Nintendo is one such magical company of magical products, so we’ll be looking today at their founder, Hiroshi Yamauchi, pictured below.

Before you start thinking that this is a tale of another Walt Disney-esque creator, I should stop your expectations right there. Sure, his results with Nintendo prove his genius, but you’ll have to leave the ウィリー・ウォンカ fantasies aside… that is, unless you want to imagine Shigeru Miyamoto as an Oompa Loompa, and nobody wants that.

Harsh Hiroshi

Look at that whimsical, magical place. You know they’ve gotta have an underground ice cream roller coaster in there!

Hiroshi Yamauchi was the president of Nintendo from 1949 to 2002. He led the company not only to financial success in the video game era, but was the reason the company made video games at all. It would be easy enough to say that Yamauchi saw the future and transformed his family’s playing card company into one of video games through sheer vision. But it was more of an accidental process than that, and it certainly had nothing to do with whimsy.

Unlike Wonka, who brought prosperity to his company with trippy boat rides and musical numbers, Hiroshi Yamauchi did it with harsh criticism and mass firings. When he was asked to become president in 1949 by his dying grandfather, Hiroshi agreed on one condition: the firing of all other family members at Nintendo. This resulted in only one person, his older cousin, being let go and is also a really roundabout way of telling this cousin, “I hate you.” Immediately after becoming president, Yamauchi faced a strike of factory workers who thought he would fold on account of he was only twenty-one years old. Instead, he fired them all on account of he was the president. This led to a clean sweep of the company during which the young prez fired many long-time employees who had dedicated their lives to Nintendo.

During the video game years of the early eighties, Hiroshi Yamauchi hired his son-in-law, Minoru Arakawa, to run Nintendo operations in America and he was smart to do so. Arakawa wasn’t hired because of family ties. He was a solid businessman with an MIT education and a reputation for successfully managing a Japanese construction firm in Canada. But when Arakawa had a hard time gaining a foothold in the American market with the Nintendo Famicom (Japanese NES), Yamauchi was not hesitant to remark “a more competent person would have no trouble marketing the Famicom in the United States.” Straight to the point, that one is.

Risky Business

Young Yamauchi with Roy O. Disney during a meeting that actually made Nintendo a lot of money, which Yamauchi would later lose on three bad business deals.

The image most projected of Yamauchi was his severity. But as a businessman, he was also shrewd, very forward-thinking and not all that conservative. Certainly by our modern standards for a “forward-thinking” boss, Hiroshi Yamauchi looks conservative, though. There was no ping-pong table in the break room or “bring your shorts to work day.” But when it came to taking a chance on young talent or uncertain ideas, he was certainly not playing it safe.

Yamauchi realized early on that the world of playing cards was only so big. After a recon visit to the world’s largest playing card company (in beautiful Cincinnati!) he was disappointed to find it was a fairly small-scale operation. Upon returning to Kyoto, he took his company public and started a series of risky ventures to bring Nintendo greater success than it had ever seen with stupid ol’ playing cards. He started with instant rice packets, which immediately flopped. Apparently people like waiting for their rice. The anticipation is what makes it taste good. Then he started a taxi company called Daiya, but he quickly grew tired of negotiating with the unions over ridiculous demands like getting paid. Finally, he started a love hotel (which is exactly what you think it is), but ended up being his own best customer and this venture was also a failure.

Though these examples do not display Yamauchi’s business acumen, it certainly shows his bold and non-conservative nature. A conservative businessman would have stuck with playing cards. Actually, at the time he took over, Nintendo was doing so well with its playing card business that there was no reason make a change. But Yamauchi was ambitious and willing to try something different even if it made no sense. Really, if you think about it, it’s the same as if I became president of a greeting card company and said, “Hey guys! I know we’re really successful making greeting cards, but I’d like to take our money resources and start producing cat sweaters.” I would immediately be thrown out the window. But no one dared to throw Yamauchi out the window because he would’ve fired them before hitting the ground.

Whispers of the Art

Gunpei Yokoi and Shigeru Miyamoto, two of Yamauchi’s best decisions.

