By James Santagata
Principal Consultant, SiliconEdge

One of the most challenging positions to find oneself in is managing across a matrix organization. It's even far more difficult if we are managing this matrix organization remotely. 

What are some of the difficulties? Well from a traditional management perspective, having the responsibility and especially accountability as a manager) without any real authority is vexing.

It becomes orders of magnitude more difficult when we are dealing with various functional areas (finance vs QA vs engineering vs marketing), various cultures, across different languages (even if we are all speaking English, it may not and most likely today is not the first language of many of our colleagues) and, of course, time zones.

In many instances, to the matrix manager it can feel akin to pushing on a string. And that doesn't get one very far.

However, there is a framework as well as concrete strategies and techniques that can be applied to the situation to anticipate issues as well as mitigate, reconcile or eliminate then as they arise.

First, it behooves us to understand that almost every problem falls into three categories:

1. Financial / Monetary
   
2. Technical
   
3. Interpersonal / Communicative in Nature
   

And that of those three, 99% of the time, the gating item(s) (not the traversable  issues) are or can expect to be interpersonal / communicative in nature.

Second, we can solve much of this, both by anticipating and by how we react by understanding how our matrix team members think.
Notice I said HOW they think. Not WHY they think.

HOW, allows to understand how the process information and structure experience and through that we can create a function that can apply a formula to information or scenarios and understand their reaction. This works even for unexperienced events and phenomenon.

WHY conversely forces us to memorize static data points and makes predicting behavior and reactions to unexperienced events and phenomenon much more tenuous and difficult.

Last, how we set the initial frames and maintain those frames will using influence and persuasion in an ethical manner will determine how well not only we are able to manage our remote matrix but how well the team itself performs.

Sometimes when the orchestra is out of tune it may fall to the feet of the conductor and not the musicians.

James will speaking on the very important career-related topic of "I'm 40 Now! Is It Really Game Over For Me In Japan's Job Market?" at the Foreign Correspondents' Club of Japan on November 20th.

Among job seekers, arguably no group is more negatively affected by this brutal reality than 40+ year old job seekers.

Many 40+ year old job seekers are shocked to find this is the reality not only in the broader US economy but even in vaunted Silicon Valley which is the supposed Mecca of open-mindedness and where a meritocracy has ruled for decades.

And yet, for how bad it is in the US and even Silicon Valley, 40+ year old job seekers soon come to find that it's often much, much worse in Japan. Terrible. Impossibly frustrating. Depressing. These are words that come to mind when seeking employment in Japan as a 40+ year old candidate.

But how can this be the case in Japan, when Japan still has an economy which is the 3rd largest economy in the world and which is moving to further internationalize its businesses as rapidly as possible in the face of both falling domestic demand and a severe shortage of experienced workers.

The bottom line is this: Older, deeply experienced job seekers quickly run into 5 seemingly insurmountable brick walls..

By James Santagata
Principal Consultant, SiliconEdge


Today I wanted to pose a very serious question regarding the coming failure of Abenomics (and it will fail, mark my words as economically there is no other alternative or outcome), Japan's continuing dearth of real, dynamic leadership and what it means for Japan's future.

Here we go: Has Japan's once rich, brave and bold Samurai spirit come to a crashing halt and been replaced by that of the Eunuch's?

I've deeply pondered this.

A Eunuch spirit and culture would suggest that, and evoke the feelings that, Japan's Samurai, Battlefield Culture has been replaced by something much softer and lacking in leadership.

I've written about this from various which you can find here:

• Japan May Be Able To Compete Globally But Not Yet
  
• Can Japan Compete Globally? You Betcha And Here's Why
  
• Can Japan Compete Globally? You Betcha & Here's How
  
• Japan's Problem: Severe Lack Of Leadership Not A Lack Of Innovation Or Creativity (The Globe & Mail)
  
• The Truth About Japan: Can Japan's New Startup Spirit Revitalize The Japanese Economy?
  
