Switch Up Your Game To Seize Opportunity
Hiroshi Yamauchi, an ambitious and arrogant young man, was named the head of his family’s playing card business when no other successor was available. Wanting to grow his family’s empire, he decided to pay a visit to the biggest player in the card game. After seeing their tiny office in Cincinnati, Ohio, however, he realized just how small the game really was. Out of this realization, the company we know as Nintendo, was born.
Back in 1956, no one could imagine that a company could go from the analog world of playing cards to the digital world of Super Mario. Yamauchi, however, understood that in order for a company to survive, it had to always be on the lookout for opportunities for growth, and if necessary, change. Nintendo survived by realizing it wasn’t just in the card business, but the entertainment business. Lamborghini, on the other hand, changed not to survive, but to take advantage of an opening they saw in the car business.
Ferruccio Lamborghini was originally in the tractor business. Fond of sports cars, he was not a fan of the Ferrari. Noticing that the clutch in the vehicle was of inferior quality, he replaced it with one of his own. He proudly shared his achievement with Ferrari’s president, who not so nicely, told him forget your improvement, and quit messing with his vehicles. Inspired by Enzo Ferrari's outburst, Lamborghini went into the car business, producing vehicles that are known for their refinement, power, and comfort.
Sometimes opportunities can come not from expanding the idea of what business you’re in, or from making horizontal moves, but from knowing your audience. In 1969, The Gap was just another record store in San Francisco. However, the founders decided to diversify their offering and sell jeans, a product that would also appeal to their young consumers. Soon they were known more for selling Levi's than LPs.
Of course, not everyone growth venture is going to work. It takes a lot of calculated risks, and shots in the dark. Nintendo experimented with a lot of new products, from a love hotel, to a taxi company, to instant rice to compete with ramen noodles, to even a love tester. All failing ventures, Nintendo had to go through an iterative process before discovering what game they were truly in. Eventually, they were able to do more than just play the hand they were dealt, but control the dealing as well.