A company with a philosophy and a company where a philosophy functions are two completely different things

Companies usually have impressive words.
Integrity
Challenge
Quality First
Customer First
Valuing People

However, when you work on the front lines, you realize something.
That having words and those words actually working are two completely different things.

Many companies post a philosophy.
However, not many companies have a philosophy that functions.

Where does this difference appear?
It is not in normal times.
It appears in the moments when upholding the philosophy results in a loss.

When you want to cut verification steps to meet a deadline.
When it is difficult to refuse unreasonable demands from a major client.
When it is more convenient for the company to downplay a defect.
When prioritizing sales can generate numbers, but erodes long-term trust.

What you choose at those times reveals whether that company has a philosophy, or just has sentences that look like a philosophy.

What is corporate philosophy?

It would not be far off to say that corporate philosophy is the embodiment of how a company approaches its work and its way of thinking.

However, that alone is a bit shallow.

True corporate philosophy is not an explanation of how to do work.
It is the framework for judgment: what that company considers good, what it considers bad, what it prioritizes, and what it will not discard.
In other words, corporate philosophy is close to a company's personality.

No matter how profitable a deal is, we will not compromise here.

No matter how rushed we are, we will not skip this.
No matter how strong the other party is, we will not yield here.
A company that has these lines has a philosophy.

Conversely, a company that lacks these lines and makes decisions on the spot, pushed by strong pressure, does not have a philosophy.

What is a company without a corporate philosophy?

A company without a corporate philosophy is not a company that lacks a philosophy statement.
It is a company where the priority of values is not shared.

What happens in such a company?

It is easy to become a slave to the customer.
However, this is not customer-oriented.
It is a suspension of judgment.

Listening to customer requests and accepting everything are different things.
Ideally, there are times to prioritize safety over customer satisfaction, and times to prioritize quality over short-term profit.
A company that cannot draw a line there is not facing the customer, but is merely being swayed by them.

Corporate philosophy also tends to become hollow.
It is posted on the wall.
It is on the recruitment page.
It is recited at morning assemblies.
But it is not used in evaluation systems, promotions, meetings, or handling scandals.
When that happens, the philosophy becomes wallpaper rather than a flag.

Product development also tends to drift toward cheap and shoddy.
This is because what is considered valuable is ambiguous.
Is low price the value?
Is durability the value?
Is ease of repair the value?
Is ease of use without fatigue the value?

A company without this hierarchy ends up gravitating toward whatever seems likely to sell.
Then, it might sell in the short term, but in the long term, it loses sight of who it is.

Why do companies without a corporate philosophy function in the short term?

This is a bit tricky.
Even without a corporate philosophy, a company will function for a while.

Why?
Because there is external pressure.

Deadlines are approaching.
Customers are angry.
This month's numbers are not enough.
The boss says to hurry.

Work moves along to some extent just with this.
People move based on what they will be scolded for if they don't do, without thinking about what is right.
In other words, it runs on reflexes without autonomy.

Furthermore, there is the goodwill and competence of the front-line staff.
People with a strong sense of responsibility push themselves too hard.
Attentive people anticipate and fill the gaps.
Excellent managers swallow contradictions all by themselves.

In this way, the company functions at first glance.
But it is not running on a system.
It is running on human sacrifice.

Moreover, contradictions are hard to surface in the short term.
The clash between quality and deadlines.
The clash between profit and trust.
The clash between front-line burden and customer satisfaction.

These contradictions are temporarily buried by overtime, endurance, and procrastination.
Therefore, even if problems are not solved, it looks like it is running.

But in reality, it is different.
It is not running.
It just hasn't collapsed yet.

To write further about economic matters, companies rarely go bankrupt as long as their cash flow is running.

Is it just that companies with continuous deficits are eating into their internal reserves? It is not just that.

There are cases where accumulated deficits are piling up internally.

Even so, as long as there is cash inflow, it looks healthy on the surface.

Cash flow is like blood for humans.

Is that cash an asset, net asset, or liability?

It is also a question like whether it is good blood or bad blood.

I do not think all debt is bad.

Even with the same debt, it means that how the blood is bad changes depending on whether it is blood with high cholesterol or blood containing a lot of carbon dioxide.

However, whether that develops into a health problem,

and whether it will exchange carbon dioxide for oxygen and carry nutrients to the capillaries again is a separate issue.

A company with a philosophy and a company where a philosophy functions

What is important here is to think about a company with a philosophy and a company where a philosophy functions separately.

A company with a philosophy is a company that has words.
A company where a philosophy functions is a company that has criteria for judgment.

This difference is significant.

For example, suppose there is the phrase 'Quality First'.
A company that only has a philosophy says 'Quality First' normally.
But when deadlines get tight, they cut verification steps.
If a sales project is large, they allow exceptions.
If a defect occurs, they want to hide it.

On the other hand, a company where a philosophy functions checks quality standards even more when deadlines are tight.
They refuse dangerous requests even for large projects.
They treat hiding a defect itself as a violation of the philosophy.

In other words, a company where a philosophy functions is a company that can refuse profits that go against the philosophy.

I think this is the essence.

A company with a philosophy can talk about impressive things.
A company where a philosophy functions can accept losses to uphold impressive things.

