Iwata discusses the changes in management
Here is what Satoru Iwata had to say on this particular matter...
I have some questions about the changes of directors. I am wondering if the shortage of game titles, which has led to slow sales of Wii U, is because President Iwata oversees too many sections. I think it would be better for Mr. Iwata to concentrate on supervising software development in Japan instead of placing the overseas operations under his direct control. Was this decision made based on the idea that it will not only enable you to boost sales overseas by releasing software but also strengthen relationships with overseas video game developers and retailers? Also, does the retirement of two representative directors in charge of business administration mean a more development-oriented management style?
It is a fact that Wii U currently has lost momentum owing to longer-than-expected intervals between software releases. We were faced with the alternatives of taking time to refine our products or launching them without too many intervals, and after careful consideration, we selected the first option because we believe that from a mid-and-long term perspective it is more important to improve customer satisfaction with each game. Development always bears many uncertainties and a delay in release is not necessarily a consequence of insufficient management of development teams. Needless to say, our new management will appropriately supervise our development teams. I have always been involved in many sections of the company, and the Software Planning & Development Division, one of our two software development divisions, has been under my direct control since 2004. After the changes of directors we announced, Mr. Shinya Takahashi will replace me in that position to oversee the daily management of that division, which I believe will spare me enough time to supervise our overseas operations.
With regard to the changes of representative directors, we have no intention of creating a more development-led management. It is a coincidence that among the five representative directors, the three directors in charge of development are younger than the two in charge of administration and marketing. As we grow older, it inevitably becomes more challenging to top the performance of our peak years, so for many years we have been considering a suitable time for the generational change. Although the changes of directors this time may sound sudden to some, it is in fact the conclusion of a long-standing discussion inside the management. You might feel that, considering the experience, stability and total performance of the current management team at this point, it would be safer to maintain the status quo this year. However, we are now in the position to take up various challenges to adapt to a fast-changing business environment. Considering our aim, I think it is never too early to change to a younger management. This is why we decided on the generational change.
I believe that development of novel and attractive products is the largest factor contributing to our competitive edge. Therefore, if we made our management full of clerical, administrative and sales staff members who are unfamiliar with development of products, people might see it as being unbalanced. From the standpoint of our competitive edge, we think it is not at all unbalanced because the three remaining representative directors have been leading Nintendo for the past 11 years. Although our business decisions have not been made by representative directors alone in the past, we are thinking of supplementing the decreased number of representative directors by having Mr. Kimishima, a new managing director, join the executive management committee and by inviting heads of departments to take more active roles in the decision-making process. I hope these efforts will address your concerns over our corporate governance.
I appreciate your opinion that I should concentrate on supervising software development in Japan, but we would like to achieve good results so that later you will understand that the change in management was indeed a good decision.
I have some questions about the changes of directors. I am wondering if the shortage of game titles, which has led to slow sales of Wii U, is because President Iwata oversees too many sections. I think it would be better for Mr. Iwata to concentrate on supervising software development in Japan instead of placing the overseas operations under his direct control. Was this decision made based on the idea that it will not only enable you to boost sales overseas by releasing software but also strengthen relationships with overseas video game developers and retailers? Also, does the retirement of two representative directors in charge of business administration mean a more development-oriented management style?
It is a fact that Wii U currently has lost momentum owing to longer-than-expected intervals between software releases. We were faced with the alternatives of taking time to refine our products or launching them without too many intervals, and after careful consideration, we selected the first option because we believe that from a mid-and-long term perspective it is more important to improve customer satisfaction with each game. Development always bears many uncertainties and a delay in release is not necessarily a consequence of insufficient management of development teams. Needless to say, our new management will appropriately supervise our development teams. I have always been involved in many sections of the company, and the Software Planning & Development Division, one of our two software development divisions, has been under my direct control since 2004. After the changes of directors we announced, Mr. Shinya Takahashi will replace me in that position to oversee the daily management of that division, which I believe will spare me enough time to supervise our overseas operations.
With regard to the changes of representative directors, we have no intention of creating a more development-led management. It is a coincidence that among the five representative directors, the three directors in charge of development are younger than the two in charge of administration and marketing. As we grow older, it inevitably becomes more challenging to top the performance of our peak years, so for many years we have been considering a suitable time for the generational change. Although the changes of directors this time may sound sudden to some, it is in fact the conclusion of a long-standing discussion inside the management. You might feel that, considering the experience, stability and total performance of the current management team at this point, it would be safer to maintain the status quo this year. However, we are now in the position to take up various challenges to adapt to a fast-changing business environment. Considering our aim, I think it is never too early to change to a younger management. This is why we decided on the generational change.
I believe that development of novel and attractive products is the largest factor contributing to our competitive edge. Therefore, if we made our management full of clerical, administrative and sales staff members who are unfamiliar with development of products, people might see it as being unbalanced. From the standpoint of our competitive edge, we think it is not at all unbalanced because the three remaining representative directors have been leading Nintendo for the past 11 years. Although our business decisions have not been made by representative directors alone in the past, we are thinking of supplementing the decreased number of representative directors by having Mr. Kimishima, a new managing director, join the executive management committee and by inviting heads of departments to take more active roles in the decision-making process. I hope these efforts will address your concerns over our corporate governance.
I appreciate your opinion that I should concentrate on supervising software development in Japan, but we would like to achieve good results so that later you will understand that the change in management was indeed a good decision.
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