Bob's Gutsy Leadership Blog

Nintendo: For a Century Plus, Taking the Long Term View!

This past year and a half have been eventful for 130 year old Nintendo, with the company vaulting back from the brink of irrelevance to reclaim its position atop the global video game industry.

In March 2017, the company released the Nintendo Switch. People were skeptical about this console, which can be used as a portable gaming device or docked to a television set.  It had been more than a decade since Nintendo’s last hardware mega hit, the Wii, and the world of home entertainment had destabilized.  Smartphones, some analysts maintained, were the future of video games.

From the start, gamers loved the Switch’s originality, versatility, and design. In April of this year, Nintendo announced that during the past 12 months it had sold more than 15 million units and more than 63 million games.  Nintendo’s revenue has more than doubled from the previous year, to $9.5 billion, and its share price has shot up 81%.

There is no doubt this company takes a long-term view.  It is often many years between its major hits. For example, it was 1989 when it took the gaming business by storm with its Game Boy.  In 2004 the Nintendo DS was a major hit and that was soon followed by Wii in 2006.  Nintendo 3DS was launched in 2011 and then things were quiet until the recent 2017 launch of Nintendo Switch.  The outside world wonders how a company periodically left for dead keeps revitalizing itself.  But seesawing is nothing new for Nintendo.  It has long alternated between fallow periods, in which the media turns out reports of impending doom, and boom times during which Nintendo mania is cast as an unstoppable force.

Nintendo executives credit their success to their culture captured in the following statement :

We believe in taking a long-term perspective and patiently seeking out

 new ways to excite consumers with gaming products. 

Employees typically spend their career at the company and the expectation is that new hires will learn the craft from senior producers and continuously hone their skills.  This is very reminiscent of the apprenticeship system that underpins the rich art-oriented culture for which Kyoto, where Nintendo is headquartered, has long been renowned in Japan.  Kyoto’s artisans pride themselves on never letting their handiwork grow stale; each generation of apprentices is expected to absorb the methods of their predecessor’s while pushing classical practices forward.

One other important aspect of Nintendo is its willingness to realize it will fail somewhat regularly as it pursues blockbuster gaming products.  An example would be Nintendo’s weak business in 2012 when it released the Wii U, the sequel to the phenomenally popular six year old Wii.  Unfortunately, the product came across as a minor upgrade rather than an enthralling advance.

Stepping back, it is clear what has, for 130 years, driven this very unusual and highly successful company. It is the company’s understated and zealously guarded culture which has enabled it to recalibrate, with some regularity, to humanities ever revolving sense of play.

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