Chuo University Speech(Nov 25th, 2011)
"The Structural Transformation of the Game Industry"

(Continued from previous page.)*

If you try to see things in that contest, you will know why that cannot be done today. Capital has become more global. Risk aversion has gone over the top, and even indirect capital market is not accessible when it is most needed. Corporate tax rate is high, net profit is muted vis-a-vis the other major markets, and equity market is now in turmoil given the political cloud. Being listed in Japan is working against the best interests of the companies. Some also say that this recession was triggered by the governance requirements given the severity of the rules. The boards of directors and executive officers have their hands tied around their back, and the business managers are more hesitant in pursing opportunities. Talent management became too protective, in an undesirable way, and the mobility not only between the companies but also within the company has been lost. If the system were to be destroyed, it has to be destroyed completely. That may have led to a self-supported new regime, but what we face today is really despicable because they are partially destroyed and amended like patchworks, without any clear vision. Particularly HR management should feel guilty because it destroyed mobility from companies as well as from the society. I used some rogue words, but unfortunately I need to be extreme, to be heard.


IV. Square Enix Group Strategy

I wasn’t managing my time today, so there’s not much time remaining, so I will be brief and to the point.

Earlier I talked about innovation being a chemical reaction. You draw up the rough image of the deliverable, deploy the necessary elements and the elements, and set up an appropriate environment and wait for the reaction to be induced. This is the management of innovation. Have vision, identify what are needed for the chemical reaction, and set up an internal corporate environment to swiftly execute the pilot trials. That is what business management is about. Needless to say, the day-to-day business activities should be carried out without any interruption, but that is not enough in times of change. Transitional period is challenging. You have a good idea of the direction and the timing, but don’t know the final shape yet. More accurately, there are multiple patterns and you cannot make a decision, because you can’t just guess backward from the goal, and you can’t operate based on a pure guess.

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