THE HORIZON MIND:
The Horizon Mind covers the 6 elements to each topic in the blogs; includes Overview, MyStory, MyAnalysis, Iconic References, Summary and What’s Next.
Horizon is defined as the line at which the earth’s surface and the sky appear to meet and it is defined as the limit of a person’s knowledge, experience, or interest.
The Horizon Mind discusses the overall topic with iconic references as resemblance of events to be remembered for the betterment of the future. Humans tend to believe things which have some kind of evidence attached to it.
1.0 OVERVIEW
Why did Nikon fail in the journey?
Founded on July 25, 1917 as Nippon Kōgaku Kōgyō Kabushikigaisha (日本光学工業株式会社 "Japan Optical Industries Co., Ltd."), the company was renamed to Nikon Corporation, after its cameras, in 1988. Nikon is a member of the Mitsubishi group of companies (keiretsu).
Nikon Corporation (株式会社ニコン, Kabushiki-gaisha Nikon) (UK: /ˈnɪkɒn/, US: /ˈnaɪkɒn/; Japanese: [ɲiꜜkoɴ] (About this soundlisten)), also known just as Nikon, is a Japanese multinational corporation headquartered in Tokyo, Japan, specializing in optics and imaging products. The companies held by Nikon form the Nikon Group.
Nikon's products include cameras, camera lenses, binoculars, microscopes, ophthalmic lenses, measurement instruments, rifle scopes, spotting scopes, and the steppers used in the photolithography steps of semiconductor fabrication, of which it was the world's second largest manufacturer. The company is the eighth-largest chip equipment maker as reported in 2017. Also, it has diversified into new areas for 3D printing and regenerative medicine to compensate for the negative impacts from shrinking digital camera market.
So choose to be among the few today.
Reset your mindset to make the difference.
Planning is everything but the mindset is the king of everything.
2.0. MY STORY - Why am I sharing this writing with you?
As an observer and an analyst, I had been observing the things in my life and in front of me with a lot of questions such as why it is happening, why it failed and did they know how to solve it from the beginning? should be better than when it became worse? And the question continues.. As I was witnessing the falls of my previous companies that my colleagues and my former bosses had to suffer due to the out of income in the coming months; had given the impact to myself to uncover the real reason of the failures.
How come a company that had been doing well in the business but failed in the middle of the operation?
The “Iconic Reference” of The Titanic Mindsets will further explain on how The RMS Titanic’s 1912 was succumbed in the seabed of The Atlantic Ocean.
In this analysis of the falls and failures of the used to be successful international companies in the world, we need to have the empathy skills of experiencing the actions taken by the “captains of the ships” or the management of the companies that made the companies failed in the middle of the journeys.
“Most people don’t really want the truth.
They just want constant reassurance that what they believe is the truth.” - Anonymous
3.0 MY ANALYSIS
Unfortunately, Nikon was once the world's leader in camera innovation but now they are struggling to survive...(Nikon lost more than USD700mil in 2020). The failures were due to the followings:
a) No KYCs exercises were implemented by Nikon - Know Your Customers (KYC-1) and Know Your Competitors (KYC-2) are the two important elements that every businesses should be monitoring in their journey. By having scheduled or seasonal KYCs’ exercises, businesses could understand their positions in the markets thus will proceed to make another decisions either to move for diversification or innovation or status quo. The following situations were the cases of no KYCs in Nikon:
i. They were too stingy in sharing their technologies and update with users. Nikon D3, D3s, D4, D4s...all are just minor upgrade. Nikon could have just updated the firmware to give the extra features functions to users, but they chose not to. They could have improved AF, high ISO noise, auto shutter speed selection in auto ISO mode...etc. in their firmware update.