Yamauchi had brought Nintendo to the brink of bankruptcy with his ideas and it was only the 1960s. He was going to have keep the company going until at least 1982 when they could start making the big money. Thankfully, almost every decision Yamauchi made from 1966 onward was successful. As Nintendo transformed into a toy company, he began to display what was arguably his most visionary aspect: his ability to take chances on young talent.

Contrary to the Mr. Burns stereotype we are wont to place him in, Hiroshi Yamauchi recognized brilliant people who had talents he did not, and gave them opportunities to create. He handpicked Gunpei Yokoi, creator of the Game Boy, from his factory floor and gave a job to Shigeru Miyamoto, creator of Mario and Zelda, despite Miyamoto’s dreamy and incredibly non-businesslike persona. A real stuffy businessman would have turned these two daydreaming ne’er-do-wells away, along with the countless other Nintendo innovators over the years. The book Game Over by David Sheff has the best insight on this:

“Nintendo would, Yamauchi decided, become a haven for video-game artists, for it was artists, not technicians,who made great games.”

Growing Up

So Hiroshi Yamauchi was smart at business and a little harsh. Actually, most sources I’ve read describe him as “notoriously harsh” or “imperialistic.” He was quick to dish out criticism and made his employees compete for his approval. In my research on Nintendo over the years, I have mostly focused on the creators and innovators at Nintendo and only read about Yamauchi as it related to them. This had cemented a picture in my mind of Yamauchi as the uncreative business-oni that sucked money from his hard working, jovial video game creators. Certainly there is a lot of truth to this oni image, but it wasn’t until after his recent death that I discovered a different side of him.

Hiroshi Yamauchi’s father, Shikanojo, abandoned his family when Hiroshi was five years old. Hiroshi’s mother then threw him into the care of his grandparents, who raised him with the same strictness that they used on their employees. During the War, Hiroshi was still too young to fight, so his studies were put on hold for an assignment in a military factory. When he finally returned to his studies, he gained entrance to the prestigious Waseda University to study law, but was forced to drop out yet again, this time to take over the family business.

Shortly after Hiroshi became Nintendo’s president, his father, Shikanojo, returned to see his son. Whether by anger or pride, Hiroshi refused to see his father and turned him away. When Hiroshi was close to thirty, he got word that his father had passed away and immediately regretted missing the chance for reconciliation. He grieved openly for days and regularly visited his father’s grave for the rest of his life. This made Shikanojo the second father figure with whom Hiroshi lost his chance for acceptance. Hiroshi’s grandfather had died regarding his grandson as impudent and foolish, never seeing his years of success. Though Hiroshi’s mother was around, she became more like an aunt than a mother and his grandmother was no different. In essence, between four parental figures, Hiroshi Yamauchi received plenty of material care and support, but little else. His history really helps to explain his style of business.

Retirement And Beyond

Upon his retirement, Yamauchi refused his pension of close to $14 million, stating that he felt Nintendo could put it to better use. It’s not that he was without avarice. You don’t become the 12th richest man in Japan without liking money just a little. But unlike the bloated CEOs who get fired and take a hefty severance at the expense of the company, Hiroshi Yamauchi looked out for his company’s and employees’ well-being, albeit firing them / squashing their pride from time to time.

So was he Wonka, Mr. Burns or Scrooge? Really, none of the above. We like it when people in high positions are easy to define. This guy’s bad, this guy’s good, this guy was bad but is now good because some ghosts scared him, etc. I read some comments about Yamauchi shortly before he died and they were all about how he was a vampire and evil and crazy (he did say some nutty stuff over the years). But after his death, articles all over the web were touting him as a visionary genius. The truth is that Hiroshi Yamauchi was a human man. He treated a lot of people badly, got hurt a lot in his early life, made good and bad decisions, donated a lot of money to charity, and gave opportunities to artists that made a lot of us really happy. He was complex and the story of his life is incredibly interesting. And that is perhaps the best and truest way to remember his personal legacy.

