Industry crisis and leadership in high-performing organizations: The case of the Japanese orange industry, 1968–1989

The purpose of this study is to identify and explore the determinants of success in the context of an industry crisis. To do so, we used the Japanese orange industry as an illustrative case, from which valuable information was obtained. Between 1968 and 1989, the Japanese orange industry underwent a period of crisis that was characterized by low levels of profitability, stunted growth, and limited development. This economic downturn compelled the production sector of the orange industry to develop innovative solutions for dealing with the crisis, as the shipping associations’ failure to respond to the crisis would damage their market position in the long term. Despite the pervasive economic crisis, those associations that were able to maintain internal contradictions became industry leaders. These events raise several questions. First, what factors incited aggressive associations to employ such counterintuitive strategies? Second, in a period of economic crisis, how could a successful shipping association realize favorable strategies? Based on our analysis, we drew the following conclusions. First, although some shipping associations in the orange industry dealt with the economic crisis through the elimination of internal contradictions (which were impediments to success), it led to a reduced ability to respond to changes in the supply chain. Related to this, although other associations were rife with internal contradictions in the short run, they could achieve desirable outcomes by positively utilizing issues that were perceived as problems. Finally, we found that organizational leadership played a critical role in transforming problems into key factors for success.