trust you. So, earning the trust of close colleagues is also an important part of your job.

If you work in a company, strive to be that person about whom colleagues say, “Leave it up to them. It'll be fine, and if they can't do it, no one can.”

The ability to earn the trust of your colleagues is a key work competency.

53 Establish symbolic rituals

No one would argue that determination is not a winning trait. I agree, but at the same time, I don't generally put my faith in the determination of others. Human beings often lack the strength and discipline to maintain a state of determination. Someone can be intensely fired up about an issue one day and forget it the next. That's just how we are.

It's important to understand these human tendencies and to create structures that help us confront them. None of us wants to forget the passions or burning ambitions that inspire us now. But we know, based on human behavior, that even those intense passions will eventually cool if left untended.

Symbolic rituals can guard against that. They may seem at first to be somewhat meaningless actions. But in fact, they provide the structure and support to keep passion alive.

We have many symbolic rituals at Rakuten. For example, every Monday, we have a companywide morning meeting called Asakai, after which employees clean their desks. We've been doing this since we started Rakuten Ichiba with just a handful of employees.

It's one ritual that serves to remind everyone that we are a team working to realize everyone's dreams. Six employees have grown to more than 14,000, but by gathering and participating in the ritual, we are able to connect and feel the presence of our co‐workers.

This isn't just about establishing traditions. Symbolic rituals, such as everyone cleaning desks together and attending regular morning meetings, foster a sense of unity among staff. Moreover, regularly confirming one's own corporate culture via such customs establishes a certain pace, like a musical rhythm, in the bodies known as organizations. Call them rituals for the corporate soul.

Concepts like milestones and codes of conduct are said to be old hat. But I don't think human beings are strong enough to do away with these entirely. Our corporate culture has impact on our ability to succeed. No matter how passionate you are about your ambitions or ideals, you'll forget them eventually if you don't keep them close to your heart.

That's why our Monday mornings will always be about Asakai and cleaning our desks afterward. That way we won't forget our ideals and aspirations, and everyone will be united.

I'd wager no one is born with strong self‐discipline. So it's all the more to your credit when you overcome those weaknesses to achieve something. Organizations are the same. No matter how lofty a person's ideals, how dedicated to their company they claim to be, those things alone are meaningless. It's much more important to establish everyday rituals that help to unite everyone's hearts and minds in a common rhythm.

54 Successful organizations combine pressure and excitement

Work without a sense of excitement is as bland as food without spice. The more excitement you feel at work, the more likely you are to become engrossed in it.

The issue is how to generate that sense of excitement in the workplace. The answer is common goals. As human beings, we draw joy from the experience of achieving something. To feel that joy of achievement, you must first set that goal.

The reason that organizations without goals are unsuccessful is that they lack the constructs to feed off each other's energy. It is only when you share common goals that a random group of people will come together to form a coherent organization. The feeling that we are all working together to achieve a higher objective is what connects and inspires us. That's the energy that gives a workplace its own unique buzz.

Ideally, everyone feels like they're running together as fast as they can to reach a goal that almost seems unattainable. Fear dissipates. Action takes over. A sense of excitement and energy in the workplace takes over.

That said, excitement alone won't bring success. The workplace needs a second factor to harness that excitement and funnel it in the right direction. And that additional factor is pressure. Often, pressure is seen as a negative aspect of work life. But in combination with excitement, the right amount of pressure is good. It sharpens the mind and makes you aware of the details, which are important at work. The pressure is what keeps people on their toes.

You can't do really excellent work unless you're concerned about every single aspect of it, however small. That's why every member of an organization must work continually to sharpen their senses, and why organizations also need to create an environment with the right amount of pressure. This can feel like stress and managers must be alert for this and strive for the right balance. The right amount of pressure can also motivate you to achieve. It is part of a leader's responsibility to apply that pressure to the whole organization. Sometimes I will deliberately use tough language to jolt the team into action. A team without a sense of urgency drives me crazy because I know it is missing the key ingredient to success. You must approach your work, convinced that the very survival of the company is dependent on you.

