War vs. Combat. What’s Your Growth Strategy?

There are two ways to grow a business.

One, I’ll call the War Business Model.

The war business model is the style where you spread out the world map on a table, and expand your business while keeping your ultimate strategy in mind. To win, you need to capture more than 50% of the market share. What the organization needs to do is take dynamic action in the direction of the goal.

Microsoft’s operating system and Google’s search engine are good examples of the war business model. Despite losing hundreds of billions of dollars at first, they were eventually able to turn their losses into profits by continually aiming toward ultimate victory.

By contrast, the combat business model is where you can see the faces of the people you are working with. In our early days when, after much running around all over Japan, we had managed to at last acquire four or five store owners, our style was a good example of the combat business model. In this way of doing business, the organization values each small victory, and slowly builds these small victories into something really big.

The overall strategy that I formulated was to expand the company’s performance in this manner. Through a gradual accumulation of victories, we eventually reached a critical point.

Under the war business model—the model where from the beginning you make large investments and have a big army at your disposal—the return for success is great, but the risk of failure is equally great. With the combat business model you can easily pick yourself up again, even if you fail, because there is nothing much to lose. The reason why we were able to meet the challenge of the Internet shopping business—a model, it was believed, that would never succeed in Japan—was because from the outset, we employed the combat business model. Because I had the psychological fallback of knowing that we could always do things over again, I was able to make bold and decisive decisions.

Do not hold back on your growth ideas just because you can’t afford to wage war. Instead, try combat and grow one small victory at a time.

(Photo: FC Photography)