What makes a company that has survived for over 100 years different? Finding a way in Japan

 

1. What makes a company that has survived for over 100 years different? Finding a way in Japan.

Japan with overwhelming number of long-lived companies

You may have often heard that Japan has many long-lived companies.

Even without mentioning famous companies. When traveling to Japan or on a business trip. It is not difficult to find restaurants and other stores boasting a long history all over the town.

In fact, if you look at the data announced by 'TEIKOKU DATABANK', a Japanese company that owns corporate information DB about companies with a lifespan of 100 or 200 years or more to companies around the world in October 2019, you can clearly confirm it with the data.

The country with the largest number of companies that have been in business for more than 100 years is Japan, with a whopping 33,076, accounting for 41.3%.

However, if you look at the number of companies that are more than 200 years old. You can see more clearly that Japan is a place with many long-lived companies.

In addition, it is impressive that there are a total of 2,943 Japanese companies having celebrated their 100th anniversary starting in 2021. And there are even 10 companies having been around for over 1,000 years. So, it is true that at this point, it is somewhat vague to call them long-lived companies based on their achievements.

Characteristics of long-lived companies in Japan

Now, let's take a look at the characteristics of long-lived companies in Japan and the background behind the overwhelming number of long-lived companies.

Feature 1: Tradition and fashion

Responding flexibly No matter how rapidly the times change. There will be 'traditions' that should not be abandoned. And there will be 'trends' that are properly followed in line with the world's trends.

If we compare this to a valley for a moment.
You can think of rocks that support the waterway while maintaining its shape under any circumstances as a tradition. Also, the streams that show different streams depending on the season or weather are fashionable.

The water of the valley shows various appearances with the four seasons, such as blowing, shrinking, or freezing. But the water and rocks of the valley are always in harmony and the valley itself is always maintained.

If we apply the keywords of tradition and fashion to a company. It might be possible to express a mission, belief, value, or identity that does not change easily as a tradition, and the various actions taken to carry on this tradition as a fashion.

Let's take a brief look at the case of 'TORAYA', a Japanese confectionery company that has been maintaining its main business for a long time.

Toraya is one of the representative long-lived companies in Japan. proprietor Enchu Kurokawa established it in 1501. Under the management philosophy of "Enjoy delicious Japanese confectionery at all times", Toraya believes in 'tradition' in all areas. Including raw materials, production technology, new products, and stores, thinking of the end consumer, the customer is continuing.

For reference, 'wagwa' refers to various types of traditional sweets enjoyed with tea.

Traditionally, Japanese confectionery uses a lot of sediment, which leads to the use of red beans as the main ingredient.

Toraya recognizes the importance of the red beans' taste, the main ingredient. And has been sticking to only white red beans of its own breed.

However, this white red bean is not easy to grow. It has always had difficulties in increasing the yield due to the aging of the producers on the farm. Toraya has adopted a contract cultivation method since 1927 to stably secure this white red bean. That is also the basis of the taste of its Japanese confectionery.

By contracting directly with farmers in Gunma and Ibaraki prefectures, where the cultivation climate is the best and placing staff in charge of cultivation guidance and various support at the site. Not only production and quality control, but also breed improvement and agricultural guidance, and strengthening the relationship with producers has come.

Through continuous cultivation and research, this white red bean from Toraya was registered as its own variety by the Japan Ministry of Agriculture, Forestry and Fisheries in February 2018. It was also recorded as the first variety registration by the private sector.

In this way, Toraya did not neglect their efforts to carry on the 'tradition' as well as the reason for their existence.

Toraya's way of business Expansion

At the same time, he was also active in considering the so-called 'fashion'. Expanding products and business attitudes in line with the values ​​of taste and food and the rapidly changing times.

A rare Japanese traditional confectionery manufacturer, we participated in the International Confectionery Fair held in Paris, France in the past to introduce Japanese confectionery to the locals.