Excitement and pressure: They're like the two wheels on a bike. Only when both wheels are turning will your company come to life.

55 Know that there are two types of speed: velocity and agility

To me, there are two kinds of speed: velocity and agility. Velocity is about sheer speed, whereas agility is about your ability to respond at explosive speed.

In work terms, we can increase velocity with measures for improving the efficiency of daily tasks, like shortening meetings, cutting the number of copies we make, or reducing the number of people working on a project.

In fact, I think it would be safe to say that we waste 70 percent of each day. This is waste that we must reduce. And not just once. Waste is like household garbage: Even if you throw it out in the morning, it builds up again by evening. So you have to keep on throwing it out. Waste is a monster that reduces efficiency in the workplace. Waste slows decision making. Do away with waste and decision making will accelerate. Even that one action will accelerate the speed of your work.

Agility, the other type of speed, might also be called explosive speed. Athletes talk about this all the time. This is the burst of speed that leads to a goal or a game‐changing event. This is the speed that launches you into action once you've made the decision to move. Once you've decided to do something, move quickly. When I talk about the importance of being quick on your feet, I'm also talking about agility.

Agility is particularly crucial when you change direction in your work. You naturally lose speed when you change direction. Uncertainty and fear will slow you down even further, but these things are not external, they are rooted in your mind. And you won't be able to regain speed until you focus on reality. So you should move as quickly you can to do so. The best course of action is to close your mind to your fear and get moving. This will cause you to think—you will think as you move. When I start something, first I get up and start running straight ahead. There's no point fussing around. I just get running. Then everyone will come chasing after me. I know that by the time the team catches up with me, everyone will be working at top speed. It's how quickly everyone gets up to top speed that determines the agility of the organization: That explosive speed is a vital skill.

Attempts to change direction often fail because they slow companies down. Loss of speed can be lethal to an organization. Loss of speed has caused many failures and disasters. We all naturally slow down when we change direction. Success depends on how quickly we can recover from that and reach top speed again. Even if the organization fails at something, if it's moving quickly, the potential for recovery is much greater.

Velocity and agility: two kinds of speed. An outstanding organization must have both.

56 Divide into small groups to improve transparency

Making shelves larger makes it harder to see what's stored on them.

Companies are the same. If one section grows very large, it becomes hard to see what's going on inside it. What's even more of an issue is that it becomes difficult to see where responsibility lies, and each individual employee's sense of accountability suffers as a result.

In nature, animals that are preyed upon are the ones that form large groups. The larger the group, the less likely it is that an animal will fall victim to the hunter. This is knowledge essential for survival. However, when human beings band into large groups, the only thing I see happening is that our sense of urgency fades and accountability suffers. When predators form groups, the groups are not usually very large. Each animal has its own responsibilities and there is no redundancy. Members of the group that aren't fulfilling a useful role in the hunt are a hindrance.

It's obvious which is better in the context of forming work teams: Work teams should be as small as possible. The number of Rakuten employees has increased by more than 2,000 times over 20 years but, as we've grown, we've divided our sections into smaller units.

At Rakuten Ichiba, merchant relations is divided into sections responsible for the different stages in the flow from recruiting to onboarding to day‐to‐day consulting. It's also divided by genre into groups such as fashion, sports, and food and drinks. The sports group is further divided into categories such as golf, tennis, and skiing. We also took this approach in the regions as the employee headcount increased, subdividing the Kansai region into Osaka, Kobe, and Kyoto.

By doing this, we've made sure that units always have only the minimum number of staff needed to do the work at hand. That's why we can clearly identify the root cause of a problem when it arises. Because responsibilities are clearly defined, decisions can be made quickly about what should be changed and how.

It goes without saying that the reverse is also true: It is very clear which unit is achieving results. This increases the feeling of accomplishment, which leads to a competitive mindset, in a good sense. It also makes it easy for other units to learn from examples of success.

Making units small increases organizational transparency. Things that you can't see in a large organization become visible. In another sense, it makes it possible to see them from an objective perspective.

Divide teams into the smallest groups possible and make clear who's responsible for what.