CHOWA

An ancient Japanese idea can teach 21st century businesses about harmonious partnerships

It’s all about the chowa.
It’s all about the chowa.
Image: Reuters/Christian Hartmann/File Photo
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The global business community has long faced the challenge of driving profits today while building a better world for tomorrow. On many fronts, this model has produced notable successes. The rise of social media, along with the spread of smart phones to all corners of the globe, has connected people everywhere in ways unthinkable just a decade ago. Rapid advances in technology, particularly artificial intelligence, are transforming the workplace and the nature of work itself.

Yet accompanying these social and industrial forces is a worrisome phenomenon. As the world becomes ever more interconnected, it is also fragmenting in ways that undermine the very growth delivered by these forces.

Workers feel left behind as new technologies displace their jobs. Rising inequality rates cast shadows over national economies. The global demand for energy continues to grow at a time when we should be significantly reducing our environmental impact. Progress can be a tricky thing–by taking positive steps forward we can sometimes encounter unexpected consequences.

As Klaus Schwab, executive chairman of the World Economic Forum (WEF), noted in the run up to this year’s annual meeting in Davos, it’s imperative that the global business community recognizes “the increasing frustration and discontent among those not experiencing economic development and social progress,” adding that, “we need a deeper commitment to inclusive development and equitable growth, both nationally and globally.”

Thus, the zero-sum paradigm that is sometimes prevalent in the business world must evolve into an approach that can handle the challenges posed by this environment. Fittingly, by looking to the past, we believe we’ve found the way to move forward.

There is a Japanese idea called chowa, meaning “a spirit of harmonious partnership.” This spirit of chowa is embedded in the foundations of Mitsubishi Heavy Industries (MHI), and we believe it has profound implications for the global business community. Facing a world that’s growing more connected yet splintering along fault lines will require businesses to adopt some of the principles of chowa in order to foster a shared sense of growth.

Indeed, as we look around we see the spirit of chowa already having an impact. What we see is fundamental collaboration.

For example: the partnership between Alibaba and Ford. The nature of the car industry is changing and the automotive world looks likely to hinge on the passenger economy created by Uber, and the increasing prevalence of electric vehicles. Ford decided to look to the East for a partner.

At the same time, Alibaba is looking to transform the way people shop for and buy cars, and hopes to use its e-commerce capabilities to transform an aging industry for modern consumers.

The partnership between Ford and Alibaba is not simply about supplying inventory; it is deeply strategic because the American company is investing heavily in electric vehicle technology. China, with its longtime struggle against pollution, is likely to be the biggest market for electric vehicles in the world.

A study by Strategy Analytics found that as much as 47% of the global car use will be in Asia. The partnership between Alibaba and Ford not only matches markets with consumers, but looks to transcend the current automotive landscape by jointly developing the technology that’s going to power and inform the automobiles of the future.

Another example of two companies coming together in a spirit of chowa is the partnership between Apple and IBM; two longtime rivals that realized combining their individual strengths and expertise could create new opportunities. Pairing Apple’s design expertise and consumer insights with IBM’s computing power and extensive knowledge of the market may allow both companies to reach new customers.

Such partnerships seek to transform the market by recognizing that the way firms are doing business is changing. Flowing with the tide, instead of fighting against it, is at the heart of the spirit of chowa.

But while we look to the future, we cannot ignore the challenges of the present. For instance: how do we balance the world’s increasing demand for energy with the pressing need to reduce our environmental impact? By building bridges from the old world to the new.

MHI is investing significant resources in renewable energy sources. MHI’s partnership with Vestas created MHI Vestas Offshore Wind, which produces the turbines that have led the way in Europe and are now pouring electricity into grids across the continent. The partnership works because MHI needs Vestas’ leading turbine technology and saw a growing market, while Vestas needs MHI’s financial stability and proven manufacturing expertise. All these elements are highly important in a nascent industry like renewables.

Now we’re working with additional partners to drive this important technology forward by testing the world’s most powerful offshore wind turbine at the state of the art facility at Clemson University in the US.

Such partnerships point the way forward for the global business community. But this is only the beginning. The coming decades will be defined by increased mobility between countries and industries. Workers, communities, businesses, national economies will all be in flux as technological and global forces transform previously defined relationships.

It is within our power to harness this transformation to propel the world forward and help bridge the fragmentation we see occurring now. But we need to embrace a new business philosophy to create that shared future; one that values harmonious partnerships and far-reaching collaboration. An idea rooted in the past but suited to the needs of the future: the spirit of chowa.