• Exploding The Myth of Japan's Lack Of Talent By Understanding The Tip Of The Sword
  

Now some may be still questioning my prediction that Abenomics will fail. I guess the only debate I can see is how one define's failure and how bad the coming failure will be. 

Abenomics is and has been economically untenable from the start, from when it was first announced.

And for those not overly familiar with Abenomics, here's a review of the so-called "3 arrows":

"The first arrow is an aggressive monetary policy. Abe appointed Haruhiko Kuroda, former president of the Asian Development Bank, as governor of the Bank of Japan in March. Kuroda has set a target of achieving 2% inflation and doubling the money supply within two years.

The second arrow is a proactive fiscal policy, consisting of a ¥10 trillion (US$100 billion) public works package.

The third arrow is a growth strategy. Structural reforms in Abe’s sights include everything from increasing women’s share of leadership positions to 30% by 2020 to joining the Trans-Pacific Partnership (TPP), a 12-country free-trade agreement that should drive trade liberalization and deregulation inside Japan.

There are several things wrong with these areas and we've discussed them before. First, even if you thought all three all needed they are in the wrong order.

The first arrow should have been the biggest, heavy hitter arrow - structural reform, but given the amount of ossified, rent-seeking incumbents in Japan coupled with near complete regulatory capture in many areas, well, that just isn't going to happen.

So instead, the two simple arrow, although massive destructive arrows to the economy, will and have proceeded -- loosing monetary policy to drop the value of the yen and going on a Keynesian-spend what you don't have public works-waste the money spree to welcome inflation!

Folks, inflation is the last thing Japan needs and given the fact that Japan is oil dependent and import dependent for food and other materials, the last thing that should have been done was to drive down the yen.

In fact, it would have naturally fallen anyhow because of the current account balance for the new record oil imports.

I wrote about this in detail, what the smart play would have been:

Now back to the Eunch problem. What Japan needs is to develop more homegrown leaders - real leaders, women and men, of all ages and persuasions that are not afraid to lead -- they are out there, but often they are forced out of the game early or left on the sidelines because they frighten the status-quo management or the ossified corporate culture.

But by paving the way for more and more startups, these leaders can move to run and drive those businesses, which in turn put heavy pressure on the ossified incumbents -- sales, business models and so on.

It's a win-win for talent, for consumers, for the country.

But Abenomics is only a symptom of a Eunuch spirit and culture (as well as a self-serving incumbency) and leadership, nascent and seasoned will continue to be rare and often smothered out or crowded out of where it is most needed.

By Mike Rogers, MarketingJapan, Universal Vision Ltd., and Smart Research 
& James Santagata, Principal Consultant, SiliconEdge

TV as a Mirror of Society

I met the boss of the biggest international television network in the world the other day. He is a Canadian. He travels all over the world and, because he is in the TV business, he told me that one of his favorite things to do in every country was to judge by TV commercials what things were important to that particular society. 

Japan's TV commercials? Insurance for this or that; home sales; automobiles; financial instruments and plans; candy, cosmetics, fast food... Companies like Zurich, Sekisui, Kanebo.... Japanese commercials that soft sell and are emotive commercials.

I think that's right. 

He also told me that he was "astounded" by just how many over the counter drug medication commercials there were on US TV all the time. US TV commercials? Drugs, Cholesterol, Machismo ("my ding-a-ling is bigger than yours" commercials); fast food; commercials to make your dick hard, make it soft, put you to sleep, keep you awake, lower blood pressure, lose weight; not to mention commercials galore for people with extreme anxiety and panic attacks.

Oh, and don't forget the side effects disclaimers! Cholesterol, etc

Why is the USA this way? It wasn't that way 50 years ago, was it? 

Here's one piece of anecdotal evidence: Japan has its problems too, but here is something that will drop the jaws of all Americans... 

By James Santagata
Principal Consultant, SiliconEdge


That Japan like any country, be it developing or developed, has her share of problems is not in the least bit surprising or at least it shouldn't be.

However, what has surprised me over the years is how many foreign "Japan watchers" and "Japan pundits" always seem to miss the crux of what's really going on on the ground in Japan and more importantly what's going on in the mind of the Japanese.

