Mickey Mikitani, Chairman and CEO, Rakuten, Inc.

Many experts argue the case for business simplicity. A simple product or service is appealing to customers, popular with investors and can be cost effective to deliver. It’s no surprise then that simplicity has become such a buzzword in corporate circles.

But while simplicity has its merits, it can also have downsides. Companies that over-index on simplicity risk long-term health. A simple concept may work well for a time, but it may act as a hurdle to future innovation and evolution. Unchecked, simplicity can become a trap.

The simplicity trap

We sometimes see this in new tech companies – firms that burst on the scene with a simple concept or service that captures the consumer imagination and sends the company’s popularity soaring. But those firms may stumble when it comes time to build on that initial successful concept and adapt to the changing world. Certainly, we’ve seen this play out in other industries as well. Blockbuster, Toys R Us and Polaroid are all companies that enjoyed periods of great success with simple initial concepts, but ultimately crumbled when they were unable to innovate. They were overtaken by more nimble rivals that had the ability to evolve quickly and embrace new trends.

Modern business is complicated: embrace it

The complexity behind simplicity is something we take seriously at Rakuten and we look to balance its positive and negative elements. Ours is a complicated company with many different divisions and services, and a robust global ecosystem. Our business extends across industry and category boundaries. We offer services in almost every country in the world. Our Tokyo head office alone houses employees with nationalities from over 70 countries. And we are constantly seeking new markets and new groups of customers. This complex network of industries, services and people – or, more simply put, diversity – is an integral part of what makes Rakuten successful. We are able to share learning, leverage data, develop disruptive technologies and pool our knowledge for innovation and success.

Putting the user first

But at the same time, we understand the appeal of simplicity. In these turbulent times, consumers naturally gravitate toward services and concepts that offer the ease and comfort of simplicity. And so we need to find a balance. Too much complexity can turn off the consumer. With so many choices in products and services, consumers don’t want to work to understand your offering. It must be easy, seamless and intuitive on the front end, even if behind the scenes it is a complicated web. That’s why we’re working with our 47,000 marketplace merchants in Japan to unify the payment options across the platform and consistently offer great delivery choices to shoppers. That’s also what we’re aiming for with the launch of a new mobile network this fall – to simplify the user fees and payment plans – so that customers are confident they know exactly what they’ve signed up for.

When it comes to complexity versus simplicity in business, you really cannot choose one over the other: It’s about how to deftly weave together a combination of both.