IF ONLY NIKON COULD HAVE DONE IT – Nikon could have known the demand from the customers for Nikon to make improvements or innovations. Thus, Nikon could have remained in the market and improved its existing customers and getting new customers.
ii. Nikon had mis-defined mirrorless as beginner/family camera, while DSLR for professional. Nikon 1 failed, and they are too late to go into full frame mirrorless. Even after entering full frame mirrorless, they still do not give their best in mirrorless, still pushing users into DSLR if they want professional camera. Nikon Z6, Z7 are failed products. Nothing special, and only one memory card slot.
IF ONLY NIKON COULD HAVE DONE IT - Nikon could have known the demand from the customers for Nikon to make improvements or innovations. Thus, Nikon could have remained and improved its existing customers and new customers.
iii. Pricing – Nikon once thought that they were the king, same level as Canon. Putting their cameras at much higher price than Sony, thinking Sony as Pentax, Olympus, Fujifilm level. It was a big mistake as Sony introduced professional mirrorless cameras at mid-range price, equivalent model at 20-30% discount from Nikon and Canon pricing. Customers were running away from Nikon due to prices.
IF ONLY NIKON COULD HAVE DONE IT – KYC-1 if implemented earlier would give signals or messages for Nikon to react on offering products at the prices that the customers are comfortable and happy.
b) Less exposure in the market, not enough connections with influencers.
Nikon was once ego to only link with the top photographers, spent lots of money on them but get little return. Sony is smart by giving out their cameras and products to many internet influencers, get as many people to talk about their cameras and lenses, and create much more interests in the market. Many people first jump into Sony because of curiosity, because many said Sony good...so they wanted to try out as well. Nikon had been left out piece by piece by its customers.
IF ONLY NIKON COULD HAVE DONE IT via the engagements with the influencers of most photographers and internet influencers, Nikon could have gained much exposures in the industry.
c) Range of Nikon’s products had shied-away its customers.
Nikon wasn't the first manufacturer to use a bayonet mount or introduce an SLR. However, it was the combination of design elements of the whole system that made it successful.
‘It fits’ isn’t the same as ‘it’s good’ - Either way, there's a risk that customers will be offered something that fits but doesn't necessarily work as well as it could. This was one of the situation for most of the enthusiast photographers with limited lens-buying resources but being offered different ranges of Nikon’s lenses. Either they needed to upgrade their mounts, lenses or the whole camera sets. It is a fallacy that benefits the camera makers more than the photographers.
IF ONLY NIKON COULD HAVE DONE IT – The KYC-1 and KYC-2 would allow Nikon to understand the needs or demands from the customers or competitors. If only Nikon have done the KYCs, they could make the product range more flexible for customers to adopt and use it in the long run.
d) Late Introduction of Full Frame Digital, The 1 System and Late Pivot to The Z System
The emergence of innovative products from its competitors earlier than what Nikon had to offer the customers had made Nikon being submerged in the industry. Nikon was late to introduce its Full Frame Digital, The 1 System and had pivot to The Z System where else its competitors, Sony, Olympus and Panasonic had captured the market.
IF ONLY NIKON COULD HAVE DONE IT - if only Nikon could have done it earlier on the introduction of the new innovation products, they could have captured the market and sustain in the market.
e) Lack of Business Diversification
As a company, it isn't nearly as diversified as other manufacturers. Just look at its main competitors to see: Sony and Canon both have significantly more employees and generate greater revenue from a wider range of sources. In 2015, Nikon's Imaging Division made up 68% of its income. Nikon has been highly focused on the camera sector to the extent that other manufacturers haven't, and this has made it vulnerable as income has fallen. It understands this weakness and is attempting to diversify.
IF ONLY NIKON COULD HAVE DONE IT – Accounting data is the language of business. It gives the insights of the things need to be done in the future. And Nikon was lacking in a business diversification strategy where its focus was highly on the camera sector.
Nikon could have utilised its existing talents of employees to generate ideas via research and development (R&D) exercises to diversify the businesses either into the same industry or different industry. Diversification strategy allows Nikon to sustain in the business despite challenges that could not be expected going to happen.
