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Nintendo is not in the habit of laying off staff

2:00 PM on 07.06.2013 // Tony Ponce

Job security = Happy employees

The videogames industry is cutthroat. We no longer bat an eyelash whenever a publisher shuts down an underperforming studio or lays off a huge chunk of a game's development staff before the game ever touches a store shelf. It's just the nature of business, we think.

The biggest exception to this trend is Nintendo, which to the best of my knowledge has not had any significant, non-voluntary staff reduction in the past three decades. On the contrary, the Kyoto company has been expanding in recent years. What is President Satoru Iwata thinking? Doesn't he know that a good CEO is supposed to fire a bunch of people when your business isn't performing as well as it once was?

Nintendo recently held its 73rd Annual General Meeting of Shareholders, during which Iwata fielded many questions regarding Nintendo's currently less-than-stellar market situation. On the topic of corporate restructuring (read: downsizing), Iwata answered, "[I]t is true that our business has its ups and downs every few years, and of course, our ideal situation is to make a profit even in the low periods, return these profits to investors and maintain a high share price. I believe we should continue working toward this ideal. If we reduce the number of employees for better short-term financial results, however, employee morale will decrease, and I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.

"I believe we can become profitable with the current business structure in consideration of exchange rate trends and popularization of our platforms in the future. We should of course cut unnecessary costs and pursue efficient business operations. I also know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo's business in the long run. Our current policy is to achieve favorable results by continuously cutting unnecessary expenses and increasing business efficiency."

I doubt anyone completely agrees with everything that what Iwata and other high-level Nintendo execs usually say -- I did just write a big ol' rant about region-locking the other day -- but this is a policy I can stand behind wholeheartedly. Job security is such a rarity in this business, so it's good to know that at least one company has enough faith in its employees to not complete screw them over for the sake of a few extra bucks at the end of the fiscal quarter.

Whereas other companies make decisions in the interest of short-term gains, Nintendo likes to play the long game. While this may paint it as "backwards" or "behind-the-times" now and then, at the end of the day, Nintendo will still be around. For all the lessons that people insist it ought to learn from other companies, there are just as many that they ought to learn from Nintendo.

The 73rd Annual General Meeting of Shareholders Q&A [Nintendo via Siliconera]

Tony Ponce, Former Contributor
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