Sources Referenced:

• Game Over by David Sheff
• The First Quarter by Steven L. Kent
• http://thepunkeffect.com/?p=11804
• http://www.usgamer.net/articles/hiroshi-yamauchi-the-iron-fist-in-the-velvet-glove
• http://www.n-sider.com/contentview.php?contentid=224
• http://www.nindb.net/feature/history-of-nintendo.html

Structure of the Japanese career system

In the United States, your career growth is primarily dependent on a few assets, but two of them are arguably the most important: the degree of specialization of your skills set and your performance. Typically, you develop yourself in a single market, moving from job to job, to develop specialized skills in order to move up the ladder and/or fatten up the paycheck. Your pay increases as you develop a highly specialized skill set, but eventually tapers off when you hit the limit of your progression. Your employment remains secure as long as you are productive. You have the option to jump from company to company, job to job, and obtain a position you are qualified for.

On average, an American goes through 5-8 different jobs and 3-4 different occupations in their lifetime. In other words, we are nomadic when it comes to who we work for; Short-term workers in a sense.

The United States style of career progression heavily contrasts that of Japan’s.

There are a few concepts that distinguish the Japanese from the United States style of white collar career growth

1. 終身雇用 (しゅうしんこよう; shuushinkoyou). Life time employment. A hired professional under the 終身雇用制度 (しゅうしんこようせいど; shushinkoyouseido; lifetime employment system).
2. 年功序列 (ねんこうじょれつ; nenkoujyoretsu). Seniority by length of service. Salary is dependent on individual’s status under the 年功序列制度 (ねんこうじょれつせいど; nenkoujyoretsuseido; seniority system).
3. 人事異動 (じんじいどう; jinjiidou). Constant job position changes within the company, not necessarily tailored to one’s skill set.

Once out of school and hired on, the expectations are for the employee to commit themselves to the company until retirement. One life, one employer.

Requirements for getting hired by a firm are usually an excellent set of general skills, and an attendance at a reputable university under your belt (for example: University of Tokyo, Keio University, Kyoto University, etc.). No skill specialization is required early on because the company will ensure you get the training you need throughout your career. The trade-off for this is a low entry-level salary.

The loss of salary during the entry-level phase is made up later in the career. Unlike the U.S. system where salary is based on performance and specialization, the Japanese salary is increased by length of service. Late in their careers, the growth percentage of a Japanese salary tends to be greater than the U.S. counterpart. Additional benefits are also given based on length of service. For example, after reaching a certain seniority level, the employee may be offered free company paid housing near the office.

The importance of the general skill set is emphasize throughout the career of the Japanese employee. Human resources will assign the individual positions in various departments, and a lot of times the position given will in no way match their education or current skill set. In the end, the employee will be able to play out many hats and understand the company as a whole. This is great for shaping employees into managerial roles.

Promotion to a higher status position is based on length of service. Job performance and skill set are secondary when it comes to promotion time for the employee. Higher level positions tend to be filled from within. Thus, it is not easy to leave a company for another because doing so essentially resets your “seniority counter”, which will stall your career growth and salary.

While it is great that experience is valued, the downfall of the seniority system is that upper level positions are filled with aged workers (the old guard), regardless of their productivity levels and qualifications. How the system is set up, firing low productivity workers is difficult. This puts younger, more capable employees at a disadvantage, since they have to wait in line behind everyone else in order to be promoted to a higher status position. In addition, having all been trained under the same system, the culture doesn’t lend itself for “radical” or “outside” ideas.

On the upside, the Japanese career structure builds a strong loyalty culture amongst the company. Having everyone commit to one company in their careers and without the fear of being laid off, people tend to trust each other more. It is like being a part of a second (or third) family.

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And then there’s Japan. Drinking is a huge part of Japanese culture; whether it’s going out to a bar with your friends, or hitting an izakaya with your coworkers, it’s hard to find a social occasion that doesn’t involve kicking back a few cold ones.