The story of The Hare and The Tortoise is a must be taught to all kids; for them to understand the mindsets of The Hare and The Tortoise. If it is deeply analysed, it gives a powerful moral story for us to adapt and adopt our weaknesses and strengths in life, business or a running event. The story of The Arrogant versus The Persistent, Humble and Focus shows us on how does a humble-persistent yet focused person could achieve successes in life or businesses but the arrogance but powerful person could fail in the journey in life or businesses due to The Titanic Mindsets.
Nikon was once the world's leader in camera innovation but due to The Titanic Mindsets, Nikon had mis-looked on the importance of the KYCs’ (KYC-1 – Know Your Customers and KYC-2 – Know Your Competitors) demands and responses. The Titanic Mindsets had also caused their misinterpretation on the power of influencers in the market and lack of business expansion strategy.
Read more on The Titanic Mindsets.
4.0 ICONIC REFERENCES
The RMS Titanic and The Hare and The Tortoise are the iconic references for the downfall history of Nikon. The Titanic Mindsets of ignorance and hubris in Nikon’s decisions for not getting prepared for the market demands had allowed the other competitors especially Canon to create new lines of product range to accommodate its customers’ demands and the iconic references of The Hare and The Tortoise had made Nikon to ignore the Know-Your-Customer (KYC-1) exercise and Know-Your-Competitor (KYC-2) exercise; to keep abreast with the current situation using the available strengths and weaknesses like what The Tortoise was doing to outbeat The Hare.
Get to know into details of The Titanic Mindsets which had caused The RMS Titanic succumbed to the seabed of The Atlantic Ocean on 14 April 1912, here; and The Hare and The Tortoise, here.
5.0 SUMMARY
The financial target set (by 2025) in the medium-term strategy is actually quite sobering: return revenue and profit to where it was in 2019. The combination of COVID and pivoting to the Z-system will have cost Nikon six years of business. Of the ¥700 billion in turnover, the expectation is that ¥200 billion will be coming from Imaging and ¥300 billion from Precision Instruments, with the overall business yielding a 10% profit.
Remember that Imaging accounted for 33% of revenue last year (down from 75% in 2013) and is the principal source of Nikon’s problems; the unwritten mantra to address this is “strengthen and diversify”. Precision Instruments is now the largest division accounting for 41% of revenue, but Healthcare (14%) and Digital Manufacturing (12%) are significant components.
The first of these — strengthen — applies to Nikon’s core businesses (Imaging and Precision Equipment) that have fallen back as a result of COVID, but have different priorities. Precision Equipment needs to expand the lithography business (flat panel and semiconductor) to new customers for what is a rapidly developing business-to-business (B2B) sector. Crucially, being B2B, it doesn’t suffer the frailties of Imaging with its consumer-facing market. The priorities for Imaging are very different: it still needs to become profitable. Progress in 2021-2022 has been good with a return to operating profit, this has to be tempered by the low market share the Z-system currently has.
Having said the above; Nikon had made a move to diversify and change their business model at the very last minute before it was succumbed, luckily Nikon had changed their focus from producing cameras for end user’s market into B2B market in producing flat panel and semiconductor.
6.0 WHAT'S NEXT?
Nikon was once the world's leader in camera innovation but due to The Titanic Mindsets, Nikon had mis-looked on the importance of the KYCs’ (KYC-1 – Know Your Customers and KYC-2 – Know Your Competitors) demands and responses. The Titanic Mindsets had also caused their misinterpretation on the power of influencers in the market and lack of business expansion strategy.
It is not too late for your business to change before it is too late but some people would only change when it is too late to change.
Your business is like a ship sailing in the deep ocean, be prepared with the relevant preparation and expect for the unexpected.
Thus, It's time to reset, rethink, reposition your current position in the map.
Plans are nothing.
Planning is everything
but the mindset is the king of everything.
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