This difference cannot be bridged by the beauty of the text.

When does a philosophy break?

A philosophy is hard to break in normal times.
The problem is when sticking to the philosophy puts you at a disadvantage.

At the time of founding
The philosophy at this stage is pure, but it is often not yet a system.
The founder's personality itself acts as a substitute for the philosophy.
That is why it seems to function while there are few people.
However, as it expands, interpretations diverge.
It easily becomes an organization that reads the founder's mood rather than the philosophy.

Growth phase
Here, speed easily becomes justice.
Hurry to hire.
Increase bases.
Increase projects.
Mass-produce managers.
As a result, people who share the philosophy and people who act only on results begin to mix.
Furthermore, exceptions where "this time is special" increase.
The accumulation of these exceptions breaks the philosophy.

Becoming a large corporation
The number of people increases, departments increase, and hierarchies increase.
At this stage, a philosophy cannot be maintained by enthusiasm alone.
It must be incorporated into hiring, evaluation, promotion, quality standards, discipline, and meeting design.
If that cannot be done, the philosophy will not be something shared, but something merely posted.

During a recession
Here, the fear of survival comes to the fore.
Do you cut the front lines first while saying you value people?
Do you cut inspections while saying quality comes first?
Do you push the burden onto subcontractors while saying you are sincere?
I believe that only a philosophy protected during difficult times is a real philosophy.

During a scandal
This is the final testing ground.
A philosophy in normal times can be used for company introductions.
But in the midst of a scandal, the philosophy becomes the standard for self-judgment.
When you start conveniently rephrasing it here, the philosophy becomes hollowed out to the maximum.

A company's true intentions appear in quality improvement.

When creating a new product, the company's dreams appear.
But when a quality problem occurs, the company's true intentions appear.

This is the interesting part.

A company that only has a philosophy is prone to start looking for someone to blame when a defect occurs.
Who was at fault?
Why did they overlook it?
Why didn't they report it?

Of course, responsibility is necessary.
But that alone does not prevent recurrence.
Because the structural problem ends up being pushed into an individual problem.

A company where a philosophy functions does not blur responsibility, but looks at the structural causes.
Why was it hard to speak up?
Why was the abnormality not shared?
Why was there an atmosphere where the quality side would lose when delivery dates and quality conflicted?

In other words, quality improvement is not just technical improvement.
It is also a declaration of what the company considers unacceptable to overlook.

Do you protect the atmosphere where it is easy to speak up about abnormalities?
Do you share defects without hiding them?
Do you prioritize preventing recurrence even if it means taking a short-term loss?

The real thing of the philosophy appears here.

People who can reframe questions are needed

Here, I would like to touch a little on the role of the person who asks questions.

The person who asks questions is not someone called in when there is a lack of technology.
They are someone needed when the questions are shallow.

For example, in product development, before asking what can be made, they ask what should be made.
In quality improvement, before asking who is at fault, they ask why this structure made this failure likely to occur.

In other words, the person who asks questions is closer to someone who organizes the framework of the question rather than someone who provides the answer.

However, the person who asks questions here is easily disliked by the front lines.

This is because they appear not as someone to help move things forward, but as someone who stops and re-questions.

Are you saying that now?
Isn't that just empty talk?
So, what are we going to do in the end?

I think it is natural to be thought of this way.

Even so, if they are needed, it is because they are someone who can translate abstractions into specifications or improvement conditions.

Protect human autonomy.
Instead of
Reduce the flow lines that incite dependence.

Be sincere.
Instead of
Share defects within 24 hours.

Quality first.
Instead of
Do not omit confirmation processes for projects with tight deadlines.

If you can drop a philosophy into practical work like this, philosophy will no longer be a decoration.

A philosophy is the resolve to accept losses.

In the end, a philosophy is not beautiful words.
I think it is a form of resolve to accept losses.

There are things you protect even if you throw away some profits.
There are things you do not yield even if you slow down.
There are standards you continue even if it is troublesome.

Only when you go that far does a philosophy become not just text, but the backbone of the company.

Conversely, a company that has a philosophy but it is not functioning is a company that has the words but does not use them for choices that involve pain.

It does not have a philosophy.
It just possesses something that looks like a philosophy.

And perhaps, I think humans are the same.

It is easy to say that you have values you cherish.
But you can tell if those values are real by whether you can protect them even in situations where you are at a disadvantage.

Since a company is also a collection of humans, it is on that extension.

It is not about whether you have a philosophy.
Can you still protect it when protecting the philosophy causes a loss?

That is where the true nature of the company appears.

Philosophy might not be a title, but a way of life.

Writing this far, I have come to think that philosophy might not be a title, but a habit of judgment that appears in one's way of life.

Some people might have thought, then should we call philosophers to product development or quality improvement meetings?

Of course, there are such companies, but that is not everything.

Rather, the buds of philosophy may already be scattered on the front lines.

A small remark that does not read the atmosphere during a meeting, or

a protest that resembles a direct appeal from a veteran employee,

a voice that tries to protect something that should not be overlooked rather than efficiency.

In such seemingly troublesome things, the philosophy that the company has not yet lost may be sleeping.

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