Leadership lessons from Satoru Iwata

Leadership lessons from Satoru Iwata

Points Highlighted:

  • “On my business card, I am a corporate president. In my mind, I am a game developer. But in my heart, I am a gamer.” – Satoru Iwata

  • Companies in this article

Satoru Iwata was the president and CEO of Nintendo for over a decade until his death in 2015. He took over the company when it was flagging and turned it back into a financially successful business. He oversaw the creation of two of the highest selling gaming consoles of all time, the Nintendo DS (154 million units sold) and Wii (101 million units sold).

What follows are five key tenets of Iwata’s leadership style, spoken in his own words. They are taken from a new book called “Iwata Asks” which features assorted reflections originally published on the website Hobo Nikkan Itoi Shinbun and the Nintendo website.

Iwata was an innovative and risk-taking leader. He was a virtuoso programmer and had a storied history in game design, playing key roles in the development of classic titles such as Earthbound and Mario Kart. This meant that he managed in an unorthodox way, bringing a designer’s eye to a job that is often focused on keeping investors happy. This helped him lead Nintendo to meet the imaginations and interests of gamers time and time again.

1. Have respect for others

Iwata believed that a leader should develop a close working relationship with their employees. This is essential in the creative industry in which companies are trying to achieve difficult tasks. As he put it: “The whole point of a company is for regular people, each with their distinctive characteristics, to join forces and accomplish giant tasks they could not undertake alone.”

Iwata had a policy of interviewing each employee twice a year to figure out everybody’s strengths and weaknesses

He showed this by refusing to order layoffs in times when the company struggled, explaining that holding job certainty over your staff halts creativity and productivity: “Nobody can really be asked to give it their all when they don’t know if they’ll have a job the next day.” When he was the president of HAL Laboratory, a game developer closely tied to Nintendo, Iwata had a policy of interviewing each employee twice a year. The process helped him to figure out everybody’s strengths and weaknesses, which helps a leader to clarify priorities, and therefore increase efficiency: “When the whole group can earn praise without working insanely hard, things get better and better on their own, creating a virtuous cycle where the work only gets stronger. This means the group has tapped into their strengths.”

2. Balance profit with innovation Nintendo must balance turning a profit while simultaneously developing new technologies and software. As Iwata put it: “If a president says they’ll revolutionize the industry, but for the next five years the company won’t be able to turn a profit, they’ll find themselves without a job. And so, every year, they need to generate a steady stream of profits, but also need to innovate. It’s like flying along in an airplane and working on repairs mid-flight.”

Satoru Iwata Iwata believed that the ability to predict future trends could be learned. He was influenced by a collaborator who had a knack for liking the things that catch on and become the next big hit. When Iwata asked him how he did this, he responded: “I don’t predict the future. I simply notice the world starting to change a little before everybody else.”

Iwata responded by methodically improving his predictive abilities. “I started testing out different hypotheses about what could be popular, one after the other. Thanks to him, I think I’m far more capable than I was back then of sensing changes before other people have realized that they’re happening.”

3. Create a shared vision Nintendo are always working on large hardware and software projects. Iwata learned that having a clearly defined outcome was essential, as was the case with the Wii.

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