When articles are written or comments made about the supposed dearth of Japanese startups, the author or speaker almost always boils this down to several factors such as Japan's Shima-guni mentality (Island Nation / 島国), the so-called Galapagos Effect (which as I've continually pointed out is really just a misnomer for an industry or marketplace rife with ossified, rent-seeking incumbents and regulatory capture), Japan's supposed lack of talent, Japan's supposed lack of diversity and Japan supposed lack of creativity.

In the past, I've written about and either fully debunked these myths and memes or I've put them into a context in which they are far better understood.

With that said,  there is another popular myth and meme that comes up regarding the lack of Japanese startups and that is the idea that the Japanese have an almost in-born fear of failure.

I'm not here to argue that Japanese don't have a fear of failure because they do. We all do. Just as most other peoples around the world do, including those in the US and even including those working in Silicon Valley.

People fear failure. 

But to hear the pundits tell it, "Japanese need to get over failure and embrace it". These pundits act like the fear of failure in Japan is simple a psychological construct* like it is in parts of the West like in the US.

(*For the record, even in the US failure is more than just a psychological construct, there are still real financial, social and psychological penalties, set backs and damage that can and do come with it. But this is so much less than what is faced in Japan)

Now I am here to tell you, that in Japan this "fear of failure" is not simply psychological but real. Depending on the failure level there are material penalties that can accrue or hit one hard and if you are to strike out on your own or with a small group of friends, launch a company and it fails it is not like Silicon Valley where you can walk down the street and pickup a paycheck at a top firm while your lick your wounds, get on your feet and start again or even just resume your pre-startup career.

In Japan, the damage and risks include and span the following:

• Career risks
  
• Social risks (personal and romantic relationships and prospects; access/membership to business clubs, etc.)
  
• Psychological risks (depression, self-hate, loathing)
  
• Financial risks (immediate and long term)
  

There are huge differences in how societies views failures and how you move on in terms of romantic prospects and relationships, platonic relationships and friendships, how your family views you, the support groups you have and, most importantly, the career risks which translate, in the end,  to money - to financial issues.

Although much has changed in Japan over the last 8 years, especially in the last 4 years or so, it is still no where near the levels of what we see in the West regarding some issues such as Mid-career hires.

Now let's step back in time, to say 1995. In the US, for instance, much of the economy was still coming out a bad recession from a couple years earlier where housing prices were pummeled - in fact, I remember many saying they wouldn't buy a home again.

As one specific example, I'll pick Silicon Valley as just one example, even in that economy, a person could have a massive failure and if they learned something and could present themselves well, they could easily land a similar or even better job by leveraging it. Even if they were fired.

Conversely, even if they didn't learn anything, they still could land a similar job. Even if they were fired.

People hired with a very open mind based on what the candidate could produce.

In Japan, the idea of mid-career hires, although changing now, was really non-existent unless you had super skills, super connections or worked at a foreign firm (gaishikei), like Microsoft, Oracle, etc. who needed talent and hired among themselves.

I can tell you, as just one example, when I met with Fuji-Xerox HR group back in mid-2008 to discuss their domestic hiring needs, although they were very polite and professional, it was made extremely clear they wanted new grads only and that they weren't set up to recruit mid-career hires.

Did that mean that mid-career hires didn't happen at Fuji-Xerox?

Of course not. 

But it did mean and it does mean that mid-career hires (a)  were rare and (b) a special case.

Which again leads to this risk factor of damage to one's career and so on.

Coupled with this was a employee/candidate ethos that often considered working for a direct competitor "dishonorable" while on the company side, such a candidate applying for a position from a direct competitor would be seen as "suspect" or "suspicious". 

Again, I want to emphasize this has been changing for the better over the last 8 years and specifically the last 4 years or so but this hiring mentality exists and so does the economic and career damage fear among workers.

I can also share with you some examples where I took top talent from various gaishikei firms (in this case, in the network & information security industry) and introduced the persons to other top companies, both domestic and gaishikei.

