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Honda just announced its first net loss since listing on the Tokyo Stock Exchange — in 1957. Let that sink in. Nearly seventy years of profitability, and this is the year it ended. The company cancelled three EV models it had been engineering for years — writing off up to two and a half trillion yen in a single fiscal year. They calculated that a two and a half trillion yen write-down was better than launching into a market that had moved against the original business case.

That fact alone is worth sitting with. This is not a story about a company that failed to try. This is a story about the difference between boldness and prudence — and what happens when you have the first without the second…

When it comes to identifying their own successor, CEOs of foreign companies in Japan whom I know often find themselves in exile in a land of no good options. Yet it does not have to be so.

A CEO is preparing to move on. Maybe he’s been recalled to head office. Maybe she’s found a compelling opportunity elsewhere. Maybe it’s simply time. And when that moment comes, they look around at their organization and realize: there is no one obviously ready to take over.

The first question I ask when leading a strategy development session is: “Which profitable business line do you intend to cut to make room for growth?”

Most leaders are not expecting that question.

On March 11, 2011, the ground under Japan moved.

You know what happened next. The earthquake. The tsunami. The Fukushima nuclear plant. The world watched Japan face one of the worst compound disasters in modern history.