Shikumi: The power of frameworks

The best companies are not powered by their products and services alone. A successful company is one that has strong frameworks ⁠— structures and consistent processes for execution that can be applied to all manner of initiatives. When an industry evolves ⁠— or as is more frequent these days ⁠— is upended through new technology, being able to draw from a base of sturdy, common frameworks allows a company to weather the change, to adapt and grow.

In Japanese, we use the word shikumi to convey this concept. When I look at a company like Toyota, I would say that its value is not simply in its automobiles, but in its unique, clearly defined frameworks. Placing a high value on the generation and sharing of shikumi is also one of our core principles at Rakuten. While we have a wide variety of global businesses and services, our strength is in our shikumi ⁠— the consistent elements that run across our company. The use of shikumi allows us to communicate across multiple teams, to mobilize our resources quickly and efficiently and to achieve new operational heights, whether we’re enriching our online fashion offering or launching a new mobile service.

Shikumi: practical examples

Let’s take a look at a few practical examples that show how Rakuten’s shikumi are laying the foundation for future growth.

Loyalty: Many e-commerce sites have loyalty programs, but we use ours to support all of our businesses. Rakuten Super Points have been described as the “glue” that holds Rakuten’s ecosystem of services together. Rakuten’s signature loyalty program extends to almost all of our businesses ⁠— from shopping online to completing credit card transactions. Users can even invest their points via Rakuten Securities. No wonder the Rakuten Super Points program has given out more than one trillion points to date. Super Points is a vitally important shikumi for us in serving our customers.

Collaborating with partners who share our values: Whether we are vetting a potential sponsor for our baseball team or investing in a Silicon Valley startup, we seek partners who share our values. This has been the case for our partnerships with FC Barcelona and the Golden State Warriors, our strategic alliance with Walmart, and many more. A partnership is a business relationship, to be sure. But by making sure that shared values are at the heart of our key business relationships, we find we are able to build not just business deals, but long-lasting, positive relationships that allow all participants to flourish.

Using KPIs to measure and improve performance: We measure our performance in Key Performance Indicators (KPIs) ⁠— that’s true whether you are an engineer, accountant or content producer. We have company-wide platforms in place for KPI management. We conduct group-wide KPI meetings monthly to assess our progress. This focus on performance measurement runs through our company and provides us with the shikumi we use to understand how far we’ve come, how we’re doing now and what lies ahead.

Shikumi for innovation

For those who argue frameworks are stifling, I disagree. A core shikumi is what supports innovation. It provides the bedrock principles and processes that allow everyone within an organization to communicate with a common language and to mobilize for the achievement of ambitious new visions.

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