Often what I heard was, "They are a job hopper".

My thought: "Are you insane" or "What an idiot, can you not see how talented this person is to fill the position you've had open for the last 4 months...."

My reply, "Uh, no. They aren't a job hopper. And regarding their changes, the last company they worked for went bankrupt and the other two companies before that, that the candidate worked for got acquired by huge multinationals. They left because they preferred a smaller work environment."

The reply?

"Well, that shows bad choices on their part."

A bad choice? To know the firm would go bankrupt? To work at a startup or a company working in emerging markets or developing nascent technologies?

This actual conversation took place in 2008. And I've had numerous conversations like this, from the mid 1990's, skipping through the dot com boom of 1999 to 2001 (in the US, the dot com bomb died out with the 2000 Nasdaq crash but Japan trailed about a year) to around early 2009. Then it thawed a bit. 

I should note that in the dot com bomb, Japanese firms were so scared by the hype and activity happening online that they did hire mid-hires and they did bring in foreigners, even non-Japanese speaking. Fear of the firm failure, spurned positive changes. In other words, competition is good.

I should also add that this was within the fast moving, dynamic tech industry. I've also done work in very static sectors like industrial chemicals, and as late as 2008, it was not uncommon to have a HR manager or even the hiring authority (even the country manager) characterize a person who had stayed at each job less than 5 to 10 years was seen as a job hopper and also undesirable.

Wrapping this up, it's not so much that Japanese have a greater fear of failure than, say, Americans, it is simply that the economic cost of a failure in Japan is much higher - financially, socially, psychologically.

Once you understand, all the pieces begin to fall into place.

By James Santagata
Principal Consultant, SiliconEdge


Former Wall Street Journal technology reporter Yukari Iwatani Kane has published a new book entitled, "Haunted Empire: Apple After Steve Jobs" and I'm here to posit, that without even having cracked open one page of this book she is spot on, at least with regard to her provocative title.

"But wait, what? How could she be right?" 

"How could that title be right?"

"How can you, James, be such a pompous ass to think you know anything about Apple let alone judge Kane's book by its cover?"

"Doesn't Apple create magical products? It's true that Steve Jobs has passed on but the same great staff, the same great workers remain!"

And all of that is true.

However, to understand why the title of the book is right and why I'm right we need to honestly and objectively understand who Steve Jobs was and what made him so successful and Apple so successful under his leadership.

And leadership is an operative word here.

At the same time, we need to understand that competition doesn't operate in a vacuum so we must ask, "What made Apple's and Steve Jobs' competitors so timid? Why didn't they respond and counterstrike?  Better yet, why didn't they create the iPhone type phone, the smartphone first?!"

And the answer is simply it goes back to the structure and dynamics of office politics and power within a company. The real shock should not be that Apple, with zero experience within the mobile phone industry, built and released the blockbuster iPhone but that none of the incumbent handset makers did!

Where was Nokia and their smart phone? In fact, where were the rest of the handset makers?

And that is the real shock. Not that Apple made a smartphone but that the 800-pound Gorillas gave them an opening and then didn't pounce and kill or even defend their territory.

However, if you've taken one of our related coaching or training sessions (How To Beat Silicon Valley's (and other) Fast-moving Startups At Their Own Game) or just intuitively understand Office Politics and Power (aka Organizational Politics & Power - OPP) this not only comes as no surprise but rather it both predicted and expected. And once you understand Office Politics and Power, you can quickly see and understand why and how Apple under Steve Jobs beat Sony to the next iteration of the Sony Walkman which became known as  the Apple iPod. 

It helps one also understand why and how Larry Ellison discussed the Net PC (in the mid-1990's) but Apple built it (the iMac), and why Apple could add some basic design features and colors to it to make a hit while intra-company rent-seeking behavior at the competition prevented them from responding or competing let alone getting that to market first.

OPP also explains why and how Jobs could do the same with Pixar while a former Disney employee, John Lasseter, who suggested as much years before Jobs ever thought about animation or rendering farms was let go (or summarily fired depending on the source one references) from Disney, only to have it all come full circle again with Disney acquiring Pixar. 

