Creating Value from Obstacles

The path to success can be varied – but as everyone knows, we learn more from our mistakes than the easy wins.

When the late automotive legend Soichiro Honda struggled to sit still in school, he day-dreamed about building. Then at 15, fascinated by the workings of motors, he set out on the path to become a car mechanic.

In 1946, he took over an old factory – ruined by World War II bombings – and  began working. He experimented with a “rotary weaving machine” before trying his hand at mass-produced frosted glass windows and even woven bamboo roof panels. None of these took off, but the observant and innovative Honda realised there was potential in the surplus of two-stroke motors he discovered. Attaching them to bicycle frames, these powered bicycles would go on to sell fast and feed the need for transportation in postwar Japan. It would also form the foundation of Honda’s venture into motorcycles in the late 40s and 50s.

By the 60s, Honda was manufacturing his own engines, eventually launching his first automotive vehicle – a mini pickup truck – in 1963.

The rest is history.

However, his non-traditional management style and aggressive marketing to challenge US carmakers were unpopular within the Japanese business community at the time, many of whom ostracised Honda while bureaucrats tried to block Honda’s growth.

It is fair to say, this is one of the most cogent accounts of overcoming obstacles and challenging conventional wisdom in business. Honda’s most quoted line, “Success is 99% failure” is as true for entrepreneurs today as it was in his earliest years. Embracing this philosophy set him and his enterprise on the path to global success.

Like Honda, other large businesses have travelled the winding road to success. The late Apple founder Steve Jobs personified overcoming adversity when he was forced out of the company he founded only to return in the face of pending failure and turn it around to make Apple the phenomenal success story that it is today. Never left out of any party, Amazon founder Jeff Bezos can also lay claim to multiple significant failures – from video games to the Amazon Fire smartphone – which lost a whopping USD170 million.

When asked about this, Bezos actually told one interviewer this was just a tiny “blip” and he was working on potentially much bigger failures – such is the confidence and the deep pockets of success that have realised Bezos’ dream to fly into space.

The Pandemic and Early Innovation

While we have all read about the pandemic success stories – think Zoom, home delivery, Grab and others,  McKinsey‘s examination of share price movements throughout 2020 of the 5,000 largest companies in the world showed that they were thriving because they were already on the right path five years prior (owing to a ‘dramatic acceleration’ of various trends that were already in place or emerging before the pandemic).

The study also found that performance gaps were amplified, with tech-forward sectors and organisations that implemented asset-light business models gaining advantage. 

It is clear here that businesses which took on calculated risks early for the long-term were better able to ride the pandemic-era wave of change. What this period has done is essentially force businesses that did not think ahead early, to adapt, rethink, and transform quickly.

Trend-spotting and Testing

Entrepreneur and founder of Singapore-based Black Marketing – whose business supports senior-level executives with their professional presence on LinkedIn – Chris ‘The Mohawk’ Reed- shared the realities that have allowed him to embrace the risk of failure as a forward move.

Chris Reed, founder of Singapore-based Black Marketing. Photo: LinkedIn

Chris Reed, founder of Singapore-based Black Marketing. Photo: LinkedIn

Years before the pandemic, Reed chose South Africa as the base for his operations, structuring it in such a way to serve clients across different time zones. Focusing on output rather than hours clocked, from the outset, Reed allowed his people to work from home.

“All the pandemic [has done] is prove to people that flexible and remote working can be done and we started this nine years ago. They’re servicing people in Europe and America. I can’t expect them to be in the office at nine, or midnight just for a call. That’s completely unreasonable. So I would say I don’t care how many hours you work as long as you deliver.”

While some abused this leeway, he found that most people did not.  “And they’re always surprised [when] they go somewhere else afterwards, and they won’t let them work from home.”

Lean company structures, like those in Reed’s enterprise, are the way forward according to Lars Wittig, Director on the Board and President of the European Chamber of Commerce of the Philippines.

“We will see more lean organisations moving forward; lean in terms of assets and that includes human beings.”

Bruised but Agile

People generally do not set out to make waves in their place of employment and this is especially so in Asia, where the organisational hierarchy is almost set in stone .

Yet innovation is almost a prerequisite for successful businesses (you don’t need to look any further than Kodak to learn that lesson). Whether it is top-down or bottom-up innovation it requires the entire organisation to get on board and commit to the changes.

While sound processes contribute to business efficiency, leaders with an agile mindset are likely to pivot decisively and effectively in times of crisis.

As an entrepreneur, Reed constantly looks out for new ideas: 

“You’re seeing which ones work and which don’t. Then sell them, and move on to the next one.” 

It is plain to see how – in architecting a strong enterprise – Reed embraces the Honda philosophy – in his case starting and testing several businesses and discovering the two strongest brands that generated the most value.

“Knowing what and when to cut things down and when to cut a product or service down, for example, is key to enabling you to focus on the one that works,” said Reed, who credits this thinking for the continuity and sustained success of his business.

Communicating Purpose

Obviously, not all changes result in success. In fact, research has found that roughly 70% of corporate transformations fail, and this is due to – among other reasons –  CEOs who do not set “sufficiently high aspirations” and what results is an unconvinced workforce with disconnected objectives.

Deeper than that, leaders who communicate the ‘why’ behind these transformations understand that a key pre-requisite to effectively pivoting in a challenging environment is having every member of their workforce understand their role in the transformation.

Sometimes it is the major challenge and its inherent change to turn the business around. At other times, there may be smaller incremental changes linked to new technologies, geographies, supply chains and other operational procedures. This entrenched purpose, or the “what’s in it for everyone” – shared and cascaded throughout an organisation – is critical to achieving the desired goal.

Having lived in the Philippines since the early 90s, with more than three decades of experience building successful operations for brand’s across Asia’s diverse markets, Wittig understands the universal nature of drastic disruption.

“Everybody gets their fair share of the downturn. But it’s always interesting to see, those people who continually scratching their heads wondering when the good times will come back again, because good times – earlier times – never come back. 

“The good old way, they come back in a new way. And it is [for] those who are agile and adapt during bad times during the downturn.” 

“Learn from your mistakes in the past. You will see how you will benefit.”

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Creating Value from Obstacles

The path to success can be varied – but as everyone knows, we learn more from our mistakes than the easy wins.

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