But there are also plenty of problems with alcohol in Japan. Today, Japan chugs down 6 times more booze than they did 50 years ago. The crown prince of the Japanese royal family had to be treated for alcoholism, and a few years ago, the Japanese finance minister held a press conference drunk:

Maybe nobody is more notorious for not being able to hold their alcohol than Japanese salarymen. Just a couple of beers (even light, watery Japanese beers) send salarymen stumbling down city streets late at night, neckties around their foreheads, faces beet-red.

You might think that salarymen are wusses or lightweights for getting drunk so easily, but there is actually a scientific explanation behind why the Japanese can’t always hold their liquor.

Drunken Science

A big reason so many Japanese have trouble with alcohol is because of a condition called the “alcohol flush reaction,” (or “Asian glow”). It’s a genetic condition that affects something like ⅓ of all East Asian people.

What does this Asian glow do to people? In a nutshell, it means that the body can’t break down alcohol all the way, causing even light drinking to result in really bad hangovers and bright red faces (hence the name “Asian glow”).

For relaxing times...

But besides the obvious, visible effects of alcohol on those who have the Asian glow, there are other things going on beneath the surface, chemical reactions within the body.

Japanese Mutants

Typically when somebody drinks alcohol, it’s processed by the body in two basic steps. First, alcohol is broken down into a harsh chemical, then into a milder chemical that’s basically vinegar.

The enzyme in your body that makes that important second step happen called aldehyde dehydrogenase (ALDH).  ALDH makes sure that alcohol is only in that harsh chemical form for a little bit of time.

But for some reason, about 40-45% of Japanese people are mutants.

No, not cool kind of mutants, but the regular ol’ boring kind. These people have a different kind of ALDH (called ALDH2) that doesn’t break down the alcohol as well nor as fast, leaving the alcohol in the body at that harsh chemical state for longer.

So while people with the Asian glow might not be able to shoot lasers out of their eyes or have Adamantium claws (they’re only Vibranium), this mutation is still pretty important, especially in a culture where drinking is so prominent.

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[Header image source]

Certainly the concept of overworking yourself to death is not unique to the Japanese, however the country perhaps does take the issue more seriously than others. Coined with the term 過労死 (かろうし, karoshi; added to the Oxford English dictionary 2002), overworking to death has become a problem in Japan and a favorite topic to cover among the media circles; As a social issue by the Japanese media, and as a characterization of the Japanese society and culture by foreign media. Causes of karoshi deaths are from developed health issues that result in heart attacks and strokes due to long periods of high-level stress. It can also lead to suicide, which is given its own term, 過労自殺 (かろうじさつ, karojisatsu; literally translated to overwork suicide).

According to the Japanese Ministry of Health, Labour, and Welfare (MHLW), “sudden deaths of any employee who works an average of 65 hours per week or more for more than 4 weeks or on average 60 hours or more per week for more than 8 weeks may be karoshi.”

How serious is it?

The first recorded case of karoshi occurred in 1969. Nearly a decade later (1978), the concept was given the name “karoshi”. In 1982, the release of the book entitled Karoshi by Tajiri Seiichiro, Hosokawa, and Uehata brought the issue in the public view, but it wasn’t recognized as a major social problem until the 1980′s Bubble Economy.

A few high-ranking corporate executives died without any hints of illness leading up to their deaths. The deaths were picked up by the media, which promptly developed growing concerns from the public. They had every right to be concerned, since they too were putting just as many hours into their jobs as the dead executives. Concerns reached to the point where the government took action and started collecting and publishing information on karoshi as a cause-of-death option.

According to the Labor Force Survey, nearly one-fourth of male employees (7.8 million) clocked in more than 60 hours per week of work in 1988. Based on the numbers in 1975, it’s nearly a 2.4 times increase. Even though the statistics threshold is 60 hours and above, a typical work week can easily be 70-90 hours per week. Why do this? To show loyalty to their company. This loyalty stems from the Japanese culture of living for one’s master and superior. More often than not, the extra work is done as cloaked overtime (furoshiki), where the employee does his work off the clock and the employer turns a blind eye.