Go figure! 

And, of course, it explains some of the biggest daddy ball drops in history such as Xerox PARC and their full blown PC and related projects (which later became reflected in industry leaders like Apple, Adobe, SGI and 3Com) and Kodak with their digital camera years before the competition had one...that all went to waste...

I've talked about that in detail here, about the Myths About Steve Jobs and how is personality and ethos, while celebrated within Silicon Valley (and beyond) is actually completely anathema to traditional Valley ethos.

Reference: Steve Jobs: The Man Who Broke Every Myth & Meme In Silicon Valley & Become A Legend

The problem then, is that a company (any company, including a post-Steve Jobs Apple) needs a strong leader who is unafraid to break eggs to make omelettes and unafraid to slaughter sacred cows for burgers or even just for fun. They also need a leader who is not just unafraid but actually enjoys and even thrills in steamrolling the competition and taking the troops straight up the middle as Alexander the Great did to Darius during one the Macedonian-Persian wars.

As a further piece of evidence, one only needs to consider that the Akio Morita, the founder of Sony, was Steve Jobs while Steve Jobs was still in diapers. Moreover, Akio Morita was extremely aggressive, even actively counterattacking industry special interests who tried to have the courts block the Sony Betamax recorder. Morita was successful in defending this and in ultimately escalating this to the US Supreme Court  with Sony (and consumers) coming out as the victor.

• U.S. Supreme Court: SONY CORP. v. UNIVERSAL CITY STUDIOS, INC., 464 U.S. 417 (1984)
  
• U.S. Supreme Court decides Universal v. Sony, as VCR usage takes off
  

Tim Cook being the nice great guy and "steady, paint by number operator" he is (certainly he's the first guy that I would hire or consult with to determine what color doilies to lay out for my dinner party), shares none of those characteristics with either Steve Jobs or Akio Morita.

So now lets move on to more questions regarding Job's selection of Cook as his successor.

• Did Jobs not know what made Jobs so successful?
  
• Did Jobs think that Cook had what Jobs did to keep Apple thriving? 
  
• Did Jobs think that Apple now needed a "steady, paint by number operator"?
  
• Did ego get the best of Jobs and he wanted to forever ensure and enshrine his legacy by making sure that his successor could only perform to a level that would make people wish that and wonder what Steve Jobs would have accomplished or would be accomplishing if he were still alive?
  

By James Santagata
Principal Consultant, SiliconEdge

“Core competencies are different for every organization. But every organization needs one core competence: innovation.”
   - Peter Drucker

By James Santagata
Principal Consultant, SiliconEdge


Business Is Simply Warfare Without The Pleasantries and Veneer of the Geneva Convention

Silicon Valley is currently experiencing one of its peak in which the frenzy could be said to be approaching idol worship. At the same time, there is much discussion of what can be gleaned from the successes of a multitude of startups emanating from Silicon Valley.
This is a contrarian view.
- James Santagata

Silicon Valley Is No Model For America (New Geography)
By Joel Kotkin
Date: 12/03/2013

Its image further enhanced by the recent IPO of Twitter, Silicon Valley now stands in many minds as the cutting edge of the American future. Some, on both right and left, believe that the Valley's geeks should reform the nation, and the government, in their image.

Increasingly, the basic meme out of the Valley, and its boosters, is that, as one venture capitalist put it: “We need to run the experiment, to show what a society run by Silicon Valley looks like.” The rest of the country, that venture capitalist, Chamath Palihapitiya, recently argued, needs to recognize that “it's becoming excruciatingly, obviously clear to everyone else, that where value is created is no longer in New York, it's no longer in Washington, it's no longer in L.A. It's in San Francisco and the Bay Area.”

But do we really want these people in control? Not if we care at all about privacy, social justice, upward mobility and the future of our democracy.

....[snip].....