After the fair was over, Toraya immediately moved to action and opened the first overseas store 'Paris Branch' in Saint-Florentin, Paris, on October 6, 1980.

At first glance, I wondered whether Japanese confectionery would suit the taste of French people. And I wonder if it would be appropriate to enter the market after thorough market research.

In fact, since the early 1970s, Toraya had been anxious about the continuity of the Japanese confectionery market. He was well aware that he could survive only through change through expansion of the base to the younger generation. As well as the overseas market development.

Since the opening of the Paris store, the product package, color, and size have been thoroughly localized. The store has become a store where regular customers come with their parents or they become parents and bring their children.

Although it is a traditional Japanese confectionery shop, about 80% of current visitors are locals, which seems to support this well.

The Toraya Paris branch has established itself deeply in the lives of locals. It launched a specialized yokan in partnership with PIERRE HERMÉ PARIS in September 2020 to commemorate the 40th anniversary of its opening.

This yanggaeng(snack) created another trend as it became a big topic in a small size and a sensual package that looks like a lipstick used by young women.

Having gained experience through bold challenges abroad. Toraya has been running the 'Toraya Cafe' business in Japan since 2003.

In fact, it is also true that in Japan, there is a perception that 'wagashi' is somewhat an old-fashioned food.

It was part of a strategy to popularize it by adding a small amount of red bean paste to reduce sweetness. And make the shape and size easier to eat. So that anyone can enjoy it casually in a stylish cafe.

From the beginning of 2021, 18 years after the launch of 'Toraya Cafe'. We are focusing on strengthening customer contact points by once again applying a new sense to the current era through store remodeling and product renewal.

Feature 2: Clearly define the reason for existence

One of the characteristics of Japanese long-lived companies is that they clearly reveal the reason for their existence. That is: "the mission they were given as the work they should do".

In fact, I think this is a very important part of any company in general. And if anyone sees what it is aiming for, such as the corporate vision or organization name. It can be a guide for members and furthermore, it can lead to brand value.

Personally, I would like to take a look at 'Hoshino Resorts', which I think is well-branded among many accommodations in Japan.

Hoshino Resort is a traditional ryokan-style hotel in Karuizawa, Nagano Prefecture, established in 1904 by Yoshiharu Hoshino. People also know it by the name "Japanese Alps".

Currently, it has established itself as a representative luxury hotel in Japan. Operating more than 40 lodging facilities in and outside Japan.

In July 2016, 'HOSHINOYA TOKYO' was opened near Tokyo Station. It earned the nickname of an oasis in the city center and tourists all over the world have well received it.

In fact, 'HOSHINOYA TOKYO' in the Tokyo Hotel category of the 'World Best Award 2020'. Which is announced by 'Travel+Leisure', an American travel magazine for the wealthy, comprehensively evaluates facilities, location, service, and meals, etc. It was ranked first with 96.42 points out of 100 and proved this

Hoshino Resort's corporate philosophy (vision) is 'Let's become a master of resort management'.

The expression that deserves attention here seems to be 'management master'. But in fact, Hoshino Resorts has so far been able to grow into a giant company through a strategy specialized in resort management.

The strategy is to provide a unique experience service that focuses on the traditions and culture of the region where the resort is located. And to provide a culture of hospitality (omotenashi) unique to Japan.

For example, in the case of 'HOSHINOYA Kyoto', all the rooms face the Katsura River. And you can enjoy the four seasons and the atmosphere of the past by boat on this river in Arashiyama, a World Heritage street and a scenic spot in Kyoto. It is located on the slope of Mt. Fuji, so you can enjoy glamping in the dense forest. While, also enjoying various superb views of Mt. Fuji that change with the seasons.

Hoshino Resorts, which values ​​experiences, launched a new program, 'Okinawa Blue Zone', on September 1, 2021, at its stay-type resort, 'HOSHINOYA Okinawa.'

Okinawa is one of the world's five Blue Zones announced by Dr. Dan Buettner. Who has been researching longevity villages for a long time. He designed it in a way that they could experience, enjoy, and learn the secrets of health during their stay.