A survey conducted by the government showed that 90% of workers didn’t understand the concept of work-life balance. Four out of five would cancel any dates or plans if their boss asked them to work overtime.

More recent statistics showed the situation hasn’t changed. According to the International Labour Organization (ILO), 28% of Japanese employees worked 50 hours or more per week in 2001. The percentage is significantly a lot higher than many European nations: Germany (5.3%), Finland (4.5%), Sweden (1.9%), and Netherlands (1.4%). Japan is on the same level with the U.S. as developed nations that put in the most work hours, although many believe that the Japanese work significantly more hours than the U.S.. A lot of the Japanese overtime hours are left unrecorded (cloaked overtime), therefore not taken into consideration when generating the statistics.

In 2005, the MHLW reported 328 Japanese employees who suffered karoshi. The number is a little over 7 times higher than the recorded result in 2000.

Bear in mind that the statistic numbers are believed to be not on par with reality. Many families accept the death with silence and don’t push the issue any further. And most companies won’t outright accept responsibility for the deaths. Lawyers and scholars estimate the annual number of karoshi victims to be in the ballpark of 9,000 deaths, which is near the annual number for traffic fatalities.

To put some of this into perspective of how severe the overworking can be, let’s consider a karoshi case. Hiraoka Satoru’s story was featured in the November 13, 1988 Chicago Tribune’s article Japanese Live and Die for their Work. A foreman in charge of a ball bearing factory, Hiraoka usually clocks in 12- to 16- hour days, easily totaling up to between 72 to 95 hours a week for most weeks. The prior three years before his death, he clocked in at almost 3,700 hours annually. A typical 40 hr work week with no vacation equates to 2080 hours annually.

The thorn in most of the karoshi victims’ side is that they are often not compensated for the overtime work.

How is karoshi being handled?

A few Japanese companies are making some effort to reduce karoshi and promote a work-life balance to their employees. For example, Toyota has set a hard limit of 360 hours of overtime annually. In addition, some of their offices play a recorded message every hour during the evenings urging the staff to go home and get some rest. Some companies enforce no overtime days where everyone must leave the office at 5:30 pm.

Sometimes the measures implemented by these companies aren’t enough for the employees. While on paper it may seem like they are recognizing the problem, the competitive work environment demonizes those who decide to partake in these policies. For example, Mitsubishi UFJ Trust & Banking has a program that allows their employees to go home up to three hours early to care for children or elderly relatives. Only 34 out of 7,000 employees are signed up for the program.

Frustrated with the situation, more and more workers and/or their families are taking on their negligent employers in court.

Some individuals are avoiding the situation entirely by taking on short-term jobs, rather than be a worn out salaried cog for large companies. Although the pay and benefits don’t match to a corporates compensation, the work-life balance is significantly better.

There is this adage I like to use when differentiating U.S./Japan work culture to the European style: U.S. and Japan live to work, while the Europeans work to live. I do believe that everyone should give their 100% effort in performing their jobs, however having your health deteriorate to the point of death is certainly not worth it. Many Japanese are slowly coming to realize this.

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Featured Image: http://www.flickr.com/photos/jamesjustin/
Sleeping (Really! They are not dead, just sleepting!) Japanese Salaryman Images: http://www.flickr.com/photos/torek/

Hiyama, T & M Yoshihara. “New occupational threats to Japanese physicians: karoshi (death due to overwork) and karojisatsu (suicide due to overwork)” Occupational and Environmental Medicine, Vol.65 No.6 (June 2008): 428-429. Print.

Morioka, Koji. “Work till You Drop” New Labor Forum Vol.13 No.1 (Spring, 2004): 80-85. Print.

Rowley, Ian & Hiroko Tashiro. “Recession Puts More Pressure on Japan’s Workers.” Bloomberg Businessweek, 5 January 2009: <http://www.businessweek.com/globalbiz/content/jan2009/gb2009015_807968_page_2.htm>. Online.

“Karoshi Strikes Japanese Businessmen” British Medical Journal. Vol.303, No.6815 (Dec 7, 1991): p 1419. Print.