None of this suggests that the Valley does not have a critical role to play in the recovery of the American economy. Just like Wall Street, Beverly Hills or, for that matter, Newport Beach, clusters of well-connected and well-educated people play a critical role in taking risks in investment and innovation, whether it involves technology, finance, fashion or media. Yet given their dangerous hubris, disdain for privacy rights, lower rates of tax compliance and minimal ability to create middle-class jobs, the Valley's elite should not be held up as supreme role models, much less the hegemons, of the Republic. That is, unless we have decided that we wish to live in a high-tech, 21st century version of a highly ossified, feudal society.

By James Santagata
Principal Consultant, SiliconEdge


One of the frequent topics I like to discuss besides the myth and meme that "Necessity Is the Mother of All Invention" is the fact many of Silicon Valley's most vaunted startups are all post-tech businesses. 

Yes, you read that right. Post-tech.

They surely use technology in their day-to-day operations just as UPS does, the Hilton hotel chain or even Walmart. However, many of these startups may actually use even less tech than these brick and mortar firms. Examples of such startups and ventures that are post tech include Airbnb, Uber and Zappos which is analogous to an online Nordstrom in terms of the excellent customer service experience they provide. Further, the technology required to run these companies is often available right of the shelf for a pittance (relatively speaking). There are plenty of other non-Valley, post-tech companies such as Groupon, Gilt Groupe and Dollar Shave Club to name just a few.

What does all this mean?

As we've discussed many times before, this means that what many of these startups are facing (or will face) as their primary challenge is primarily human in nature not technical.

Specifically, the markets that post-tech startups will want to or tend to target are those which are massively inefficient (thus, having huge profit potential while populated with tepid or ossified competitors) due to the use of regulatory capture by rent-seeking incumbents.

Over the last 18 to 20 years (and especially during the last 7 years) the skills and knowledge needed to quickly and cost effectively build, mass produce and even consume these technologies and tools have now become almost completely common place.  Consider that the amount of computing power (and bandwidth) we have in our smart phones to a person 10 years ago as is the ability to buy right off the shelf most of the things we need to create just about any product or business. 

We're no longer concerned with the theory behind building a router or the design and development of packet switched (versus a circuit based networks).  Even IPTV is no longer a hazy dream but a daily reality. 

I could go on and on, but I won't so as not to bore you.

Beyond core technology, the Valley has now grown and matured in regards to the knowledge, processes, skills and resources needed to not only build a product but to launch a company and to make it successful (although, often times, the Valley still struggles greatly with market-based productization and ultimately the monetization off the product. These two sticking points, therefore, provide huge opportunities for the next generation of entrepreneurs to focus on).

For me, I'm glad I lived in the Valley and still do business there. It was a very huge turning point and chapter in my life, however, for many reasons, not everyone can get there, at least now. 

Yet they worry and fret. Don't.

My advice, is don't worry or fret, do the best you can, with what you have, where you are. If the Valley is in your future you'll be there. And beyond that, there is a downside to the Valley -- too many posers, Drive-by entrepreneurs, Lottery Ticket Louts and so forth attending events and conferences rather than staying home or at the office building product or businesses. Better yet, spending the time getting in front of customers. The point is the Valley is a huge echo-chamber where luck and one-trick ponies are seen as "systems", "processes" and "truths" and where almost no one I have met can separate talent from systems, brand and product.

That's the downside. A major downside.

The upside is that even if you aren't in the Valley, you can still read and see what's going on, in real time, without being pulled into the Valley echo-chamber and backslapping "ataboys" that are often made with good intentions but damage companies and entrepreneurs in the long run.

The glorious fact, and I do say glorious,  is that now with all of the knowledge, mentors, books, forms, templates and so on I question this "race to setup in the Valley"  Further, we should consider and clearly understand that most of the "tech pain" and "tech risk" has been taken entirely out of the startup equation. 

To summarize, in effect, so many of these startups are post-tech. They surely use tech in their daily business or operations just like KFC, Burger King and UPS does but they aren't tech firms. This doesn't make them better or worse than any startup. But it does mean they should acknowledge this new reality as should every startups, potential entrepreneur as well as incumbent.