* Blue Zone means an area where the average lifespan of residents is much higher and they live a long and healthy life. They have designed it to deepen the sense of bond with the local residents of Okinawa. And it has been attracting a lot of attention right after its inception.

Resort management strategies of CEO Yoshiharu of HOSHINAYO, Tokyo.

Mr. Yoshiharu Hoshino has been running the family business for 4 generations and is celebrating his 31st year as the CEO of Hoshino Resort this year. Hoshino grew up hearing countless stories from his grandfather that he had to run the family business from a young age. However, after frequent clashes with his father, who insists on only traditional ryokan, he quit his job after 6 months of joining the company.

 

"When I was studying hotel management in the United States. People began to read travel trends that value relaxation and privacy. And Hoshino Resorts argued that the tradition and wonders of a ryokan could be continued. But that it would be sustainable only if it was transformed into a new concept resort."

 

CEO Yoshiharu's argument is also in line with the tradition and fashion perspectives, that we looked at, as the first characteristics of a long-lived company.

 

After the opening of 'HOSHINOYA TOKYO', CEO Yoshiharu said in a media interview that he felt the 'mission' to become a Japanese hotel that could reach the world. This can be understood as a way to widely publicize the corporate philosophy of being a “master of resort management”. As a representative hotel manager in Japan and the will to satisfy customers all over the world and I think it would have certainly spread to all employees.

 

Feature 3: Focus on ideas and research that overturn common sense

 

we can term, carrying on a tradition and following a trend and changing appropriately, as two opposites in some context.

 

You may miss the tradition while following the trend, and vice versa.

 

In addition, in the case of a long-lived company that is several tens or hundreds of years old. The socio-cultural difference between its foundation and now, is quite large.

 

In this respect, it can be seen that companies that have overcome the changes of the times and have lived for a long time have their own innovative DNA. And the companies we will look at now also pursue innovation with ideas that went beyond common sense in the industry at the time of their founding.

 

Gekkeikan, a sake manufacturing company; founded in 1673 and celebrated its 349th anniversary this year, is one such place.

 

In 1909, Gekkeikan established the first sake brewing research institute among Japanese sake manufacturing companies.

 

In a nutshell, by utilizing science and technology in sake manufacturing. It has laid a foothold for growth through innovation in brewing technology and improvement of quality.

 

At that time, wooden barrels were the mainstream and microbiological knowledge was lacking. So, there were many cases of adding or throwing away preservatives because of the limitations of sterilization and cleaning, which could not prevent the spoilage of the alcohol produced at each brewery.

 

In 1911, two years after they established the institute. Gekkeikan developed a bottled container, which consumers thought difficult at the time. And introduced the first sake in Japan that does not require preservatives.

 

In addition, after repeated research to overcome the limitation of making alcohol only in winter. In 1961, it became the first Japanese brewing company to have a four-season brewing system.

 

This made it possible to mechanize, automate, serialize the process and manage microorganisms. Starting to produce high-quality sake throughout the year regardless of climate or environment.

 

This corporate culture that emphasizes quality first and R&D eventually led to research on yeast, which is the core of alcohol. It has also published a number of papers and has now firmly established itself as a leading company in related fields.

 

Based on a long-standing innovation mindset, Gekkeikan has focused on the development of brewing, microorganisms, and other new technologies. In 1984, they made Cheongju to be the first in the world; distributed at room temperature.

 

It has been the first in the industry to commercialize alcoholic beverages with various flavors, such as sugar-free sake in 2008 and non-alcoholic sake-flavored beverages in 2014. And contributed greatly in raising the overall level of the Japanese sake brewing industry.

 

However, in order for Gekkeikan to continue to grow. It had to solve the fundamental task of popularizing Cheongju. And in the end, with DNA specialized in research and new product development, in March 2019. It introduced the 'THE SHOT' series, a new concept product.

