by Radu Magdin
That divide ended in 2010, when a trade dispute over Chinese rare earth minerals exposed how dependent Japanese carmakers’ production lines had become on imports. Since then, a supply chain built in Nagoya has become subject to tariffs imposed in Washington, licensing decisions made in Beijing, and regulations adopted in Brussels. Rare earths, semiconductors, maritime routes and cyber resilience now join finance as determinants of corporate strategy.
Welcome to Businesscraft.
Statecraft, by definition, refers to the conduct of national policy aimed at achieving and sustaining sovereignty and prosperity through international relations. Its corporate equivalent, Businesscraft, refers to the management of geopolitical risk and the discovery of opportunity through treating politics, economics and security as one interconnected problem-set.
Japan pioneered Businesscraft
Japan offers considerable precedent, having developed this approach instinctively long before anyone named it. The sogo shosa, the zaibatsu conglomerates such as Mitsubishi, Mitsui and Itochu, spent almost a century combining their functions as business corporations with strategic intelligence gathering, monitoring political risk worldwide as part of normal operations. Just-in-time production methods pioneered by Toyota showed their downside during the 2011 Tohoku earthquake.
The clearest early warning for Businesscraft came after the September 2010 collision between Chinese fishing trawlers operating around the disputed Senkaku islands and Japan’s Coast Guard. Beijing retaliated against the Japanese arrest of the trawler’s captain by restricting rare earth exports, hitting Japanese companies heavily reliant on Chinese supply in semiconductor manufacturing, automobiles and other industries. Tokyo grasped almost instantly the role minerals could play as geopolitical weapons, and moved to diversify sources, build up stocks of rare earth metals and invest heavily in recycling technology. Domestic recycling of rare earths became known in Japan as ’urban mining’ years before Western governments began treating rare earths as a security matter.
Japan codified Businesscraft instinctively
Japan adopted the Economic Security Promotion Act in May 2022. The legislation designated inputs such as semiconductors, rare earths and batteries as critical products requiring coordinated policy responses to secure reliable supply chains through state-sponsored planning. The Japan Organization for Metals and Energy Security, an agency owned by the Japanese government, invested in rare earth separation projects at Australian sites controlled by Lynas Corporation, part of an effort to build alternative supply channels that bypass China. In effect, Businesscraft involves turning experience accumulated over years into institutional capability.
It wasn’t just technology. Japan’s advantage in Businesscraft came less from technological prowess than from strategic patience, sustained over years instead of mustered only once a crisis hit. Businesscraft rewards that patience. It has become the biggest edge available to any firm operating internationally today.
Pillars of Businesscraft
Five foundational elements underpin Businesscraft, and none of them belongs exclusively to a company’s public affairs office.
The first is strategic intelligence: the capacity to read not only financial market dynamics but also governments’ growing involvement in the economy through industrial policy, sanctions regimes, export control lists and technology regulation. The second is resilience: a conscious move away from optimizing supply chains for efficiency alone, in which redundant production capacity becomes a form of insurance. The third is that companies now face choices about geopolitical positioning that are also, inescapably, choices about moral positioning. How a firm’s reputation and standing are perceived carries consequences for market access, investment appeal and its ability to recruit. The fourth is an extensive global network, built by engaging governments, universities, think-tanks and multinational organisations, because standing increasingly rests on relationships rather than single transactions. The fifth is strategic flexibility: the ability to hold a long-term vision while still acting quickly when circumstances demand it. Together, these five elements constitute Businesscraft.
CEOs don’t need degrees in geopolitics. Every management team, however, has to build the institutional capability to assess geopolitical dynamics early, judging where a political development is heading before it turns into an emergency that hits the bottom line. That predictive capacity will increasingly separate competitive firms from the rest.
Asia taught the lesson
Asian countries have been practicing Businesscraft for decades already. Singapore built its growth on geographic advantage. South Korea built a technological economy despite living under constant threat from abroad. Japan combined openness with resilience. Europe has now begun learning the same lessons, though under far more immediate pressure than before.
In 2024, the European Commission passed a Critical Raw Materials Act, setting ambitious goals for extracting and processing strategic minerals domestically. Beijing responded by expanding its licensing regime to cover wider categories of rare earths, and by asserting jurisdiction over finished goods containing Chinese materials, or processed through China, regardless of where they were manufactured. Some European manufacturers experienced significant disruption as a result, with unexpected delays in license issuance holding up production. Restrictions on exports of packaged semiconductors during the Nexperia dispute between the Netherlands and China reverberated across Europe. Some companies had already adopted this approach to strategic minerals, treating them as a potential geopolitical threat and not merely a sourcing issue. They were the best prepared to weather the storm.
Economics has become political again. Geopolitics and economics have merged back together, and discussions of industrial policy and strategic autonomy have moved out of seminar rooms and into cabinet offices. Energy security, data security and military readiness now sit inside economic policy as well, because economics never really stopped being a matter of security. Executives who refuse to factor geopolitics into economic decisions may end up learning the lesson the hard way.
A wind of change is blowing
That wind is blowing through Japan right now, a sense of reform and innovation not felt there in some time. The changes underway are both modernization and revitalization, evidence of a renewed willingness to think creatively. This is where Businesscraft matters most. Modernization addresses domestic imperatives for renewal, while Businesscraft addresses the challenges that lie outside Japan’s borders. Combined with a clear understanding of external strategic dynamics, it offers Japan a path to recovery on its own terms.
Corporate renewal can proceed along three dimensions: reform, correcting internal inefficiencies; rejuvenation, energizing innovation; and restoration, recovering past strengths. Corporate governance is being rewritten, capital is being pressed to work harder, and a country often caricatured as cautious is rediscovering its appetite for ambition. Businesscraft gives Japan a way to sharpen its international competitiveness despite mounting geopolitical turbulence.
The Discipline of Businesscraft
Finance was the analytical tool of the last century, letting managers standardize practices and benchmark themselves against peers. Digitization defined the corporate agenda through the 2010s. The decade ahead will see Businesscraft emerge as a corporate discipline in its own right, one that needs to be built into executive training, governance models and boardroom composition. Businesscraft will let the companies that master it read patterns ahead of competitors, build genuinely mutual partnerships instead of purely transactional ones, and seize opportunities where other businesses see only risk. In a fragmented global environment, this skill set has moved from nice-to-have to a condition for survival.
The edge will belong to those who understand the strategic order within which innovation now has to operate.
*Radu is CEO, Smartlink Communications
By: N. Peter Kramer