 

"By devising a new sake brewing (酒質), packaging, and drinking method. We came to propose a way to enjoy sake along with values ​​that fit the lifestyle of young people".

 

The first thing that catches your eye is a cute bottle with a wide mouth, with a suitable size that fits in one hand. Like a drink you often encounter in your life, and a package design that looks like a fancy product when you open it.

Here, with an easy-to-open cap and an affordable price of 249 yen. Reducing the overall taste, package, and price of alcohol. And introducing a new sense of stylishness that anyone will want to find casually.

 

They launched it in four products. And subdivided each product in consideration of consumers' diverse tastes. Such as alcohol content, depth of taste, sweetness level and fragrance.

 

After the launch, many people shared photos of enjoying snacks, cheesecakes, and puddings on social media. And word of mouth quickly spread, proving that the younger generation’s interest in Gekkeikan, which has been the main customer base in their 60s and 70s, is changing.

 

From the product name 'THE SHOT'. It seems that you can even feel the enthusiasm and confidence toward the change of Gekkeikan.

 

Why there are so many long-lived companies in Japan?

 

But how is it that there are more long-lived companies in Japan than in other countries?

 

The three factors that I personally think about this part are as follows:

 

Maintaining peace for a long time

 

Japan, an island nation located at the tip of Far East Asia, has little history of fighting large-scale wars caused by foreign invasions within its mainland.

 

The Sengoku period from the middle of the 15th century to the late 16th century is usually called the period of civil war with frequent social and political fluctuations. Although it was an era of, mostly local battles.

 

In addition, the lords at that time increased the number of soldiers to maximize agricultural production. By adopting the policy of prospering and on. Even in the unstable social environment, the lords, warriors, and farmers remained closely connected with each other, so that pure farmers and traders were able to rather lay their foundation.

 

If it is a war that affected the whole of Japan. It can be said the only war that took place about two years before and after 1944, when the U.S. air raids took place in earnest at the end of World War II.

 

 value old things and pass on from generation to generation

 

The Japanese mindset, which values ​​something that lasts for a long time, seems to be closely related.

 

In other words, while striving to find social significance rather than simply making money. People recognize the business organization as a family business rather than an object of ownership.

 

This way of thinking served as an invisible watchdog to prevent companies from taking excessive profits or engaging in speculation for short-term profits. And became a driving force in allowing them to focus on their original business. Without the economic situation greatly affecting it.

 

In the Heisei era (1989.01.08 ~ 2019.04.30), which came right after the bubble era and called the 'lost 30 years'. With the burst of the bubble, most of the companies pursuing short-term profits disappeared. It is a reminder to look back at the true value of long-lived companies.

 

We develop the necessary human resources ourselves

 

Companies in North America and Europe place importance on individual skills and abilities. Find and hire people with a so-called immediate sense of power. And put them into a specific job right away, treating them appropriately for their careers.

 

It is common for individuals to naturally change jobs at any time when they meet the conditions. Regardless of their length of service.

 

On the other hand, in Japan, it is common to hire people who fit the company's talent profile. To allocate departments and tasks to each individual through the training process. And then provide training opportunities and promotions or new positions according to years of service and abilities.

 

In other words, it would be appropriate to say that a company spends a long time nurturing the talent it needs internally.

 

Because of this culture, in Japan, it is difficult for people who change companies to maintain a good reputation.

 

The more Japanese companies that put forward traditional values, the more they value the fact that they will someday rise to the position of a new craftsman. As they build up their abilities through the process of working with artisans for a long time.

 

The so-called collectivist tendency, believes that working silently for a company for a long time increases the unity between individuals and companies. This in turn increases the viability of the company, also influenced longevity companies.

 

So far, we have looked at the characteristics of long-lived companies in Japan and their backgrounds. Will the company you are working for or running a place be remembered for a long time by everyone?

 

I hope that all of us living in the present age will look back at ourselves at least once and become an opportunity to play again in 2022.